This chapter turns to the historical sequence of events that led to the emergence of Japan's distinctive welfare system. This chapter focuses on the transition from the period of the Allied Occupation of Japan, which lasted from 1945 to 1951, to the period after sovereign power was returned to the Japanese Diet in 1952. A big policy shift occurred after 1951. During the Occupation, universalistic welfare programs developed for the first time. Yet as soon as the Japanese Diet regained its full legislative power, Japan abandoned the universalism introduced by the Americans.

More specifically, this chapter carries out three tasks. First, this chapter attributes this policy shift to the new structural logic of politics that emerged in the early 1950s. The Allied Occupation placed a number of stringent constraints on Japanese politicians. It was only after the Occupation ended that the electoral motivations associated with multimember districts and the personal vote began to shape Japan's welfare state. Second, this chapter accounts for the cross-policy variations during the same historical period. Despite the fact that welfare issues were a political priority during the late 1940s and the 1950s, governmental action was highly selective. Simply put, programs in line with the preferences of the veto players had a much better chance of being enacted and expanded. Thus during the occupation period, welfare programs reflected the preferences of the occupying Allied Forces – the veto player at the time – whereas, after 1951, they reflected the preferences of conservative politicians – the new veto player.