803.51/2130
Memorandum of the Third Assistant Secretary of State (Long)
The Japanese Ambassador called today at the suggestion of Mr. Polk that he see me, as Mr. Polk was leaving town. I read to him the aide-mémoir[e] of today’s date, advising him of the Secretary [Page 563] of State’s failure to recall the conversations of May 6th and May 11th, but stating that he was not disposed to question the accuracy of the Ambassador’s memorandum, and further suggesting that in view of the changed circumstances in regard to consortium proposals that it was not only advisable, but of practical necessity to postpone the appointment of a financial advisor. At his request I gave him an initialed copy of the aide-mémoir[e]. He said that he would communicate it to his Government, and that it placed him in a very embarrassing position with his Government, but that he would have to assume the responsibility. I replied that the first paragraph of the aide-mémoir[e] seemed to relieve him of any embarrassment, because, whereas, the Secretary of State could not confirm the statements contained in his memorandum he was not disposed to question its accuracy, and practically accepted the situation which it created. I then pointed out to him that there was an entire change of circumstances, and that this Government felt that as long as the Japanese are interested in the circumstances, and had been a party to it, that she should realize them and accept them as they now appeared.
Further I called attention to the fact that his memorandum, which was under reference, had suggested that Baron Sakatani should be invested with powers additional to those of a financial advisor, and that he should be practically director of the currency reform. This I said was wholly without the contemplation of this Government, and that we did not see, irrespective of his function as financial advisor, and whether or not he should be appointed as such, that he should also become associated in such a specific way with the reform of the currency. The Ambassador argued that he had so advised Mr. Lansing in May, 1918, and that his Government had felt that we should be advised of their intentions in that respect, and that the agreement of China and Japan contemplated that Baron Sakatani should be appointed, not immediately, but when the opportunity arose for activity in the field of currency reform, as, practically, director of currency reform.
I reiterated this was entirely without the thought of this Government, and that such matters should be left for consideration at the time the circumstances arose wherein a currency reform should become a question for immediate consideration. I also suggested that the governments interested in currency reform should consider through their respective financial groups the question as to whether the financial advisor and the currency reform director should be a Japanese, or a citizen of some other nation, as was done in 1911 when the groups agreed upon an advisor unconnected with any of the lending powers.