740.0011 PW (Peace)/6–248
Memorandum of Conversation, by Mr. Marshall Green of the Division of Northeast Asian Affairs
| Participants: | Mr. Dening, Asst. Under Secretary for Foreign Affairs, British Foreign Office |
| Mr. Graves, Counselor, British Embassy | |
| Mr. Butterworth, Director, Office of Far Eastern Affairs | |
| Mr. Allison, Chief, Division of Northeast Asian Affairs | |
| Mr. Green, NA |
Mr. Dening stated that he and Mr. Graves had given considerable thought to the points raised by Mr. Butterworth and Mr. Kennan at the meeting on May 28,1 and that he hoped to take up the better part of the present meeting in conveying the British viewpoint on these matters.
As a result of the last meeting, Mr. Dening said, he realized that a peace treaty this year would not be feasible, though he hoped that it might be concluded next year. He also appreciated the reluctance of the U.S. to conclude a treaty so long as Russia remains an aggressive threat, unless, of course, adequate U.S. security arrangements could be made to meet that threat. According to Mr. Dening, it might therefore be advisable for the U.S. to secure its strategic interests in the [Page 797] Western Pacific without postponing a treaty through the conclusion of a U.S.-Japanese bilateral pact. Presumably, such a pact would give the U.S. rights to maintain bases and troops in Japan to the extent necessary for guaranteeing Japan’s territorial integrity. Mr. Dening suggested that it might be drawn up secretly in advance of a treaty and need not be discussed during treaty negotiations. Re-emphasizing a point made at the previous meeting, Mr. Dening stated that if we were to wait more than another year without a treaty, the Japanese would become restive, uncooperative and susceptible to Soviet propaganda of a character designed to play upon Japan’s injured national pride as an occupied country. Moreover, he thought, there is an urgent need for regularizing Japan’s position in the international community, which cannot be done in a treaty less period.
Mr. Butterworth and Mr. Allison questioned the feasibility of a bilateral pact, pointing out that there would undoubtedly be attempts to introduce clauses in the treaty stipulating that any defense of Japan should be on a multilateral basis. Such clauses, if accepted, would obstruct the possibility of a bilateral pact and the U.S. would find itself in the invidious position of prematurely being required to withdraw its forces and to destroy its airfields. Mr. Butterworth inquired if the U.S. could count upon the support of the British Commonwealth to such a pact.
Mr. Dening replied that he had recently discussed the matter with the Anzac Governments. Mr. Fraser had initially offered objections on moral grounds, but, after elucidation, saw justification for the proposal. Australia was “quite receptive to the idea, being keenly interested in security considerations”. Mr. Dening admitted, in reply to a further question from Mr. Butterworth, that Russia would probably learn of the existence of a bilateral pact during treaty negotiations and that it would probably never be party to a treaty leaving the U.S. in a favored military position in Japan. He did not think, however, that Russian participation in a treaty was of vital importance.
Mr. Butterworth took exception to this view, indicating that otherwise the Russians would not respect the treaty terms and might be enabled independently to offer Japan more favorable terms than ours. In this respect the USSR is in an advantageous bargaining position, holding the key to raw materials and fishing areas in Northeast Asia critically needed by the Japanese economy.
Mr. Dening remarked that for the next few years there would probably be little export surplus of these raw materials and that in the meanwhile, Japan would come to depend heavily on the U.S. for the revival of her industries. He thought that thereafter Japan would hardly be in a position to “switch sides”. Mr. Dening stated that the [Page 798] general impression in the Foreign Office is that world opinion would not be morally adverse to such a US-Japanese defense pact. Even China, he added, could be made to understand that this pact would be in China’s best long-term interests.
Mr. Butterworth referred to an argument advanced by Mr. Dening at the previous meeting that the terms of surrender have been virtually completed and that the USSR could therefore point out to the Japanese with telling effect that “an iniquitous United States is responsible for still holding Japan down”. Mr. Butterworth observed that it must be fairly apparent to the Japanese which country has been primarily interested in reviving Japan economically and in restoring its normal relations with the outside world. In this latter respect, he added, the U.S. would appreciate the cooperation of other countries in the FEC.
Mr. Dening maintained that it would be difficult to gain the general support of the other FEC countries if they were not acquainted with the general concept of U.S. policy thinking. The appropriate method of gaining this support, he suggested, would be through a general FEC paper. It certainly could not be gained against the background Of further U.S. press conferences in which references are made to Japan as a “strategic bastion for the U.S.” or the “workshop of Asia”.
Mr. Butterworth did not believe that FEC action would be an effective approach to this problem, preferring that the support of friendly FEC countries be gained through comprehensive discussions on a direct intergovernmental basis.
Turning to the reparations question, Mr. Butterworth regretted that it would not be possible at this time to discuss the question in any detail since no final agreement had been reached on it in the Executive Branch of the Government. He recognized, of course, that the early determination of the reparations problem was of fundamental importance. Mr. Graves interjected that levels of industry, not reparations, is the basic issue. Mr. Butterworth rejoined that in his opinion the two problems could not be so separated, since the FEC levels of industry are an important issue in so far as they determine reparations availabilities. Otherwise, he thought, they do not affect Japanese industry, being generally set well above what Japan, for lack of raw materials, etc., will actually be able to produce during the period in which the FEC levels of industry are to be effective. Mr. Butterworth suggested that it might be necessary for the U.S. to set a final reparations program in motion by the issuance of an interim directive to SCAP establishing a schedule of shares along the lines of the schedule which the U.S. submitted last November to the FEC. Such a schedule [Page 799] would presumably take into consideration the amounts of Japanese external assets now held by reparations claimant countries.
Mr. Graves remarked that the basic difference between Mr. Strike’s approach to the level of industry problem and the British approach is that the former is made from a long-term point of view. He affirmed that the British Government regards Japanese levels of industry as applicable only during the period of the occupation and that Japan will not be bound by any such restrictions in the post-treaty period. Reemphasizing a point made by Mr. Dening at the May 26 meeting, Mr. Graves urged that no matter what levels of industry are now proposed by the U.S., a firm U.S. position will at least prompt his Ministers to consider the problem afresh. In Mr. Graves’ opinion there is already a wide area of agreement between the U.S. and the U.K. on the subject of levels of industry since both countries appreciate that no levels should be set which could in any way jeopardize Japan’s economic recovery.
Mr. Butterworth stated that Mr. Graves would, therefore, presumably agree that the levels of Japanese industry should not be so low as to tolerate large scale removals of reparations items to countries lacking the power, materials and skilled labor for their utilization.
In conclusion Mr. Dening stated that this was about as far as he could go in his discussions of Japan and he would now like to take up problems connected with China and Southeast Asia.2