18. Memorandum From Secretary of State Rusk to President Johnson 1

SUBJECT

  • Japanese Aviation Negotiations
[Page 24]

Recommendation: That you authorize the Department to resume its negotiations with Japan on the basis of the position described in the July 9 memorandum from Governor Harriman to Mr. Feldman.2

Background: I realize that to recess is one of the options contained in my memorandum to you of July 21.3 I do not believe, however, that industry or CAB attitudes are apt to change between now and the end of the year unless Japan resorts to retaliation by harassment, or even threat to abrogate. My recommendation is based upon a belief that a reasonable counter-offer will demonstrate good faith, forestall retaliation, and cushion the shock which would be produced on U.S.-Japanese relations were the Japanese Delegation to return home completely empty-handed.

To have denied Japan the exception we gave Canada under the proposed interest equalization tax rankles deeply and, over the coming six months, we are likely to disappoint Japanese expectations on a number of matters. We will have difficulty in meeting even minimum Japanese expectations: (1) from the king crab negotiations; (2) in achieving success from a promised Administration effort to reverse the Saylor amendment; (3) for satisfactory clarification of the Treasury antidumping action on Japanese steel pipe; and (4) of Administration softening of “ship American” policies.

Tokyo's anxious and sullen mood is reflected in the attached telegrams.4 We face, I fear, a situation in which, if talks are recessed, [Page 25]alarmist press and Parliamentary speculation about the future of United States-Japanese relations will very likely reflect government opinion as well. Moreover, were the Japanese Government to try to suppress anti-American overtones of that speculation, it could endanger the position of Prime Minister Ikeda himself, strengthen public demand for exchange of trade missions with Peking, and weaken Japan's present resolution to collaborate with the United States in such areas as South Viet-Nam, Indonesia-Malaysia. We can consider Japan's economic triumphs to be a success of United States policy, but the charge that our aviation policy reflects persistence of a United States “occupation mentality” reveals the delicacy of our political relationship with consequences which could vitally affect our strategic position at Okinawa and elsewhere.

If you have any hesitation about approving the recommendation, I would hope to talk to you about this personally at the earliest opportunity.

Dean Rusk
  1. Source: Johnson Library, National Security File, Country File, Japan, Vol. II. Confidential.
  2. In his memorandum to Myer Feldman, Special Assistant to the President, July 9, Harriman detailed the Department of State's position that to reject totally Japan's request for an air route to New York could jeopardize the favorable treatment and economic benefits U.S. airlines enjoyed as a result of Japanese concessions regarding trans-Pacific travel. At the same time, the Department believed U.S. carriers could acquire additional benefits from Japan, if Japanese desires were met, and therefore the U.S. Government should promote the interests of the U.S. airlines by negotiating an aviation agreement. (National Archives and Records Administration, RG 59, Central Files 1964–66, AV 9 JAPAN–US)
  3. The other options contained in Rusk's memorandum were to deny Japan a route to New York for the foreseeable future and to negotiate for some or all of the proposals contained in the Harriman memorandum of July 9. The talks had already been in recess since July 7, and Rusk advocated resuming the negotiations, granting Japan access to New York by way of the Pacific, and asking for additional benefits for U.S. carriers in exchange for that concession. (Ibid.) President Johnson authorized the resumption of negotiations on that basis on July 29. (Memorandum to Read from Bator, July 29; ibid.)
  4. In telegram 253 from Tokyo, July 20, Reischauer noted that “Japan feels genuinely the ’aggrieved partner‘” in the aviation issue because access to New York and points beyond, which would give Japan round-the-world service, had been granted to other countries by the United States. That message was echoed in telegram 280 from Tokyo, July 22, containing remarks made to Reischauer by Japanese Transportation Minister Matsuura. Matsuura also pointed out the one-sided nature of the aviation agreement currently in effect and noted that Japan had in the past granted U.S. carriers special rights and privileges granted to no other country. (Ibid.)