354. Department of State Guidelines Paper0

A draft of this paper, dated October 1961, was circulated to 10 Departments and agencies and to the Embassy in Tokyo for comment. The draft and several replies are in Department of State, S/S Country Files: Lot 70 D 209, Japan. In a March 16 memorandum to Rice, Leonard Bacon of EA/RA wrote that although the “question of concurrence did not arise” in interagency discussions subsequent to the replies, CIA and DOD representatives “could formally state that they did not find the revised paper objectionable in any important respect.” (Ibid.) See the Supplement. Of the replies from other agencies, the memorandum dated December 12, 1961, from Robert Amory, Deputy Director (Intelligence) of the CIA, to Battle, and the memorandum dated December 13, 1961, from William Bundy to McGhee, are also in the Supplement.

GUIDELINES OF U.S. POLICY AND OPERATIONS TOWARD JAPAN

I. Basic Approach

1.
We see Japan as our principal ally in East Asia, our second largest world trading partner, the host for important forward U.S. military facilities, and a source of technical skill and capital contributing to the economic development of South and Southeast Asia. Japan offers the prospect of development as an increasingly important political, economic and, possibly, military counterweight to the rising power of Communist China.
2.
Japan’s continued control by moderate elements, its readiness to cooperate with the United States in foreign policy, and its ability in the future to play a more constructive role in Asian and world affairs depend on many factors but primarily on the maintenance of a high level of economic activity, which, in turn depends to an unusual extent upon access to world markets. As a reaction to defeat and occupation, there is a profound wish to avoid military involvement and great sensitivity to the risks of nuclear warfare. Recently there has been a growing nationalist sentiment and an increasing desire for independent self-assertion and leadership.
3.
Accordingly, as Japan attempts with our help to play a more positive role in Asian affairs, U.S. and European economic and trade policies [Page 729]must be responsive to Japanese marketing needs, and defense links must infringe as little as possible on Japanese prerogatives and sensibilities.

II. Background

1.
Japan stands today as a fully independent and influential member of international society. Its recovery since 1945 has been most impressive in the economic sphere and least impressive in the military field. Japan has enjoyed one of the fastest rates of economic growth in the world, averaging nine percent annually during the past ten years; trade has increased to record levels; foreign exchange reserves reached a post-war peak of $2 billion in April, 1961, since reduced to $1.5 billion, and per capita income (about $350) is now the highest in Asia, though still low by the standards of Western industrialized nations.
2.
The continued rapid rate of economic growth has reinforced the firm grasp over political power in Japan held during the post-war period by the moderate conservative forces (Liberal-Democratic Party), which are supported by over 60 percent of the electorate and have large majorities in both houses of the Diet. The 1960 elections, however, showed a rise of 3.7% since 1958 in the opposition vote. Population shifts partially accounting for this rise seem likely to continue. Major scandals, significant foreign policy failures, or a radical curtailment of the rate of economic growth would accelerate the apparent gradual shift of political power to the left. If as a result of the current economic boom Japan’s balance of payments situation should further deteriorate, the Ikeda Government might be faced with the necessity of taking counter-measures of such severe character that economic growth would be seriously retarded. In such case the position of his Government and the Liberal-Democratic Party would be seriously weakened, particularly in view of promises to double the income of Japanese wage earners within ten years. The conservatives, moreover, have been unable to give Japan the kind of stable, firmly Western-oriented government warranted by their large parliamentary majority, due to certain weaknesses in Japan’s post-war structure, principally:
a.
Factionalism is endemic to the Japanese conservative movement and breeds ineffectual governments if not curbed. Although the leaders of all factions of the Liberal-Democratic Party in varying degrees recognize the necessity of close ties with Western countries, some have shown serious political irresponsibility in their intra-party struggles for power. As a consequence, conservative governments in Japan have been tempted occasionally to sponsor opportunistic policies, to be less cooperative with the United States, and to be susceptible to appeals based on emotionally-tinged nationalism.
b.
Conservative parties have failed to develop genuine grassroots support for their policies, relying instead on traditional patron-voter [Page 730]relationships, particularly in rural areas where their main source of strength lies. This failure could become increasingly serious for them with the steady shift of population to the cities and the gradual erosion of traditional political patterns throughout Japan.
c.
Japan is extremely vulnerable to external economic influences, because the health of its economy is heavily dependent upon a high level of international trade. Conservative public appeal, however, rests increasingly on the “bread and butter” issues and its demonstrated ability to guide an economic growth which has brought steady improvement in living standards. If their economic policies falter, the conservatives could be in very serious difficulties. Therefore, the maintenance of a high level of trade with the West, particularly the United States, is virtually a life or death issue for the conservatives.
d.
Japan has failed to digest fully the major political and social reforms of the occupation or to develop a solid sense of national purpose. Pre-war totalitarian institutions and national goals are largely discredited. However, the new postwar democratic institutions have shallow roots and are not fully understood by any segment of Japanese society on the right or the left. Furthermore, the Japanese people have not recovered fully from the tremendous social upheaval of the last twenty years or developed a new social equilibrium.
e.
The urge for neutralism and for disengagement from alignment with the U.S. has a major impact on Japanese policy. Japan is under constant pressure to assume a neutral stance both from Sino-Soviet sources and from left-wing elements in Japan. These appeals often strike a responsive chord: Japan’s long isolation from the West ended only a little over 100 years ago; Japanese nationalism is introverted and places great value on “national independence”; and the memories of defeat in World War II and particularly of the atom bombings of Hiroshima and Nagasaki are still intense. While successive conservative governments have rejected a policy of disengagement without election defeat, in deference to these public sentiments they must trim their sails by demonstrations of Japanese independence particularly on such sensitive issues as the Ryukyus and China policy, and by limiting Japanese security ties particularly through the refusal to enter into regional security commitments. Although aware of the United Nations’ present limitations, Japan places great store by that body and participates actively in efforts to make it a more effective instrument of peace and progress. The Japanese remain unwilling, however, because of Constitutional considerations, to contribute troops or logistic support to UN emergency operations.
f.
The Japanese people are haunted by the fear of involvement in another nuclear war, to the point where all manifestations of military activity, whether U.S. or Japanese, are at most acquiesced in by substantial segments of the nation. The conservatives cannot afford to flout these [Page 731]fears and must tailor their security policies so as to avoid, when possible, heated public debate on military-security issues and particularly must oppose storage of nuclear weapons in Japan. Such storage, however, remains an important U.S. military objective to be pursued when politically feasible.
g.
The left has demonstrated its capabilities for effective exploitation of Japan’s political weaknesses and fears of involvement in a nuclear war, and is often able to handcuff completely government initiatives having large parliamentary support. The left has developed extra-parliamentary means of frustrating the conservative majority through the use of violence to impede or interrupt the normal legislative processes. The Government is deterred from the use of its full powers to override these tactics by the fear of adverse public reaction weakening its mandate, or of the creation of a situation of disorder bordering on the revolutionary. The left, for its part, is restrained by the fear of jeopardizing public support, or at least tolerance, of its activities. Since the left is particularly well entrenched in the communications media and labor circles, it has been able to secure very broad tolerance for its actions, and to impede the efforts of the Government to gain support for its own policies. This situation is particularly dangerous because the Communists have shown themselves capable of effectively influencing left-wing actions to the benefit of the Sino-Soviet bloc.
3.
Continued conservative rule can, therefore, not be taken for granted. Its vulnerabilities are most evident on issues involving Japan’s security ties with the U.S., the status of the Ryukyus, policy toward the Communist bloc, particularly Communist China, and, most importantly, the expansion of Japan’s trade and economy. However, the only current alternative is rule by the Japan Socialist Party (JSP), which seeks not only drastic social revolution in Japan, but a neutralist policy leaning very much in the direction of the Sino-Soviet bloc. There are forces at work within Japanese society which may in time effect a change in the orientation of the JSP, and a closer approach to the responsibilities of a ruling party might of itself have a sobering effect; however, rule by the Socialists as now oriented would not only completely reverse the present trend of U.S.-Japan relations but could also precipitate a major and decisive power shift in Asia toward the Communist bloc with other Asian nations also swinging to a Communist-oriented neutralism.
4.
Given this situation, U.S. policy toward Japan must necessarily depend upon maintenance of a moderate, conservative government for the time being. The day may come when this is no longer feasible. Looking toward this day, it is vitally important to seek a gradual moderation of left-wing views, but not at the expense of accelerating or condoning an early accession to power of the left. At the same time, U.S. policy toward Japan must recognize the limitations on the conservatives for actions in [Page 732]the security field and their most vital dependence on trade as a means of promoting Japan’s continued economic growth. This dependence on trade, however, provides the United States with very considerable leverage in Japan. If trade with Japan can be maintained at a growing level over the next decade, Japan’s alliance with the U.S. and its inter-dependence with the West can become so intimate and responsive to Japanese interests as to discourage thoroughly any Japanese government, whether left or right, from reversing this course.

III. Objectives

A. Long-Term Goal

The long-term goal of U.S. policy toward Japan is the development of Japan as a major power center in Asia acting in concert with U.S. and Free World interests.

B. Short-Term Objectives—(Objectives realistically attainable during the period 1962-64)

1.
Continuation in power of a moderate, Western-oriented government.
2.
Maintenance of a U.S.-Japanese alliance based on the political, economic and security provisions of the Treaty of Mutual Cooperation and Security.
3.
Maintenance of our base structure in Japan, primarily to assist in the defense of Japan and to provide logistic support for the U.S. military forces in the Far East.
4.
A Japanese defense effort capable of maintaining internal security against Communist-inspired subversion and insurgency and capable of assuming increasing responsibility for the defense of the Japan area and thereby, together with U.S. forces, of coping with and deterring Communist aggression in the Pacific.
5.
Continuation of Japanese acquiescence in the U.S. administration of the Ryukyu and Bonin Islands.
6.
Growth of a more healthy and moderate outlook on the part of the Japanese intellectual community.
7.
Development of closer links with the U.S. and other non-Communist nations, particularly developed countries, based on increased trade and greater coordination of economic policies.
8.
An increasing Japanese contribution to economic growth in non-Communist Asia.
9.
An expanding international role for Japan, particularly among the Asian and African nations.
[Page 733]

IV. Lines of Action

In the short-term, U.S. policy toward Japan will be dominated by achievement of two objectives: continuation in power of a moderate government and the development of an expanding level of trade between Japan and other non-Communist countries. A fundamental reorientation of Japan’s position in the world and its relationship to the U.S. will result from failure to achieve either objective.

A. U.S.-Japanese Alliance

1.
Move quickly to resolve differences between Japan and the U.S.
2.
Maintain a pattern of consultation with Japan consonant with its status as the major partner of the U.S. in Asia, paralleling such consultations with top Western European leaders.
3.
Seek broader public support in Japan for the U.S.-Japan alliance:
a)
By expeditious settlement of security and base problems.
b)
By minimizing overt U.S. pressures on the Japanese Government in security matters.
c)
By implementing and emphasizing the non-security provisions of Article II of the Treaty of Mutual Cooperation and Security, particularly in the field of trade and economic cooperation.
d)
By fostering both the concept and reality of equal partnership and interdependence with the U.S. and Free World.
e)
By promoting ideological identification with the Western democracies and encouraging closer ties with the NATO countries.

B. Moderate Government

4.
Support the continuation in power of a moderate, Western-oriented conservative government in Japan.
5.
Encourage—without alienating conservative support—the development of moderating trends among the opposition Socialists and their trade union supporters, by such steps as:
a)
Showing sympathetic interest in Zenro and the Democratic Socialist Party;
b)
Stimulating broader contacts between non-Communist Sohyo, Zenro and other labor leaders and the U.S. and other Western union leadership, by inter alia continuing a sizeable labor exchange program, while encouraging privately financed programs; and
c)
Encouraging West European Socialist interest in and contact with the Democratic Socialist Party and the Japan Socialist Party.
6.
Encourage discreetly Japanese initiatives to strengthen their democratic institutions, and in particular to reduce the government’s vulnerability to extra-parliamentary pressures and violence.
7.
Strengthen systematically cultural and intellectual relations with Japan on a long-term and largely non-governmental basis by: [Page 734]
a)
Stimulating and supporting private American and other Western efforts to increase greatly Japanese intellectual, cultural, and youth contacts with democratic societies on the lines recommended at the first meeting of the U.S.-Japan Committee on Cultural and Educational Cooperation.1
b)
Maintaining an expanded U.S. Government educational and cultural exchange program, with emphasis on the areas of political theory, law, social sciences and welfare, communications media, education and labor.
c)
Stepping up U.S. cultural presentations in Japan, and Japanese cultural presentations in the U.S., by actively encouraging private sponsorship and by providing increased U.S. financial assistance.
d)
Promoting scientific exchanges, both government and non-government, in non-defense areas, on the lines initiated at the first meeting of the U.S.-Japan Committee on Scientific Cooperation.

C. Economic Relations

8.
Promote closer economic relations and expanded trade between the U.S. and Japan through such actions as:
a)
Generally maintaining a liberal trade policy and urging Japan and other trading nations to maintain in practice such a policy.
b)
Consulting through normal diplomatic channels and through the joint U.S.-Japan Committee on Trade and Economic Affairs on problems of trade, aid, investment, regional groupings, technical assistance, economic relations with the Communist bloc, and other economic matters.
c)
Resisting pressures to establish U.S. import restrictions, or to “negotiate” Japanese “voluntary” export quotas, except where absolutely essential; when Japanese export quotas to the U.S. are unavoidable they should be negotiated on a multilateral basis.
d)
Handling all specific import commodity problems through the “Escape Clause” or other available legal mechanisms.
e)
Urging Japan not to raise tariffs solely for protection purposes, or as a means of avoiding the consequences of trade liberalization.
f)
Urging Japan to take steps toward more meaningful liberalization of items of interest to the United States under its trade and exchange control system with the objective of eliminating all but a “hard core” of non-discriminatory import restrictions.
9.
Seek Japan’s cooperation in the alleviation of the United States balance of payments problem, while avoiding actions in this connection which would have a serious or abrupt adverse effect on Japan’s own balance of payments position, trading position, or economic strength generally, through such actions as:
a)
Pressing vigorously for Japan’s trade liberalization (see 8.f above).
b)
Promoting increased Japanese assistance to less-developed countries.
c)
Seeking Japanese understanding of the changed U.S. balance of payments position and of its necessary effect on U.S. economic policy.
10.
Promote a broadening economic relationship between Japan and Western Europe through such actions as:
a)
Continuing strongly to urge a liberalization of Western Europe trade policy toward Japan, including the disinvocation of Article XXXV of the GATT.
b)
Promoting at the highest levels of government in Japan and Western Europe understanding of the need for closer economic ties between the two areas.
c)
Studying the possibility of organizational ties between Japan, Western Europe, Canada, the U.S. and other developed nations.
d)
Continuing to support as appropriate Japan’s efforts to secure full membership in OECD.

D. Japan’s International Role

11.
Encourage and assist Japan to exercise a moderating and constructive influence in the UN, particularly with the Afro-Asian nations, but avoid efforts to overidentify Japan with Western positions to the extent that its usefulness and influence among Afro-Asians is undermined and to this end accept occasional divergencies of viewpoint.
12.
Seek to increase Japan’s contribution to and assumption of responsibility for the economic development of the less-developed countries through such actions as:
a)
Encouraging a large-scale economic assistance program to ROK;
b)
Coordinating, through such mechanisms as DAC and multilateral consortia, U.S. and Japanese economic assistance programs;
c)
Seeking with Japanese agreement a selective acceleration of utilization by recipient countries of Japan’s reparations payments, including urging recipients to make increased use of the loan portions of such payments.
d)
Encouraging and facilitating, at every opportunity, increased Japanese technical assistance to less-developed countries generally and, in particular, seeking to increase the scope of and Japan’s contribution to the Asian Productivity Organization.
13.
Seek an early settlement of ROK-Japanese differences with such steps as:
a)
Establishment of reciprocal official relations.
b)
Japanese economic assistance for the ROK.
c)
A fisheries conservation agreement in the Korean straits.
14.
Coordinate closely with Japan on policy toward the Sino-Soviet bloc and particularly Communist China, but recognize that Japanese policy toward Communist China may diverge from U.S. policy in certain [Page 736]respects. In this connection, encourage Japan to hamper and weaken ties between the Japan Communist Party and the Soviet Union and Communist China.

E. Security-Military Relations

15.
In public statements generally avoid reference to the military-security aspects of U.S.-Japanese relations. In such public references to this subject as are appropriate, accentuate the mutually supporting aspects of U.S.-Japanese security relations and seek to reduce fears that U.S. military bases in Japan will increase the risk of Japanese involvement in a nuclear conflict.
16.
Maintain with Japanese agreement a level of U.S. military facilities and forces in Japan as required to provide primarily logistic support for U.S. forces in the Far East, and to demonstrate our determination to fulfill U.S. treaty commitments to Japan.
17.
In U.S.-Japanese security relations:
a)
Assist in the defense of Japan in the event of an armed attack against the territories of Japan.
b)
Adhere rigidly to the provisions of the consultation arrangements, avoiding actions contrary to the wishes of the Japanese Government as expressed in such consultations.
c)
Implement the [less than 1 line of source text not declassified] response to an attack against the United Nations Forces in Korea only with the authorization of the President.
d)
Inform the Japanese Government confidentially in advance regarding major United States logistic operations from bases in Japan to areas outside of Japan and regarding any major withdrawal of United States forces from Japan.
e)
Implement U.S.-Japan administrative arrangements in a manner best calculated to obtain maximum cooperation and support from the Japanese Government and public and to avoid publicly-inflamed base rights issues, being prepared to adjust existing military bases when overall political considerations are believed to outweigh purely military considerations.
18.
Encourage Japan to increase its defense effort and to modernize its military forces, while avoiding pressures and other actions prejudicial to Japanese political and economic stability. Continue U.S. military assistance for specific projects designed primarily to stimulate the expansion and modernization of Japanese forces. U.S. assistance should be predominantly in the form of U.S. contributions to cost-shared projects, with the Japanese providing approximately 75% of the total cost, and should normally not include items which the Japanese are capable of producing for themselves. Assistance should be gradually phased down with the objective of ultimate termination.
[Page 737]

F. Ryukyus, Bonins and other U.S.-Administered Pacific Islands

19.
Attempt to keep pressures in Japan and in the Ryukyus for reversion within manageable proportions by developing a cooperative relationship with Japan with respect to the Ryukyus to the degree consistent with the indefinite continuation of exclusive U.S. jurisdiction over the islands. Acknowledge the inevitability of substantial Japanese influence in the Ryukyus, and seek to use it constructively to enhance the security of the U.S. bases. Be prepared to accept a substantial Japanese contribution to the economic and social development of the Ryukyus, preferably through the medium of an economic cooperation agreement. The agreement would define, channel and limit the levels and types of Japanese aid activities, while creating the political basis in Japan for Japanese Government acquiescence in continued U.S. administration.
20.
Conduct our administration of the Ryukyus so as to promote political stability, economic advancement and reasonable satisfaction with continued United States rule. To this end,
a)
Speed up the process of giving responsibility and autonomy to the Government of the Ryukyu Islands and extending the liberties of the Ryukyans to the greatest extent consistent with the High Commissioner’s fundamental responsibilities, using the report of Task Force Ryukyus as a policy guide.
b)
Seek amendment of the Price Act2 to remove the $6 million ceiling on assistance to the Ryukyus.
c)
Provide assistance, in conjunction with Japanese contributions which are agreed upon, at a level substantially higher than in past years as a supplement to local resources in order to support effective administration and long-term economic development of the islands.
21.
Permit the selective entry of Japanese nationals into U.S. administered territories in the Pacific.

V. Contingencies

Achievement of U.S. policy objectives in Japan, particularly the maintenance of a close alliance, could be seriously frustrated in the event of the following contingencies:

A.
A split in the conservative Liberal-Democratic Party or a sustained period of intense factional conflict within the Party, leading to prolonged ineffective conservative rule and greatly intensified vulnerability to leftist extra-parliamentary pressures.
B.
Socialist assumption of power, followed by neutralization of Japan in accord with current Socialist policies.
C.
An open and violent conflict for power between the left and the right, precipitated by continued leftist resort to extra-parliamentary pressures and violence.
D.
A failure to achieve adequate trade levels with the U.S., Western Europe and other non-Communist countries, particularly as a result either of restrictions against Japanese imports by these countries or of a major world-wide economic recession.
E.
Major pressures in Japan and the Ryukyus for reversion of the Ryukyus to Japanese administration.

  1. Source: Department of State, S/S Country Files: Lot 70 D 209, Japan. Secret. Fearey was the principal drafter. In connection with preparation of this paper, the NSC rescinded NSC 6008/1, “U.S. Policy Toward Japan,” June 11. (Memorandum from Bromley Smith to holders of NSC 6008/1, January 2, 1962; ibid.) By approving on April 18 a memorandum dated April 12 from Harriman to Rusk, McGhee authorized the publication and distribution of this paper. (Ibid.) CA-6760 to Tokyo, December 21, 1962, enclosed the paper and termed it “the primary formulation of U.S. policy toward Japan.” (Ibid., Central Files, 611.94/12-2162) For text of NSC 6008/1, see Foreign Relations, 1958-1960, vol. XVIII, pp. 335-349.
  2. Held in Tokyo January 25-31. See Department of State Bulletin, January 22, 1962, p. 142.
  3. See footnote 6, Document 352.