- 1 1 Hesse eriginallv passed a $25 millien a L 1 mm - Immune MW Familial Eds decumeir- Eff NARA imam pages a spies series a DEPARTMENT OF arm-s Memerendem e Cenverseh'en DATE July le I 1955 SUBJECT U S Peliey in the Rvuh y'u Islands PARTICIPANTS Stanly Reser Secretary ef the Arm r David ifferdJ Under Secretary ef the Army H Steadman Deput 'Dnder Secretary ef the Army fer Inter natienal Affairs Lt Del William J Spahr foice ef the Under Secretary ef the Ammv fer Internatienal Affairs Edwin D Heischauer American Ambassader te Japan Hebert A Fearey Directer fer East Asian Affairs Richard W FetreeJr Ifoicch in DhargeJr Japanese Affairs a seam TD Department ef-the am r 3965 Amembassy - f1 5 sf I gh'f in Pre Treatr Claims HEd- liAdq rml m l 4% Secretary Reser said cemmittee hearings in the Heuse ef Representatives en the Department ef the Army's Dkinawan pre Treaty claims bill were scheduled tn 5 be held July 23 General Hatsen has expressed his streng hepe that legislative actien autherising payment cf these claims can be taken befere the epening ef the Dkinawan legislative electien campaign this fall The Department ef the Army alse has its a bill ceming up fer censideratien in the SenateJ a fact that must be taken inte censi dcratien in appreaehing the Dengress fer legislatien en the pre Treatv claims In respense te a questicn Secretary Heser and Mr HcDifferd said they heped te get seme feel fer Dengressienal at titudes teward the pre Treatp clainsbill after July 2D when they expected te meet with Senater Eparkman The key staff members ef the pertinent Cengressienal cemmittees have been sympathetic with the prepesed lcgislatien but as yet there is ne clear indicatien ef the attitudes ef the Dengressmen and Senaters sec Sni vd i Prime Hinister Data s Visit te Dhinawa Ambassader heischauer said he felt that a was essential te amend the Price Act te isc the limit en aid tn the Ryuhvus Secret agreed that this sheuld be dene e said the Department ef the A gv' ag drafting a memerandum requesting autherisatien free the Department ef Defense and Bureau ef the Budget te ge ahead with a legislative request fer this pur pese He recalled that the pear DRDUP 05415 Excluded frem autsmatic dewngrading -- -and-deciass' gs sates 0X3 ICIFIM menu-ww- v i swam-CE - i semen l mallet selling en U 5 aid but the Senate eut it bask tn the $12 millien that is eurrently in effeet The Department ef the Army dees net have te ask Gengress fer autherisatien te spend this ameunt en aid eaeh year but it dees have te fight fer apprepriatiens te fund it Secretary Heser said Gengressman Passman is the real preblem in ebtaining funds He reealled that when General Hatsen testified befere Gengress this spring Hr Passman asked the General if the Army weuld be eeming in fer a higher level ef funds fer Gkinawa General Hatsen limited his reply te saying that he eeuld net prediet what might be required but it was pessible Secretary Heser said General Hatsen weuld like te have an epenhended autherisatien fer aid with ne specified limit set in the law The Seers tary said he and his staff felt hewever that General Hatssn's hepe was unrealistie arm that they sheuld endeaver te ebtain autheriaatien fer a i $25 millien eeiling He believed $25 millien weuld be sufficient in the shert run ambassader Heisehauer agreed that appreaimately $25 millien in H S aid funds fer Gkinawa sheuld be eneugh in the shert run He said we sheuld aim at previding tetal ef abeut $5e millien in external as sistanee eaeh year eembining the Japanese eentributien with eur ewn The millien figure was derived by eemparing the Hyukyus with pre feetures like Saga in the main islands sf Japan which have abeut the same pepulatien and level as the Hyukyus Saga funds ef varieus kinds frem the central gevernment ever and abeve leeal revenues that ameunt te abeut $50 millien a year We sheuld try ts as- sist the Hyukyus at apprekimately the same level eeneentrating primarily en the edueatien and seeurity systems He said it was net realistic fer us te attempt te effeet a substantial raise in the standard ef living ef the Hyukyuans but we eeuld eentribute funds at the same level that the Japanese Gevernment dees fer its prefeetures The dmbassader said he felt nenetheless that General Hatsen's prepesal te make a publie statement defining seme bread geals fer imprevmeent ef the living standards ef the Hyukyuans was fine Heeretary Heser said he had had deubts abeut the wisdem ef setting up sueh high geals sinee they prebably eeuld net be aehieved Ambassader Heisehauer agreed that aehievement ef sueh geals weuld be unlikely but he felt that a statement eentaining sueh grand ebjeetives weuld be pelitieally useful Seeretary Heser felt that it weuld be better te set eur sights en aehievable geals Ambassader Heisehauer agreed that it might be better te piteh eur effert teward eenerete measurable geals such as imprevement ef publie edueatien and establishment ef seeurity benefits at the same levels as Japan's He felt hewever that there weuld be ne harm in making 3 a publie statement abeut grand ebjeetives fer pelitieal purpeses Seeretary Heser said the kind ef living standard geals suggested fer publie statement SEGHFW until-1111 i MW ammww I EHIHHTP 3- by General Hatsen were unattainable in the shert runJ se he felt that it was net wise te play them up in a public statement Ambassader Heischaucr said he leeked en the effert te get the Price Act amended impreve the Hyukyuan public educatien system and ether measures as enly step-gap measures He felt strengly that we had enly relatively little time remaining te us in the Ryukyus The fundamental natienalistic reactien ef the Japanese and Hyukyuans has been exacerbated by develepments in Hist-Nam Twe years age he was relaxed abeut the kinawan preblem and had he werry abeut pessible'tenminatien dates fer eur tenure in the islands Since the last few menths' events in Hist-Ham hewever he has revised his thinking cempletely The medd in Japan and the Ryukyus has changed and we have enly a shert pcried left in the Fer this rcasen he did net feel cencerned abeut the pessible repercussiens ef making public statements centaining grand premises He said he cen- siders actien en the Price Act aid ceiling essential regardless ef the pcried ef time left te us in the Ryukyus It is particularly'immertant te us this fall because ef the Hyukyuan electiens scheduled fer Nevember If we lese these electiens the playhback in the Japanese pelitical scene will make it harder fer the Japanese Gevernment te held its present pesitien ef ceeperative acquiescence in ear centinued presence in the Ryukyue Secretary Hcser said he was semewhat cencerncd abeut the requests fer legislative actien en the Price Act and the pre-dreaty claims piling up tegether in Cengress He said the Department ef the Army intended te press fer actien en the pre Treaty claims first and then turn te the Price Act Ambassader Reiachaner said we needed te make up eur minds en whether te seek amendment ef the Price Act in time te infenm Prime Minister Sate ef eur intentien prier te his visit te Dkinawa in August This weuld permit him te make a public anneuncemcnt ef the Japanese Gevernment's censidera- tien ef large-scale aid te the Hyukyus Secretary Reser said the Department ef the Army had reached a decisien te ge ahead with an effert te get the Price Act amended Hr Hc ifferd said they had had a difficult time in getting Gengress te appreve the $12 millien aid limit He recalled that Senater Russell had been eppesed It prebably weuld be wise te discuss the further amendment ef the Price Act with Eengreesienal leaders befere launching a fermal legislative prepesal He said the tactics in Cengress weuld require careful study Ambeseader Heischaucr said the Senate side in Gengress censtituted the meet scrieus preblcm General Hhtsen wants a firm dccisien en this SEEHET msameness Iul-I i - MAFIA i SEEREE matter by early August sc he can clear his handling cf the prepesed Japan- ese statement en largenseale aid at the time ef Prime Minister Eate's visit te Okinawa General Hatsen alse wishes tc discuss this matter in advance with Chief Executive Matsueka Secretary Eeser was assured by Mr HcGifferd and Gelenel Spahr that a paper requesting EDD autherisatien te ge ahead with the Price Act amendment was being prepared Ambassader Reischauer asked if the Japanese prepesal that Sate make an anneuncement abeut lengrterm lew interest financial assistance te the Ryukyus weuld he acceptable te the Department cf the drama Secretary Rescr said that weuld net pese any prehlems frem Army's peint ef view Ambassader Reischauer went en te say that the Japanese request that restrictiens en the flying cf the Japanese flag in the hyukyus he lifted was just as impertant te them as the large-scale eccnemic aid prcpesal te a Fereign foice spekesman Secretary Reser said cur em perience with a similar flag prehlem in Panama was extremely difficult sheet five years age we decided te permdt the U S and Panamanian flags te he flewn jeintly in the Ganal che He said they felt new that this decisien had enly accelerated the emergence ef natienalistic feelings in Panama The u s and Japanese flags are therefcre net jeintly in the Ryukyus except at the USGAR headquarters which alse happens te heuse the Gevernment ef the Ryukyu Islands He said the time remaining te us in the Ryukyus weuld make a difference in judgment en this questicn if Ambassader Reischauer's assessment that we have enly a shert tenure left is cerrect then the flag issue in cennectien with Eate's visit is net a significant questien frem cur peint ef view if we can hepe fer a lenger tenure in the islands hewever the flag issue might be very significant Ambassader Reischauer said there was ne deuht in his mind that the situatien had changed in recent menths se we new have cnly a fairly shert peried ef assured tenure in the islands 'we shculd start meving teward an arrangement with the Japanese Gevernment en a different basis we are en the edge cf a distinct change in the whele U 5 Japan relatien- ship The year l T leans as a majer waterfall a few menths age he felt that altheugh 19 0 was enly 5 years away the relatienship with Japan seemed te he geing well and the patential crisis in the rslatienship seemed likely te smeeth itself eut hefere we even reached New hewever things are net geing well fer us in Japan and this past spring we even meved backward in eur relatienship Sines May we seem te have halted the backward metien and are new helding eur ewn and if the Viet Ham prehlem achieves same kind ef selutien we ceuld receup cur lessee and ge en as hefere witheut changing eur pelicies The chances ef a selntien in vict Ham in the near future appear slim hewever and time is running cut cn us Era-Ii - e - - -v indem IgI-h SEBEET There has been a rise in natienalism in beth Japan and the Ryukyus ac- celerated by reactiens ts Hist Ham Fer these rcasens Ambassader heischauer believed that the Dkinawan preblem weuld eeme te the eaplesien peint befere Ambassader Reischauer said eur safest strategy in view ef these trends is net te centinue te drift aleng in eur relatienship with Japan 'He must start te dc seme paddling He is cenvinced we can successfully influence these develepments The censervatives in Japan have always dedged such issues as defense but mere ef them are new ceming te believe that th will have te take a pesitive stand and that they will be able ts face the Japanese public en the need fer defense The therniest preblem the censervatives face is Dkinawa but if we can help the Liberal Demecratic Party IDPJ selve the Dkinawan preblem it will be a great asset fer us as well as fer them Ambassader Reischauer said he wanted te talk privately with key censervative leaders abeut the selutien repesed by fermer Finance sinister Tanaka new Secretary General ef the LDP whe created quite a furer in Japan at the time ef the visit te Japan ef fermer ntterney-General Hebert F Kennedy by stating that the best selutien te the Dkinawan preblem weuld be fer the Japanese peeple te permit the statiening ef nuclear weapens en Japanese seil If Japan weuld accept nuclear weapens en Japanese seil including kinawa and if it weuld previde us with assurances guaranteeing cur mdlitary cemmanders effective centrel ef the islands in time ef mili- tary crisis then we weuld bezblc te keep eur bases in the islands even theugh administrative centrel er full severeignty reverted te Japan ambassader Reischauer said we must achieve this new arrangement befere the blew-up cemes in Okinawa Secretary Heser asked if Ambassader Reischauer envisaged a new treaty with Japan in effect placing kinawa eutside the limitatiens ef the Japan- ese Censtitutien Ambassader Reischauer said semething like that weuld be necessary altheugh there was ne explicit prdhihitien against nnelear weapens in the Censtitutien we have a relatively shert ttae te werk these arrangements cut but unless we de we will again run inte a Panama situatien If the U S were ferced by mdlitary develepments te bemb pepulated centers in Herth Vietu am bringing the Chinese emmnnists inte direct participatien in the war we might need te belster cur defenses aleng the DMZ in Kerea with same actiens frem eur bases in Japan Under the present circumstenees the Japanese Gevernment ceuld net give us permissien te use eur bases in Japan fer these purpeses Hr Steadman asked hew seen a blew-up it might be in 19 0 Ambassader Heischauer seme te him than befere kinawa hewever in the Hyukyus might same whether said even was mere werri- cannet be held en present terms SIERET anti-WEE 1 m Hana Dab Jl -b SEEHET fer mere than twe years Secretary Heser referring te ambassader Heischauer's suggestien that we take the initiative te werk eut new arrangements invelving Japanese ad ministrative centrel ef the islands said he did net clearly'understand what we weuld get frem the Japanese censervatives in exchange fer eur acquiescence in such a selutien Ambassader'Reischauer said that if the IDP achieved agreement with the u s en the reversien ef the islands te full Japanese severeignty it weuld be a majer pelitical ceup strengthen ing the party's pesitien in the face ef eppesitien pressure and in the eyes ef the Japanese public With this preblem selved and cut ef the way the LDP weuld be able te talk directly en defense questiens and Eeutheaat Asian develepment The impertant benefit te the weuld be that we weuld have a much mere stable base fer eur relatienship with Japan and fer a lenger peried ef time It weuld eliminate the nest serieus threat te U S Japan relatiens and weuld enlist Japan as an ally'mere deeply cemmitted te eur vitally impertant geals in Seutheast Asia At present we have nething but strike ferees based in Japan ether than varieus supn pert elements Perhaps we sheuld have defensive ferees statiened there perhaps at Japanese expense ws sheuld be meving mnch mere inte jeint strategic censultatiens with the Japanese In shert the Okinawan selntien prepesed by ambassader Reischauer weuld cenvert Japan frem a but pleasant partner te a true ally Hr HeGifferd asked the peried ef agreement Ambassader Reischauer was thinking ef Ambassader Reischauer said the agreement weuld be with eut terminatien eats He said develnpments in the wake ef bur mili actiens in Viet-Nam had changed his time sense He reiterated his belief that we sheuld ge tn the Japanese in an effert te werk a package arrange- ment which weuld include Ukinawa Hr Steadman said there were several theeretically pessible alterna- tives and asked the Ambassader whether he felt seme kind ef shared ad- ministratien arrangement might werk with the Japanese in kinawa Ambas- sader Heischauer said he theught it weuld be better te make a clean break rather than trying te werk eut the many cemplicated preblems that weuld arise in a shared administratien situatien Hr Fearey wandered whether the LDP weuld meet that gave them he rights te censult tien ef the military bases in Okinawa the LDP net requiring the kind ef censultative rights they have in re latien te U 3 bases in Japan Ambassader Reischauer said the Japanese weuld achieve reversien which weuld evershadnw any questien abeut censultative rights Hr Fearey agreed that reversien weuld be a big pelitical plus fer the LDP but lack ef any Japanese say ever cur use ef the Ryukyus bases weuld censiderably reduce this He deubted whether we 'fcensent te an agree- with the U S en the utilisa- He feund it hard te visualise SEEHEE -H na r- -45 5513 null- 5 rungs-u- - T - I it l'lrs' I In 3 r- r-l-I- a lm UEuU-h uw 1w Wnnemnmmaw l ulh 'l 31 mamas-um ceuld give Japan any real say in the use cf cur bases in Dkinawa km- hassader Reischauer said we weuld be giving them all cf the pclitically important symhels which weuld be enough Hr Steadman wandered if the Ambassadcr's suggestien weuld buy twe er three years If the situatien has deterierated as far as Ambassader Reischauer indicated we shculd he ccnsidering ccntingency plans and plans fer ccping with ricts and unrest in the Hyukyus ambassadcr Reischauer said that if we less the electicns in chemher there will he a certain ameunt cf trcuhle The impertant thing hcwever is net dis- turbances in kinawa but the playahack in Japan where the repercussiens cculd affect Japanese willingness tc with us an kinawa Hr Fearey said the effects might shew up in Japanese Govern- ment inability ts us in matters campletely unniated tn the SEA develepment Ambassadcr Reischauer said that the Jcint Dcmmittee meeting July lB lh made him feel that we ceuld talk ahcut such things discreetly with Japanese leaders The Japanese meved ferward during the recent talks Hinister ef Internatienal Trade and Industry'Hiki and Finance Minister Fukuda in particular key leaders in the present gcvernment seemed respensive en the Seutheast Asian develepment prepesals They seemed te feel that they eculd make pelitieal prefit a pcsitive ecenmmic rule in Seutheast Asia Hr Steadman asked the AnMassadcr when he theught we ceuld appreaeh the Japanese cn these sensitive matters Ambassadcr Reisehauer said he thcught he cculd scund them cut tentatively at first an his return tc Japan He said he wanted te scund cut Prime Hinister Sate first He had already a casual suggesticn with Sate that he ccnsider fer talks with President and Secretary Rusk after he attended the UN General Assembly meeting in New fcrk Sate sensed te react favcrahly tc that idea Hr Steadman asked Ambassadcr Reischaucr if he had met with the Jcint Ghiefs cf Staff during his current visit tc He recalled that when the kmhassadcr met with the Jcint Chiefs in January 1955 he had spcken cf a different time span cur tenure in the Hyukyus Ambassadcr Reischauer said his thinking had changed since then His calculaticn cf time then depended primarily upen an assessment cf the rising nationalism in Japan and Hyukyus Since then hcwever the Hist-Nam situaticn has generated ether streng rcactiens that must be taken intc Secretary Hescr asked whether ambassadcr Reischauer had discussed his ideas with Secretary McNamara The Ambassader said he had and at Secre- tary HeHamara's suggesticn had written a memcrandum en the subject tc him and tc Secretary Husk SEEHET firsts-7'32 Er 1115 I 73 15 - ll - I in l - --I- - -1- a _nuiul'l'l' 1251i 1 I d- -necaoou ED AT THE i ug i - -I- - Hr Steadman said the business of day Ryukyus would still have to go on with Reisehauer said that General 1Watson had been doing an extraordinary Job in the Ryulqms He did not feel that in the the islands General Watson had left any-thing undo General Hatson's personality and wisdom have made there He said the large scale increase of aid to the Ryukyus is es- sential with particular focus on concrete achievanents in the educational and social security systems is compared with these goals the flag issue is not so important Ambassadc letter on this subject from former Deputy Assistant Secretary of State for Far Eastern Affairs Marshall Green Seeretany Resor indicated that he had read it The J'unbassador said he thought the letter was a very gee-d a He said he felt a double liability a double danger of exposure of our action by channeling funds into the Gkinawan election through two routes It nly the Japanese route permitting the Japanese LDP to handle the money in the most effective way Gkinawa is a small place like a small town in the U E Gkinawa is also like a small country prefecture in Japan where political maneuvers particularly involving money - are well known It would be risky to try to take clandestine political action in Gkinawa using direct U S Ryukyuan channels The Japanese conservatives are going to be involved with funds and other activities in the Ryukyuan elections anyway and it would he a perfect cover to simply add to their resources rather than trying to carry it out directly in the Ryukyus Aumu U Mwm I-- - r-I-r inp- SEERET 9- Hr Steadman said he had been that the risks ef the twe reutes fer these funds were abeut equal That being se he had felt it weuld be just as well te use at least part ef the funds directly in the Ryukyus Ambassader Reischauer did net feel that the risks were equal The Okinawan situatien is weak General Hatsen has an under- standable desire te maintain elese and effective eentrel en the use ef these funds but the meney eught te ge thrcugh the Japanese censerva- tives If the U 5 is caught with its hand in the ceekie jar there will be a serieus blewhup in Japan Mr Fearey asked whether Ambassader Reischauer had discussed this matter with General Hatsen in these terms The Ambassader said he had expressed his views tc General watsen at the eutset ef planning but he had net talked persenally with aheut it recently Secretary Reser asked if meney given inte Japanese hands weuld be likely te reach its targets in the Ryukyus Ambassader Reischauer said it wuuld be perfectly safe because the Japanese censervatives have a vital stake in an electien victery just as we de Hr Steadman asked whether there was any deubt abcut the cemparative risks in the twu alternative reutes ambassader eischauer said he theught there was ne deubt that the Japan- ese-LDP previded the safer reute altheugh there is he abselute guarantee ef safety either way Mr Steadman said he theught they sheuld send Ambassader Heischauer's views te General Watsen fer his cemments He explained that their think ing had been based in part en a desire te carry cut the aetien plan as much as pessible witheut deepening Japanese pelitical invelvement in the islands Ambassader Reischauer expressed understanding but said he was net cencerned en this seere in the everall situatien presented Secretany Hescr in sunning up the censensus cf the meeting said they weuld gc ahead with werk en the memerandumin DGD requesting authcrisa tien fer an te ebtain legislative aetien amending the Price Act He neted the shert deadline created by the Gate visit te Gkinawa in august Geneerning the flag issue Mr Fearey said he had discussed the matter with Mr fasukawa ef the Fereign foice and had getten the impressien that fasukawa understeed why a change in current regulatiens geverning the ing cf the Japanese flag in Hyukyus might be difficult us tc accept Yasukawa did net seem inclined te press the issue Mr Fearey said he had seme deubt ef the wdsdem ef a change in flag regulatiens during Sate s visit which ceuld lead te the impressien that as a result ef Sate's talks in the Ryukyus the u s had accerdcd Japan a in Ryukyus administraticn Ger- tainly the press might se picture it Anether eccasien might be better if we decide te meve in this directien SEERET Luann-runw- - 3 seesaw tht HiDse ttik Emma s AT THE wales-HM anemEs I SEEREE -10 Ambassader Reisehauer said a eaneessian en the flag issue was net abselutely essential ta a successful Sate visit Eate's visit itself will help ts strengthen the Okinawan Demaeratie Party pesitien in the fall eleetiens The Japanese ean live witheut a eeneessian an the flag issue Ambassadar Reisehauer said that we started the train ef develepments leading tn the present nationalistic fetus en the flag issue when we issued Japanese tewtheeks in Okinawa same years age The beaks all start eut with references ta eur eeuntry and remind kinawans that they are Japanese 5's I This document is from the holdings of The National Security Archive Suite 701 Gelman Library The George Washington University 2130 H Street NW Washington D C 20037 Phone 202 994-7000 Fax 202 994-7005 nsarchiv@gwu edu