740.00119 PW/4–1847
The Assistant Secretary of State (Hilldring) to the Chief of the Civil Affairs Division, War Department (Noce)
Dear General Noce: I concur for the Department of State in the draft letter to General MacArthur sent to me with your letter of April 18, 1947, with three qualifications.
- 1.
- With respect to sulfuric acid there is no change in the views of
the Department as indicated in the Strike memorandum.2 The 3,500,000
figure was reached as representing an adequate capacity, and no
information is available to the Department to indicate that the
removal of integrated contact plants in order to bring capacity down
to this figure would so vitally affect the Japanese economy as to
call for a change in the New York agreement and the SWNCC decision. The following is
suggested for inclusion in the letter to General MacArthur on this
point:
“You will note that the memorandum does not reflect full agreement with respect to sulfuric acid, and we cannot therefore assure you that no integrated contact plants will be subject to removal. If in your judgment the proposed provision allowing you to retain facilities for the needs of the occupation is inadequate to prevent serious damage to the Japanese economy at the agreed level, on this account, you may wish to furnish detailed information on the basis of which the question can be reopened.”
- 2.
- With respect to the light metals industry, there is, I think,
complete agreement about aluminum and magnesium capacity. I cannot,
however, accept the parenthetical comment under 1 a (7) (a) that at no future time
will any of the nonferrous metal rolling capacity be made available
for claim, except in accordance with paragraph 1 b, and I doubt if
that is a legitimate interpretation of paragraph 1 b. It is true, of course, that the inclusion of copper or
other non-ferrous metals would require amendment of SWNCC 236/43, but there is a decided
interest in the matter in the FEC,
and the Department of State may have to recommend amendment on this
score. It is fully agreed that rolling capacity in the non-ferrous
industries should be used to process aluminum produced in Japan. If
an amendment to SWNCC 236/43 is
offered to make rolling capacity of copper or other non-ferrous
metals available for claim, the Department of State agrees that
insofar as possible such capacity as is needed to roll aluminum must
be retained. The following is suggested for inclusion in the letter
to General MacArthur on this point:
“With regard to the light metals industry, the intent is that capacity to roll aluminum produced in Japan shall be retained in the other nonferrous industries. The statement in the parenthetical comment under 1a(7) (a) is too broad, however. It is possible that it will be necessary, as a result of the interest of the FEC countries, to make available some metal rolling capacity in the copper and other non-ferrous industries. That would require amendment of SWNCC 236/43; if that is done, capacity to process aluminum will be safeguarded.”
- 3.
- With respect to fishing and whaling vessels, the Department is
sympathetic to the retention for this purpose of some shipping over
the limitation of 3000 light displacement tons or with a speed of
over 15 knots. The agreed amendment to SWNCC 236/43 to permit SCAP to retain whatever industrial facilities or ships
are deemed necessary to meet the needs of the occupation would
clearly protect SCAP in retaining
essential whaling vessels. To propose a specific exemption for
whaling vessels would be obnoxious to the FEC countries who have strong sentiments on this
subject; would add no real protection to SCAP beyond that already provided in the general
retention exemption; and would in fact materially weaken the U.S.
case for FEC approval of the general
retention exemption. Moreover, the character of and areas in which
Japanese fishing and whaling operations are to be permitted is a
matter for eventual settlement in the peace treaty. A specific
exemption for Japanese whaling vessels at this time would be
regarded by the FEC as an attempt by
the U.S. Government to prejudge this aspect of the peace treaty. For
these reasons, the Department is unable to agree with the proposed
specific
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exemption for
whalers and suggests the following for inclusion in the letter to
SCAP on this point:
“With regard to merchant shipping, the comment under 1 a (9) (a) 1, that no fishing or whaling vessels will be made available for claim, is too sweeping. The sentiment of the FEC countries on this subject is so strong that it is considered preferable not to discuss it there or to amend the SWNCC paper. You will be able in any event to retain vessels for the needs of the occupation. The United States will press for recognition in the Peace Treaty of Japan’s whaling and fishing interests and the right to retain vessels for that purpose.”
Yours sincerely,