Foreign Relations of the United States, 1961–1963, Volume XXII, Northeast Asia

246. Memorandum of Conversation⁰

Washington, November 14, 1961, 10 a.m.

SUBJECT

• Korean-United States Tour d’ Horizon

PARTICIPANTS

• Gen. Chung Hee Park, Chairman
• Maj. Gen. Yang Soo Yoo, Chairman, Foreign Affairs Natl. Defense
• Duk Shin Choi, Foreign Minister
• Byung Kyu Chun, Finance Minister
• Byeng Kwon Bak, Minister of Defense
• Chung Pum Song, Deputy Chairman, Economic Planning Board
• Il Kwon Chung, Korean Ambassador Sang Ho Cho, Interpreter
• The Secretary of State
• Ambassador Samuel D. Berger
• Mr. W.P. McConaughy, Assistant Secretary for Far Eastern Affairs
• Mr. J.S. Killen, Director,USOM/Korea
• Mr. H.L.T. Koren, NA Director
• Mr. D.S. Macdonald, NA
• Dr. Paul S. Crane, Interpreter
• Mr. Avery F. Peterson, Deputy Assistant Secretary for Far Eastern Affairs

The meeting convened in the Secretary’s Conference Room at ten o’clock Tuesday, November 14. The Secretary extended a warm welcome to Chairman Park and his party, and expressed his appreciation for his reception in Korea on the occasion of his recent visit there.¹ He said that the United States was impressed with the Chairman’s accomplishments and those of his Government in Korea at present, and that he looked forward to an opportunity to make the current series of talks as profitable as possible for both sides.

Chairman Park said he appreciated the warm welcome he had received. Referring to the ceremony at the Tomb of the Unknown Soldier, from which he had just come, he said he had been deeply touched at this recollection of American sacrifice for Korea, and appeared at the conference table with deep feeling. The Secretary said he had been struck by a small but significant incident at the airport: Chairman Park’s thoughtful greeting for the Korean community after the welcoming ceremony was a simple but expressive gesture and the first such action that he had observed.

Continuing, the Secretary said he attached the highest importance to the forthcoming talks with the Administrator of AID² and with the President.³ The purpose of the present meeting would be to review matters in a preliminary way; he would like the Chairman to raise any points he might wish on his side, following which the Secretary might have a few to raise for his part.

Chairman Park said that the first purpose of his visit was to convey thanks for United States assistance. He wished also to take the opportunity to present his views on the problems of Korea and his recommendations. He believed the Secretary was already familiar with most of the major problems since he had visited Korea and had been briefed by the Government Ministers there; moreover, Ambassador Berger and Mr. Killen had reported to him in Washington. In a way it was odd to reiterate this material, but he would like to re-emphasize the points the Secretary already knew. The Secretary replied that he would be happy to hear the Chairman’s views and recalled his long association with Korea.

The Chairman stated that in view of the Communist threat, Korea must maintain her armed forces strength of 600,000, but at the same time Korea must develop economically. These two major problems must go together. The United States was aware of the decrease in force maintenance assistance since 1960, with the consequent increase in the Korean proportion of force maintenance. Korea was making all possible efforts on its own to take over America’s share of the burden, because the problem affected the over-all defense posture throughout the Free World. However, the Korean Government had prepared a five-year economic development program. The increase in the defense budget imposed a burden on economic development. Therefore, until the economy was stabilized to a certain extent, he hoped the level of United States military assistance would be maintained at the level of 1959 for force maintenance.

The Chairman pointed out that to remain as the staunchest anti-Communist country, for which an armed forces strength of 600,000 men was imperative, it was necessary to obtain as much economic aid as possible until the five-year program was completed. It had been reported, although not verified, that supporting assistance was to be decreased. If true, this fact would reflect a great deal on the economic program. Accordingly, the Chairman requested that this year’s level be maintained.

The Chairman continued that, in order to carry out the five-year economic program for the next year, Korea had planned to invite large foreign investment loans. Korea was faced with a shortage of hwan to meet the local currency requirements associated with such loans. It was, therefore, necessary to ask for a loan of $100 million as a special, or stabilization fund plus $70 million from DLF, and technical assistance of $8 million. Of course, this might seem a large request, and the Chairman recognized that the United States had its own problems; but to maintain a strong anti-Communist nation and 600,000 troops, Korea needed this amount of United States assistance. The Chairman said he recognized that he had reiterated items the Secretary had already known about, but wished nonetheless to repeat them.

The Secretary replied that he was glad to discuss the policy aspects of Korea’s requirements with the Chairman; there would be opportunity during the visit to discuss the subject in more detail.⁴ He continued that, first, the American people and Government felt a strong commitment to uphold the safety and independence of the Republic of Korea. This feeling was not based solely upon the Mutual Defense Treaty. The United States had already made a very large investment in Korea’s independence and security in terms of men and resources. Moreover, in the present world situation, the facts of international life gave the United States a powerful interest in the security of the Republic of Korea. In this connection, the Secretary said that the United States had had some extremely dangerous questions on its agenda this year which touched closely the Sino-Soviet bloc—Berlin, Southeast Asia, the Congo, and other points of immediate friction, of which the Chairman was aware. The United States had not thought it wise on its side to inflame other issues and points of friction, such as the Middle East, Iran, and Korea, by making speeches about them. The United States had a direct and fundamental commitment to Korea, but we did not think it wise to make speeches on Korea vis-a-vis the communists at this time.

The Free World will go through a period of great danger in the next few months. In the case of Berlin, although there had been some apparent reduction of tension in one or two procedural matters, there was still conflict between the powers concerned on the basic issues. Speaking to the Chairman in the most private possible sense, the Secretary wished to say that Khrushchev was still on a collision course in respect to Berlin. Similarly, in Southeast Asia it was apparent that the Sino-Soviet bloc was engaged in a “sacred war of liberation,” which the Free World would define as an illegal war of enslavement. In respect to Viet-Nam, the United States would be taking basic measures which would become apparent in the future. The Secretary explained that he was saying this to the Chairman because it was important to him even though these points were distant from Korea; it was unlikely there could be tension in troubled areas without having effects all around the Sino-Soviet bloc. Accordingly, the Secretary said, he agreed with the Chairman that Korean and United States forces in Korea should be in a good state of readiness and preparation in the months ahead. The Chairman could rely completely on the presence of American armed forces in Korea as tangible and, the Secretary thought, convincing evidence of the United States commitment in Korea.

In respect to assistance, both military and economic, the Secretary recalled that an Englishman once termed economics “the dismal science,” because those on the policy side demanded more than those on the resource side could furnish. This was surely true in Korea as in the United States. He wished to give background on one special part of the problem: The Kennedy administration and Congress felt it necessary to review in broadest terms the experience of fifteen years with United States foreign aid, because it was felt that the American people had become weary of foreign aid and needed a new program they could support with good conscience and some degree of enthusiasm. Great emphasis had been put in the administration’s foreign aid program on long-term economic development and support for such programs as Korea’s five-year development plan. Unfortunately, the Congress had taken up the idea of long-range development, but at the same time had put pressure on reducing military assistance, supporting assistance, and short-term assistance generally. He wished to say with great sincerity and without giving offense that it seemed some aid given on a short-term basis had not been used to best advantage in some countries, including Korea. The same reasons which had led Chairman Park and his Government to take power led the United States to believe that aid had not been used to best advantage. The attitude of Congress was heavily influenced by the past, and it had not been able to take into account developments at the present time. Korea had problems but the United States had also, such as those just stated. The United States would endeavor to work out solutions realistically and speedily with Chairman Park and his Government, taking account of defense needs, not only in Korea but in the entire world, and of the need also for economic and social development.

The Secretary continued that there were one or two points he would like to make which had bearing on the question of need: first, whether there were aspects of economic development where added assistance might be provided by the armed forces as a part of their training operations without interfering with their combat readiness—in such fields as engineering, signal communications, and health. The Secretary said that the Prime Minister had pointed to the limitations on armed forces participation because of the unemployment problem, but he left it as something to consider, based on his own armed forces experience. He realized that soldiers in all countries felt it their duty to fight, not to work, but he still supported the possibility. A second possibility, the Secretary said, was the contribution which might result from relations with Japan. He would welcome the observations which the Chairman might wish to make. A third point was that, although there might be legal limits on various categories of United States assistance, there were “many ways to skin a cat,” and the United States would work with Korea to find solutions to problems.

Chairman Park responded that, as a citizen of Korea, he wished to express his deep regret that United States assistance had not always been utilized to best effect. The Secretary interjected that it would be better to say that there had been mistakes on both sides. The Chairman continued that he also fully realized the United States, as leader of the Free World, must give consideration to many countries other than Korea. All came to the United States and looked to the United States for assistance and support; if it continued, the United States would exhaust its resources for aid. Unless they attained self-sufficiency one by one, eventually Free World strength would deteriorate. He noted the Secretary had pointed out that one of the reasons for the recent revolution was ineffective use of United States assistance. The present revolutionary government was fully aware it must strive for self-sufficiency so that gradually United States aid could be decreased. Also, the Secretary had pointed out the orientation of United States policy toward long-term loans rather than grant assistance; however, in Korea it was impossible to switch from one to the other at once. The Secretary responded that he recognized Korea’s problem in this regard.

However, if present United States assistance was continued for the next few years, Korea would be able to lay the foundations for transition to long-term loans.

The Chairman referred to questions raised by the Secretary. Regarding the Secretary’s suggestion on the utilization of the armed forces in economic development, the Government was planning to make maximum utilization of them and had already started in that direction. In his opinion, it was mandatory so to use the armed forces, so long as their primary duty was not imperiled.

In respect to his meeting with Prime Minister Ikeda en route to the United States, the Chairman keenly felt it was necessary to normalize relations between the two countries to assure peace and security for the Far East. This was the consensus of himself and other Government leaders, but he could not say Korean public opinion was the same as theirs. In order to satisfy public sentiment, it was necessary to solve a couple of pending issues before the relationship between the two countries was normalized. On this point, he had had an exchange of frank views with Prime Minister Ikeda at an exclusive private interview. Both men had agreed the two countries must normalize diplomatic relations at the earliest opportunity. To attain this, a couple of problems remained to be solved; administrative and technical details had to be ironed out at working levels. This done, economic relations between Korea and Japan could be taken into consideration. It was a fact that some knowledgeable people in Korea expressed concern at possible Japanese economic aggression if relations were normalized, especially in view of past history. The Government was using all prudence in normalizing relations with Japan.

The Secretary said he wanted to repeat what he had said to the Prime Minister—that he did not expect settlement with Japan to provide a substitute for United States aid, but rather a supplementary resource. Though it was a matter for the experts, the Secretary felt some aspect of a Korea-Japan settlement might provide a hwan contribution, perhaps through some interlocking arrangement with the United States.

Chairman Park said that this matter was too technical to answer, but asked the Secretary whether he could give the Korean side some hope in respect to the question that he had raised. The Secretary said he would rather let Mr. Hamilton discuss these questions, and perhaps he himself could talk to the Chairman before he left.⁵ There would also be conversations with the President. He wished to make clear that this response should not be taken as a negative answer.

In concluding, the Secretary expressed his belief that the amnesty measures taken by the Korean Government would contribute to the international standing of Korea and stated his view that the Chairman was to be congratulated on this step.

0. Source: Department of State, Central Files, 895B.00-FIVE YEAR/11-1461. Confidential. Drafted by Macdonald and approved in S on November 28. McConaughy proposed to Rusk on August 31 that Pak undertake an informal working visit to Washington in November. McConaughy noted that the visit would be in keeping with the recommendations of the Korean Task Force Report and pointed out the advantages for Pak of meeting with senior U.S. officials. (Memorandum from McConaughy to Rusk, August 31; ibid., 933.95B11/8-3161) Pak was in Washington November 14-16.
1. See Document 245.
2. Pak met the Administrator of the Agency for International Development, Fowler Hamilton, at 11 a.m., and discussed assistance and development. Pak stressed the need for maintaining at the current level U.S. support for the ROK’s 600,000-man armed forces and strong and positive support for its Five-Year Plan. (Memorandum of conversation, November 14; Department of State, Central Files, 811.0095B/11-1461)
3. See Document 247.
4. Pak met with Walt Rostow, Hamilton, McConaughy, and others for an informal discussion of ROK economic planning on November 16. (Memorandum of conversation, November 16; Department of State, Central Files, 895B.00/11-1661) He also met with Secretary of Defense McNamara and Defense officials on November 15. (Memorandum of conversation, I-17979/61; Washington National Records Center, RG 330, OASD/ISA Files: FRC 64 A 2382, 333 Korea) William Bundy also sent a letter to Felt and Meloy, November 18, describing the contacts between Pak and the Koreans and the Department of Defense during the visit. (Ibid.) Pak also met Secretary of Commerce Luther H. Hodges on November 15 at 2:30 p.m. They discussed mutual trade and ROK development. (Memorandum of conversation, November 15; Department of State, Central Files, 795B.00/11-1561)
5. See Document 248.