2. The birth of the Japanese military-industrial complex
As Hirohito come to power in 1926 the banking system in Japan was heavily influenced by what came to be known as the Big Four. Mitsubishi, Yasuda, Mitsui, and Sumitomo comprised the Big Four, each of them monopolies which dominated their industry and which were family-owned. All four maintained significant ties with the Japanese military and government, dominated the stock exchange, and enhanced their profits through stock and currency manipulation. In 1927 the Japanese economy collapsed, preceding the Great Depression which began in the west two years later. Unemployment skyrocketed.
The Big Four – the first zaibatsu, which means financial clique – were joined by smaller corporations which operated in a similar manner throughout the early Showa period. The number of zaibatsu expanded with the increase of Japanese-controlled territory in the 1930s. They were thoroughly entwined with the government, and controlled interest rates, currency value, and labor rates throughout Japanese society. They also controlled government expenditures, tax rates, and heavily influenced military procurement. While much of Japanese society suffered from the economic downturns the zaibatsu increased their profits and power within the Japanese government, giving significant control of Japan to a few wealthy families.