-41-

non-tariff barriers, not least in order to reduce the discrim-
inating consequences of the broadened European Community
and the European free trade zone. The Tokyo round of multi-
lateral trade negotiations provides a timely opportunity to
sustain momentum toward global trade liberalization. Through
these negotiations we should seek more reliable access to
sources of supply as well as to markets. And we must continue
to avoid sharp imbalances in our bilateral trade, foreswearing
efforts to alleviate trade deficits through import curbs, export
subsidies or exchange rate manipulations.

-- We should intensify our cooperation in the fields of

<u>science and technology.</u> We are currently engaged in a joint

review of scientific and technological exchanges and programs.

-42-

On the basis of this review we hope to increase the efficiency
of our collaborative efforts and to identify new areas of
cooperation. We plan to continue our support for Japan's
rapidly evolving space program. In the field of medical
sciences we recognize possibilities for working together to
improve the safety and quality of food and drug products.

We hope to develop better coordination of those programs in
science and technology which can serve to facilitate the
growth of less developed countries in the Asian area.

-- The preservation of the natural environment demands our
urgent attention. As industrial and urban societies we face
similar problems and possess the technological capacity with
which to alleviate them. We cannot afford to ignore each
other's experience. For several years the United States and
Japan have been close to full agreement on the terms of a

[y]

-43-

bilateral environmental accord. I would like to see it signed soon.

-- Finally, to help assure the success of all these efforts, we must deepen the intangible bond of mutual understanding.

This requires greater effort by both countries in the cultural and educational fields. It has never been more important to us to support and draw upon the scholars and academic centers that give specialized attention to international matters.

The Japanese Government's gift of $10 million for Japanese studies in America is a landmark in this effort. Our mass media have yet to fulfill their potential role as a channel of communication between our two nations. And the creative arts of each of our cultures remain too little known in the other.

-44-

[y]

We intend to augment our cultural relations with Japan.

To this end we will seek to integrate and obtain approval

this year of proposals now before the Congress to establish

a Japan-United States friendship fund and to implement the

1962 GARIGA Agreement which would make up to $12 million

available for cross-cultural studies between our two countries.

## Conclusion

The great Tokugawa* writer Ihara Saikaku, who lived

in another era when the old order was breaking down and the

shape of things to come was not yet clear, said that to

* The shogunate, or regency period (1600-1650), in which
shoguns of the Tokugawa family rules in the names of the
Emperors. Saikaku (1642-1693) chronicled a time of
urbanization, changing mores, fears of foreign penetra-
tion and colonialism, and the breakdown of the feudal
social structure.

-45-

experience "this modern age, this mixture of good and ill
and yet to steer an honest course to the splendors of
success -- this is a feat reserved for paragons."

Our times demand as much of us. But our assets are
great. No two partners in the world are so different yet so
close; none have such wide-ranging experience of the best
and the worst which the modern age offers; and none have
constructed such elaborate arrangements for consultation
and effective cooperation. We can look forward to the
common tasks before us with confidence. Our future will
be filled with problems, but it is through problems and
challenges that we have come to know one another. We have
achieved success, while never forgetting that success is
relative, variable and fragile.

-46-

Looking back over the years since World War II both
American and Japanese can take pride in the ties we have
forged. In breadth and depth that relationship has no equal
in the contact between East and West. It can become a
model for peaceful and effective international cooperation,
for we are seeking the crucial balance between uniqueness
and commonality, between flourishing diversity and common
purpose that is the best hope for building a creative, just and
productive international community. With the good will,
good sense, and hard work which has marked our effort so
far we will continue to strengthen and develop our relations --
for ourselves and for humanity. There is no more exciting
task before us.

6/6/75

# THE UNITED STATES AND JAPAN IN A NEW ERA

## Japan Society

## June 18, 1975

A new era of changed circumstance and fresh challenge has begun -- for America, for Asia, and for the world.

The compelling issues of our time are security and prosperity. We must work for a new era of international economic cooperation necessary for political stability, for growth, and for accommodation on the crucial issues of food, energy, raw materials and trade. And above all we must strive to develop a stable and peaceful world order without which none of the great goals of mankind can be realized.

As the United States turns to meet this new age, we look first to our friends and allies; those with whom we share values, capabilities, experience and aspirations -- the great industrial democracies of the world.

-2-

To this end, President Ford in recent weeks went to Europe
to consult with our traditional allies there on these great issues.

Earlier, the President visited Japan on a similar mission. It
is with anticipation that we await the visit of the Emperor.

Before the Emperor's arrival Prime Minister Miki will come
to Washington to discuss the common objectives of our two
countries.

Just as our relations with Europe are crucial, so too is
the US-Japan relationship central to the great issues of our
time. It is a linchpin without which neither the peace nor the
prosperity of the world can be maintained or strengthened.

Tonight I want to set forth the principles which will guide
America's Asian policy and discuss the core of this policy: the
unique and vital relationship between the United States and Japan --

-3-

its foundations, its meaning for stability in Asia, and its place
and purpose in the changing international economy.

The Principles of America's Asian Policy

Some six years ago the U.S. began to shape a new inter-
national role that would reflect the new opportunities and needs
of the world and rest on a durable basis of public support within
our own nation. Nowhere have the cardinal elements of this
role been more clearly delineated than in Asia. We would
continue to play a major and active role in Asian affairs, but
look to our allies to draw increasingly on their new strength
and on their own determination to be self-reliant. We would
seek with China to begin a new chapter in our relations after
two decades of hostility and estrangement. We would seek
with Japan to build a more mature relationship among partners.

-3a-

This basic design remains sound. Together with
our friends we retain strong assets for carrying
it out. But we must now pursue our course in the
wake of the setbacks in Indochina.

We can face the future with confidence so long
as we face up to realities. Even those governments
that have been most critical of our

-4-

involvement in Vietnam, which have most earnestly regretted
the diversion of our resources which that involvement produced,
and which most fervently hoped for an end to the division in
American opinion which it spawned, harbor some concern about
the continued ability and willingness of our government to make
the difficult decisions required of a great power. We will
respond to these concerns. Tonight I want to affirm the
central tenets of our policy.

The United States will remain an Asian Power

The United States has been part of the Asian world since
we began commercial relations with East Asia shortly after
the birth of our nation. Since the Second World War our
involvement and interests in Asia have deepened enormously.

-5-

Through bilateral and multilateral arrangements we became the guarantor of the security of many Asian nations and the principal source of economic and military assistance for much of the region. American lives and wealth have been given in the cause of Asian self-determination. And our economic and cultural ties with the region have expanded to a point where they are central elements in developing international trade and understanding.

All this compels our attention and concern for Asian affairs. Asia will figure importantly in our thoughts and policy calculations as far ahead as we can see.

help

World peace requires the U.S. to/maintain a stable equilibrium in Asia. The security interests of four of the five great world powers intersect in Asia -- particularly in

-6-

Northeast Asia. China comprises the heartland of the continent.

The Soviet Far Eastern lands spread across the top of Asia. The Japanese islands span 2000 miles of ocean off the Asian mainland. And America's Pacific presence affects every region of Asia. The ways these powers interact will determine the stability of Asia and the world.

Stability requires a balance of strength just as it calls for a growing accommodation of interests. The U.S. is committed to both these objectives. Thus the U.S. will resist any nation or bloc which aspires to dominate the region, for stability could not survive the success of any powers' ambitions for hegemony. And the United States will continue to pursue the policy of detente, so that the

-7-

great powers in the region can adjust their differences on a
more rational and mutually beneficial basis.

The United States will continue to bear its fair share of
responsibility for the security and economic development of its
friends and allies. We will keep our treaty commitments and
strengthen still further mutually beneficial bonds of trade and
investment. At the same time we will continue to look to our
partners to assume the primary responsibility for their
own national destinies. The key to sustained economic
progress still lies in what nations do for themselves. And
their peace will depend heavily on their willingness to overcome
old disputes and take primary responsibility for providing the
manpower their defense requires./ In this regard, those allies

- 8 -

who seek our support will find us to be a firm friend.
We will not abandon those who wish to retain a security
relationship. But the nature and extent of such
relationships must be perceived to be in the mutual
interest. We will not insist on maintaining current
arrangements if our partners seek to modify them. The
United States in any event will continue to protect
its vital security interests whenever and wherever
they are challenged.

And finally,

The United States recognizes that cooperation on issues
and developments within Asia are vital for the continued
stability and progress of the region. We welcome the trend

-9-

toward greater intra-regional cooperation in seeking solutions
to regional problems. The U.S. will provide incentives for the
peaceful resolution of disputes and conflicts in the area through
negotiations among the parties concerned. In our support of
regional efforts, the United States will continue to actively
participate in, contribute to, or support key multilateral
organizations in Asia.

To this end, we place the highest value on the relations
we enjoy with our ANZUS partners Australia and New Zealand --
a relationship which is indispensable to Asian stability and
peace.

The ASEAN nations -- the Philippines, Thailand,
Indonesia, Malaysia, Singapore -- show a healthy nationalism
and resilience, and a capacity to defend their independence,

-10-

develop their economies, and strengthen their regional
arrangements. We welcome their increasing influence as a
force for security, and political and economic stability.

We will welcome consolidation of regional efforts in any
ways the countries concerned deem appropriate.

As for the new regimes in the region, we cannot ignore
the fact that they have flagrantly violated international agree-
ments and the accepted standards of international conduct.
But we are ready to look to the future. We shall not obstruct
the access of these new regimes to the international community.

Our attitude toward bilateral relations with these regimes will
be influenced by their regional conduct and their attitude
toward us.

[y]

-11-

The U.S. - Japan Relationship: The Hinge of Success

Our relationship with Japan is the keystone of America's
Asia policy. More than this, the calculations and the
prospects of countries in Asia and around the world --
great and small power alike -- are based on the hope and
expectation of continued close cooperation between Washington
and Tokyo.

Let me now turn to the foundations of our relationship
and then discuss its importance for two of the critical issues
of our time: security in Asia and economic prosperity for
the world.

-12-

The Foundations of Our Partnership

Relations between the United States and Japan go deep into
the history of the modern era. After Commodore Matthew
Perry met with the Imperial Commissioners at Yokohama
in 1854 the then American Secretary of the Navy commented
that "through their instrumentality, a new era seems to be
dawning on the commerce of the world." This was prophetic,
far
but/more than commerce was to be affected. As Commodore
Perry's orders noted, "no limit's can be assigned to [the]
future extension" of this relationship. And, indeed, it was
not long before Japan's great cultural tradition became a
significant influence in American art, literature and
architecture in this century -- while the impact of America

-13-

and the West helped transform Japan across the broadest range
of human activity. In the course of the last century and
a quarter, our relations with Japan have encompassed
phases of friendly competition, rivalry, conflict,
occupation reconciliation, and now alliance and mutual
dependence.

-14-

Our long and varied association has taught us valuable lessons. We now know that:

> Close partnership is possible between countries whose national styles and situations differ widely.

Indeed, we have achieved remarkable appreciation and understanding of our cultural and social differences. We Americans are a disparate people, heterogeneous in our origins, constantly striving to redefine what we have in common. Japan is a country of unusual cohesiveness and homogeneity.

Our social systems differ widely. For Americans, contracts and laws are a prime guarantor of social peace. The Japanese depend less on legal and formal rules than

-15-

on the warmth of human relationships and unstated patterns of
consensus and obligation to preserve social harmony.

Our language is designed for categorization. It invites
logical distinctions and value judgments. The Japanese
have experienced so much in common that they frequently
communicate through intuition and indirection. The Japanese
prize form and mood, as well as content; we honor content
above all, frequently displaying impatience with the setting
in which it is placed.

We are endowed with abundant land, ample resources and
high technology. Affluence is taken for granted. Japan is a
great world industrial power; but its prosperity, more recently
attained, seems more vulnerable because of its
extensive dependence on imported food, energy and other raw
materials, and external markets for its great industry.

-16-

In foreign policy we have assumed global security responsibilities. The Japanese have emphasized economic strength and commercial success while foreswearing large military forces or assertive diplomatic conduct.

True communication between cultures is at best a compromise. But despite past misunderstandings the U.S. and Japan have achieved a remarkable sensitivity, indeed fascination with our national differences. And our understanding has led to important decisions, such as America's postwar determinations on the unity of the Japanese nation and the role of the Imperial family -- both in recognition of the expressed desires of the Japanese people. The most durable international relationships may be those forged

-17-

through long effort by peoples of different circumstances
pursuing converging aims with understanding and goodwill.

Our economic, political and strategic interdependence
with Japan is inescapable. By the logic of geography and
interest we are partners. Japan's emergence is a political
fact of enormous importance. The U.S.-Japan relationship
is a major determinant of stability in Asia and a major factor
in the international system. As maritime trading nations with
complementary economies, we have developed the largest bilateral
overseas commerce in history. As major industrial powers
our respective economic policies profoundly affect each
other and the rest of the world. As open societies we are
committed to democratic procedures and the preservation of

-18-

basic human values as we search for solutions to the problems
of pollution, energy, the oceans, and preserving a sense of
community amidst rapid social change.

Our security, our prosperity, our hopes for order

in Asia and our responses to global economic dilemmas depend

importantly on the preservation of close and mutually beneficial

relations between us.

We have achieved a mature alliance relationship of
equals, on a basis of mutuality.

Our alliance was formed in the period of Japanese
dependence. War had shattered her economy, political
system and national confidence. Japan accepted American
leadership and only gradually came to take part in inter-
national diplomacy.

-19-

Japan's dramatic emergence as a major economic power and factor on the international scene brought a swift evolution of our relations. Today we approach our mutual problems as full and equal partners. Interdependence brings new sources of friction along with the benefits of association. But our record of resolving such problems in a spirit of equity and reciprocity is encouraging.

In recent years our relationship has evolved to reflect our respective efforts to improve relations with former adversaries, to accommodate Japan's growing economic power, and to adjust the burdens of mutual cooperation and regional development.

Where adjustments have been accompanied by strains, we have worked to alleviate them. Where mistakes or miscalculations have occurred, we have attempted to rectify them.

-20-

The reversion of Okinawa removed the last major vestige
of war from our bilateral agenda. We have made progress
toward solving the trade imbalance and have reaffirmed our
specific commitments as suppliers and purchasers of important
goods and materials. We have broadened our concept of
security to include our mutual need for reliable access to
energy, raw materials and foodstuffs.

We have devised channels for more intensive consultation
and have used them with growing frequency and frankness.

Differences arose between our two countries in 1971 when the
U.S. initiative toward the People's Republic of China and
economic steps in response to trade problems and a deterior-
ating U.S. payments balance disquieted our relationship.

These problems are now behind us and we are moving forward
in both areas along mutually compatible lines.

-21-

Thus we have achieved a close relationship based on
long experience and understanding. We have achieved striking
successes. As our bilateral relations have developed we
have become able to address multilateral issues with greater
confidence.

The multilateral dimensions of our ties have become
increasingly central.

Today, the issues most crucial to our interests -- security,
the health of the international economy, the oceans and the
environment -- do not lend themselves to unilateral solutions,

-22-

nor even to bilateral management: they are regional and global problems; they demand multilateral solutions. And they provide the setting for our contemporary relationship with Japan.

Our relationship faces two main challenges of broad scope: security in Asia and global economic prosperity.

## The Challenge of Peace and Security

Since the end of the Second World War, Japan has been conducting an historical experiment: despite its industrial prowess it has foresworn the military attributes of great power status, relying for its security substantially on the

support of the United States, [and the good will of others,]
limiting itself to modest conventional self defense forces.

Note:
Miyazawa
language

-23-

This experiment, which some Japanese regard more
a matter of necessity than of choice, has brought signifi-
cant and tangible returns. Japan's market economy has
achieved unparalleled growth. Parliamentary democracy
and individual freedom are now firmly established.

Japan has been able to concentrate its energies
on developing constructive economic and political relations
with its neighbors, thereby contributing to regional
stability and growth.

The success to date of this experiment owes much to
several factors. The U.S.-Japan Treaty of Mutual
Cooperation and Security has been and continues to be
widely acknowledged as an indispensable element of
peace and stability in Northeast Asia.

-24-

In addition, Japan enjoyed through much of this period assured access to imported raw materials and food at reasonable prices. And its commitment to a democratic system and international economic cooperation simplified Japanese choices in the arena of world politics.

Most of all, success has come as a result of the Japanese peoples' hard work, prudent planning, and dedication to great ideals.

Since the oil crisis of 1973, this relatively simple universe appears to some Japanese to be in the process of disintegration. The clear cut choices of the Cold War period are yielding to a more complex interplay among the powers. Suppliers of raw materials are presenting a

-25-

variety of new demands for power and participation not easily
accommodated within the context of the existing world trade
and monetary regimes.

These changing circumstances compel policy adjust-
ments on the part of Japan as well as the United States.

The continued success of the Japanese postwar experiment
in the face of these new complexities is a question in which
not only the Japanese but we as well as others possess
an important stake.

There are many encouraging signs. The commitment
of the Japanese people to a democratic social order appears
irreversible. Whatever legitimate concerns exist about the
adequacy of their self defense capabilities, few Japanese

-26-

propose a return to a heavily armed state. However acute
their uncertainties may be about the future, Japanese security
concerns are focused on improving the chances for peace in
the area. In this regard, two specific issues are of
common security concern to both the United States and Japan:
detente and the containment of conflict on the Korean peninsula.

First, our two nations have a vital interest in the policy
of detente. We have no illusions, recognizing that our values and
social systems will not soon, if ever, be compatible with those
of the communist powers. But our security, and humanity's
survival require that we reduce the dangers of nuclear war.

The strength of the U.S. -Japan relationship is an indispensable
prerequisite for progress in detente. With this firm foundation,

-27-

the U.S. and Japan, independently but increasingly in consultation, have taken historic steps to stabilize and improve our relationships with the Soviet Union and the People's Republic of China. We have reduced tensions, deepened dialogue and reached a number of significant agreements. All great powers in the area now see advantage and stability in a sound U.S.-Japan relationship.

The United States is determined to strive steadily to encourage a further relaxation of tensions in the world through dialogue and exchanges with countries of different social systems. We fully recognize the need for consultation with our Japanese friends on this most fundamental issue of world security and stability.

-28-

Second, we are resolved to maintain peace on the
Korean peninsula. As President Ford recently stated,
we will honor our mutual security treaty with Korea. We
will not reduce our troop levels there so long as a threat
to peace remains. A U.S. disengagement from our security
responsibilities in Korea under current circumstances could
invite tests of local strength with far-reaching consequences
not only in Korea but in Japan and beyond.

We will continue the search for ways to reduce confronta-
tion and institutionalize security on the Korean peninsula. At
the same time we will further assist South Korean efforts to
develop their economy and strengthen their defense.

-29-

We recognize, however, that true security must rest on a broad base of political acceptance and social justice. We will be working with our friends in Korea on these as well as the traditional aspects of security.

Let me turn now to a second great issue, the creation of an era of global economic cooperation that encompasses both the industrial and the developing nations in a new equilibrium.

-30-

The Challenge of the World Economy

In the past few years the world economy has come under great stress. An energy crisis, a food crisis, a global recession, a rate of inflation unprecedented in the postwar age, and the politicization of many economic transactions have severely strained the fabric of international cooperation.

No improvement of this situation is possible without the cooperation of the world's great industrial democracies -- Europe, America and Japan. Clearly, the response which the U.S. and Japan make to this situation will be crucial -- not only for the future health of our own economies, but of the future prosperity of the world, with which our prosperity is interwined.

-31-

[y]

In this situation we have these principal tasks:

- to coordinate our economic policies with each other
and within the industrialized world with the aim of
returning to sustained growth; and

- to devise cooperative solutions to the new global imperatives of energy, food, and raw materials in ways beneficial and fair to developed and developing nations alike.

Japan and the United States bear a special responsibility in helping the world back to a path of sustained economic expansion without inflation. Our economies are the world's largest. Together we account for 52 percent of the output and 26 percent of the trade of the non-Communist industrial world. If we do not grow, the economic problems of the rest of the world will be difficult to overcome.

-32-

In a new development last winter, President Ford and
former Prime Minister Tanaka consulted on our efforts to
combat recession. We must continue to coordinate our
policies at all levels to ensure that we are working together,
rather than at cross-purposes, to alleviate recession and
unemployment.

An important aspect of our efforts to avoid recession and to
enhance economic cooperation is more vigorous pursuit of an
increasingly open world trading system. If we attempt to
solve our own problems through economic nationalism, the
result will be not only less growth for us all, but an environ-
ment of conflict in which we will find it difficult to resolve other
economic and political issues between us.

-33-

To build a more open trading system over the longer run, the Tokyo Round of trade negotiations in Geneva is crucial. We must make progress not only on lowering tariffs, but on reducing non-tariff barriers to trade, guidelines for trade and tariffs on commodities, a code on international safeguards, and agreement on export subsidies and counter-vailing duties. If we fail to progress in the building of a better trading system, the dangers will grow of regression to the undisciplined trade wars of the thirties.

But the economic growth and well-being of the United States and Japan cannot be separated from the context of the global economic picture. Our prosperity cannot be maintained in the absence of an international system whose

-34-

economic benefits are widely shared and arrangements
perceived as just. To this end the United States welcomes
the proposal of the Japanese government to the OECD to
examine the long range development of advanced societies
in harmony with the less developed countries.

With Japan's cooperation we have already begun to
chart new methods of dealing with the key issues of energy,
food, and commodities.

In *energy*, the United States and Japan face totally
different circumstances within the group of oil-consumer
nations. The U.S. has large untapped oil, gas and coal
reserves. Japan does not: she must turn to new technology
to reduce her dependence on imported oil. Any long-term

-35-

solution to the energy problem will require the consuming
nations to cooperate to utilize energy more efficiently, to
expand production of conventional fuels, to develop new
energy sources, and to devise a world energy system in
cooperation with the producers.

Japanese-American collaboration is central to this
effort.

The search for new energy demands massive capital,
technical prowess, and management skills -- attributes
with which our two nations are amply endowed. Our
companies are exploring possibilities for joint ventures
to exploit new oil and natural gas sources and to jointly
construct additional uranium enrichment capacity in the
United States. We both acknowledge a responsibility to

-36-

provide emergency assistance to resource-poor nations
hardest hit by the energy crisis. Our cooperative arrangements are not directed against anyone, but designed to
minimize our vulnerability and provide a promising basis
for discussions with the oil-producing countries.

In food, the U.S. is Japan's largest single agricultural supplier, and they our largest overseas market. We both are aware of the responsibilities large suppliers and large purchasers must exhibit during periods of short supply. United States agriculture policy is aimed at meeting the essential needs of Japan and other traditional customers in the future.

-37-

But food is more than a bilateral issue; it is a global problem. The danger of widespread famine is real and immediate. In view of our wealth, our technological capabilities, and our respective positions in the market, the U.S., Japan, and our industrialized partners bear special obligations to minimize the grim prospect of world famine. This will require a broad international effort to develop a system of food security -- including expanded agricultural production, increased global fertilizer output, continued food aid over the short-term, and the creation of an international system of nationally-held grain reserves.

-38-

In the area of *raw materials* too, the situations of our
two countries are vastly different, but our responsibilities
and converging interests are substantial. Our vulnerability
to disruptions of raw material supplies is limited.

Japan's is great. But we share an interest in:

- a flourishing commodities trade on terms that
mutually benefit producers and consumers;

- an end to volatile price fluctuations which jeopardize
the foreign exchange earnings of developing country
suppliers and discourage investment in new sources;
and in

- limiting to the extent possible political intrusions on
market forces.

-39-

The United States and Japan are in a position to stimulate
the expansion of global raw materials development by pro-
viding needed capital, technology and management services.

As leading participants in the multilateral trade negotiations
we must help to devise a new role for access to supplies as
well as markets, promote the development of mining and
local processing industries, and explore new methods for
resolving investment disputes.

Conclusion

The great Tokugawa* writer Ihara Saikaku, who lived
in another era when the old order was breaking down and
the shape of things to come was not yet clear, said that to
*ca. 1600-1850: the shogunate, or regency period in which
shoguns of the Tokugawa family ruled in place of the Emperors.
Saikaku (1642-1693) chronicled a time of urbanization, changing
mores, foreign penetration, and the breakdown of the feudal
social structure.

-40-

-41-