Foreign Relations of the United States, 1952–1954, China and Japan, Volume XIV, Part 2

033.9411/10–2053: Telegram

No. 704
The Secretary of State to the Embassy in Japan¹

secret

Washington, October 20, 1953—7:22 p.m.

937. Ikeda Discussions.² Over weekend Takeuchi approached Young and McClurkin separately expressing concern over discussions especially US insistence early GARIOA settlement. He emphasized Ikeda burned bridges in coming and politically could not afford go home with nothing but onus for agreeing commence GARIOA negotiations.

Takeuchi, Aichi, Watanabe and Miyazawa morning October 19 brought paper³ to McClurkin, Hemmendinger, Cronk setting forth Japanese position on items under discussion. Following points developed from paper and subsequent discussion:

(1) Japanese likely resist strenuously any effort induce them spend more on defense than contemplated Ikeda’s plan;

(2) Believe they might like reach agreement here with US Government on financial and political limitations defense program so Far East Command and Japanese military can proceed work out best possible plan Japanese forces;

(3) Re Mutual Security Program they want (a) general commitments re military assistance; (b) statement our willingness in principle withdraw US forces and reduce Japanese contribution support our forces as they build up own: (c) target figure for offshore procurement; (d) $50 million surplus commodities under Section 550 Mutual Security Act⁴ with counterpart yen used for construction strategic road or advance payments develop munitions industry; (e) some form economic assistance under Mutual Security Program with accompanying conclusion economic aid agreement to parallel Mutual Defense Assistance Agreement.

In conference with Robertson October 19⁵ Ikeda and party presented same paper and pressed strongly for economic assistance indicating Japanese willingness discuss ground force above 180 thousand, in return for such assistance. When pressed on GARIOA Ikeda reversed previous statements and said he is in position negotiate on all issues short only of formal signing agreement. However felt sure Japanese Government would carry out any agreement he made. He said all issues should be considered together as package.

US side preparing package proposal for formal meeting with Japanese October 21 involving: ground force increments 10,000 JFY53; 40,000 JFY–54; 40,000 JFY–55; Japanese defense budget 200 billion yen JFY–54; 235 billion JFY–55; $100 million OSP under MSP; $50 million Section 550 of which $40 million for OSP and $10 milllon for investment munitions production; GARIOA $850 million with interest 35 years. Economic aid agreement would be concluded to cover $10 million investment munitions production. Foregoing discussed other agencies but US presentation to Japanese not finally determined.

No formal meetings between October 21 and 28 due absences Robertson and Ikeda. Hopeful staff conferences will permit conclusion talks on or about 28th.

Dulles

1. Drafted and approved for transmission by McClurkin.

2. In telegram 915 to Tokyo, Oct. 16, drafted by Hemmendinger, the Department summarized the Sixth Meeting of the Ikeda talks, held the previous day, at which several economic issues were discussed. The section on GARIOA reads:

   “US urged agreement be reached during Ikeda talks on time and place settlement and settlement provide repayment agreed amount with interest over agreed period along straight financial lines. Ikeda said did not have authority enter into settlement but did have authority agree time and place meeting. Commented proposal made Dodge San Francisco was on assumption no reparations provided Peace Treaty, must take into account reparations, defense and other burdens. Hopeful reach general understanding these matters as package present talks. Robertson said would expect settlement take all factors into account but cannot expect settlement all problems at once.”

   In conclusion the Department stated: “Reference all questions discussed Ikeda indicated desire submit package analysis in next day or two. Now evident Ikeda main object discuss economic issues as package and receive assurances economic support. Believe clear to Japanese military issues cannot be pursued here much farther.” (033.9411/10–1653) The U.S. Minutes of the Sixth Meeting, drafted by Hemmendinger, bear the drafting date “11–53”. (FE files, lot 55 D 388, “Ikeda Talks”)

3. This paper is an Annex to the U.S. Minutes of the Seventh (informal) Meeting of the talks, held on Oct. 19, neither printed. (FE files, lot 55 D 388, “Ikeda Talks”)
4. For text of P.L. 118, the Mutual Security Act of 1953, approved July 16, see 67 Stat. 153. For the excerpted text of Section 550, accompanied by an exposition of the surplus commodity program, see Department of State Bulletin, Nov. 9, 1953, p. 638.
5. Reference is to the Seventh Meeting.