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

FE files, lot 55 D 480

No. 787
Memorandum by the Economic Coordinator in the Bureau of Far Eastern Affairs (Baldwin) to the Assistant Secretary of State for Far Eastern Affairs (Robertson)

secret

[Washington,] August 11, 1954.

Subject:

• Ikeda’s Statement re Japanese Foreign Policy

I suppose one of the reasons which motivated Ikeda’s recent statements about Japan’s foreign policy orientation was the expectation or hope that it might loosen U.S. purse strings and enhance the possibility of a fat economic aid program for Japan. This supposition is strengthened by the remarks about U.S. assistance to Japan attributed to Ambassador Iguchi in today’s New York Times.¹

While the Indochinese situation furnished a convenient justification for some such statement as Ikeda’s, recent U.S. developments (including the President’s statement about Japan and the subsequent Meyer Mission to Japan) certainly did not discourage it.

The Japanese will, of course, expect some official U.S. reaction to Ikeda’s remarks. It seems to me that a soft or too conciliatory reaction might justify the hope that the bluff (assuming that it is a bluff) has worked. Consideration might be given to the advisability of our slowing down a bit with respect to some things in the economic field which Japan wants as a means of suggesting to the Japanese that we were not greatly impressed by the Ikeda statement. This could be done, I would think, without harming our basic relation with Japan or prejudicing any subsequent actions we might wish to take in the economic field.

If a policy of this kind on our part should be adopted, the question of an FOA Mission in Tokyo or even the assignment there of an economic minister, hand-picked by the FOA, should certainly be shelved for the time being. There are other good reasons for shelving it (NA is now preparing a paper on the subject from you to the Secretary)² but if the Ikeda statement is to be met by an attitude of coolness on our part, any move or gesture which might suggest that we are currently considering an economic assistance program for Japan would be inadvisable.³

Apropos this matter, and particularly the memorandum mentioned above, which is being prepared by NA, is the attached copy of a memorandum of conversation between the Secretary and Mr. Stassen.⁴ The Secretary’s response to Stassen’s remarks concerning the first two items in the memorandum is not indicated; presumably it was non-committal. The Secretary should, I think, be advised to avoid taking a definite stand on either matter for the time being.

1. This matter came up in the course of a conversation held between Murphy, Ambassador Iguchi, and Finn on Aug. 11. “Ambassador Iguchi referred to an article appearing in the New York Times of August 11 summarizing an interview he had given. He said the figure of $1.5 billion mentioned by the reporter as a possible total of assistance desired by Japan from the United States was of course ‘preposterous’. The Ambassador said he had mentioned no such figure and that the article was erroneous in a number of respects.” (Memorandum by Finn, who became Officer in Charge of Japanese Affairs in the spring of 1954, attached to the source text)
2. For the finished paper, see Robertson’s memorandum to the Secretary, Document 794.
3. A handwritten notation presumably by Robertson appears in the margin beside this paragraph: “I agree”.
4. The item concerning Japan in Hanes’ memorandum of a conversation held Aug. 9 reads: “Mr. Stassen advocated a three-year program of $100,000,000 of raw materials, principally food, each year to be handled through an FOA mission to be established in Japan.” During the conversation Stassen also suggested an economic policy to back up Southeast Asia military arrangements, and raised the possibility of himself going to the area to prepare the groundwork for a major economic conference in Asia. (Secretary’s Memoranda of Conversation, lot 64 D 199)