365 Eggleston to Watt
Letter (extracts) 3 September 1947,
We have just finished the Inter-Dominion Conference on the Japanese Peace Settlement and it has gone off very well indeed.
The organisation was quite good and the Delegates seemed very satisfied. There was a notable outpouring of good feeling, but, of course, this does not mean much. I have been to six international conferences at each of which the Members parted with their arms round each other saying that they had made life-long friendships, but between each conference the international situation deteriorated.
The fact is, of course, that at conferences of this kind the Members do not approach the crucial issues. They seem to steer off them by a kind of protective instinct. I think the opportunity should be used at such conferences to bring out these difficult points so as to get opinion on them and then for each to decide what his policy shall be. To agree on negatives is a waste of time.
I have been very interested in several of your telegrams recently and, if you will allow me to say so, I think they are extremely valuable. Apparently you are able to get some information at Moscow, and I gather that you have made excellent use of some of your dear colleagues. Your telegram of 22nd August (No. 271) applies the method of appreciation of the situation, which I think is very valuable indeed.  This, as you say, is made without any definite information except for official statements, but there are one or two things in it which are exceedingly important, and I should be very glad if you could expand one or two points.
In paragraph 3, you say 'As assembled in confidential American views here, the United States appear to regard Asia as the logical and the most profitable ground for Communist expansion, largely because the standard of living of under-privileged classes in Asia is so low that the present low Russian standard accompanied by full employment seems attractive'. And, at the end of the paragraph, you say,'...they seem to assume that the main pressure will be in the Far East,though perhaps only by way of infiltration with remote control'.
Have you any more concrete evidence of this than the American appreciations on the subject? It is, of course, of the greatest importance in connection with the Peace Treaty with Japan. The Yalta Agreement has altered the balance of power so strongly in Russia's favour that it is difficult to see how any method of control of Japan can be devised by the Allies which could not be twisted to its own ends or absolutely dominated by Russia. The arc around from the thirty-eighth parallel to Vladivostock and then on to the Kuriles can be denied to any other force. This brings Japan within fifteen miles of Russian possessions and prevents any active operation by the Allies. The only possible counter-balance to this is the group of Islands to the south of Japan which are now occupied by the United States, but I suggest that island bases of this kind cannot be compared for effectiveness with continental bases.
The Military people here seem to think that the United States may be able to establish air supremacy from their islands, but I would suggest that that can only be temporary. The statement in your telegram has to be lined up with the evidences of Russian and American policy.
As to American policy, they framed all their plans, when they entered Japan, for a twenty-year occupation, but are now convinced that they will not be able to carry on for that period of time. In fact, they contemplate an evacuation when the Peace Treaty is signed. We, here, were always in favour of a long occupation. We did not believe that the Japanese could be converted within a short time. In this view, we were supported by Defence, but Defence have now changed round and state that it is important to retain the goodwill of Japan and that, if occupation continues after the signing of the Peace Treaty, the Japanese people will immediately become hostile and almost impossible.
There may be good reasons for all this, but I claim that until a feasible scheme for maintaining the balance of power in East Asia is worked out the occupation should go on, or control should be exercised from the nearby islands. At any rate, it would be wrong at the present time to come to any agreement among ourselves that a long occupation is impossible until all the possibilities are explored.
Now, as to Russia's intentions. Here, my information rather cuts across your appreciation. There is no evidence, so far as I can see, of any intensifying pressure by Russia in the Far East. I will leave [a]side the question of Korea for the moment. You will remember that, by the Yalta Secret Agreement, it was agreed that the rights of Russia, which were taken from her by the treacherous attack of Japan, should be restored to her, and Railway Agreements and Agreements as to Port Arthur and Dairen were set out. This Agreement was implemented by an Agreement between China and the Soviet on 14th August, 1945.
Now, it is noticeable that, in this Agreement, the Russians did not exact the full position which they held in 1903. They then had full and exclusive control of the two Railways. They now have joint control. in the second place, they have not got full control over Dairen or Port Arthur. They have joint control and the Agreements are in several respects less onerous on the Chinese;
for instance, there is no provision for troop movements except during war with Japan. But still more remarkable is the fact that, since the war terminated, the Russians have not even secured control of the Railways and are not insisting upon it. Copland's information is that the Chinese Communists run the Chinese Eastern Railway across the north of Manchuria, and that, when the South Manchurian Railway is run, the Chinese Government operates it.
They have deliberately squeezed the Russians out. I cannot imagine this, but this is my information.
Port Arthur and Dairen are occupied by 35,000 Russian troops, but the Russians do not occupy the area that was allotted with these ports; it is occupied mainly by Chinese Communists.
There are two other things about the Agreement which are not [settled]  for instance, it has not been decided what properties go with the Railways, and it seems that both China and Russia are [sparring for] time over these Agreements. If the main pressure of Russia were to be exerted towards the Far East, it seems rather remarkable that they have not so far exerted it in Manchuria. On the other hand, of course, they have exerted it very strongly in Korea and their hold on the north of Korea is complete and absolute. They have a large army there and have trained a Korean Army of 250,000 men. So that they may believe that, as long as they hold the north of Korea, their hold on the Far Eastern balance of power is sufficient and they are willing to maintain that position for the present.
This may be due to their feeling that pressure in Europe is likely to be more dangerous to Russia or it may be merely a waiting policy until it is disclosed what America proposes for the occupation of Japan. Of course, there are other places where Russia can break out, such as Afghanistan and Persia. I am told on very good authority that the Pakistan people were unable to make an Air Agreement with Afghanistan because Russia had forestalled them.
I have tried to sketch the situation as it appears to me. I have the greatest apprehension as to what will follow the evacuation of Japan, demilitarised and helpless, with Russia occupying a key strategic position in the area. Yet, so far as one can see, Russia has not put her main pressure on this area, and it does not seem to be contemplating any step in the immediate future.
If you could give us any further information you have on these points, we should be very glad indeed to receive them.