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United States Department of State / Foreign relations of the United States, 1949. The Far East and Australasia (in two parts)

Northeast Asia: Japan,   pp. 601-939 PDF (132.7 MB)

Page 608

740.00119 PW/1-649
Memorandum by the Chief of the Division of Northeast Asian Affairs
   (Bishop) to the Director of the Office of Far Eastern Affairs
TOP SECRET                         [WAsHINGTON,] January 6, 1949.
  With reference to our conversation this morning I am attaching
a memorandum on Japanese reparations.' I regret its length but feel
that the subject merits rather exhaustive treatment.
  Personally I remain convinced that the position recommended by
General MacArthur in his last telegram on this subject (C-66288,
December 14 2) is the position which the United States can best defend,
which will in the long run cause the least bitter disappointment to
friendly countries, which is in the best interest of the United States,
which will be most acceptable to Congress and to the American people,
and which, for all of these reasons, we should adopt. As General
MacArthur has pointed out, economic stabilization has now formally
become a basic and primary "Allied objective" in the occupation
Japan. As far as United States policy toward Japan is concerned,
economic recovery is second only to United States security interests.
I believe that we can make, and should make at the earliest practical
moment through the diplomatic channel, a strong case for our position.
We can defend it not only on the'grounds of practicality and political
realities, but also on the grounds of the moral and political commit-
ments we have assumed. Without in the least detracting from our
commitment that there shall be reparations from Japan, we can in
good conscience point out that there have been reparations. Claimant
countries have already appropriated, on reparations account, from
the Japanese economy large amounts of overseas assets.
  I believe, as is pointed out in the underlying memorandum, that we
could emphasize with great effect that, in considering the total amount
of reparations to be exacted from Japan, we have always restricted
that total to the amount which wo-fld allow a decent livelihood for the
Japanese; that the Japanese economy has been a drain on the United
States since the day of surrender;.that the United States must examine
carefully present worldwide demands on its resources and weigh each
demand in the light of ability to meet it; that to abandon Japan at
this juncture would be to undo the recent costly victory in the Pacific;
and that we have no intention of so abandoning Japan.
  With regard to the bitter disappointment which claimant nations
will feel no matter what settlement we propose, I believe that we have
a stronger case, legally and morally, and a more palatable proposition,
if we base our position on the fact that the reparations which can be
  Not printed.
  2   printed, but see memorandum on this subject in Foreign ReAations, 1948,
vol. vI, p. 1064.

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