Memorandum of Conversation, by the Deputy Director of the Office of Far Eastern Affairs (Penfield)

Mr. Graves16 called this morning at his request and handed me the attached memorandum.17 By way of explanation he said that yesterday [Page 346] he had been approached by Dr. Blakeslee,18 who stated that, in view of the long delay in British reply to our approach of November 6 on reparations, there seemed to be some feeling within the Department to interpret silence as assent and asked whether this impression was correct. Mr. Graves said that this emphatically was not the case and that the purpose of the attached memorandum was to make this position clear. He went on to explain that the subject of Japanese reparations is considered of great importance and has been put up to the British Cabinet Committee, from which a decision is now awaited momentarily. He intimated that much of the delay has been due to an endeavor to reach agreement with the Australians, who are “dead set against” our proposal.19

Mr. Graves stated that the Embassy had received a copy of the memorandum sent to the Cabinet Committee and went on to say that in his “personal opinion” the British reply might be expected to agree in principle to our proposal, but urged that agreement first be reached on reparation shares. He felt this very important because the initial removals, even if they amounted to only 20% of the contemplated total removals, would constitute the cream of the available equipment and the countries which received this 20% would in effect be receiving a very large proportion of the total worthwhile assets available for reparations. The British are anxious, he said, to see that their dependencies in Asia such as Borneo, Malaya, Hong Kong, et cetera, receive a fair proportional share of reparations in compensation for the devastation they have suffered.

I made no comments to Mr. Graves other than to remark that we were apparently all agreed as to the urgency of the problem and hoped that an official British reply would be forthcoming in the very near future.

  1. Hubert A. Graves, Counselor of the British Embassy.
  2. Not printed; it promised a British reply in due course to the American proposal to compile interim directives on reparations by Japan (740.00119 PW/1–847).
  3. Member of the U.S. delegation to the Far Eastern Commission.
  4. The Australian Embassy on January 6 stated that the Australian Government could not “agree at this stage to the proposals” by the United States and hoped that alternative measures could be devised which would not by-pass the jurisdiction of the Far Eastern Commission and depart from the Moscow Agreement of December 1945 (740.00119 PW/1–647). For Soviet concern regarding the U.S. proposal, see telegram 12 (FEC 4), January 13, to Tokyo, p. 160.