TOKYO, 5 April 1946 Received 7 April 1946
1. On Thursday I saw MacArthur. Privately talked for one hour.
MacArthur expressed warmest friendship for Australia and gave me a most cordial welcome. He assured me that despite his initial opposition to the establishment of the Allied Council, he would now do everything possible to make its work influential and effective.
2. MacArthur's analysis of the existing political situation in Japan was dominated by his urgent and repeated warnings against Russian policy towards Japan. He said that Russia's policy was directed towards sabotage of Allied policy, in order that Russia might subsequently build here upon the Japanese communist party a satellite state. MacArthur is convinced that the Japanese communist party is completely controlled by Moscow. He said that the Russians here in pursuit of this policy made bitter vituperous attacks against the Allies and that these attacks were based on deliberate falsehoods. He believes that Derevyanko though probably a gallant soldier is hopelessly stupid about non military questions. This does not prevent him being offensive in his manners and methods.
3. The first Allied Council meeting was held this morning. This is an interim report based on memory since transcription is yet unavailable.
(a) MacArthur in his opening speech made the following references to the constitution. 'A new constitution has been evolved, patterned along liberal and democratic lines which the Japanese Government intend to submit for consideration to the next incoming National Diet. This proposed new constitution is being widely and freely discussed by the Japanese people who show a happy disposition to the subject which has had critical public examination through the media of the press and radio. Regardless of changes in form and detail which may well result from this open forum of public debate and ultimate consideration of the National Diet and Allied powers, if the underlying principles are substantially the same when finally adopted the instrument will provide the means that will permit development in Japan of a democratic state fully conforming to existing Allied policy.' (b) You will notice that he made no reference to possible other drafts nor any specific reference to the right of Far Eastern Commission to pass on the final draft before it becomes operative.
 Throughout his speech, MacArthur made no reference to F.E.C.
(c) He gave some time and emphasis to protest against 'those members of the commercial world who raise their voices in sharp and ill-conceived criticism of our occupational policies.' 4. The Russian member disagreed with S.C.A.P. proposal that all formal meetings of the Council should be in public and proposed instead that all should be closed and if necessary, press communiques issued. I suggested a compromise whereby two types of meetings should be held, one to deal with final discussions of major principles and the other to deal with preliminary discussions and technical details. The Russians withdrew the proposal and the meeting unanimously accepted my compromise.
5. The Russian member requested that copies of all orders from S.C.A.P. to the Japanese up to date, all papers received from the Japanese Government in answer to S.C.A.P.'s memoranda and translations of all orders issued by the Japanese Government in compliance with orders from S.C.A.P. be made available to the Council. I supported the Russians in substance with the qualification that I did not know what physical problems were involved in supplying the material sought. The Chairman said that this arrangement was. conceded in principle in MacArthur's speech.
6. The Russian member asked that copies of all S.C.A.P. [projects should be]  brought to the notice of Council members at least seven days before they were due to become operative. I supported the Russians views on the importance of giving the Council adequate time for consideration without committing myself to support their specific request for seven days notice. The Chairman said that the Supreme Commander had agreed that all directives in draft would be submitted to the Council before issue but insistence on the Russian period of notice might be a restriction.
The matter was carried no further, but remained in the minutes for submission to the Supreme Commander.
7. The Russian member requested that three deputy secretaries general be appointed to the secretariat to work under the American Secretary General, one to represent each of the three powers. I explained that I was without instructions and suggested postponement of this question to the next meeting. The Russian request was duly noted and it was agreed to place this question on the agenda of the next meeting.
8. When matters on the agenda were exhausted Derevyanko asked that in view of the 'activisation' of conservative candidates the Supreme Commander should issue a warning to the Japanese people before the election that if the majority of candidates proved to be unacceptable, the election would be regarded merely as a test and a new election ordered. The Chairman explained that S.C.A.P.
already has power to screen all candidates. Derevyanko urged that the matter should be treated as urgent and the Chairman, while pointing out that the Council was not in a position to treat this as an agenda matter at its opening meeting, said that the Russian request would be included in the minutes and passed on to the Supreme Commander.
9. I formed the following personal impressions of the first Council meeting:
(a) There seemed to be extra strong assumption both in MacArthur's speech and subsequent chairmanship by General Marquat , the Deputy Chairman, that all initiative should rest with S.C.A.P. and that the Council should restrict itself to reviewing proposed or present policy.
(b) There was evident, throughout the meeting, an atmosphere of marked mistrust between the Russian and United States members.
10. Will you please instruct me on the following:-
(1) I assume that Council members should individually or collectively seek not merely to review., but to initiate proposals if they feel such proposals are necessary to carry out effectively F.E.C. directives.
(2) I assume that I should do whatever possible to reconcile American and Russian points of view, in particular, that I should openly support those declarations of democratic principles which the Russian member seems anxious to make while showing caution in committing myself to support his specific request to S.C.A.P.
(3) The question of appointing three Deputy Secretaries General will arise at the next meeting. Should I support Russia of the opinion that a Deputy Secretary General should be appointed from each of the three powers to work under the American Secretary General, though my own view is that such appointments would tend to create unnecessary administration complications [and] that we can rely on present Service personnel for satisfactory Secretarial service.