were coming to be run by competent managers rather than by their owners, became in some ways merely economic branches of the government. In fact, the militarists, who had long been unfriendly to capitalism, appeared to be taking the first step toward a curious sort of state socialism.
Throughout the 1930’s the bureaucrats kept up the appearance of being in the political saddle, balancing the party politicians and big business interests against the militarists; but as the politicians and big business interests lost power, it was more and more evident that the militarists, if not in the saddle, were at least leading the horse. All the bureaucrats could do was to exert a restraining influence on them. The bureaucrats were not liberals in the sense of being ardent supporters of democracy, but they were at least moderates. They had faith to some degree in parliamentary forms of government; they believed in the capitalist system, which the more extreme militarists were ready to discard; and they were apprehensive about the ultimate outcome of the aggressive foreign policy the militarists were pursuing.
This group of moderates included some of the older army and navy leaders, who in contrast to the younger officers believed that the civil government rather than the army and navy should determine foreign policy. But the chief strength of the moderates was to be found in the Privy Council and other groups around the throne. One moderate stood out in particular. He was the old court aristocrat, Prince Saionji, the last of the “elder statesmen” from the Meiji period, who served as a definite moderating influence until his death in