Foreign Relations of the United States Diplomatic Papers, 1936, The Far East, Volume IV

611.946/315

Memorandum by Mr. Eugene H. Dooman of the Division of Far Eastern Affairs

[Washington,] June 20, 1936.

Conversation:	The Japanese Ambassador;
	Mr. Seijiro Yoshizawa, Counselor, Japanese Embassy;
	Mr. Sayre;
	Mr. Dooman.

Mr. Sayre asked the Japanese Ambassador with a smile whether he had ever heard of “zippers”. The Japanese Ambassador replied that unfortunately he had occasion to read about “zippers” in the press.

Mr. Sayre went on to say that the Tariff Commission had recently submitted to the President a report on slide fasteners, and that he could say in strict confidence that the Tariff Commission had found that there was a substantial difference in costs of production in the United States and in Japan. Mr. Sayre stated that the President had indicated that he would take action on the report. The Japanese Ambassador interrupted to inquire whether the President had actually signed the report. Mr. Sayre said that whatever might be the action thus far taken by the President, the fact was that no action could be effective until it had been published in the Federal Register. In view of the undertaking given by the Department to the Japanese Ambassador to the effect that no action to restrict imports on Japanese goods would be taken until there had been consultation with the Japanese Government, the President had authorized him (Mr. Sayre) to ascertain whether the Japanese Government would be prepared voluntarily to regulate exports of slide fasteners from Japan.

Mr. Sayre stated that he felt that he should place his cards on the table. He had been disposed at one time to think that, in view of the possibility that any undue delay in obtaining from the Japanese Government a voluntary undertaking to regulate shipments might perhaps lead to a re-opening of the case and to a new recommendation by the Tariff Commission that imports be placed on a basis of American valuation, it might be wise to let matters take their course. He said that there was room for an honest difference of opinion as to what the basis of valuation should be, and that, although the present report of the Tariff Commission recommends a moderate increase in duties, it might be possible to deduce from the available facts that American valuation would be warranted. He had been mindful, however, of the promise given by the Department to consult with the Japanese Embassy, and he had accordingly been authorized to offer the Japanese a choice between voluntary restrictive action by the Japanese or increased duties.

Mr. Sayre expressed the hope that, in view of the efforts he had made to delay the taking of action by the President on the Tariff Commission’s report, it would not be thought that he was holding a gun up to the heads of the Japanese, for such was not the case. He sincerely hoped that it would be possible for the Japanese to increase their exports to the United States and in order to help along the development of Japanese trade with the United States he had in the past taken action to remove focal points of agitation. He wondered whether the Japanese appreciated the courageous stand being taken by the Secretary to liberalize trade. It is our hope that when the Secretary’s efforts were finally successful it would be possible for each nation to participate in the benefits of this program. The failure of the program would necessarily lead to still further decreases in world trade and it was Mr. Sayre’s opinion that a victory for bilateral balancing would very seriously affect Japan.

The Administration, Mr. Sayre continued, was being severely attacked by its political opponents on account of its foreign trade policy, and considerable help was unavoidably given to these political opponents whenever it became necessary to take some measure toward increasing duties, which, of course, is a form of action not consistent with the foreign trade policy of this Government. It would be reasonable, he thought, for people to wonder why then the Administration had taken these measures. The explanation was that duties had been increased in several instances in order to save the larger program; that political pressure had been difficult to withstand in these instances; and that by satisfying the important interests concerned it would be possible to keep their allegiance for the fight to maintain the basic foreign trade program.

The Japanese Ambassador remarked that while he understood the circumstances referred to by Mr. Sayre he hoped that the American Government for its part would appreciate the difficulty which restrictive measures by the American Government created for the Japanese Government, and that was the encouragement given countries with an unfavorable balance of trade with Japan to cut down their imports of Japanese goods.

Mr. Sayre stated that matters were urgent and that there was not sufficient time for bargaining. He hoped that the Japanese Government could see its way clear to offering us terms so liberal that it could be possible for us to resist those who would like to see Japanese manufactured products excluded.

The Japanese Ambassador asked whether he could be given some idea as to the figures which we would consider satisfactory. Mr. Sayre said that there had not been sufficient time to go into the matter of figures. He could say that imports from Japan competed with a certain range of American products equal to fifteen percent of the total production of slide fasteners and that in that range Japanese competition was so severe as to threaten to eliminate American production. He said that during the last six months of 1935 imports from Japan amounted to 9.7 million slide fasteners and that imports during the first four months of the present year amounted to 9.8 million slide fasteners. Here again there was a sharply rising curve of imports from Japan.

Mr. Dooman expressed the opinion that perhaps it might be well for the Japanese Government to consider, in the light of political background so frankly described to the Japanese Ambassador by Mr. Sayre, whether it would not be well to acquiesce in the President proceeding with the report of the Tariff Commission. Mr. Sayre concurred in that view, but he said to the Japanese Ambassador that he hoped that, if the Japanese Government should come to that decision, it would make it completely clear to the Japanese public that the American Government had not taken any action without first consulting the Japanese Government. The Japanese Ambassador thanked Mr. Sayre for his efforts toward removing the possibility of misunderstanding over the matter under discussion, and he stated that he would not fail to report fully to his Government the thoughts and circumstances so frankly presented by Mr. Sayre.