In the wake of World War Two, the citizens of Japan were faced with what seemed like an insurmountable task—to rebuild their society, culture, and government from the ground up. As history shows, they proved remarkably successful at this, in part because of a bustling criminal underworld that flourished in Japan's cities in the post-war years (1945-52). Criminal activities from black markets to prostitution to illicit property development deals created the foundation of a new Japan, relying on a strong partnership between Allied forces, Japanese government officials, and the yakuza gumi, or criminal “families” of the underworld.
The Japanese postwar landscape was a nightmare. All major Japanese cities were destroyed in the war. Ever wonder why Tokyo or Osaka weren't hit with nuclear bombs? They were already obliterated. The firebombing of Tokyo incinerated more than 16 square miles of the city, an area equivalent to about 70% of Manhattan. Major cities in Japan were filled with millions of homeless civilians and psychologically damaged war veterans, who slept in bomb craters, ruined buildings, tents, or just out on the street.
From the atomic devastation in Hiroshima and Nagasaki to the firebombing of Tokyo, Allied bombs destroyed huge swaths of Japanese real estate. After the war, the country was left a blank canvas, and the yakuza (or Japanese mafia), flush with cash from the black markets, made unfathomable sums of money on redevelopment.The yakuza inextricably tied itself to business and government in the post-war years by brokering deals with Japanese politicians, gangs, subcontractors, and the 8th Army Procurement, the Allied office in charge of reconstruction money. The outrageous acts committed by these groups continue to have consequences for Japan even today.
Pan Pan Girls Were Prostitutes Originally Pimped by the Japanese Government
Pan Pan girls were prostitutes who catered to Allied military personnel. Their name comes from the Japanese pronunciation of “pom pom," a direct association with American traditions like cheerleaders and small-town sports.
The Pan Pan girls were mostly former employees of the Recreation Amusement Association, an organization created by the Japanese to provide prostitutes to Allied personnel. The organization served as a legitimate pimp service, but shut down in 1946 after the rampant spread of venereal diseases through the Allied community.Pan Pan girls became a major symbol of the occupation, and were used in countless films to imply Allied presence without showing Allied personnel or using spoken English, both of which were forbidden by SCAP (the Supreme Commander for the Allied Powers, officially a term for General MacArthur that was used by the Japanese to refer to any of the offices of the US occupation).
Hooker Alley and the Great Condom Clog
Hooker Alley sat right between Tokyo's Imperial Palace and the Nomura Hotel, headquarters for Allied soldiers. Hundreds of Pan Pan girls worked this area, which was something like an outdoor sex club, with prostitutes performing various sexual acts in stairwells, cars, nearby huts, spaces between buildings, or in some cases right on the street. American soldiers threw so many condoms in the moat of the Imperial Palace after their visits to Hooker Alley that the moat clogged, and had to be cleaned out weekly with a giant scoop.
Rice Was Used as Currency
Food was so scarce in postwar Japan that rice became a form of currency. As detailed in Stray Dog, the Akira Kurosawa film, rice ration cards were traded as highly prized commodities, and it was essentially impossible to survive without eating food from the black market, as illustrated by the story of a judge who died from malnutrition after publicly declaring he would eat no food obtained illegally. The sad truth behind all of this is, once the Allies arrived with their rations, there was more than enough food to go around, but it mostly ended up on the black market, where the lower class paid exorbitantly inflated prices for things like stale bread.
The Ozu Gang Jumpstarted Black Market Japan with a Newspaper Ad
The Ozu yakuza family holds the distinction of starting Japan's postwar black markets. On August 18, 1945, three days after Japan surrendered, the Ozu gang ran an ad in a Tokyo newspaper asking factory owners and other manufacturers to come to their headquarters to discuss distributing their products. Japan's economy was essentially dead following the war, and most manufacturers were stuck with stockpiles of useless military equipment the war-time government forced them to make. Gang leader Kinosuke Ozu told them to melt down swords to make kitchen knives, and turn helmets into pots and pans. They did so, providing him with a huge supply to meet the broken city's demand, and so was born the Shinjuku black market.