403 Forsyth to Burton

Cablegram 1048 WASHINGTON, 21 November 1945, 2.19 a.m

SECRET

FEC.19.

1. The Committee on basic policy dealt with Part IV economic policy on 20th November and appointed a sub-committee of United States, China and Australia to draft a report to be submitted to the full Commission on 23rd November. The main points in the discussion were as follows:

Sansom considered the United States document went into more detail than necessary and considerably further than Potsdam. Evatt agreed and the report will be based on Potsdam. Sansom also expressed fear of disruption from the dissolution of Japanese big business.

Blakeslee [1] said that American policy was to bring about dissolution of big business by the Japanese themselves rather than direct action by Supreme Commander of the Allied Powers. The Chinese desire ... [2] the limitation of Japanese standard of living. Committee's difficulty was to state precise definition.

Sansom said an Allied Reparations Body might be necessary and detailed statement of reparations policy should, therefore, be avoided at present.

2. At this meeting Dr. Evatt informed Dr. Blakeslee that he intended at the next meeting of the Commission to raise the question of records of Allied prisoners of war in Japan. He referred to New York 'Times' 18th November report of destruction on surrender day of 30,000 records and said those responsible were the equivalent to war criminals.

3. Your 1767, paragraph 4. [3] Owing to the adoption of a direct approach by means of literal amendments, general statement was not pursued but new opportunity has now arisen. A statement is being prepared. Meanwhile, the general line is that of the telegram to London of 10th August and subsequent telegrams concerning the Emperor. [4] Other dominions had this, and substance was conveyed to the United States by Eggleston. On the economic side, Australian emphasis here has been on tougher treatment of Japan.

[matter omitted]

1 Special Assistant on Far Eastern Affairs, U.S. Department of State.

2 A sign here indicates 'word mutilated'.

3 Dispatched 20 November. On file AA : A1066, P45/10/33/2. Burton had suggested that Evatt provide a draft summary of Australia's views at the Commission.

4 Presumably Documents 171, 176 and 178.

[AA:A1066, P45/10/33/2]