The highlights of that narrative are, of course, the two great “mistakes” as everyone now agrees they were: doing nothing to choke off the asset price bubble in 1988, and the premature burst of fiscal prudence that choked off the nascent recovery in 1997. Grimes's explanation of the former (p. 141) seems plausible; everyone was just too happy—and history had not then taught the lesson that is being understood only now as it happens again in America, that debt-deflationary recessions induced by asset-price bubble bursts can be much worse than recessions caused by correction of price inflation. As for 1997, he gives a comprehensive account of the background to Hashimoto's fiscal reform drive. If anything is left out, it is the not insignificant factor of image politics. As Koizumi's “no gain without pain” line once again shows, in this masochistic post-Confucian society, austerity can actually be popular.

The last of the four core narrative chapters is devoted to the structural changes of the second half of the decade—independence for the Bank of Japan, and the “dismemberment” of the Ministry of Finance with the creation of the Financial Supervisory Agency. The complex background—international models, real regulatory problems, and populist bureaucracy bashing, which for various reasons became concentrated on the Ministry of Finance—is well explained.

The narrative is preceded by three chapters dealing respectively—Grimes himself talks about macroeconomic policy as a game, after all—with the chessboard (organizational conflict), the chessmen (the institutional actors), and the ploys and strategies of the game (macroeconomic policy tools). The trouble is that macroeconomic policy isn’t just a game. It is about managers’ investment plans and people's livelihoods; it is about the fate of Japan Inc., being an international good neighbor and keeping dangerously powerful Americans sweet; it is about the responsibility of the present to future generations; it is about adherence to monetarist or Keynesian theories about how economies work; it is about ideological choices: market versus state, equality and cooperation versus freedom and competition. Grimes's hard-nosed, rational-choice methodology as he sets it out (e.g., on p. 14)—policy as games played between organizations whose behavior is a product of the structured pursuit of power and prestige by the individuals within them— strips out all passion, ideology, and theory, much as a prisoners’ dilemma payoff schedule strips out the hates and friendships and principled convictions of actual prisoners.

Fortunately, in the narrative chapters he uses a less restricted causal framework, allowing for the effect of personal resentments, the diabolo ex machina interventions of politicians like Ozawa, and the laid-back ineffectualness of a Miyazawa. But in the analysis sections with which each chapter concludes, he reverts to his chosen frame. Ministry of Finance officials become the grudging turf defenders singlemindedly devoted to fiscal consolidation because (p. 20) it is the way their ministry can enhance its power and autonomy.

Two consequences follow from this. First, Grimes does not distinguish between issues of day-to-day or month-to-month macroeconomic management designed to boost or slow down economic activity—which are largely matters of technical judgement—and on the other hand, long-term issues involving values and ideology, such as the desirability or otherwise of a shift from direct to indirect taxation, whether financial institutions should be privatized, or the optimal size of the tax take in the economy. All issues get jumbled together as game ploys. Secondly, with the focus on institutional jockeying over policy, scant attention gets paid to the actual macroeconomy. The bureaucrats I know have both a keen intellectual curiosity about, and—dare I say it—a public-spirited concern with, the evolution of the economic structure and shifts in comparative advantage, the responses of consumers and investors to policy, the multiplier effects of fiscal stimuli, and so on, not just with bureaucratic turf. The “Japanese miracle” of the title was a microeconomic, economic-institutional miracle, not a miracle of bureaucratic power. The book is billed as a Hamlet, but with all the spotlights on Horatio rather than the prince—the Ministry of Finance rather than the economy.

Also missing from Grimes's Hamlet are the Rosencrantz of the U.S. Treasury and the Gildenstern of the foreign, overwhelmingly American, financial community in Tokyo. American pressures in formal negotiations— Plaza, Louvre, the Structural Impediments Initiative, and so on—are well described, but of informal pressures from the U.S. Treasury— what a Jim Baker or a Larry Summers may or may not have said on the phone: the subject of much rumor and press comment—he refrains from speculating. A propos one of Grimes's chief puzzles—why the bubble-creating low interest rate of 1988–89 was allowed to continue “at least a year beyond the point at which it was economically justifiable” (p. 136)—surely, for all its paranoid tone, it was worth reporting, if only to refute, the explanation offered by Kikkawa's populist bestseller Losing the Monetary War (Kikkawa Mototada, Manee Haisen 1998). Supine obedience to America's wishes, contrasting with Germany's greater independence, says Kikkawa; it was all about ensuring an adequate transpacific flow of Japanese funds to cover the American deficits, and help the elder Bush to get elected. As for the foreign financial community, two questions occur to me as worth exploring: How far were the announcement effects of successive stimulus packages blunted by the rubbishing they received from the analysts and chief economists of the American banks and brokerage houses, relayed to the Japanese via the Financial Times and the Wall Street Journal? And how much were the structural reforms of the last few years—those described in Chapter 7, plus all the pension reforms and changes in fund management arrangements—prefigured by urgent memoranda from the Finance Committee of the American Chamber of Commerce in Tokyo?