Foreign Relations of the United States, 1958–1960, Japan; Korea, Volume XVIII

3. Telegram From the Embassy in Japan to the Department of State⁰

Tokyo, February 12, 1958, 8 p.m.

2083. For Secretary and Robertson. Deptel 1623¹ and Embtel 1998.² I fully agree it is matter of greatest urgency to reappraise our policies with respect to Japan and Ryukyus in order to bring about timely readjustments which are essential if our relations are to be put on durable and dependable basis.

1. As preface I must again stress my conviction that Japan’s foreign policy and international orientation will over long term be governed very largely by economic facts of life and notably fact that Japan must trade or die. If US and other free world countries do not allow Japan a fair and reasonable share of their markets so she can earn her living, Japan will inevitably be forced to turn elsewhere, and at same time great and lasting bitterness toward US will be engendered here. If Japan is forced into some form of economic accommodation with Communist Bloc, Communists will of course exact political price. Thus if we and other free world countries start down trade restrictionist path with respect to Japanese products, all other basic problems of US-Japan relations will, as inevitable consequence, become quite unmanageable over period of time.

On other hand, if we handle our trade and economic relationships with Japan properly and at same time recognize that it is most urgent that we make some fundamental adjustments which go beyond our present treaty rights, I think there is a good prospect of putting our overall relations with Japan on reasonably firm and dependable basis. My suggestions and recommendations for reappraisal of policies re Japan and Ryukyus follow.

2. As set forth in my letter of Feb 1 to you, I believe that a major adjustment is required in Okinawa where time is running swiftly and remorselessly against US. My letter describes in detail our appreciation and makes specific recommendations for changes in our policy and in present administration there.

3. Bonins are lesser but nevertheless important problem. If considered view remains that return of some islanders not feasible for indefinite future, compensation to islanders should be pushed to satisfactory conclusion. Since basic problem is political, terms and amounts of compensation should be worked out to achieve desired political effect, i.e., reduction of agitation, therefore not limited to what strictly legal grounds might seem to warrant.

4. Another basic problem is our security arrangements with Japan proper.³ There are signs that GOJ will soon revive question of treaty revision.⁴ From our viewpoint, we must face prospect that our bargaining position may decrease as Japan regains her strength. For example, as time passes without necessary adjustment in security treaty to bring it into keeping with realities of present situation, risk may increase that Japan would come to believe its interests best served by termination of treaty without any replacement, feeling strong enough to stand alone like Sweden. With above considerations in mind, and since we may be faced with talks on treaty revision this year, we have been working for some time on possible draft treaty for Dept’s consideration and will pouch it to you shortly. My general thoughts are:

a. Japan may now be ready for treaty that is really mutual, provided we limit proposals to our minimum essential interests. (Certainly we should be prepared to offer a mutual treaty to replace present one-sided arrangement.) For operative mutual defense clauses, for example, treaty area might be limited to Western Pacific (i.e., Japan and Article III islands in peace treaty).⁵

b. For optimum psychological impact and political durability, treaty should be in broad pattern of our other treaties of alliance in Pacific area, with emphasis on provisions for political and economic as well as defense collaboration. Likewise, perhaps useful to give it a name such as “treaty of mutual cooperation and security”.

c. Administrative Agreement⁶ would have to be revised correspondingly in important respects. Detailed base arrangements will probably have to be individually agreed on as with NATO countries, and it will be very important to estimate really minimum requirements as basis. Existing jurisdictional arrangements of course are satisfactory and can, I believe, be retained.

d. If new defense relationship with Japan achieved on basis genuine equality as above, it should create favorable psychological climate which would facilitate progress on two most delicate problems: joint or combined defense, and perhaps eventually few years hence, introduction of nuclears, although we certainly could not count on this.

Timing of negotiation for revision is of course important. Japanese have not pressed for discussions on this since Kishi’s Washington visit, although Fujiyama has mentioned it to me (Embtel 1656).⁷ Assuming Kishi does well enough in elections⁸ to give promise of stability, my thought had been that following elections I would sit down with him and Fujiyama to explore question. However, if elections are delayed until fall, political pressures may well oblige Kishi to force pace. In any case, it seems urgently necessary that US position be established as soon as possible so that we will be prepared to respond constructively to initiative which might be taken by Japanese, as well as to take advantage of occasion where we might think it in our own interest to initiate at least private discussions even before elections.

Yet another major subject we should be considering most carefully at same time we are conducting reappraisal of: (a) our policy and administration in Ryukyus; (b) revision of security treaty; and (c) compensation for Bonin islanders, is Asian economic development. It is in our interest to encourage participation by Japan in SEA economic development because it will have two fold beneficial effect of furthering US policies in SEA and in Japan. Kishi Govt more than any in recent past is looking toward Japanese participation in SEA economic development as major element of Japanese foreign policy. Serious effort on our part to facilitate Japanese participation in Asian economic development will pay immediate political dividends here and, in longer run, economic returns to both SEA countries and to Japan. Furthermore, it is in US interest that Japan rather than Communist China or Soviets exercise greater economic influence in SEA. Increasing economic activity of ChiComs in SEA makes this latter point of increasing importance.

We fully appreciate sensitivities about Japan in many Asian countries leading to concern that it may be hazardous for US to associate itself too closely with Japan in SEA economic development. Nevertheless, we are convinced that patient and discreet efforts on part of US political, economic, and USOM officers in all countries concerned to foster closer Japanese-SEA economic relations would further our objectives in both areas and in Asia as a whole. Developments such as recent conclusion of Indonesian reparations agreement, India–Japan loan agreement, Indonesian request for Japanese shipping, and success of third-country training and technical assistance (which might well be expanded along lines of European Productivity Agency), suggest political atmosphere is gradually changing for better and that it is possible for us to take advantage of this trend.

Japan has assumed heavy reparations burdens which will probably be increased soon by agreement with Vietnam. These out-payments represent real economic sacrifice by Japan and it is greatly in our interest that indirect return from them be maximized. Although Embassy of course cannot judge usefulness of reparations program to SEA thus far, it is our strong belief that every appropriate effort should be made to assure that our own aid programs and Japanese reparations projects be geared to complement each other in economic development countries concerned. It should be evident to SEA countries to whom Japan is paying reparations that Japan’s ability to continue to discharge heavy reparations burden it has assumed is dependent on high level of trade, since many items sent as reparations payments involve raw materials, much of which Japan has had to pay for with dollars and hard currencies obtained through her trade. Therefore it is in these countries’ interests to cooperate with Japan in trade field so Japan can continue to have capability of paying reparations.

MacArthur

0. Source: Department of State, Central Files, 611.94/2–1258. Secret; Limit Distribution. Transmitted in two sections.
1. In telegram 1623 to Tokyo, January 31, MacArthur was instructed to reevaluate U.S. policies toward Japan and the Ryukyus and to submit recommendations because Dulles had expressed the view that “our present posture in Japan and Ryuykus cannot be continued safely.” (Ibid., 611.94/1–3158)
2. In telegram 1998, February 3, MacArthur replied that he had written to Dulles on February 1 regarding the Ryukyus. (Ibid., 611.94/2–358) MacArthur’s letter to Dulles is in Eisenhower Library, Dulles Papers, MacArthur, Douglas II; see Supplement. On February 26 the OCB Working Group on Japan submitted to the Board a draft report entitled “Problems and Issues Affecting the U.S. Civil Administration of the Ryukyu Islands.” (Department of State, OCB Files: Lot 62 D 430, Japan) See Supplement. No final version has been found.
3. U.S.-Japan Security Treaty, signed at San Francisco September 8, 1951; entered into force April 28, 1952. For text, see 3 UST (pt.3) 3329.
4. See Document 4.

5. Article III of the Treaty of Peace with Japan reads:

   “Japan will concur in any proposal of the United States to the United Nations to place under its trusteeship system, with the United States as the sole administering authority, Nansei Shoto south of 29° north latitude (including the Ryukyu Islands and the Daito Islands), Nanpo Shoto south of Sofu Gan (including the Bonin Islands, Rosario Island and the Volcano Islands) and Parece Vela and Marcus Island. Pending the making of such a proposal and affirmative action thereon, the United States will have the right to exercise all and any powers of administration, legislation and jurisdiction over the territory and inhabitants of these islands, including their territorial waters.” (3 UST (pt. 3) 3172–3173)

6. Administrative Agreement under Article III of the Security Treaty between the United States and Japan, signed at Tokyo February 28, 1952; entered into force April 28, 1952. For text, see 3 UST (pt. 3) 3341.
7. Telegram 1656 from Tokyo, December 20, 1957, recounted MacArthur’s confidential meeting on December 19 with Fujiyama, during which Fujiyama commented on the “profound reaction” caused by High Commissioner Moore’s remark to the Japanese press that U.S. administration of the Ryukyus could be limited to a definite period. Fujiyama went on to say that the duration of the U.S. retention of the Ryukyus and of the Security Treaty were extremely sensitive political issues in Japan, although he did not bring up treaty revision. MacArthur replied that U.S. policy remained the same as that which Eisenhower informed Kishi in June 1957. (Department of State, Central Files, 794C0221/12–2057)
8. General elections in Japan were held on May 22, 1958.