The writer Inose Naoki describes an encounter he had with officials of the Water Resources Public Corporation (WRPC), the special government corporation that builds and maintains dams. Inose inquired about a company called Friends of the Rivers, to which the WRPC had been awarding 90 percent of its contracts and most of whose stock was owned by WRPC ex-directors, and this is what the WRPC official told him: «Contracts are assigned by local units across the nation, so we have no way of knowing how many go to Friends of the Rivers. Therefore I cannot answer you.» «But isn't it true that many of your employees have transferred to Friends of the Rivers?» Inose asked. «Job transfers are a matter for each individual employee» was the reply. «If someone transfers in order to make use of his superb ability and expertise acquired while at the Corporation, it is his individual decision. The Corporation can say nothing about these individuals' choices.»

The Corporation «cannot answer you,» «can say nothing.» There is no recourse against this. In 1996, newspapers reported that auditors at government agencies turned down 90 percent of the public requests for audits during the decade from 1985 to 1994. And if a citizens' group presses too hard, documents simply vanish: this is what happened when citizens of Nagano demanded to see the records of the money (between $18 and $60 million) the city spent courting the International Olympic Committee in 1992. City officials put ninety volumes of records in ten big boxes, carried them outside town, and torched them. Yamaguchi Sumikazu, a senior official with the bidding committee, said the books had taken up too much space and contained information «not for the public,» such «who had wined and dined with IOC officials and where.» Neither the tax office nor the city administration asked any questions. Case closed.

One reason for the vast waste and hidden debts in the «special government corporations,» tokushu hojin, is precisely that they don't need to open their books to the public. The WRPc does not publish its balance sheets; neither does the New Tokyo International Airport, nor dozens of other huge special corporations, all of which function in near-total secrecy. For those who believe that reform is on its way to Japan, it was sobering to learn of a law proposed by the Ministry of Justice in 1996 that would tighten, not loosen, the bureaucrats' hold on information. According to the new law, agencies need not divulge information about committee meetings and may even refuse to disclose whether requested information exists.

This brings us to the critical factor in MOF s delay in closing down the Jusen: the Jusen hid their debts so well that they fooled everybody. A high-ranking MOF official admits «it was impossible at the time to get a handle on the scale of the situation.» This was true not only of the Jusen companies but of other banks that went belly-up in the mid-1990s, such as Hyogo Bank and Hanwa Bank, which turned out to have debts ten or twenty times larger than their stated liabilities. Today, the Ministry of Finance cannot find its way out of the labyrinth it created when it encouraged banks and securities firms to cook their books, bribe regulators, and consort with gangsters. It is lost in its own shell game.

Kawai Hayao, a leading academic and government adviser, says, «In Japan, as long as you are convinced you are lying for the good of the group, it's not a lie.» It's all part of what Frank Gibney, Jr., a former Japan bureau chief at Time, calls «the culture of deceit.» A few examples will show how deeply rooted this culture is, and how the policy of hiding unattractive facts prevents citizens from learning the true depth of their nation's problems or doing much about them.

Ladies and gentlemen, step right this way to a junior high school in the town of Machida, outside Tokyo. In 1995, the school board commissioned a study of a large crack that had opened up on the school grounds, since local residents were concerned that the landfill on which the school was built might be sinking. It was, but no need to panic: the board instructed the consulting firm to alter its report. Where the original had read, «It is undeniable that subsidence could re-occur,» the revised version stated, «The filled-in areas can be thought to have stabilized.» To prove this was so, the consultant set up meters at a school far away, in Yamanashi Prefecture, calibrated them to show no tilt, and attached photos of those meters to the report. So, although the Machida crack was 120 meters long, 10 to 20 centimeters wide, and up to 3 meters deep-and growing-the land was, according to the report, magically ceasing to sink. This fiction troubled very few people, for the school board granted another large contract to the same consultant immediately after it was revealed that the report had been doctored. A company representative commented, «We just want to avoid misunderstandings and make the phrasing of the text easy to understand.»

Government officials work hard to make sure that reports are easy to understand and eyesores pleasant to look at. Here is another example. At Suishohama Beach in Fukui, on the Sea of Japan, a large nuclear power plant regrettably detracts somewhat from the beach's picturesque charm. So while preparing its tourist poster, officials simply air-brushed the plant out of the picture. «[We did it] believing the beauty of the natural sea can be stressed when artificial things are removed,» they said.

Police departments provide special training materials to educate officers in how to shield the public from situations that they would be better off not knowing about. In November 1999, on the heels of a scandal in which Kanagawa police destroyed evidence in order to protect an officer who was taking drugs, newspapers found that the Kanagawa Police Department had an official thirteen-page manual expressly for covering up scandals, entitled «Guidelines for Measures to Cope with Disgraceful and Other Events.»

All this should come as no surprise – it's the natural consequence of Japan's political structure, which puts officialdom more or less above the law. What is surprising is that the media, in a democratic country with legally mandated freedom of the press, collude in these deceptions. It comes down to the fact that the press is essentially a cartel. Reporters belong to press clubs that specialize in police or finance or politics, and so forth (which do not admit foreigners), and these clubs dutifully publish handouts from the police or the politicians in exchange for access to precious information. If a reporter shows any true independence, the agency or politician can exclude him from further press conferences.

Shinoda Hiroyuki, the chief editor of Tsukuru magazine, says, «Investigative reporting isn't rewarded.» In fact, it is often punished. Kawabe Katsurou is the reporter who in 1991 led TBS Television to investigate the trucking company Sagawa Kyu-bin's connections to gangsters and politicians. By 1993, prosecutors had filed charges against Kanemaru Shin, one of the nation's most powerful politicians, and soon thereafter the government fell. But far from rewarding Kawabe, TBS transferred him to the accounts department in 1996, and eventually he quit. Today, he survives precariously as a freelance journalist. «Many journalists have become like salarymen,» Kawabe says. «They want to avoid the difficult cases that will cause trouble.»

In the old days, the populace waited for their feudal masters to issue the O-sumitsuki, the Honorable Touch of the Brush, a written proclamation against which there was no recourse. The function of the press today is to publicize modern O-sumitsuki issued by major companies and bureaucrats. It means that you must read the newspapers with great care, as it's easy to mistake official propaganda for the real thing. Okadome Yasunori, the editor of the controversial but widely read monthly Uwasa no Shinso (Truth of Rumors), says, «With such a close relationship between the power and the media, journalists can be easily manipulated and controlled. Just study the front-page articles of major Japanese dailies. They are almost identical. Why? Because they just print what they are given.»

For example, Nihon Keizai Shimbun (Nikkei) is Japan's leading economic journal. Nikkei gives out technology awards every year, and in 1995 its winners included, along with Windows 95, NTT's PHS handphone and Matsushita's HDTV. Though both were notoriously unsuccessful-PHS is an enormous money-loser, and one could fairly say that HDTV (high-definition television with an analog rather than digital base) ranks as one of the biggest technological flops of the twentieth century-both are favorites of the Ministry of International Trade and Industry, so Nikkei dutifully celebrated them.

The most entertaining rooms in the press wing of the Hall of Mirrors are the television studios where producers cook up documentaries. So common is the staging of fake news reports that it has its own name, yarase, meaning literally «made to do it.» Japanese television is filled with faked events. In a mild version of yarase, villagers dress up in clothes they never wear to enact festivals that died out years ago. For truly sensational effect, television producers will go much further, as in reports of young girls tearfully admitting to being prostitutes – in what turn out to be paid acting stints. In November 1999, one of the longest-running and most elaborate yarase came to light when it was revealed that Fuji Television, over a period of six months had paid prostitutes and call girls ?30,000 per appearance to act as wives on its supposedly true-life series, Loving Couples, Divorcing Couples . Nor is yarase limited to television. In 1989, the president of Asahi Shimbun newspaper resigned after it came to light that a photographer had defaced coral in Okinawa in order to create evidence for a news story on how divers were damaging the reef.

The most elaborate yarase often involve foreign reporting. Here's how Far Eastern Economic Review describes a report on Tibet by NHK, Japan's national broadcasting company: «[In 1992] an NHK documentary on harsh living conditions in the Tibetan Himalayas featured a sand avalanche, footage of a monk praying for an end to a three-month dry spell, and an explanation that his horse had died of thirst. NHK later admitted that a crew member had deliberately caused the avalanche; it had rained twice during the filming; and the monk, whom it paid, did not own the dead horse.»

The common thread in the yarase for foreign documentaries is to show how poor, miserable, seedy, or violent life is elsewhere, with the implied message being that life in Japan is really very nice. For reports on the United States, scenes of low life and violence are obligatory, and a practiced producer can manage to set these up almost anywhere. In 1994, NHK did a special on the city of Missoula, Montana, a state famed for its natural beauty and national parks. Most of the program, however, took place in a seedy bar, which offered just the atmosphere NHK felt was right for America. Here's how the program was filmed, according to a Missoula citizen: