894.60/2–1147: Telegram

The Secretary of State to General of the Army Douglas MacArthur, at Tokyo


43. Personal for MacArthur from George Atcheson.30

Yesterday American Delegation FEC invited me to sit with them preparatory to full FEC meeting Feb 13. Principal topic was paper on retention Jap industrial plants. Delegation fully realizes importance of getting this paper through FEC soonest and has been making [Page 353] strenuous efforts to do so. Matter has now come to point where Soviet member is agreeable, providing authorization to you to undertake retention of plants contains some reference to consultation with Allied Council. Specific Soviet proposal is to use words “after consultation with Allied Council”. One alternate American suggestion was “after such consultation as may be called for under the Council’s terms of reference”.
My views were requested and I pointed out strong objections to any reference to consultation with Council on various grounds as such reference would open way for Derevyanko to demand some system of plant inspection with his staff participating and also as non-compliance with recommendation of Council would expose SCAP to public Soviet and possibly other criticism as well as providing Soviet press with further anti-American propaganda material. However, in the light of importance of achieving early FEC approval of the paper, American delegation still feels it will have to make some language concession to Soviet along the lines of that suggested. While this will undoubtedly bring about difficulties envisaged there will be no impairment of your authority and it might be possible to handle matter with a minimum of trouble by asking Council members by letter for their recommendations and at the same time exercising your full authority by going forward with the program.
Other subject was publication of Constitutional review decision. My views and delegation’s were as widely divergent as before and discussion was inconclusive.
  1. The Political Adviser in Japan was in Washington for consultation.