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

66. Telegram From the Embassy in Japan to the Department of State¹

Tokyo, December 27, 1955—8 p.m.

1460. Joint Embassy–FEC message. Pass Defense. Reference Embtels 1450,² 1461,³ Deptel 1319.⁴

1. Afternoon December 24 Ambassador Allison saw Kono and Matsumoto and expressed his great disappointment in the Japanese proposal given us Saturday morning (Embtel 1450). He told them this would not make a good impression upon Washington and he therefore hoped Minister Kono would agree to obtain consideration for a different proposal. He mentioned his particular distress that Japanese proposal appeared to represent ultimatum rather than negotiating position. Kono assured him proposal was not ultimatum and that he had urged against presentation of position in belief that it was not within spirit of 140 billion yen figure given Ambassador by Shigemitsu previously.

2. Ambassador also expressed concern at reduction in JDA budget to 96.4 billion yen. Kono thought JDA budget of around 10 [100?]billion yen feasible but, [for] political reasons, total defense budget over 140.7 billion yen would be extremely difficult. He offered get Japanese agreement to 140.7 billion yen total budget divided as follows: JDA 100.2 billion yen, facilities 10.5 billion yen, contribution to US 30 billion yen. Allison told Kono he had no authority to agree to such proposal but would pass on his comment to Washington.

3. Kono further suggested strategy of US presenting proposal along above lines to Shigemitsu this week. When Shigemitsu referred our proposal to Cabinet, Kono would then enter discussion and insist on its acceptance.

4. Under circumstances, Ambassador believes proposal of 140.7 billion yen defense budget made by Kono represents our best hope for quick settlement defense budget negotiations free from undesirable political recriminations. Even proposal made by Kono will be unpopular with Finance Ministry and other elements who behind Japanese proposal made on Saturday morning. However, Kono’s prestige and influence appear to be strong enough to overcome these elements in Japanese Government.

5. However, before accepting 140.7 billion yen defense budget, all possible effort should be made to convince Kono agree to both or either of steps with respect to facilities expenses outlined in para 3 b of Embtel 1462,⁵ providing at best slight augmentation of 1.6 billion yen. (These steps developed out of subcommittee meeting held subsequent to Kono–Allison talk 24th.) This appears virtually only possibility for raising total actual defense expenditures above 140.7 billion yen and would result in total defense budget as follows: JDA 101.7 billion yen; Procurement Agency 9 billion yen; and yen contribution 30 billion yen with additional .7 billion yen carry-over for relocation program and .9 billion yen for road construction outside regular defense budget.

6. With respect to strategy proposed by Kono (para 3 above) Ambassador feels that Kono’s willingness to support US position even to the very limited extent indicated by his figures is an important asset and that we should strengthen the position of those conservative leaders like Kono who willing to work with US. Therefore believe it desirable to follow strategy Kono has suggested—i.e., accepting his figures and making them the basis for a new US proposal.

7. General Lemnitzer states that the Kono figures are inadequate from the military point of view. He would much prefer to receive a proposal from Japanese rather than advance it as a US offer to the Japanese Government, particularly when it is so inadequate from the standpoint of accomplishing US military objectives. However, in view of information received in conversations between Ambassador Allison, Ministers Shigemitsu and Kono and developments in committee meetings with the Japanese on this matter to date, General Lemnitzer accepts Ambassador Allison’s evaluation of the political aspects of the situation and reluctantly concludes that there is no alternative other than for the US now to adopt the course of action proposed by Ambassador Allison and submit a counter-proposal along the lines indicated in para 8 below in response to the very unsatisfactory figures which the Japanese submitted during the committee meeting on 24 December and reported in Embtel 1450 and C–75065.⁶

8. We therefore request authority to reach agreement with Japanese on not less than 140.7 billion yen total defense budget for JFY–56, providing for minimum of 100.2 billion yen for JDA and 30 billion yen for contribution to USFJ, with further provision for progressive reduction of yen contribution in JFY–57 and subsequent years on basis of general formula substantially along lines set forth in Embtel 1411.⁷

Parsons

1. Source: Department of State, Central Files, 794.5/12–2755. Secret; Niact.
2. In telegram 1450, December 24, the Embassy reported it had that day presented to Japan the formula authorized in telegram 1319 to Tokyo, December 22; see the memorandum supra. Japan, however, had presented a formula comprising a Defense Agency appropriation of 96.4 billion yen, a yen contribution to U.S. forces of 31.575 billion yen, and facilities expenses of 12 billion yen, for a total of 139.975 billion yen. (Department of State, Central Files, 794.5/12–2455)

3. In joint telegram 1461, marked “Pass Defense”, the Embassy and the Far East Command described and assessed the effect of projected cuts in the Japanese Defense Agency budget. They commented in part:

   “While JDA budget cut in part consistent with economics enforced on all Japanese agencies, cuts tend to retard force development to total capability much less than size of force implies. About additional 5 billion yen for JDA probably required to restore principal deficiencies created by cut budget to 96.4 billion yen as well as to provide for few new projects. However, overall budget of this magnitude would still have basic deficiencies of previous 103.3 billion yen budget and Japanese forces will continue live on austere basis.” (Ibid., 794.5/12–2755)

4. See footnote 3, supra.
5. Apparently telegram 1461 is meant here; the “steps” referred to were U.S. proposals designed to yield .7 billion and .9 billion yen sums mentioned at the end of paragraph 5.
6. Not printed.

7. Regarding telegram 1411, see Document 65. In telegram 1365 to Tokyo, December 29, the Department replied to telegram 1460 as follows: “You authorized negotiate agreement on basis paragraph 8 reference telegram. Defense considers 140.7 billion yen inadequate from military point of view, states it provides 3.1 billion less than minimum necessary fulfill six-year plan and falls short by 3.75 billion yen of meeting minimum required under Administrative Agreement and yen reduction formula. Defense recognizes political considerations may be overriding and interposes no objection our granting you authority reach agreement on basis paragraph 8 reference telegram.” (Department of State, Central Files, 794.5/12–2755) A lengthier exposition of Department of Defense views is in a letter from Gordon Gray to Robertson, December 29. (Ibid., 794.5/ 12–2955)

   In telegram 1497 from Tokyo, December 30, Allison reported that the Japanese Cabinet had agreed that day to the 140.7 billion yen figure. (Ibid., 794.5/12–3055)