Evening star., 1946-05-12
Pau|ey Says Mission
Aims al New Balance
In Economy Of Asia
BY the Assoeioted Press

BY the Associated Press
TOKYO, May Interpretations
Commissioner Edwin w. Pauley
informed Gen. Macarthur today
that his mission aimed to pro-
mote a new economic balance in
Asia purged of Japanese control.
Mr.. Pauley handed the supreme
commander a letter, written on
White House stationery but signed
by himself, summarizing the OBJ
jectives of the reparations mission
as an effort to laid in the estab-
lishment OF peaceful, prosperous
economic balance in Asia by sever
ence of tributary ties between Japan
and the areas she conquered and by
refrigeration of the economies of
those areas"
In line with these objectives, the
letter explained, the mission aimed
to determine how completely Japan
industrialized Korea and Man
churia, how such industry was cor
related with Japanese home indus
try, and what Japanese installa-
tons in those territories were avail
able for reparations.
Assets to Be Left Abroad.
The letter stressed that 1T was
American policy to leave In China,
Manchuria and Korea all Japanese
assets found there, for the settle
ment OF reparations accounts in
those countries.
The mission seeks to discover, it.
said, the present status" of Man
churia and North Korea in view of
reported changes since the end Of
the war;" and to evaluate the effect
Of those changes on Korean and
Chinese Production capacity.
1t said Mr.. Pauley and his group
intend to recommend 'in view of
the present conditions of mining
and industrial capacities in Man
churia and Northern Korea, what
facilities should be removed from
Japan and distribution made to
China and Korea"
part of Mr.. Pauley's assign
ment in the Far East is to learn
how much industrial and mining
equipment the Russians already
have removed from Manchuria
and Northern Korea. At last
reports he had not yet received
Russian permission to enter
Northern Korea; most Of Man.
churia, since its evacuation by
the Russians, is under Chinese
Communist control)
The letter emphasized that in
recommending removal of the equip
ment from Japan maximum con-
sideration shall be given to the in
tegration of economic development
in Greater China. Korea, the Philip
pines and other countries victimized
by japanese aggression"
1888 Level to be Maintained.
In a statement issued earlier to-
day, Mr.. Pauley said the reparations
program for Japan would not reduce
that Nations productive capacity
below the 1888 level. There will re-
main, he asserted. sufficient capac-
ity to make the things necessary
for civilian requirements"
Mr.. Pauley conceded that repara-
tions estimates proposed by the VIC
torious nations were high, but ex-
planned that "the needs of those
countries are so great they are look
ing forward to more than they will
get"
Commenting on reports that
Australia was asking for the Jap
anese wool industry as part of rep
arations, Mr.. Pauley said no cera-
mics, textiles or nonwar potential"
had been listed as available for
reparations. He declared the United
States would resist demands for
SUCH"
Mr.. Pauley's arrival in Tokyo CO.
incided with the disclosure by in
formed sources that official thinking
in Washington was swinging to-
ward "a more practical policy" on
the price Japan shall pay for losing
the war.
Tight Controls to Stay.
The new line, these sources said,
provides for maintenance of produc-
ton levels favoring a start toward
Japanese recovery 80 that we won't
have to take care of these people
forever"
The establishment Of such SUBJ
sistence levels of production, it was
pointed out, would not preclude
tight controls on such major in
dustries of steel. petroleum, light
metals and chemicals-all of which
are war potentials.
The extent of Russian reparations
claims against Japan has not been
disclosed, but if Mr. Pauley goes to
Northern Korea and Manchuria his
findings there may help settle argu-
ments likely to arise out of such
claims.
Mr.. Pauley said he anticipated
getting Russian permission" for his
scheduled exploration of areas occu-
pied by Soviet troops.
If industries have been removed
from Manchuria and Northern
Korea by the Russians, Mr. Pauley
continued, his recommendations will
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