Foreign Relations of the United States, 1955–1957, Japan, Volume XXIII, Part 1

26. Memorandum of Discussion at the 244th Meeting of the National Security Council, Washington, April 7, 1955¹

Washington, April 7, 1955

[Here follow a paragraph listing the participants at the meeting and items 1–3.]

4. U.S. Policy Toward Japan (NSC 5516; Memo for NSC from Executive Secretary, same subject, dated April 5, 1955)

Mr. Dillon Anderson commenced his briefing of the Council by referring to the general considerations with which the subject report commenced. When he had reached paragraph 13,² Secretary Dulles interrupted him to say that he disagreed with the first sentence of this paragraph, which read: “Japan’s broad objectives are to recover a position of international influence and prestige and to strengthen its economic position.” Secretary Dulles said that the first portion of this sentence was simply not factual. We had done everything that we could think of to stir up in Japan a desire to assume a position of international influence once again, and the results had been markedly unsuccessful. Indeed, the Japanese were utterly lethargic and lacking in any perceptible ambition to recover their pre-war international prestige. Even under proddings which approached the brutal, they remained inert.

The President then referred to the widespread growth of nationalism which had become obvious in the world since the end of the war. He said that it was very alarming to observe how the Communists had managed to identify themselves and their purposes with this emergent nationalism. The United States, on the other hand, had failed to utilize this new spirit of nationalism in its own interest. While this phenomenon was general, Japan was a notable illustration. Accordingly, if Japan grew more strongly nationalist, we should play up more to this development in order to bend it to our advantage. The President said he was aware that Mr. Streibert and Mr. Rockefeller had been doing a great deal of thinking about this problem; but nevertheless the fact remained that the Communists seemed to be more successful in this area than we did.

Mr. Dillon Anderson inquired whether, in view of these observations, the Council desired to change the first sentence of paragraph 13.

Secretary Dulles repeated his earlier statement that it was simply not a fact that Japan desired to recover a position of international influence and prestige, although it was true that Japan wanted to strengthen her economy.

Governor Stassen said that the position the President had taken with respect to the success of Communist exploitation of national feelings was emphatically true. Accordingly, the United States must try to identify Japan’s national objectives with its own. In addition, the United States should place more emphasis on the obvious fact that the Communists ultimately obliterated all national objectives. Governor Stassen indicated his understanding that Mr. Streibert was doing what he could to exploit this fact.

The President suggested that one means of doing this was to stress what we had done in the Philippines as evidence of our sympathy for nationalist aspirations. He repeated his feeling of exasperation over the fact that the assistance which the United States gave to foreign nations was so frequently misunderstood; while the Communists, who were really enemies of these nationalist aspirations, were given a great deal of credit as being friendly to these aspirations.

Governor Stassen indicated that as far as Japan was concerned the situation might be greatly improved when the debts and reparations settlements had finally been concluded. At the end of this discussion the President stated once again that with this nationalist spirit so widespread in the world, the United States must find ways and means to capitalize on it.

Mr. Dillon Anderson, after suggesting a rewording of the first sentence of paragraph 13, continued with his briefing of the paper, and read to the Council paragraphs 21 through 24 of the general considerations, which set forth the problem of building Japanese strength. Thereafter he called attention to the split of views in paragraph 35, which read as follows: “Indicate [at a suitable early date] [at a mutually advantageous time]³ willingness to negotiate replacement of the present United States-Japan Security Treaty by a treaty of mutual defense which would include the right to maintain forces in Japan and the right upon Japan’s request to aid Japan in resisting subversion or infiltration by unfriendly forces.”

The President stated that he was completely at a loss to understand the difference between “a suitable early date” and a “mutually advantageous time”. This appeared to him a distinction without a difference.

Secretary Dulles said he had a more profound disagreement with paragraph 35 than that suggested by the bracketed language. In short, he did not think it wise to supplant our present treaty with Japan with a new one. This could not be done without a grave loss of advantage to the United States. If we suggest a new mutual defense treaty to the Japanese they will certainly want to model such a treaty on the existing mutual defense treaties between the U.S. and South Korea⁴ and the U.S. and the Philippines.⁵ This would mean that the United States would have to forgo its right to maintain forces and bases in Japan, and the privilege of doing so would be dependent on the agreement of the Japanese Government. Moreover, the treaties for mutual defense ran for a much shorter time than is desirable in the light of the present situation. Such mutual defense treaties were subject to termination in a year’s time at the behest of either partner. Accordingly, concluded Secretary Dulles, unless pressure in Japan for a new treaty became a great deal stronger than it was at the present time, he was firmly opposed to the proposal set forth in paragraph 35 of NSC 5516.

The President expressed some surprise, because he thought that it was the State Department which had proposed the substitution of a mutual defense treaty.⁶ Secretary Dulles replied that whatever the source of the proposal he was strongly opposed to it. The President inquired what we might be expected to gain by a new mutual defense treaty which we do not already have. Secretary Dulles replied that we would gain nothing, with which view the Acting Secretary of Defense, Mr. Robert Anderson, expressed agreement. Accordingly the Council decided to delete paragraph 35 in its entirety.

Secretary Anderson pointed out the relationship between paragraph 35 and paragraph 52, which called for developing “with the Japanese Government a general understanding on a long-range plan for the build-up of Japanese defense forces, a phased withdrawal from Japan of United States ground forces as consistent with United States and Japanese security interests, etc.”. Secretary Anderson warned that if the United States Government suggested such a proposal to the Japanese Government at this time, the substance of it would undoubtedly become public, and the resultant psychological repercussions would be very unfortunate for us in view of the situation in the Far East.

Secretary Dulles then said that he wished to comment on paragraph 44, which read: “Support Japan’s claim against the Soviet Union for sovereignty over the Habbomai Islands and Shikotan; treat as legally invalid the Soviet Union’s claim to sovereignty over the Kurile Islands and Southern Sakhalin.” Secretary Dulles said that he agreed with the first portion of the sentence, but disagreed with the proposals relating to Soviet claims to sovereignty over the Kuriles and Southern Sakhalin. If we carried out this course of action he warned that we would be marching onto very treacherous ground. The Soviet claim to the Kuriles and Southern Sakhalin was substantially the same as our claim to be in the Ryukyus and the Bonin Islands. Accordingly, in our efforts to force the Soviets out of the Kuriles and Sakhalin, we might find ourselves forced out of the Ryukyus and the Bonins. Secretary Dulles cited the terms of the peace treaty with Japan in which the Japanese agreed to confine themselves to the four major islands of the homeland. It was this which enabled us to maintain our own positions in Japanese territories outside the four main islands. He repeated that if we succeeded in getting the Russians out of the Kuriles it is certain that we would be forced out of the Ryukyus.

The President stated with a smile that it was also certain that we would not succeed in getting the Russians out of the Kuriles.

Secretary Dulles emphasized that the Ryukyus were more valuable to the United States than the Kuriles were to the Soviet Union. Obviously, therefore, we should not imperil our position in the Ryukyus. The President agreed to removing the offending phrase in paragraph 44, and pointed out that the only reason he had initially accepted it was because he did not think we had ever claimed sovereignty over the Ryukyus. Governor Stassen suggested that instead of removing the disputed phrase it should be changed to read “do not concede the Soviet Union’s claim, etc., etc.”. Governor Stassen’s suggestion was accepted,

Mr. Dillon Anderson thereupon resumed his briefing of the remaining paragraphs of the paper, dealing first with the military courses of action—paragraphs 49 through 57. When he reached paragraph 52, Secretary Dulles indicated that he opposed the proposal by the Joint Chiefs of Staff for a rewording of the last sentence of the paragraph. The Joint Chiefs had desired to say that “reductions in Japanese contributions to the support of U.S. forces in Japan will be matched by Japan and the total devoted to the development of Japanese defense forces.”⁷

Secretary Anderson explained the reasons for the Joint Chiefs’ proposal, and indicated his support for it. He thought, nevertheless, that no part of paragraph 52, which involved a long-range plan for the build-up of Japanese forces and a phased withdrawal from Japan of U.S. forces, should actually be set in motion until there was a notable easing of the present tension in the Far East.

Secretary Dulles returned to his objections to the last sentence of paragraph 52, pointing out that the formula which governed Japanese contributions to the support of U.S. forces in Japan as proposed by the Joint Chiefs of Staff, was much too rigid. For every dollar the Japanese gained by being obliged to provide less dollars for the support of the U.S. forces, they were obliged to throw in yet another dollar for creating additional Japanese defense forces.

The President, agreeing with the Secretary of State that this was too much to ask of the Japanese, said we would be making a horrible mistake by pushing these people too hard.

Secretary Dulles then indicated that he wanted to speak on the more general subject of paragraph 52—namely, the build-up of Japanese defense forces. He said that negotiations on this subject were now going on with the Japanese Government. The State Department hoped very much that these negotiations would be completed before the provincial and local elections came up in Japan on April 20. The question of the appropriate Japanese contribution to their military budget would be a very great issue in this forthcoming election. He believed that we had tended to push the Japanese too hard. We must be more cautious, because it was manifest that there was a strong pacifist sentiment abroad in Japan. In part, we ourselves were responsible for this, since we had imposed a pacifist constitution on the Japanese. Over and above these facts, Secretary Dulles pointed out that the Japanese were greatly concerned about their economic situation. To make matters worse, Communist propaganda was capitalizing on all these grievances. So that while Secretary Dulles said he of course realized the importance of rearming Japan as promptly as possible, he could see no sense in doing so if you ended up by putting arms in the hands of people who are going to shoot in the wrong direction. Finally, he feared a weakening of the conservative parties in Japan, with the possibility that the Japanese socialists might eventually gain control. While the elections on April 20 were local rather than national, they were important because those who controlled the local political machinery might eventually determine the results of a national election. To illustrate his point, he compared the situation with the state political machines in the United States and their manifest influence on U.S. national elections. In conclusion, Secretary Dulles hoped that the Department of Defense would come to feel that we should settle this defense contribution issue as quickly as possible, and that the U.S. could make concessions which would help to maintain control of Japan in the hands of the conservatives.

Secretary Anderson said, speaking frankly, he could not disagree with the Secretary of State. He said it was of course natural that the Service staffs in the Pentagon should desire to build the defensive strength of Japan as rapidly as possible. But he personally had no real difference of view with Secretary Dulles.

The President cited the case of Turkey as evidence of the Tightness of Secretary Dulles’ view. The Turks had now more of a military establishment than they were really able to support and cope with. The President also added that more help must be given to Japan to improve its economy. He suggested that a certain amount of trade in Japanese consumers goods with Communist China might assist in solving this latter problem. He added that he gathered that the Secretaries of State and Defense would agree on new language to replace the disputed last sentence of paragraph 52. Secretary Dulles, however, suggested that the Council agree to use the language which appeared in the present draft, but to reject the changes suggested by the Joint Chiefs of Staff in that language. The Council accepted this position.

Mr. Dillon Anderson then went on to describe the economic courses of action and read paragraph 61,⁸ with respect to the provision of assistance by the United States to the Japanese economy, both by the extension of public credit to Japan and by widening opportunities for the investment of private capital in Japan.

Governor Stassen said that paragraph 61 was in accordance with existing basic national security policy. Secretary Dulles asked Governor Stassen if he would care to comment on the evident Japanese antagonism to the influx of any significant amount of foreign capital. If this was indeed the case, as Secretary Dulles understood it to be, should the United States not put greater emphasis on trying to induce the Japanese to follow more liberal policies with respect to the investment of private capital?

Governor Stassen indicated that he had made efforts in this direction in all his conferences and contacts with the Japanese. He admitted, however, that the results had been spotty. It was not so much that the Japanese objected in principle and as a general rule to the introduction of all foreign capital or to the activities of all foreign companies in Japan. Their point of view depended on a particular industry or a particular company. The Singer Sewing Machine Company had experienced great difficulties in Japan. On the other hand, International Business Machines, certain of the U.S. oil companies, and Westing-house had been very successful.

The Director of the Budget confirmed Governor Stassen’s appraisal on the basis of his own experience in Japan.

Mr. Rockefeller said that this attitude was closely related to the national feeling of the Japanese. American companies who went along with this Japanese national sentiment were welcome. Those who tried to buck it were not.

At this point, Mr. Dillon Anderson called the Council’s attention to paragraph 66,⁹ a course of action by the United States to encourage Japan to improve the climate for private investment, both domestic and foreign.

The President then said he wished to go back to paragraph 62,¹⁰ which dealt with efforts to promote the expansion of Japan’s trade and commerce. If, said the President, we are going to continue to ignore Japan’s evident desire to trade with the Chinese Communists, he would like to have Mr. Dodge’s committee (the Council on Foreign Economic Policy) study the validity of the view that such trade between Japan and the Communist states is exclusively bad. After all, said the President, as he had frequently mentioned before, trade was the best weapon of the diplomat. He therefore wanted to see this analysis and study made. In fact, he had been calling for it for over two years, and his request had been ignored.

Secretary Dulles pointed out to the President the uniform Communist practice of funneling trade into the particular channels that they desire, rather than to permit it to be a means of contact between peoples.

Governor Stassen pointed out that the study to which the President had referred had already been given to the Dodge committee to prepare. Unhappily, very strong differences of view had emerged in the Council on Foreign Economic Policy, although a progress report would shortly be presented to the President.¹¹

The President observed that of course if the Secretary of State’s view on the funneling of trade by the Communists was correct, that would change the whole picture he had in mind when he referred to Japanese trade with the people of Communist China.

Governor Stassen described briefly the problems encountered in the Dodge committee with regard to the problems of trade between Japan and Communist China. The single biggest issue was whether or not to reduce the level of controls on trade with Communist China (CHINCOM controls) to the same level agreed upon for controls on trade with the Soviet Union and the European satellites (COCOM controls).¹² Governor Stassen also emphasized to the President that the Soviets and the Chinese Communists do not want to trade with Japan in consumers goods, but instead wished to buy materials which contributed to the development of heavy industry and war potential.

The President said that it seemed to him that if it were the Communists themselves, rather than U.S.-inspired controls, that represented the chief reason for the failure of any significant trade developments between Japan and Communist China, the least the United States could do was to make this fact perfectly plain and put the blame where it belonged—on the Communists.

Secretary Dulles replied that we had done our best to make it plain that the failure of Japan to achieve a market for its consumers goods in Communist China was primarily caused by Chinese Communist policy.

The President expressed great skepticism as to whether we had succeeded in making this matter clear to the Japanese. To explain what he meant, he referred briefly to his well-known speech on the peaceful uses of atomic energy. Despite the content of this speech, polls recently taken in a variety of foreign nations indicated that not more than one percent of the population of these nations actually believed that the United States was earnestly concerned with promoting the peaceful uses of atomic energy. Thus, while the “big shots” in the Japanese Government may be quite aware that it was the Communists and not the United States which was responsible for Japan’s inability to sell its consumers goods in China, the President doubted very much whether the “little people” in Japan really understood this fact and realized that the Communists were at fault.

Mr. Rockefeller suggested that progress might be made in this area through the creation of a Joint U.S-Japanese commission on trade and commerce. The President did not seem to react positively to this proposal. He reverted to his point that the Japanese blamed us more for the restrictions on their trade than they did the Russians. They listened to speeches by Senator Knowland and other Members of Congress, and thought that these speeches represented the Administration’s policy.

Mr. Dodge commented at the end of the discussion that while the President’s point of view had validity from the propaganda angle, he doubted if it was valid from a practical point of view. After all, the consumers goods that the President wanted the Japanese to sell—such as rubber shoes, straw hats and the like—would not be sold directly to the people of Communist China; if they were sold at all they would be sold to a Chinese Communist government monopoly, which would then resell them to the population. Accordingly, there was very little likelihood that trade between Japan and Communist China would help to advance understanding among peoples.

The National Security Council:¹³

a. Noted and discussed the draft statement of policy on the subject contained in the reference report (NSC 5516) in the light of the views of the Joint Chiefs of Staff transmitted by the reference memorandum of April 5.

b. Adopted the statement of policy contained in NSC 5516, subject to the following amendments:

(1) Paragraph 13, first sentence: Revise to read as follows: “Japan’s immediate objective is to strengthen its economic position, with a probable long-term objective of recovering a position of international influence and prestige.”

(2) Paragraph 35, and footnotes thereto: Delete, and renumber subsequent paragraphs accordingly.

(3) Paragraph 44: Substitute “do not concede” for the words “treat as legally invalid”.

(4) Paragraph 52: Delete the footnote thereto, and the word “ground” in the fourth line.

Note:NSC 5516, as amended and adopted, approved by the President; circulated as NSC 5516/1; and referred to the Operations Coordinating Board as the coordinating agency designated by the President.

[Here follow the remaining agenda items.]

S. Everett Gleason

1. Source: Eisenhower Library, Whitman File, NSC Records. Top Secret. Drafted by Gleason on April 8.
2. This paragraph reads: “Japan’s broad objectives are to recover a position of international influence and prestige and to strengthen its economic position. Japan considers that increase of defense strength is of lower priority, partly because it believes that its defense will be assured by the United States. While political stability is desired by most Japanese, sharp and persisting conflicts between rival personalities and factions seriously retard its development.”
3. Brackets in the source text.
4. For text of the Mutual Defense Treaty between the United States and the Republic of Korea, signed at Washington on October 1, 1953, see TIAS 3097; 5 UST (pt. 3) 2368.
5. For text of the Mutual Defense Treaty between the United States and the Philippines, signed at Washington on August 30, 1951, see TIAS 2529; 3 UST (pt. 3) 3947.
6. Language to this effect appears in paragraph 7(a) (1) of the original NA draft, January 7, cited in footnote 3, Document 11. All subsequent drafts retain (with variations in emphasis) this general recommendation.
7. See Document 22.
8. This paragraph reads as follows: “Assist the Japanese economy through the appropriate extension of public credit to Japan, the use of technical assistance, the use of local currency proceeds of agricultural surpluses and the widening of opportunities for the investment of Japanese capital.”
9. This paragraph reads: “Encourage Japan to relax or remove legal and administrative barriers and to improve the climate for private investment, domestic and foreign.”
10. This paragraph reads: “Promote the expansion of Japan’s trade through United States participation in programs of economic development in free Asia; give particular emphasis to development projects which would tend to increase sound intra-regional trade; use Japan as a source of supply to the extent practicable in connection with United States-financed aid programs; encourage Japan to contribute to the development of South and Southeast Asia by providing technical assistance and financing.”
11. For documentation on the activities of the Council on Foreign Economic Policy, see vol. IX, pp. 1 ff.
12. Documentation on this question is printed in vol. x, pp. 203 ff.
13. Paragraphs a and b and the Note that follow constitute NSC Action No. 1374. (S/S–NSC (Miscellaneous) Files: Lot 66 D 95, Records of Action by the National Security Council)