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895A.00R/1–2050

Memorandum of Conversation, by Mr. John Z. Williams of the Office of Northeast Asian Affairs

confidential

Participants: John M. Chang, Ambassador of the Republic of Korea
W. Walton Butterworth, Assistant Secretary of State for Far Eastern Affairs
Mr. Williams

Having been informed that the Secretary was not available for appointments because of his appearance before Congressional Committees, [Page 12]Dr. Chang called at his request on Mr. Butterworth at 5:30 p. m.

After expressing his concern over the possible reaction in Korea to the failure by the House yesterday to act favorably on the Bill relating to ECA aid for Korea, Dr. Chang asked if the Department could do anything to bring about reconsideration.1 Mr. Butterworth informed Dr. Chang, in confidence, that the Secretary and the President expected to issue statements soon.2 It was explained that the Executive branch of the Government could do no more at this point, but it was suggested that the action contemplated might well stimulate favorable Congressional results in one form or another. In reply to Dr. Chang’s question, the point was made that no portion of the $75 million at the disposal of the President for expenditure “in the general area of China” from MDAP legislation could be spent in Korea unless the will of the House, as expressed yesterday, could be overcome. Dr. Chang then said that he had been at a loss to explain to himself, and to reporters who had asked him, the significance to Korea of the line of U.S. interest in the Far East the Secretary had drawn in his recent statement at the Press Club.3 He said that the fact Korea found itself on the other side of that line, combined with the House action yesterday, appeared to raise the serious question as to whether the United States might now be considered as having abandoned Korea. Mr. Butterworth said he could not share this view. He pointed to the fact that with respect to Korea the United States had associated itself with others of the United Nations in support of Korea’s cause and in that sense therefore, Korea’s position transcended a definition of interest by a line drawn in any direction.

[Page 13]

Mr. Butterworth commented on the soundness of President Rhee’s statement relating to the House action,4 and said that the press of business had not permitted him to read Dr. Chang’s recent communication regarding the financial situation in Korea.5 Dr. Chang stated that he had communicated to his Government Mr. Butterworth’s past expressions of concern regarding the inflationary trends in Korea, and had been informed that strong measures were being taken to combat this development. Mr. Butterworth reminded Dr. Chang that should the Congress finally pass legislation for the remainder of a FY 1950 Korean ECA program, the proposed FY 1951 program would probably be subjected to very critical examination, and that therefore any measures that might be taken to check the inflation could be considered as being doubly important.

Dr. Chang said that reporters were waiting at the door for a statement from him and asked if he could say that he had received assurances that the Department would do something to remedy the unfavorable House action. Mr. Butterworth stressed the fact that such a statement should be avoided as it might create an unwarranted pressure on the Secretary and the President and prejudice the action they contemplate taking. Mr. Butterworth suggested that the usual practice in similar circumstances, and one understood by the press, was for the Ambassador to state that he had expressed his concern, and that he had been accorded a sympathetic hearing. Just before his departure Dr. Chang said that he had been instructed by President Rhee to call upon the Secretary in order to express the confidence of his Government in the Secretary’s and the President’s good will toward Korea and the faith President Rhee had expressed that Korea would not be abandoned by the United States. Mr. Butterworth mentioned the heavy schedule the Secretary had imposed upon him these days, but assured Dr. Chang he would make every effort to arrange a meeting early next week. Dr. Chang said that he would not expect to occupy the Secretary’s time for longer than five minutes.6

After leaving Mr. Butterworth, and in his interview with the reporters, Dr. Chang expressed the view suggested by Mr. Butterworth but stumbled into an almost inaudible statement to the effect [Page 14]that the Department was “going to do something”. He caught himself however, and directed the attention of the reporters to President Rhee’s statement, saying that copies were available at the Embassy and at the Press Club.

  1. On January 19, 1950 the House of Representatives by a 193–191 vote defeated legislation authorizing the remaining $90 million of a $150 million aid appropriation originally requested for fiscal year 1950 by the President on June 7, 1949; for further details, see Foreign Relations, 1949, vol. vii, Part 2, p. 1039. A $60 million authorization for Korea was approved on February 14 under the Far Eastern Economic Assistance Act of 1950 (64 Stat. 5). The amount actually appropriated on June 29 under the Deficiency Appropriation Act was $50 million (64 Stat. 275), bringing the total appropriation for aid to Korea in fiscal year 1950 to $110 million. In addition, the Far Eastern Economic Assistance Act had provided for the advancement of up to $30 million from the RFC to the ECA for Korean aid, provided that no coalition government was formed in the Republic of Korea which included Communists or members of the ruling party of North Korea.
  2. On January 21, President Truman issued a statement calling for Congressional reconsideration of the Korean aid program; he also released a letter addressed to him on the previous day by Secretary of State Acheson. For the texts of these documents, see American Foreign Policy, 1950–1955: Basic Documents, vol. ii, p. 2527.
  3. Reference is to Mr. Acheson’s address at the National Press Club on January 12, the text of which is printed ibid., p. 2310. In one portion of this speech, referring to the military security of the Pacific area, the Secretary spoke of a U.S. defensive perimeter running from the Aleutian Islands through Japan and the Ryukyus to the Philippines.
  4. In his statement, which was transmitted to the Department in telegram 77, January 20, from Seoul, not printed, President Rhee expressed confidence that upon reflection the U.S. Congress and Government would not fail to extend aid to Korea. On the same day, Secretary Acheson instructed Ambassador Muccio to convey to President Rhee his appreciation for the President’s “excellent, temperate statement”. (895.00R/1–2050)
  5. Not printed.
  6. Ambassador Chang met with Mr. Acheson on January 28, expressing the appreciation of President Rhee and the National Assembly for the Secretary’s remarks on Korea in his National Press Club address and for his letter to President Truman on Korean aid (895B.00/1–2850).