740.00119–PW/4–1249
Memorandum by the Chief of the Division of
Northeast Asian Affairs (Bishop) to
the Director of the Office of Far Eastern Affairs
(Butterworth)1
secret
[Washington,] April 12,
1949.
The attached comments on our Japanese reparations position (Tab A)
were handed me by General McCoy on Saturday, April 9. I recommend
that you read them and, if you agree, that you sign the attached
letter in reply to General McCoy (Tab B)2 and then forward General McCoy’s comments
with copy of the letter to the Secretary for his information under
cover of the memorandum at Tab C.3
[Annex 1]
top secret
[Washington, April 9,
1949.]
Comments of General McCoy on the U.S.
Policy for a Reparations Settlement With Japan
- 1.
- I appreciate the thoughtfulness of the Secretary of
State in sending me a copy of the draft of the United
States policy for the settlement of the Japanese
Reparations issue. I assume that the Secretary wishes
any comments which I may care to make from the point of
view of the United States Representative on the Far
Eastern Commission.
- 2.
- The merits of this proposed settlement, viewed from
the economic and financial angle, are to be judged by
the Department of State, and I have no thought of
expressing a personal opinion regarding them. The draft
U.S. policy, however, may affect the interests of the
United States in and with regard to the Far Eastern
Commission; and I should like to invite the attention of
the Secretary of State to certain aspects of this
settlement which may affect these interests.
- 3.
- The query may be raised whether this settlement is in
harmony with the broad, basic United States policy of
settling international problems by international
cooperation and with the specific United
[Page 705]
States policy, expressed
in the Moscow Agreement of December 1945, of settling or
attempting to settle the postwar problems of Japan by
international cooperation within the Far Eastern
Commission.
- 4.
- Our colleagues in the FEC may view this U.S. statement on
Japanese reparations as evidence that the United States,
in disregard of the spirit of international cooperation,
is attempting to use its controlling position in Japan
and its veto in the Far Eastern Commission to force upon
the other states in the Commission a settlement which is
basically different from that previously agreed to by
the U.S. and all other states concerned.
- 5.
- The United States Government is obviously justified,
legally and ethically, in changing its views regarding
the reparations settlement in Japan. When it does so,
however, the Secretary of State might consider whether
it would not be in the interest of the United States, in
view of its adherence to the principle of international
cooperation, especially as this principle is embodied in
the Terms of Reference of the Far Eastern Commission, to
afford to the other members of the Commission an
opportunity to express their views regarding the
proposed settlement and to take these views into
consideration, before the United States makes this
settlement definite and final.
- 6.
- Some months ago I was informed—and this has been my
understanding until I had the privilege of reading the
pending U.S. draft settlement—that the United States
Government, after it had tentatively adopted a
reparations policy, would (1) present this policy to and
discuss it with representatives of the other states on
the FEC in bilateral
conversations conducted by officials of the State
Department; (2) consider the possibility of modifying
the United States position in view of the expressions of
opinion by other states; (3) submit the U.S. policy,
possibly modified, to the Far Eastern Commission with
the understanding that the United States would take into
consideration the views expressed in the discussion; and
(4) determine the final United States position, either
the original policy or that policy amended in the light
of discussions, and put this policy into effect, if
necessary, by an interim directive.
- 7.
- In my judgment, it would further the interests of the
United States in the group of states represented on the
Far Eastern Commission and would fulfill the obligations
of the United States to support the principle of
international cooperation, if the Secretary of State
could find it possible to modify the present draft U.S.
policy so that the proposed reparations settlement would
be presented (1) in diplomatic bilateral conversations
to representatives of the states on the Far Eastern
Commission for an expression of their views which the
United States would take into consideration, and (2) to
the Far Eastern
[Page 706]
Commission for discussion, with the same
understanding that the United States would consider the
opinions of the members. Whether or not the United
States Government modified its policy as a result of the
views expressed, it would be a matter of great
importance that the other states in the Far Eastern
Commission had been given an opportunity to consider and
to discuss the United States proposed settlement of
Japanese reparations before it was made definite and
final.
- 8.
- I recognize that the U.S. plan envisages some
discussion within the Far Eastern Commission of various
aspects of the U.S. policy, since in paragraph 5, page
2, of the draft letter to the Secretary of the
Army,4
it is stated that the United States should submit to the
FEC proposals for
the rescission or amendment of existing and pending
FEC resolutions and
policy papers “so as to bring them in as close
conformity as possible with U.S. policy.…”5 If, however, it should not be possible
to bring these FEC
policies into “close conformity” with U.S. policy, what
then? I see no provision for any possible modification
of the U.S. plan in view of and in deference to any
persuasive statements of our colleagues, since the last
clause in this same paragraph says that the United
States should “prevent action by the FEC contrary to U.S.
policy.”
[Annex 2]
top secret
[Washington, April 9,
1949.]
Comments of General McCoy on Some Details
of the U.S. Policy for a Reparations Settlement With
Japan
- 1.
- In the U.S. plan for a reparations settlement with
Japan, I note no reference to the possibility of
reparations from current production, which some of the
FEC states are still
advocating. I assume that the United States will
continue to be opposed to reparations from current
production, although the question may be brought up at a
peace conference.
- 2.
- I also note no reference to the use of Japanese
precious metals a [as]
reparations, nor to a United States commitment on the
subject. In the FEC
policy paper on “Interim Import-Export Policies for
Japan,” paragraph V, 16c. (The Far Eastern Commission:
Second Report by the Secretary General, p. 33), it is
stated: “Stocks of gold, silver, other precious metals,
precious stones and jewels of clearly established
Japanese ownership ultimately should be disposed of as
reparations.”
