Office of the Historian

740.00119 Control (Japan)/5–249

Memorandum by Mr. Robert A. Fearey, of the Division of Northeast Asian Affairs, to Mr. John P. Davies, Jr., of the Policy Planning Staff

top secret
[Washington,] May 2, 1949.

In answer to your request for a record of implementation or non-implementation of NSC 13/2, there are attached copies1 of four periodic reports on this subject to the NSC (Tab A), the last dated March 30 (there has been nothing positive to report since), copies of the telegrams to and from General MacArthur in the matter (Tab B) and copies of letters and telegrams on particular topics (Tab C). Summarized below for convenience is the present state of implementation of each paragraph of NSC 13/2.

1.
Timing and Procedure (of a Peace Treaty)—No action. (In this and certain other similar instances below action responsibility rests mainly with State.)
2.
The Nature of the Treaty—No action.
3.
The Pre-Treaty Arrangements—General MacArthur has maintained that he has always been guided by the policy of reducing the psychological impact of the occupation on the Japanese. As far as is known no action has been taken pursuant to this paragraph. On the contrary the psychological impact, all observers report, has been increased by GI soda fountains in front of the Yokohama station, [Page 725] ostentatious PX displays, taking over of hotels and offices, more dependents, etc., etc. Forces have not been removed to less conspicuous locations or reduced.
4.
The Post-Treaty Arrangements—No action.
5.
The Ryukyu Islands—The Ryukyus were placed on a pay-as-you-go basis as of April 1. Development of Okinawa as a naval and air base has been negligible, due mainly, it is understood, to lack of funds. In this connection air forces in the Ryukyus have been reduced for this coming year. No action of consequence has been taken by CINCFE or COMRYKOM to our knowledge to “formulate and carry out a program on a long-term basis for the economic and social well being” of the natives. Tentative plans have been prepared here for long-range economic and political development in the Ryukyus but the response in these matters from the field has been poor.
6.
Naval Bases—Action responsibility was assigned to the Navy. There has been no report of action, although informal inquiry was made some time ago.
7.
The Japanese Police Establishment—State and Army have stressed to CINCFE that it is their view that this paragraph calls for (a) improving police equipment and training, (b) creation of a mobile reserve for handling disasters and organized violence, (c) establishment of a national investigation bureau, and (d) greater degree of coordination at all times for what we consider to be a currently over-decentralized police system. So far CINCFE has reported the provision of 20,000 pistols to the police, with 86,000 more to be received shortly from the U.S. No official reaction has been received on (b), (c) or (d), nor is it known whether anything is being planned along the lines of our suggestions, although press reports indicate that some of these suggestions are supported by the Japanese authorities.
8.
Supreme Commander for the Allied Powers—Progress in reducing SCAP’s role to general supervision, with corresponding reduction in personnel, and in transferring responsibility to the Japanese, has been negative. SCAP has stated that the stabilization directive of last December has “completely reversed this policy”. Personnel has if anything increased. Interference in the operations of the Japanese Government has increased at all levels in the economic field, and has not been materially reduced in political and social matters.
9.
Far Eastern Commission—Policy toward the FEC has been guided by this paragraph. With the imminent settlement of the reparations and level of industry problems, the FEC’s activities will be almost entirely limited to certain property matters and U.S. projects for the resumption of normal Japanese international relations.
10.
Allied Council—No action called for.
11.
Relations with the Japanese Government—See paragraph 8 above.
12.
Internal Political and Economic Changes—Since the reform programs have been substantially completed, and the Japanese have not made any serious attempts to undo them, implementation of this paragraph has not required much specific action. SCAP Headquarters, however, has indicated in a number of instances that the principle underlying this paragraph is only partially appreciated at best and is being only partially followed.
13.
The Purge—In spite of the utmost efforts and prodding from Washington the purge has not been modified. Increasing efforts by the Yoshida Government to modify the purge and secure the services of competent Japanese have met with repeated rebuffs by Headquarters. A complete record of the history of this matter is contained in the attached folder.
14.
Occupation Costs—Steps have been taken to reduce occupation costs but they still comprise almost as large a proportion of the Budget for the year just begun as for last year. The figure for occupation costs in the Budget is 125 billion yen, which is roughly 5/7 of the value of anticipated GARIOA and EROA aid as estimated in the figure for the Counterpart Fund.
15.
Economic Recovery—Intensive efforts have been taken for recovery, highlighted by the stabilization directive, the assignment of Mr. Joseph Dodge as SCAP’s Financial Adviser (where he has been given almost complete authority in the economic field), and the recently instituted single general exchange rate. The Director of the Budget, however, has just slashed the Army Department’s occupied areas appropriation request of 1100 million by 150 million, most of which will have to come out of rehabilitation funds. Efforts are being made to restore the amount.
16.
Property Matters—Some progress has been made in disposing of claims matters but much remains to be done.
17.
Information and Education
a.
Censorship—Action completed.
b.
Radio—A U.S. Army Signal Corps survey of Okinawa as a potential site for a VOUSA transmitter station to Japan has been completed and is now under examination in the International Broadcasting Division of the State Department.
c.
Interchange of Persons—The interchange program has been held up through lack of funds. We have urged that SCAP pay for the travel abroad of Japanese business men and technicians from SCAP Trust funds but have not observed any definitive action resulting from our proposal.
18.
War Crimes Trials—Action virtually completed. “A” trials finished, “B” and “C” trials are expected to be completed in one or two months.
19.
Control of Japanese Economic War Potential—No action.
20.
Reparations—An agreed State–Army policy paper is now before the NSC for final approval.

  1. None printed.↩