Eisenhower Library, Eisenhower papers, Whitman file
No. 801
Memorandum of Discussion at the 214th
Meeting of the National Security Council, Denver, September 12,
19541
eyes only
[Extracts]
Present at this meeting, held at Lowry Air Force Base, Denver, Colorado, were the following: The President of the United States, presiding; the Vice President of the United States; the Secretary of State; the Secretary of Defense; the Director, Foreign Operations Administration; and the Director, Office of Defense Mobilization. Also present were the Secretary of the Treasury; the Attorney General; the Director, Bureau of the Budget; the Chairman, Atomic Energy Commission; the Director, Federal Bureau of Investigation; the Chairman, Joint Chiefs of Staff; the Director of Central Intelligence; Robert Cutler, Special Assistant to the President; Robert R. Bowie, Department of State; Bryce Harlow, Administrative Assistant to the President; and the Executive Secretary, NSC.
Following is a summary of the discussion at the meeting and the main points taken.
1. Report by the Secretary of State2 (NSC 5429/1 [2?])3
. . . . . . .
Secretary Dulles said that in Japan he had had lengthy meetings with Premier Yoshida and Foreign Minister Okasaki, and a separate talk with Ikeda. Secretary Dulles had explained U.S. redeployment policy and, as far as he could judge, Yoshida seemed to understand it and accept it.
Secretary Dulles said that the talks had indicated that economic matters were of considerable concern to the Japanese. The Japanese economic situation actually is improved, because of their austerity program and their good crop this year. They have almost enough rice for domestic consumption. In fact, the Chinese Nationalists were complaining that the Japanese were not buying Formosan rice. The Japanese trade deficit last year was about $1.1 billion. It is expected to be considerably less this year, and may be [Page 1725] manageable if Japan can find some export markets in Southeast Asia. Secretary Dulles told Yoshida frankly that Japan should not expect to find a big U.S. market because the Japanese don’t make the things we want. Japan must find markets elsewhere for the goods they export.
Secretary Dulles said the big problem economically for Japan at present is the question of reparations, particularly with the Philippines, Indonesia, and Burma. He had told Yoshida that this presented a real dilemma, since that Japanese economy can’t stand sizeable reparations but can’t be built up without a reparations settlement. He suggested that Yoshida try to accept a reasonable settlement such as the recent Burmese offer, which appeared to be a reasonable proposal. Yoshida assured Secretary Dulles in the most emphatic terms that the outward evidence of anti-Americanism was not truly the feeling of the Japanese people. Secretary Dulles said that he feels no doubt that the Communists are making progress on that campaign, however.
Secretary Dulles expressed the belief that we may have to lower our sights on Japanese rearmament. We must measure the value of military forces in being against the political support as to how and when they may be used. He feels that General Hull and Ambassador Allison agree. General Hull recently made a trip to Hokaido, where he observed the air facilities being built on a series of islands in the Kuriles. There were 50 MIG’s on the nearest island, and if the buildup continues at its present rate the Russians will have more air power there than our entire Far East Air Force. The President commented that while we had spent many months arguing about the responsibility for losing China, we had just given away the Kuriles. He said he had never understood why in the name of God we did it, and that he thought it constituted the “damnedest stupidity”.
In answer to the Attorney General’s question whether Japan would need rice from Indochina, Mr. Stassen said that he did not believe so, although Japan was buying a little rice from Pakistan and Thailand. In answer to the President’s question, Mr. Stassen said some progress was being made in persuading the Japanese to eat wheat. In answer to the Vice President’s question regarding the impression Magsaysay4 made on the other people at the Manila meeting, Secretary Dulles said that he saw more of Magsaysay than the others, who did not get a chance to have an adequate impression. Secretary Dulles said that Magsaysay had told him how he, Magsaysay, had dealt with the Communists, and that it would make your hair stand on end.
[Page 1726]The National Security Council:
Noted an oral report by the Secretary of State regarding the signing of the Southeast Asia Treaty and his visits to Formosa and Japan.
. . . . . . .
- Drawn up by Lay on Sept. 13.↩
- For the remainder of the memorandum of this portion of the meeting, see vol. xii, Part 1, p. 903.↩
- For text of NSC 5429/2, Aug. 20, “Review of U.S. Policy in the Far East”, see ibid., p. 769. NSC 5429/1, Aug. 14, same title, is not printed. (Both in S/S–NSC files, lot 63 D 351, NSC 5429 Series)↩
- Ramon Magsaysay, President of the Philippines.↩