740.00119 Control Japan/5–1247
The Assistant Secretary of War (Petersen) to the Assistant Secretary of State (Hilldring)
Dear John: As you are undoubtedly aware, there are several outstanding questions on the subject of Japanese Reparations which could [Page 391] and should be settled in the immediate future. The answers to these questions appear to be mainly within the realm of the State Department. This letter is a request for information as to the status of the problems enumerated below:
- 1.
- On 9 April, the State Department sent to the Far Eastern Commission a paper entitled “Reparations Removals from Japan” (SWNCC 236/43). It was our agreement that this paper was to be acted upon by the Far Eastern Commission within a period of 21 days, or the United States was to take unilateral action and issue the provisions of the paper to General MacArthur as a directive. You stated, however, that your agreement to this effect was subject to General Marshall’s approval. Has General Marshall’s approval been given to carrying out such a plan? Has McCoy been so informed? If so, on what date will we be able to proceed unilaterally and issue a U.S. directive to General MacArthur in the absence of agreement by the Far Eastern Commission?
- 2.
- On 14 April, a conference was held in the Pentagon between the Strike group, representatives of the State, War and Navy Departments and of SCAP to interpret the definitions and limitations contained in SWNCC 236/43. The results of this meeting were contained in a letter which was sent to you on 18 April for your approval prior to the time it was sent to SCAP. When may we expect a reply to this letter?
- 3.
- At the SWNCC meeting on 29 April, it was agreed that SWNCC 236/44 would be withdrawn from current consideration by SWNCC, but that it would be used as a directive to General MacArthur after all provisions therein had been approved by FEC, or the U.S. had decided to take unilateral action on those provisions not approved by FEC. It was further agreed to delete the reference pertaining to percentage shares of reparations for the eleven nations comprising FEC. When will unilateral action be taken by the U.S. Government in the absence of FEC agreement? Will such action be simultaneous with action taken on SWNCC 236/43? Could you also give me an estimate as to when all provisions contained in SWNCC 236/44 will be finally submitted to the Far Eastern Commission?
- 4.
- On Thursday, May 1, the Committee of Three agreed that SWNCC 302/6 would not be submitted to the Far Eastern Commission at this time, but they did not consider or approve the substance of the paper in its entirety. It is believed by the War Department that this paper should be considered by SWNCC and that formal approval of the paper by SWNCC is desirable. In light of the current consideration of the control of economic war potential in Japan by the Far Eastern Commission, it is requested that the War Department be [Page 392] informed as to how the State Department proposes to use the provisions contained in SWNCC 302/6, i.e., whether they will be issued to SCAP as a unilateral directive, whether they will later be submitted to FEC after its action on FEC 084/9, or whether they will be retained for ultimate introduction into, and consideration by, a Japanese Peace Conference.
- 5.
- There are indications in the Far Eastern Commission that certain nations are willing to raise the levels established by the U.S. Government in SWNCC 236/43 for the retention in Japan of certain levels of industry. The War Department position has consistently been that the levels established for the ultimate retention of industrial capacities in Japan are minimum levels and therefore the War Department has no objection to any action taken by the Far Eastern Commission which would raise the levels of industries which are allowed to remain in Japan under the terms of SWNCC 236/43. Accordingly, it is recommended that the U.S. member of the Far Eastern Commission be advised that the United States Government has no objection to the raising of any levels of industrial capacity for Japan above those which are contained in SWNCC 236/43.
Due to the lack of progress on this subject during the past year and the pressing need in Japan for a final reparations program, both of which are well known to you, it is earnestly hoped that early action will be taken on the above points and that the U.S. Government will be able to furnish General MacArthur with instructions which will permit him to carry out the reparations program for Japan at an early date.84
Sincerely yours,