Lot 56D527

Memorandum of Conversation, by Mr. Robert A. Fearey of the Office of Northeast Asian Affairs


Notes on Conversation Among Ambassador Dulles, Prime Minister Yoshida and Staffs

Mr. Yoshida said that he had promised to say something to the Cabinet regarding the fishing understandings at the time the exchange [Page 867] of letters was published. Ambassador Dulles accordingly agreed to inform Mr. Yoshida when the texts of the letters were to be released.

Mr. Yoshida said that if a Japanese general staff should be formed it should have an entirely different character from that of the past. Japan, he said, suffered much from the former structure. The old general staff was formed on the German pattern in accordance with recommendations of a German general who had been invited to Japan. We want a democratic general staff on the lines of the U.S. system. If a general staff is to be formed we hope that your Army and Navy will advise us in its establishment. Mr. Johnson pointed out that the essential difference between the U.S. and German staff systems is that ours heads up to a civilian President. The President appoints a civilian Secretary of Defense and the Secretaries of each of the three military Services, and the Assistant Secretaries. Direct control of the military is thus exercised by these civilian leaders. Military officers do not have direct access to the President and the Congress but are normally represented by the Secretary of Defense and the Secretaries of the three Services.

Ambassador Dulles referred to the Japanese Provisional Memorandum of February 6 (copy attached)1 commenting on the U.S. Provisional Memorandum of February 32 in which U.S. thinking on the content of a Japanese treaty had been outlined. Ambassador Dulles said that the first suggested change, calling for deletion of the phrase “and their elected representatives”, was acceptable. The Japanese had next suggested that the reference to internal riot and disturbances be qualified by the phrase “through instigation or intervention by outside Power or Powers”. Ambassador Dulles said that this proposal was also acceptable. He said that it might be possible to delete the sentence from the general treaty since it was already in the bilateral. With reference to the Japanese desire that a clause be inserted putting an end to the prosecution of war crimes cases, Ambassador Dulles said that it was his understanding that the Japanese war crimes trials would be completed in advance of the treaty. If that should be the case, there would be no need for a provision of the type suggested by the Japanese Government. If, however, it looked as if the trials would not be completed by that time, the U.S. would be willing to consider the Japanese proposal. Mr. Yoshida noted that there was no reference in the treaty to prisoners of war and war criminals held by the Soviets. Ambassador Dulles said that we were in no position to do anything about these prisoners unless the Soviets participated in the peace settlement, in which case we would raise the matter.

In regard to the Japanese request that the U.S. use its good offices in order that Japanese war criminals imprisoned abroad might be sent [Page 868] back to Japan and allowed to serve out their terms there, Ambassador Dulles said that the U.S. had already used its good offices with certain countries to this end and that Japan could expect it to continue to do so in support of any request the Japanese Government might make. Ambassador Dulles confirmed to the Japanese, in answer to their next point, that most-favored-nation treatment would be reciprocal. In regard to the Japanese desire to retain Japanese assets in countries which merely severed diplomatic relations with Japan, Ambassador Dulles said that there were only three nations in this category, namely, Bulgaria, Rumania and Finland. While a larger number of nations did not take an active part in hostilities, it would be extremely difficult to make a distinction in these cases. In any event the matter was probably academic because all or almost all belligerents had already expropriated Japanese assets in their territories. Ambassador Dulles stated that the Japanese understanding in the last point they had raised was correct.

Ambassador Dulles said that he wished to make it perfectly clear to the Prime Minister that, as stated in the General Observations in the U.S. Provisional Memorandum, the U.S. views which he had advanced were subject to negotiation with our Allies. This would involve some difficult problems, more difficult than the Mission had encountered with the Japanese Government, and there could be no assurance that later drafts would be as free from restrictions as this one. The two problems on which we foresee the greatest difficulty were shipping and reparations.

In regard to the first, he said, some countries are greatly worried over what they consider to be Japan’s excessive shipbuilding capacity, fearing that it will lead to cut-throat competition. The U.S. does not know anything it can do to meet these views. It certainly does not want to put anything in the treaty. As the U.S. envisages the matter Japan will be subject to raw material allocations which will insure that imported materials will only be used in the interest of the free world.

As to reparations, some countries will say that it is not right to provide in the treaty for compensation for damage to Allied property in Japan and not for damage to Allied property destroyed by the Japanese abroad. Of course the proposed provision for compensation in Japan will not impose a heavy burden on Japan. The total is not to exceed 40 billion yen, paid in four equal annual installments, and payment is to be subject to Japanese exchange controls. Most of the funds will probably be used for capital construction in Japan. This is very different from reparations involving the removal of assets from Japan. A strong moral case can nevertheless be made for reparations, especially from Japanese owned gold or from current production. [Page 869] In the Italian treaty3 there was provision for reparations out of current production, such production to be based on raw materials provided by the recipient countries. The provision was never implemented, however. The idea may or may not be feasible in Japan but the Japanese Government might think about it on the chance that a certain amount of reparations, not sufficient to impair Japanese economic conditions, might be paid to satisfy public opinion in certain countries; and secure their adherence to the treaty. The Japanese might find it in their interest to consider a reparations program of this sort. Ambassador Dulles said that after he had returned to Washington he might communicate further with Mr. Yoshida in the matter through Ambassador Sebald.

Mr. Yoshida thanked Ambassador Dulles for his presentation. He said that although he had expected difficulties in the discussions no difficulties had arisen from the U.S. side.4

  1. Ante, p. 860.
  2. Ante, p. 849.
  3. For text of the Treaty of Peace with Italy signed at Paris February 10, 1947, see Department of State Treaties and Other International Acts Series (TIAS) No. 1648, or 61 Stat. (pt. 2) 1245.
  4. In telegram 1520 from Tokyo, February 7, marked “For Rusk from Dulles”, the latter reported in part that the Prime Minister and his aides had “indicated [the] acceptability” of the Provisional Memorandum, the draft of a bilateral treaty, and a detailed administrative agreement which dealt with technical problems involved in the exercise of the right given in the bilateral treaty to the United States to station land, air, and sea forces in and about Japan. Mr. Dulles added that the allocation of costs had not yet been finally determined. (694.001/2–750)