Executive Secretariat Files: Lot 61D167

Memorandum by the Deputy Under Secretary of State (Rusk) to the Executive Secretary of the National Security Council (Lay)

top secret

Subject: Implementation of NSC 13/31 (covering period July 1 through December 31, 1949).

Pursuant to NSC Action No. 123, the following progress report on the implementation of NSC 13/3 “Recommendations with Respect to U.S. Policy Toward Japan” is submitted for the information of the Council.

Paragraph 1 (Timing and Procedure of a Peace Treaty)

Paragraph 2 (The Nature of the Treaty)

Paragraph 4 (The Post-Treaty Arrangements)

[Here follows a description of developments which are documented in Foreign Relations, 1949, volume VII, Part 2, pages 601 ff.]

The Department of State is currently analyzing the JCS memorandum2 with a view to determining its position on the future course of this Government with respect to a treaty.

Paragraph 5 (The Ryukyu, Nanpo and Marcus Islands)

Permanent construction on Okinawa is being designed on a long-range master plan for base development, appropriations of approximately $58,000,000 having been obtained for this purpose.

A detailed directive to CINCFE is now being drawn up by the State and Army Departments, in consultation with CINCFE, looking to the full implementation of the principles set forth in this paragraph.

[Page 1136]

Paragraph 6 (Naval Bases)

During July the Secretary of Defense reported as follows:

  • “(a) Yokosuka. Items of equipment suitable for a commercial shipyard have been retained and repaired; and the physical layout altered to promote use as a commercial shipyard.
  • (b) Okinawa. No construction ashore is planned due to unsuitability as a year-around naval base. The fleet anchorage is usable in good weather for self-supporting fleet units.”

Paragraph 7 (The Japanese Police Establishment)

On December 16, SCAP reported that the Japanese police force was at full authorized strength of 125,000 men, of whom 100,000 are undergoing intensive in-service training. As of that date the 30,000 national rural police were completely armed with U.S. revolvers and approximately 40,000 of the 95,000 municipal police were similarly armed. It is understood that the remaining 55,000 municipal police will shortly be equipped with revolvers.

No report has been received as to the precise nature of the measures SCAP may be taking to expand the centrally-directed police organization.

Paragraph 8 (Supreme Commander for the Allied Powers)

Paragraph 11 (Relations with the Japanese Government)

On December 16, SCAP cabled as follows:

“Since 1 January 1949, GARIOA. Department of the Army civilian personnel in Japan (GHQ and Eighth Army) have been reduced from 3,660 to 3,205 on 1 July and to 2,747 on 1 January 1950: a total of 913 reduction or 25 percent of 1 January strength.

Net reduction resulting from elimination prefectural civil affairs teams is 1,968 military and 164 Department of the Army civilians for a total 2,132, or 77 percent of 1st January, 1949, strength.

Prefectural civil affairs teams were discontinued 30 November 1949.”

SCAP then proceeded to list in his cable various recent steps that had been taken to turn over responsibility to the Japanese Government in the fields of import trade, the direction of foreign exchange funds, the control of commodity allocations, communications, transportation, customs, immigration, etc.

Paragraph 13 (The Purge)

General MacArthur has expressed the view that any action to change existing directives and ordinances with respect to the purge would require FEC approval, in view of the fact that FEC policies on the purge were developed in broad outline in the light of actions previously consummated in Japan. In order that all U.S. directives with respect to the purge might be brought into consonance with NSC 13/3, the JCS have rescinded those paragraphs of the basic [Page 1137] initial post-surrender directive for the occupation and control of Japan which treat of the purge. This rescission has left FEC policy decisions the sole directives to SCAP in force in connection with the purge. The Japanese Government is now reviewing purge actions previously taken on over 31,000 persons.3

Paragraph 14 (Occupation Costs)

Allied occupation forces fund requirements on the Japanese national budget, computed at official military conversion rates prevalent during the respective years, have been JFY 46*—$2,323.3 million; JFY 47—$1,409.0 million; JFY 48—$932.5 million; JFY 49—$287.0 million. Figures for JFY 50 are not available but are understood to be slightly less than for the preceding year.

Paragraph 15 (Economic Recovery)

Specific measures taken to encourage economic recovery in Japan have included the implementation of the nine-point economic stabilization program,4 notably, the passage by the Diet of a balanced budget, the elimination of export subsidies and the reduction of domestic subsidies, the creation of a counterpart fund to assure most effective use of U.S. aid, the tightening of credit policies. Other measures to encourage economic recovery have been the reopening of the stock exchange, the improvement of the raw materials allocation system, the return of trade to private channels, and the expenditure of U.S. appropriated funds for Japan’s economic recovery. The U.S. is continuing its endeavors to obtain most-favored nation treatment for Japan and contemplates the establishment within the near future of Japanese agencies abroad for trade expansion.5 During December, [Page 1138] SCAP announced a plan for strengthening the Japanese merchant marine by use of counterpart funds designed to effect an increase in tonnage of ocean-going Japanese vessels.

Paragraph 16 (Property Matters)

A number of property matters have been settled during the period under review, but SCAP considers impractical at least at this time a program for compensating UN nations for property confiscated in Japan.

Paragraph 17a (Information and Education—Censorship)

Censorship of Japanese postal and telegraphic communications, strict initially, has been gradually scaled down and has now been virtually discontinued.

Paragraph 17b (Information and Education—Radio)

The deficiency appropriation passed by Congress in October allocated sufficient funds to finance the construction of a powerful relay transmitter station on Okinawa. A private engineering firm is now surveying Okinawa for the purpose of going ahead with the construction of a station which would reach almost all of East Asia. …

Paragraph 17c (Information and Education—Interchange of Persons)

Under GARIOA project 452 launched in August, it is planned that 159 national leaders and specialists and 192 students will have come to the U.S. by the end of FY 1950. In August a U.S. mission was sent to Japan at General MacArthur’s request for the purpose of studying and making recommendations on how to improve the exchange of students, teachers and research scholars between the United States and Japan. The recommendations have been approved in principle and early implementing action is anticipated.

Paragraph 18 (War Crimes Trials)

All war crimes trials in Japan have been terminated.

Dean Rusk
  1. Dated May 6, 1949, printed in Foreign Relations, 1949, vol. vii, Part 2, p. 730.
  2. Of December 22, 1949, to Secretary of Defense Johnson, printed ibid., p. 922.
  3. On October 13, 1950, SCAP announced the release of 10,090 persons from the purge designation, including a number of prominent officials and more than 3,000 former noncareer military personnel (mostly technicians). SCAP based its action on the findings of a Japanese Government appeals board, which stated that the purge designations of these individuals had been in error.

    On November 10, SCAP, again on recommendation of the Japanese Government, released from the purge somewhere between 3,200 and 3,250 former junior officers. In this case the Government had emphasized in part that the men in question had all entered the Army after December 8, 1941.

    As of early January 1951, 190,000 Japanese were still on the purge list. (This footnote summarizes in part the following: Memorandum by U. Alexis Johnson, Deputy Director of the Office of Northeast Asian Affairs, to Maxwell M. Hamilton, United States Representative on the Far Eastern Commission, November 30, 1950 (690.00–FEC/11–3050); memorandum by James E. Webb, Under Secretary of State, to James S. Lay, Jr., Executive Secretary of the National Security Council, “Second Progress Report on NSC 13/3,” January 26, 1971 (Executive Secretariat Files, Lot 61D167).)

  4. The Japanese fiscal year runs from April 1 to March 31. [Footnote in the source text.]
  5. For documents pertinent to the initiation of this program, see Foreign Relations, 1948, vol. vi, pp. 647 ff.
  6. For a summary of action on the question of Japan’s participation in international relationships, see the attachment to the memorandum by John M. Allison, Director of the Office of Northeast Asian Affairs, to John Foster Dulles, Consultant to the Secretary, April 26, 1950, p. 1182.