740.00119 Control (Korea)/8–2746: Telegram
The Economic Adviser in Korea (Bunce) to the Secretary of State
[Received August 27—8:49 a.m.]
Tfgcg 471 [to Tokyo]. PolAd 54. 1. Re Wash rad WX 94512, it is clear that no immediate move is to be made to solve US-Russian-Korean problems. Policy directives indicate that we are to outsit the Russians and sell American democracy. This is not easy because Russian Communism has a well organized and effective propaganda machine which promises free land to the landless, cheap rice to the worker, work for the unemployed, and attacks US policies as being imperialistic and reactionary. It is essential, therefore, that General Hodge be given the financial support to complement this new policy.
Industrial production is still low. The cut in the Korean civilian supply program, which was one means of showing we were truly concerned in their welfare, will have serious repercussions. The Koreans are mainly interested in a united independent national govt. All the [Page 732] delay in attaining this end will create neither [sic] unrest and dissatisfaction. This can only be offset by their meeting our commitments and improving the economic conditions of the people or by more rigid military control.
2. Present political conditions are more hopeful. Lyuh Woon Hyung has split from the Communists and has agreed to join the coalition of Rightists and Leftists. The Communist Party in the south shows signs of a split with opposition to Pak Heun Yung growing. At the same time Communist propaganda against military government and the US is growing.
General Hodge is preparing a statement refuting the Communist attacks; military government is preparing constructive labor laws and has a good rice collection program which should enable us to ration more adequately all non-producers if we receive the requested supplementary food shipments from US. This program will enable us to reduce the cost of living for workers who now have to buy a large part of their food on the black market at fantastic prices. It is also hoped that tax receipts will be increased, govt expenditures revised, and a currency conversion will be undertaken as early as possible. Land reforms will be undertaken as soon as the South Korea Assembly meets to take over some of the responsibility of developing a program satisfactory to the Koreans.
In order that this program may be realized it is essential that we obtain the support of the farmers and really obtain control of the rice crop, that Communist propaganda telling the farmer to hold his grain be offset, that essential imports needed to increase industrial production be supplied, and our minimum food import requirements for September, October, and November be met.
3. To assist General Hodge in the attainment of these objectives it is requested that the following actions be taken.
- A.
- That a high authority in the United States, preferably the
President, issue the following, or amended, statement of US policy
in Korea:
“Title: United States Policies in Korea.
- 1.
- The United States wishes to see a united, independent and democratic Korean Government established as early as possible; to attain this end she is willing to carry out the Moscow decision, and is ready to continue the work of the Joint Commission at any time.
- 2.
- The United States believes in the right of the Korean people to determine for themselves the kind of economy and democratic political organization they require. It is opposed to establishing any minority group in power.
- 3.
- The United States stands for freedom of speech, of assembly, and of press. Honest criticism is not considered a crime, but is welcomed and in many cases programs are modified as good suggestions [Page 733] are received. All political parties have functioned freely in South Korea.
- 4.
- The United States has no imperialistic aims in Korea. Military govt was established to take over when Japanese rule collapsed; it is temporary in nature. The United States is specifically committed not to gain any economic advantages in Korea during the period of occupation, while it permits its citizens or the citizens of any other country to enter into contracts giving them economic advantages.
- 5.
- The policies of military govt may be summarized as
follows:
- a.
- To stimulate production in order to relieve the accumulated shortage of consumers goods.
- b.
- To assure a fair collection and distribution of food and other essentials so that all people may have enough to eat and share equally in other goods.
- c.
- The restoration of trade between Korea and other nations so that the country will become economically independent and not be dependent upon Japan for either imports or exports.
- d.
- The development of democratic labor unions and improved labor conditions.
- e.
- Land reforms which will reflect the wishes of the Koreans and their desire to replace widespread tenancy with full ownership of the land by the individual farmer.
- f.
- A stable currency and price level that will achieve a fair balance between the farmer and the laborer.
- g.
- The elimination of all profiteering.
- h.
- The removal of all monopolistic controls in the hands of individuals and prevention of the concentration of wealth in the hands of a few rich men, particularly those who attained their wealth through collaboration with the Japanese.
- i.
- To expand educational opportunities and cooperate in the development of national culture.
- j.
- To establish an impartial judiciary and a Korean police force free from domination by any group or faction.
- 6.
- The delay in uniting the country has made it essential that the south should proceed with the solution of urgent social and economic problems along lines which embody the will of the Korean people. Therefore we desire to establish cooperation between all political parties and a Korean legislative body, to express Korean views and aspirations, and to provide Korean leadership.”
- This, or a similar statement, should be released to the morning papers Saturday morning August 31st in order to report [support?] General Hodge’s reply to the Communist attacks which will be released here on Thursday August 29. Such a statement will help to split the nationalistic Leftists from those Communists dominated by the Soviet.
- B.
- Food shipments for the next 3 months must be maintained at all costs.
- C.
- The civilian supply program should be pushed as rapidly as possible.
- D.
- Enabling legislation to obtain adequate funds should be prepared immediately because it will be impossible to achieve the ends established in the new directive without adequate financial aid.
- E.
- Lt. Colonel Roberts42 should be given all possible aid by Assistant Secretary Benton43 and Mister Stone44 in financing and recruiting staff for the public information program which he is bringing to Washington soon.
A reply to request A should be sent immediately in order that General Hodge may time his statement so that it precedes the Washington announcement, if one is made, by about 2 days. Hodge and Langdon concur.