Murata: First, to clarify the particulars of your career, from 1975 to 1977 you were the director of the Economic Cooperation Bureau, right. Then from 1977 you were the ambassador to Singapore for less than two years and then from 1979 to 1982 you became the Deputy Foreign Minister in charge of Economic Affairs. From then on you served as the ambassador to Mexico, Canada, and the UN, and retired in 1988, right. For the first half of the 1960s did you also serve as Foreign Minister Ohira's private secretary?
Kikuchi: No, that was from July 18, 1962 to July 18, 1964, exactly two years. It was said that Mr. Ikeda believed in the auspicious figure 8, so it was reorganized on the 18th.
Murata: So, before your service in 1975 as the Economic Cooperation Bureau director, what was your position?
Kikuchi: Before joining the Economic Cooperation Bureau in 1971, I spent two years in the Embassy in America, and before that, from 1966 to 1969 I was in Bonn, Germany. From 1971 I stayed in the Economic Cooperation Bureau. As a senior official I hold the seven year record for the longest time spent in one Bureau without interruption. I returned as a counselor, became the vice-director general, and then was made director general. I was there for seven years. So, within the Foreign Ministry, I became known as the "Economic Cooperation man." But, before all of that, I had worked mostly on U.S.-Japan relations.
Murata: Was your case an exception to the rule?
Kikuchi: Yes it probably was. Spending seven years in the same bureau is definitely an exception of exceptions. I mean, I became the bureau director general just at the time when economic cooperation was on the upswing, Mr. (Akio) Watanabe talked about this in his hearings, but for the first time in 1977, the Foreign Ministry published the "White Paper on Economic Cooperation." Up to that point, MITI was the ministry in charge of publishing a paper on economic cooperation so it had always put out the "Economic Cooperation White Paper." The result of MITI's influence was a widespread blame placed on Japan for using economic cooperation as a means toward export promotion. At that time, that criticism remained. Therefore, because the Foreign Ministry was the only ministry in Japan that had a specific bureau for economic cooperation, I decided that it should put out a white paper. There was considerable opposition to this, but the Foreign Ministry began to publish it.
Murata: So, you were in Washington during the July 1971 Nixon shock?
Kikuchi: No, I had already returned to Japan (February 1971).
Murata: While you were in Washington, did the Japanese Embassy completely fail to predict the drawing closer of the United States and China?
Kikuchi: There were no predictions of the sort. There was, however, the statement by Ambassador Asakai that has become legendary in the Foreign Ministry as I'm sure you know. Calling it his nightmare, he said, "My greatest worry is that one morning an unannounced call will come from the State Department saying 'America has decided to renew relations with China, so you will have to know it. Thank you for your past cooperation to this point.'" You have heard that story, right? I heard this related directly from Asakai himself.
I had served under Mr. Asakai when he was a minister in London, and again at the embassy in Washington, so I worked under him on two occasions. Therefore, I was very familiar with his way of thinking. He talked about this subject so often that we younger officers were permeated with it. As a result, I think the Foreign Ministry was relatively unsurprised by the Nixon shocks.
Murata: What was your area of responsibility at the Washington Embassy?
Kikuchi: In Washington I consistently dealt with economic relations. In the Foreign Ministry at home, I had been the director of the U.S./Canada section of the Economic Bureau, and before that, in 1951 and 1952, I was in the third section of the Economic Bureau. At that time, North and South America were together in the same section.
Murata: The Nixon Shock took place in July of 1971 and.....
Kikuchi: When you say Nixon shock, you're speaking of the China matter, right?
Murata: Yes, the China matter. I don't know if "American faction" is the right term, but did those who had worked in the Washington Embassy experience any criticism in the Ministry because they had not foreseen this situation?
Kikuchi: No, there was none. As I just mentioned, it was because we had all been prepared for that possibility by the things that Ambassador Asami had said. The first thing we all learned when we entered the Foreign Ministry was: "Never get upset, never be surprised." Therefore, even when there were sudden crises, we were not surprised by them.
Murata: Are you saying that the Foreign Ministry on the whole took the news quite calmly?
Kikuchi: Some in the Foreign Ministry probably even harbored the attitude of "it serves you right" toward those who had innocently believed that this kind of thing would not happen. In the ministry where many people are cool-headed, those who unconditionally support the U.S., the Soviet Union, or China are looked down with contempt.
Tanaka: What about the economic Nixon Shock that happened one month later?
Kikuchi: That was more of a surprise. There was no one, even in the Finance Ministry (MOF), who warned of a possible economic shock like Ambassador Asakai had with the China shock. At that time, I had been involved with economic relations for a long time, but I didn't know anyone in the MOF who said anything about the coming shock. The MOF stuck closer to the United States than I though it would, and this shock was something to be surprised about. The feeling of Japan at the time was that it could be so devastated by the country that it was most closely allied with.
There was a reason for this. I debated this with Mr. T. Gyoten once. He said in the end that, "Japan's economy cannot compare with America's economic power. There are people now who say that America's economy is bad or that it is a declining power, but I don't think so." This was the honne from the MOF faction that supposedly knew America the best.
Tanaka: When looked at on the national level, the first shock also put Japan into an uproar and I think that it caused Prime Minister Sato a great deal of problems, but......
Kikuchi: The China shock was probably the most difficult for Sato to endure.
Tanaka: Now we have the question of why the MOF left the Tokyo market open during the financial shock crisis. At the time, as you had been recently transferred to the Economic Cooperation Bureau, did you have the feeling that you were viewing all of this at a glance?
Kikuchi: I had previously been the director of the U.S. section of the Economic Bureau so I was supposed to have had experience with this kind of situation, but it was really a great shock.... However, although the degree was different, this was not the first shock that the MOF had dealt with. The 1963 Interest Equalization Tax was the first shock. This happened during the Ikeda cabinet, with Ohira as the Foreign Minister. The Interest Equalization Tax was applied to loans that Japan had borrowed from America. Compared to Japan's interest rates, America's were extremely low. Because countries with low interest rates lend to countries with high interest rates, it was thought that adding a tax would be necessary. Japan was the biggest borrower at the time, so this was a huge shock for the MOF. Prime Minister Ikeda was especially surprised.
With that, when Mr. Miyazawa, who was Minister of the Economic Planning Agency at the time, was ordered to "go quickly and renegotiate," the night before he had his appendix flare up. (Laughter) It suddenly became Foreign Minister Ohira's turn. On only one day's notice, Mr. Ohira and I departed. On that trip we met President Kennedy, Treasury Secretary D. Dillon, Secretary of State D. Rusk, and David Rockefeller and other New York-based business leaders. Our first point was to ask for a repeal of the Interest Equalization Tax, and our second was, if it could not be repealed, to negotiate an exemption for Japan. The exemption would have been, for example, that for the first $75 million borrowed, no tax would apply, and for anything borrowed past that point, the tax would accrue. We negotiated for that, and in the end, Japan received a special exemption for $100 million. At that time, when I quit working as the private secretary for Mr. Ohira and became the U.S./Canada section director, I negotiated alongside the MOF International Finance Bureau (at the time called the Currency Exchange Bureau).
Returning to the question of why the Tokyo market remained open, at the time, that question really didn't come up. Mr. Kashiwagi was a MOF Financial Commissioner at the time, right? I hear that the Budget Bureau and other bureaus outside of the International Finance Bureau were saying, "How long will it be left open? How long will we keep suffering a loss." This was not the same as the later jusen case (mortgage problem), but the MOF united when it had to face a problem, so at the time there were no voices calling for the markets to be closed. Except, there were people like us in positions with a lot of contact that were asking why the market was left open for so long. I did hear some people say that it was just like the MOF's nature to do this.
Murata: Returning to an earlier point, you mentioned Asakai's nightmare about the possible closing of the gap between the United States and China, and how this lessened the surprise when it happened......
Kikuchi: I don't want to categorically say that there was no surprise, but I think many of the long time members of the Foreign Ministry had developed a kind of immunity to this type of happening.
Murata: Was there no message, or anything of the like, from Washington telling you that this might happen?
Kikuchi: I'm not completely sure, but I don't think there was any. This is a kind of episode, but at this time Kissinger entered China through Pakistan, right? The ambassador to Pakistan at the time was the fairly famous Ambassador Sono Akira. In the Foreign Ministry, Sono Akira had been a Soviet Union and intelligence specialist. He was in Pakistan, but failed to telegraph the Ministry in Tokyo about Kissinger passing right under his nose. This fact bothered Sono all the way to his grave.
I received his retirement letter which was unusually long. In it he wrote that his failure to detect this while he was in Pakistan was the worst mistake of his lifetime, but that he intended to join the mass media world and do his best. It was his declaration that he would become a commentator on current affairs. From this it is even clearer that no one in the Foreign Ministry knew anything about this due to the great feint operation put on by Kissinger.
Murata: Was there a strong sentiment within the Foreign Ministry that America, and especially the Nixon administration had betrayed Japan?
Kikuchi: Betrayed? Why would we feel betrayed?
Murata: Because he went over Japan's head and made overtures to China.
Kikuchi: Going over one's head to make overtures is very different than betrayal. They were totally free to do this.
Murata: But, weren't there, nonetheless, quite a few who felt betrayed?
Kikuchi: There may have been some, but I certainly did not. It is unwise to get too emotional about international relations problems.
Murata: This is also a vague question, but within the North America Bureau and the Asia Bureau which were trying to push for Sino-Japanese diplomatic normalization, did you feel anything like opposition concerning Japan's China policy?
Kikuchi: No, I did not.
Murata: Do you not remember a split within the Ministry over Japan's China policy?
Kikuchi: No I don't recall one. The Director of the China department, Hashimoto, tried hard to do many things, above his own official responsibilities, to push for Sino-Japanese relations. However, his biggest responsibility was not Sino-Japanese relations but it was to try to persuade the various anti-normalization groups within the country (LDP). And because he didn't speak much Chinese, his biggest achievement was done within Japan. He was most suitable for that responsibility.
If there was any opposition, it involved the debate that came after the quick resumption of diplomatic ties with China, the debate about UN representation. There were basically two sides. One faction strongly argued that the UN should not continue the fictional arrangement and that the actual government of China should hold representation in the UN. The other faction claimed that while that might be true, the current international situation made supporting the first position unwise. There wasn't anyone in the Foreign Ministry that opposed that position.
Murata: So there was no opposition among the specific bureaus on this matter?
Kikuchi: None.
Tanaka: I am not very strong in economic cooperation issues of this period so I don't know much, but what would you say was the most important policy that came out of your seven years in the Economic Cooperation Bureau?
Kikuchi: At the time, Japan's budget for economic cooperation was about third largest in the world. It was behind America and France, about even with Germany. As I said earlier, it was on the upswing, becoming gradually larger and larger so the main thrust was to continue to make the quality of aid better in the future. However, we knew that it was wrong to only extend aid money, when we negotiated with the Ministry of Finance. I think it was in 1977 when I was the bureau director general and the first mid-term plan for economic cooperation (ODA) was completed.
This was a five year plan which had the primary goal of making the economic cooperation budget grow. The second most important goal was to publicly announce the "vision" of economic cooperation. My last days in the Economic Cooperation Bureau saw serious public criticism because the amount of economic cooperation had grown quantitatively. The public made several criticisms saying things like, why do we cooperate economically with foreign countries instead of using that money at home, why does Japan extend public assistance to other countries? The idea of foreign assistance became a problem about the year 1975. We heard criticism from the Diet also, as well at the Japanese media. For the first time, I began to lobby in the Foreign Ministry for making a public statement about economic cooperation. I spoke at length about this subject at Mr. Watanabe's hearing. Those two things were most important.
Iokibe: When Prime Minister Tanaka made his round of calls to Southeast Asian countries in 1974, did that have a large impact on your activities?
Kikuchi: There was a shock, but it was not a large one. At that time, according to our information, there were student demonstrations in Thailand and Indonesia. It is now very clear that those were demonstrations against their own government. The different movements in those countries used the occasion of Prime Minister Tanaka Kakuei to mobilize their forces, and it seems that their target was the government itself. I, however, in general would not say it like that. We knew that it would have that aspect from our information, so we just figured that it was too bad for Mr. Tanaka. In fact, he was a leader that leaned more toward the side of extending aid to these countries.
Iokibe: So, he was used for the conflict in those countries. Because of these developments, was there any effort to reform the way that direct investment, commerce, and assistance was undertaken in relation to those countries?
Kikuchi: I don't think that there was any special effort made because of that occasion.
Japan's economic cooperation began in 1959 with yen loans to India and Pakistan. At that time, I had just become the person in charge of that kind of issue at the Washington Embassy. Because the meetings about aid to India were held in Washington, I was able to attend. Japan's foreign economic cooperation began with the technical support called for under the Colombo Plan. A yen loan was an export credit with a different name. It became impossible to sell large machine plants to developing countries at the normal commercial base. At that point, MITI thought that we should use the yen loan as a way to promote plants' exports. Other countries did the same thing. It became impossible to sell large construction equipment except on a deferred payment basis. Yen loans were a bit better than deferred payments because the condition of loans was better.
The initial steps of Japan's obligatory economic cooperation were, at the very least, thought of as a kind of extension of war reparations. The reparations were ultimately established in the promotion of exports, and yen loans and economic cooperation then had a tendency to link Japanese export promotion to Japanese goods. That began in 1959 and extended until at least the mid-1970s. About that, it seems that there were periodic complaints in the OECD's DAC that a high percentage of Japanese aid came with strings attached.
But, if you look at whether aid from other countries had strings attached, it all did. America, in fact, had the most onerous strings attached, but the yen loans were the only ones that were spoken of as having those strings. It is fine to attach strings to grant aid, and Japan at the time gave little grant aid compared to loans, so it was chided for having strings attached, but foreign countries also had them. Most of the time strings attached to grant aid are accepted, so it was just a case of them not standing out as much.
Tanaka: Is that because in most cases of grant aid there is a strong notion that the nature of the aid is good?
Kikuchi: Yes, that is also true. Except, invariably, the sum of grant aid money is limited. It would be impossible to have grant aid to the order of hundreds of millions of yen. Grant aid is usually around one million dollars or less, so no matter how much grant aid you give out, it has little effect on the total amount of aid. Thus, the situation arises where developing countries ask for as much Yen loan as possible regardless of the obligation attached. You see, countries would rather build large infrastructure projects than use the money on medical equipment or the like.
Because of this, aid money from Japan did definitely have this hue of export promotion. And because of that, MITI published the "Economic Cooperation White Paper." During our tenure, we thought that it was strange that there was no way to refute the blame put on us by other countries, so the Foreign Ministry began to publish its "Economic Cooperation White Paper." We gradually moved from having the hue of export promotion to that of humanitarian aid.
The objectives that we had for economic cooperation were twofold: first, humanitarian aid, and second, interdependence. When I was involved in economic cooperation, strategic aid was a taboo, but it has gradually become less and less taboo. America was engaged in strategic aid from the beginning. America's aid to Israel, Egypt, Jordan, and Turkey was all strategic aid. It became acceptable for Japanese aid too, now that it had risen to such a high volume, to be used as a foreign policy tool, and not just for humanitarian purposes. That happened by the late 1980s.
Even when I was there, the Foreign Ministry felt in its heart that economic cooperation was the best kind of foreign policy tool, but during the disputes over the relative jurisdictions of the different ministries, we could not exactly say anything about it. If it had been agreed that economic cooperation was a main instrument of foreign policy, the other ministries would not have had a say in economic cooperation. Or, at least they would not have been able to claim that they had jurisdiction in economic cooperation matters. They understood this, though, and knew that if they agreed to it, their own ministry's authority to intervene would disappear. The MOF, MITI, and the EPA would all have had a problem with that outcome. Therefore, there was an atmosphere that prevented us from clearly stating that economic cooperation was a foreign policy tool.
At that time, for economic cooperation we had what was called the Four Ministry Consultation System. I think it had started when the Foreign Affairs and Finance Ministries, MITI, and the EPA would send secretariat and department director level officials to meetings that would determine the amount and conditions for yen loans. Of course, the Foreign Affairs Economic Cooperation Bureau and its Economic Cooperation First Section (The section in charge of loan operation) would submit plans at these meetings, but under the Four Ministry Consultation System, we also had to acknowledge the competence of the other ministries assembled.
I think it was at the end of the 1980s when the critical reactions by the opposition parties and the media concerning strategic aid began to decrease. In 1992, the ODA Outline was completed. That included all of the results of previous studies regarding humanitarian aid, interdependence, strategic aid, and democratization and ideological aid.
Those changes all took place, but I don't think you can say that demonstrations against the 1974 visits by Tanaka Kakuei to Southeast Asia were a positive opportunity for him.
Iokibe: At about the period of the last half of the 1970s, during the time of the Fukuda Doctrine, did the Fukuda Doctrine take advantage of that kind of opportunity
Kikuchi: Yes, that was in 1977. During the time of the Fukuda Doctrine, I served as Mr. Fukuda's "chief of staff". That was probably the thing that was able to set aside two billion dollars for each of those five ASEAN countries.
Murata: Were you involved in the drafting of the Fukuda Doctrine?
Kikuchi: Yes. It was drafted by me and Mr. Nishiyama Takehiko of the Asia Bureau who has since passed away.
Murata: Was private secretary Owada in on the drafting as well?
Kikuchi: The prime minister's private secretary had nothing to do with the substance of the document. He was only the intermediator.
Iokibe: In that case, you took care of the economic cooperation side of the document and left the Asian foreign affairs side to Nishiyama......?
Kikuchi: Yes, that is correct. Except, the central portion of the Doctrine involved economic cooperation and it was Nishiyama who suggested that we include the various countries of Indochina.
Iokibe: So you dealt with cooperation with the ASEAN countries and Indochina, right?
Murata: When it was passed up the pipeline, did Mr. Fukuda play an active role in the phrases and wording used in the document?
Kikuchi: He was not very involved with it. Mr. Fukuda was the type of person who did not play a large role in this kind of thing. Mr. Ohira was the type who really got involved, but he would change things to read like literary works. (Laughter)
Murata: Weren't the "heart-to-heart" talks Fukuda's idea?
Kikuchi: Yes, they probably were. In Spanish, they are called "Corazon-a-corazon," and there was also a phrase for it in Indonesian, what did they say...... The Asian Bureau group used to talk about "heart-to-hearts" a lot.
Tanaka: In that case, are you saying that the Asian Bureau came up with the phrase and Fukuda used it because he thought it was a good one?
Kikuchi: Yes, I think so. Mr. Fukuda had a great deal of interest in Asia. The Southeast Asian countries had all been colonies, and Mr. Fukuda had been a great help to the Southeast Asian foreign exchange students who had studied in Japan before and during the war, and even after the war, he set up an "Alumni Association" to invite these students back. Even I went out to greet them on occasion. I said this before, but because Mr. Fukuda had lavished so much effort on Southeast Asia, Mr. Ohira had few relations with it except for China.
Tanaka: What about the Pacific Rim?
Kikuchi: Well, Southeast Asia is, of course included in the Pacific Rim, isn't it. (Laughter)
Tanaka: He went to Australia, right?
Kikuchi: He did go to Australia.
Tanaka: From about the time of the fall of Saigon, was Japan genuinely thinking about aid for Indonesia and Vietnam?
Kikuchi: Of course, we were thinking about aid for the whole time following the fall of Saigon. I went to Saigon with Ohira in 1964. Ngo Dinh-diem was assassinated in November of 1963, and we went after that. I had still not become director general of the Economic Cooperation Bureau, but I had often gone to the World Bank's Vietnam aid conferences. The World Bank had also put a lot of effort into Vietnam before it fell.
Tanaka: Did aid to Vietnam cease with its invasion into Cambodia?
Kikuchi: Yes.
Tanaka: And aid to China......?
Kikuchi: Aid to China began in 1977. At that time, Mr. Ohira was the Finance Minister. I was, of course, in contact with he authorities in charge in the Finance Ministry, but during that period, I also golfed with Ohira every weekend, so on the train to and from places like Karuizawa or Hakone, I was able to directly say things like, "right now this thing is in the works, please give me a hand on it."
Iokibe: Was it a common thing for a former private secretary of Foreign Minister Ohira to have such a long relationship with him afterwards?
Kikuchi: Mr. Ohira was just like that. When he became Foreign Minister the second time, Mr. Fujii Hiroaki, who is now serving as ambassador to the U.K., took my place. He had once been my assistant when I was section director so he was a good source of information from then on. Mr. Ohira always included me in his golf group even after I was no longer his secretary. When he became Prime Minister I was in Singapore, and he asked me to return and after a year and a few months I came back to the Foreign Ministry as Deputy Foreign Minister (Gaimushingikan).
Iokibe: He must have been found of you.
Kikuchi: I don't know, he was a very warm person.
Iokibe: But, after you became Deputy Foreign Minister, Mr. Ohira passed away and.......
Kikuchi: I believe he died on June 12, 1980. I served as an official representative of the Prime Minister to the Economic Summit for about six months. During that time, I was his sherpa (person who goes ahead to prepare) so I was involved in two sherpa conferences after which I would report to Mr. Ohira. When I made my reports, he would take out his notebook and take notes on what I said.
Murata: The summits you attended were the Tokyo Summit and the......
Kikuchi: As a sherpa, I attended the 1980 Venice Summit and the 1981 Ottawa Summit. When the summits began from 1975, Prime Minister Miki and Foreign Minister Miyazawa attended, and at that time I was the Economic Cooperation Bureau director deneral. Economic cooperation was only a secondary focus of the meeting, but it was Miki's primary focus. He tried to attend the Rambouillet summit with his economic cooperation concept as his main emphasis. Therefore, I became important to him by coincidence and also went to the following Puerto Rico summit as deputy directer general from the Economic Cooperation Bureau. After that I also attended the London summit. I did not attend the Bonn and Tokyo summits, but went to the ones in Venice and Ottawa. I attended the Versailles summit as far as the first sherpa meeting, and shortly after that Jacque [Atali], a French sherpa, planned a sherpa alumni get-together at the 1989 [Arche] summit. For that, I went to Rambouillet. I returned to Japan for a time from Ottawa during the next Tokyo summit. Therefore, I think I may hold the record for attending the most meetings that had the word "summit" attached to them.
Murata: So, during the Tokyo and Bonn summits you were the ambassador to Singapore so you did not attend, right?
Kikuchi: That's right.
Iokibe: What do you mean when you say that Miki's focus on economic cooperation at the first Rambouillet summit turned out to be an illusion?
Kikuchi: Because it was never realized.
Iokibe: What was the situation like?
Kikuchi: I think the Foreign Ministry came up with the plan. (By the same token, I heard that Hashimoto Ryutaro, who would become prime minister, pushed for his "Global Welfare Initiative" at the summit he attended.) Miki, though, because it was the first summit, thought that Japan should introduce some kind of idea. He called Yoshino Bunroku, who was the Foreign Ministry Deputy Foreign Minister in charge of economic cooperation, and directed him that, "I want to announce Japan's mid-term plan for economic cooperation, make a plan." I mentioned this before, but the plan that came out of that was like an medium range plan.
Yoshino came down to my place, and showed me his fairly modest five year plan that provided for several billion dollars of aid. The first Rambouillet summit was not in the summer like they are now, it was November, I think. It was extremely late in the year when the French president called for the summit. It was very cold, so Yoshino and I went to the private residence that was located behind the Prime Minister's office, sat down at the kotatsu and briefed Prime Minister Miki. Mrs. Miki Mutsuko brought tea for us.
This had been done in complete secrecy from the Finance Ministry. Miki, you see, understood that the plan would be crushed if it went before the Finance Ministry. He didn't have any experience in bureaucracy, so he had no influence on the Finance Ministry. On the day before we were to leave, it was decided that we needed to coordinate this, so Foreign Minister Miyazawa, Finance Minister Ohira, met with the rest of us. Miki announced this plan saying, "The way things are is......" I thought that it was a bad situation that I couldn't have told Ohira before that point, but because of official ethics, I didn't tell him.
Foreign Ministry Deputy Foreign Minister Yoshino started to explain the plan, and Ohira silently listened and only opened his mouth to speak at the end. He asked, "Yoshino, this is a Foreign Ministry plan, right?" I think this made things difficult for Yoshino because Ohira was asking the Foreign Ministry when he should have asked the prime minister. I think that Yoshino said something like, "Yes, that's right." With that, it was all over. He couldn't say that it was Miki's idea. If he had said, "It is Prime Minister Miki's plan," I think that Ohira might have decided that "there's nothing that can be done about it."
Iokibe: Why didn't Mr. Miki do it himself?
Kikuchi: Miki was that just that kind of person. He had that type of personality. I have seen many prime ministers in my day. The Japanese prime ministers who have no influence over the Finance Ministry never succeed. Only those who can control the Finance Ministry have any success. At the very least, they need to have direct relations with a vice-minister of finance. Among prime ministers who could not do this, Mr. Miki was the least able to do it. (Laughter) This was the illusory Miki plan...... Mr. Miki has also passed away so I guess it is OK to say that.
Tanaka: Was Prime Minister Miki also there at that time.
Kikuchi: Of course.
Tanaka: So it would have been acceptable for him to say "I told him (Yoshino) to make that plan for me."
Kikuchi: Miki was not the type of person who would say something like that.
Tanaka: I wonder why. It's strange, isn't it?
Kikuchi: Yes, but someone who knew him even a little bit would think, "Yes, that makes sense." In effect, the virtual image and real image of Mr. Miki were quite different. It is said that he was very clean and honest, and he probably was. It would not be a mistake to say that, but he was also a strong member of the zaibatsu. He married a daughter of the Mori zaibatsu. People say that he was a party man, but his zaibatsu connections made it possible for him to be a party man, and yet clean.
Iokibe: But, in that case, if he had said just one phrase, "It is I," it would have been very good form. It doesn't seem that the cost of doing so was very high. It seems that he might have thought that if he let down his guard just a bit, it might have worked out.
Kikuchi: I don't think that this was such a serious situation. It seems that he gave up thinking that he had tried in vain. That is the point that I cannot respect him 100%.
Iokibe: Did he retreat at this point because he didn't want to be covered with mud?
Kikuchi: No, I don't think there was any mud involved.
Iokibe: There would have been at least a little trouble.
Kikuchi: I was truly disappointed about it at the time.
Tanaka: About the fact that this all took place at the Rambouillet summit, on one hand the tactics may seem strange, but on the other, it was the first summit, so he really didn't know what to do.
Kikuchi: Yes, Yes. I'm sure you are all aware of the circumstances surrounding the start of the summit, it was a debate between the French president and Kissinger over the (oil) safety net and the energy problem. Because his plan did not succeed, Kissinger strongly held that France was at the root of the problem. Kissinger claimed that when he tried to solve the energy problem, France refused to follow along.
Murata: I would like to ask just one more question about the summit. I spoke to Mr. Miyazaki Isamu about ten days ago, Mr. Miyazaki attended about six summits following the one at Rambouillet. He said, as you have, that the first summits were small affairs where leaders would discuss things on a personal basis, but as things progressed, the summits became much larger. What had begun as economic conferences became venues for political and other discussions. From his six experiences, Miyazaki said that there was a problem with the official aides of the meetings also. Especially, the leadership of the MOF began to have a more and more dominant influence on the proceedings whereas they had started with a balance between the ministries. From your experiences, do you have the same impression?
Kikuchi: Miyazaki said some interesting things, didn't he. I actually understand his feelings well; the summits definitely did change over time. Especially the Tokyo summit. It set up the oil import ceiling and was definitely an economic summit. The words "economic summit" are always attached to any mention of that one.
The name "sherpa" was invented during my time. There was no political discussion between those who had been chosen to be sherpa at the summit. It was allowed to debate political subjects the night before the meetings when the leaders met alone, but otherwise, political subjects were off limits. I recently talked about the Lyon summit that is coming up, and I disagreed with the opinion that was given at the time that summits are a product of the Cold War and are placed where political debates are most important. They are not a product of the Cold War or any other period. I argued against that opinion by saying that summits are, rather, a product of the currency problems.
Either way, the summits began as opportunities to discuss economic, and especially financial and currency problems. Political debates only entered the picture later. On the question of exactly when political issues began to be discussed at summits, some would say that it was from the Tokyo summit, while others would choose the 1983 Williamsburg summit as the starting place. I think that it began from the Venice summit (1980) that I was in charge of.
At the Tokyo summit (1979), Foreign Minister S. Sonoda tried to start a discussion about terrorism, but this was also basically an illusory proposal. There may have been some debate about it, but nothing like a statement about it was ever issued. At the Venice summit, though, the problems in the Middle East created a big turning point in the discussions. Also, in December the year before the Soviets had invaded Afghanistan. It was absolutely necessary to discuss the Persian Gulf problems. After that, the Middle East problems, and Resolutions 242 and 337 also had to be discussed, so we could not avoid the political debate at the summits. As a general rule, though, this discussion would take place at the evening meal the night before the actual formal summit meetings. However, this time there was a declaration issued regarding terrorism and the Middle East. With that, political topics ceased to be off limits at the summits.
Because Prime Minister Nakasone went there, and for the first time declared that Japan was a part of the Western alliance, there are also those who say that the Williamsburg summit was the starting point for political discussion. That may be true for Japan alone, but it means little with regard to other countries.
I think I have answered your question, but the summits changed again from that point. From last year and the year before, Russia has entered the discussions. Now that Russia has joined, there is the problem of whether to call it the G-8 or G-7 plus one, but that is for future summits to work out. The present common sense seems to suggest that it will continue as the seven plus one for a time.
What I mean is that last year Yeltsin came, and participated in the political discussion, but not the economic talks. The summit system has entered a period in which it is unsure whether to continue to deal with economic issues or what. This was the reason that it had become the seven plus one format, but at the Lyon summit another plus was added as Chernomyrdin was added to discussions about global scale problems. With this, I think that we have moved closer to a G8 system, maybe a G7.75. (laughter)
Tanaka: After you became a Deputy Foreign Minister, is it correct to say that the biggest problem you faced was the U.S.-Japan automobile disputes?
Kikuchi: I wouldn't say it was the biggest, but it was an extremely large problem.
Tanaka: From what you said earlier, it sounds like you came home from Singapore and were directly picked up by Mr. Ohira, is that correct?
Kikuchi: No, it was the case of Ohira telling the vice-minister, Takashima Masuo, to return me to Japan.
Tanaka: Do you mean that Ohira himself wanted you to head up his economic end of the Foreign Ministry team?
Kikuchi: More than that, I think he really wanted to use me as a "sherpa". The most immediate job of the Deputy Foreign Minister was to be a sherpa.
Tanaka: On that point, when you returned to Japan in 1980, the automobile problem had become very large in America, hadn't it?
Kikuchi: Yes, from the year before, in 1979.
Tanaka: Would it be right to say that your assessment of the problem was different at first from that of MITI?
Kikuchi: More than different from MITI, the true difference was that my way of thinking was very different than Amaya's. What I mean is that within the Foreign Ministry and MITI, there were many different personalities at work, neither was a very closely knit group.
Tanaka: Well, if Mr. Amaya was going to proceed from the start with the voluntary regulation that America pushed for......?
Kikuchi: You told me before that you would be asking about this, so I did some research and found that he had used the phrase "self-discipline" when talking about automobile exports to America. At that point, he was not using the term "Voluntary restraint."
Tanaka: The automobile problem became difficult in 1979, then in 1980 things cooled off a bit, and then in 1981 things blew up again. In the spring of 1981, 16,800,000 cars were exported. Mr. Kusano Atsushi, during this time of "structural U.S.-Japan friction," sent out feelers in the summer of 1980 with MITI's Section Director Yoneta. He wrote that they often spoke about how the U.S. would react to voluntary regulation. Do you have any recollection of this?
Kikuchi: No, I knew nothing about it.
Iokibe: What was your attitude toward Amaya's pushing of export self-discipline?
Kikuchi: I thought that Japan would have to have some kind of voluntary restraint, but I repeatedly said that it was still premature to take steps like that. The reason was that there was still too much corruption.
On June 22, 1980, when I went to the Venice summit, Mr. Okita was the "acting head of state," and I was the "acting Foreign Minister" at the meetings and President Carter and Special Assistant Brzezinski were there. They came over to us and Carter said, "my information tells me that Toyota and Nissan are increasing their production capacity. What does this mean? There are fears in America that this is linked to efforts to increase exports to America. Would you look into it for me?" Mr. Carter was never one to say things in an absolutely straightforward way. The fact that he never said things in a demanding sort of way gave me great respect for him. Some say that he was too indecisive, but on the other hand, he was a person who understood well how to be courteous to other countries. He was an American with the polar opposite type of Mickey Kantor's personality.
As Professor Tanaka just said, the year before this, Japan's production of automobiles had exceeded the 10,000,000 unit mark, and Japan's auto industry was extremely prosperous, leading to an increase of exports to the U.S. It had already become a problem in America. On top of that, a recession began as well. This was exactly the time that Iacocca emerged. The news behind Carter's request was probably based on the general atmosphere in the U.S., which fueled fear that Japanese exports would continue to rise.
I vaguely knew the situation, but did not have the specific numbers to answer the President's question. The conference was held on an island a bit away from Venice, San Giorgio. He had since passed away, but Mr. Moriyama Shingo, who later went to Kyosera Co., came along as either the director of the Commerce Bureau or the Industrial Policy Bureau, and I called him and asked "what is the situation," and he came right over. As a result of his call to Tokyo, and I don't know if this was merely an excuse or not, he answered, "that has to do with the nature of production. It is merely an improvement of technology, not an increase of capacity. There is no correlation between this and the export increase." The next day Dr. Okita reported his answer to Mr. Carter. From the feeling of all of this, I realized that Carter was not asking us for self-restraint immediately.
With that, when I returned to Japan, UAW President Fraser came and said that the U.S. automobile unions hoped that Japan would implement voluntary restraint. Ambassador Mike Mansfield also took advantage of this. From his later activities, it is difficult to criticize him for his activity at this time, but he was surprisingly able to persuade Japanese industry to impose voluntary restraint on itself. This became a large problem inside Japan, and tense feelings gradually grew on all sides. By that time, the things said by Amaya remained in history, he said "there are those who, even though their opponent is sick in the hospital, would enter the hospital with dirty shoes on." By saying this, he badly upset the Japanese automobile industry. Japan's auto industry began to hate Amaya.
During that period, I knew nothing of all this talk, but according to my experience at Venice, my way of thinking was that, "the measures advocated by the American labor unions and ambassador are still premature. If America really wants Japan to implement voluntary restraints, President Carter should appeal directly to Prime Minister Ohira." The U.S. ITC also had determined at the time that U.S. industry was not being harmed by imports from Japan, thus validating my position at the time.
Tanaka: According to Amaya's book, this was November 1980, right?
Kikuchi: Yes, because Japan began its voluntary restraints in 1981. These events all happened, and the feeling that this was a necessary thing to do spread rapidly through the Japanese government. Okita was the Foreign Minister in 1980, and the post was taken by Foreign Minister Ito in 1981. Ito received strict instruction from Ohira that an emphasis on the U.S. should be the most fundamental part of his job, the idea that in economic matters the U.S. should be respected was forced into his head.
I remember even now one time that I was called by Ito. He told me, "Kikuchi, what shall we do about this? Ambassador Mansfield complains to me too loudly." I said that "it is an ambassador's job to do things like that, so there is no need for the Foreign Minister to worry about everything that he says." He then asked, "so, what should we do about the automobile problem?" and I related the story about Venice and said, "it is too early to do this!" With that he said, "I have to go over to the American embassy, what should I say?" I told him that he should say, "it would be best to do this after we have made sure of a few more facts." Ito had expected me to say that voluntary restraints were inevitable so he left quite unsatisfied.
It was vital to understand the fact. There were a few foreign policy strategies involved. It would have been a stupid mistake for Japan to agree to voluntary restraints before the other side even formally asked for them. At the very least, we had to try to do this under the more favorable circumstances (that may be the wrong way to put it) of the President saying, "Will you please institute voluntary export restraints?" Then we could reply, "Well, since the President insists upon it, we will do it." These voluntary export restraints were a violation of free trade, completely against the GATT, so the countries of Europe would sharply criticize Japan for them.
At that time, Mr. S. Nikaido was the Secretary General of the LDP, I think. That title may be mistaken, but Amaya and myself were summoned before him and confronted about this. We presented our arguments, with Amaya arguing for restraints and me arguing that it was not yet the right time to do it. Mr. Nikaido had lived in America before, so he was very close to the United States. In the end he said, "I have listened to both sides, and I think that Kikuchi's argument is the correct one. However, because of my political reasons, I'll have to go along with Amaya." With that it was all over. Looking at one level down, when I was the Foreign Ministry chief economic official and Fukada Hiroshi was the Economic Bureau Director General, Fukuda did not seem to have the same view as I. He was, rather, more like Amaya, so once the government had made a decision to do this, I no longer was able to put up any opposition.
Tanaka: Reading Mr. Amaya's book, he seems to have thought that if a compromise was not reached soon, something like the Danforth Bill would have materialized, which was a piece of legislation that was even more protectionist. He says that this was a bad thing, but that there was no real alternative. Was the reason that the government went with his plan because the government leaders felt that it was politically necessary to do so?
Kikuchi: No, that is not correct. The government thinking always seems to be that if Japan yields, problems will get solved. Government leaders are always saying that if they don't give in, worse legislation will be enacted. I have been involved in a lot of international economic policy making, and I never assumed that, "if we don't do this, something worse will happen," or "if we don't give in to America's demands, worse legislation will be passed." You see, this is exactly an opponent's strategy, and an argument is only a sophistry.
Tanaka: At this time, I think that the settlement at 1,680,000 cars came before the Prime Minister's visit to the U.S. In the plans made previous to the visit, was there the notion that some concession had to be made before the visit?
Kikuchi: Yes, there probably was.
Tanaka: There was an atmosphere of unsmooth U.S.-Japan security relations with the invasion of Afghanistan and the Iran problem, right? This also comes out here and there in Amaya's book, but was there a feeling of debt toward the U.S. that made Japan think that a certain level of cooperation was necessary? In the Moscow Olympics, etc......
Kikuchi: It was a problem of "insensitivity."
Tanaka: Do you mean that Japan was called insensitive?
Kikuchi: Most people did not say this, but when Foreign Minister Okita met with Secretary of State Cyrus Vance, Vance said, "now when everyone is decreasing their imports of Iranian oil, Japan has bought it at high price. Is not Japan behaving insensitively?" Mr. Okita told many people in Japan, especially the press, that Japan had been called "insensitive".
This was really a shame. It was a shame that Vance said it in the first place, and still more of a shame that the Foreign Minister returned to Japan and told everyone about it. That one foreign minister would be called insensitive by another, and then return home and have the lack of sense to shamelessly talk about it to the people was something that we foreign affairs specialists could not believe.
One country's foreign minister said to another country's foreign minister, "you are insensitive." Then, the one who had been called insensitive assumed that the other meant that Japan as a whole was insensitive, that he had been called insensitive as a representative of the country. I am from a different generation than all of you, so I don't know how you would have taken this. But when I heard of it, I really wondered what would have possessed him to say such a thing. This was not a personal problem, it was a national problem. Being called names and then vowing to exact revenge for the embarrassment used to be a practice of 19th century foreign policy. (Laughter)
Tanaka: And Mr. Okita's strong point was taking what was said in several different meetings and repeating it verbatim. (Laughter)
Kikuchi: Mr. Okita was an impressive person, but Peter Drucker said this about him, "his greatest strong point was relating what this man said or that man said." It got to the point where he did it so much that he received complaints from those around him. They probably felt that he was owed a debt.
Tanaka: Do you mean that because of that debt, he influenced the decisions of those in the government by saying that even though he was sick, people were treating him insensitively?
Kikuchi: I think there was some of that. This was the way of thinking that did harm to the U.S.-Japan economic relationship, the thinking that if we didn't do this, America would pass a more damaging Danforth Bill. We were playing right into U.S. strategy for 45 years. Originally, American specialists in the Executive Branch had very little influence over trade problems.
Tanaka: Because in the U.S. Constitution, bureaucrats are not given authority over those things.
Kikuchi: Negotiating with those bureaucrats that had no authority was tremendously difficult.
Tanaka: But, that is still a pretty good system. (Laughter)
Kikuchi: Japanese scholars, especially those who work on economic relations, should look into that question. Barshefsky (USTR) is talking about coming up with a preliminary opinion regarding the upcoming APEC summit, right? But Barshefsky has no real authority to negotiate on what will go on there. Unless the Congress passes Fast-track authority, she has no authority in the matter. They may just be choosing not to write what they know, but it seems that the Japanese economic reporters have not studied this subject enough.
Tanaka: Looking at it after the fact, it seems that the voluntary automobile regulation also had many positive benefits for Japan. For MITI, the positive side was that all of these automobile companies that had departed from MITI's advice were pared back, although in Amaya's book, none of this is discussed. Mr. Amaya seems to take an apprehensive view about what might have happened when he says that looking at America's laws logically, it is clear that Japan had to agree to voluntary restraints. However, could it be that MITI actually wanted the restraints for some time and were just looking for this opportunity?
Kikuchi: I would not go that far. The voluntary restraints were instituted in 1981 and continued until 1984, right? When the last year arrived, 1.68 million units was set as the standard and this was also called voluntary restraint. At this time, Tsurumi Yoshihiro (NYU) sent a letter to the State Department or the White House saying, "You must immediately end Japan's voluntary restraint system because even though Japan is not currently hurting, the car companies that have this quota limit on the total number of cars that are shipped to the U.S. increase the price of each car to make up for the loss. To take advantage of this, American manufacturers are also raising their prices which results in a double-punch to American consumers. You must immediately stop this."
The fact that the Reagan administration had come into office may have had much to do with this, but the U.S. government stopped seeking a voluntary restraint system from Japan. Despite this, though, MITI continued its system of voluntary restraint. It certainly was not a case of continuing it out of fear that the U.S. would enact tougher laws. The U.S. said that it would be fine to stop, but Japan continued anyway.
Tanaka: This all happened during and after the middle of the 1980s, right? At first MITI continued, saying that it was impossible to stop, but thinking about it later, do you think that this was all just talk?
Kikuchi: Yes, I think that is closer to the truth. There was no reason for MITI to act so badly. (Laughter)
Iokibe: When I asked Mr. Onaga Keichi, he said that this political change in the U.S.-Japan relationship began with the small textile problem. Thinking about the cost of that problem, he said that it was not good that this one economic problem was stretched so large, because of the tactics of MITI, to include the automobile problem as well.
Kikuchi: The people in MITI were very serious, and I think that they thought of many different courses of action. I prefer to look at things from the long perspective. For example, this was when the target that allowed for 1.68 million automobiles was not yet met.
Iokibe: Yes, it was still not met after this.
Kikuchi: The same thing happened before when the Tokyo summit's 3.6 million barrel and 3.9 million barrel ceilings weren't yet reached, and there was also a textile case. None of these had been met, so from a result-oriented approach, it seems that something had to be done. It is clear that America used Japan as a political scapegoat to make the U.S. government look better at home.
MITI may have had an understanding that problems such as the textile issue would worsen the U.S.-Japan economic relationship, but I doubted it. I mean, this is the benefit of hindsight. Economic problems up to this point had not damaged the mutual relationship. Can you think of any? Please tell me if you can.
Iokibe: Didn't the textile problem damage the relationship?
Kikuchi: It did no damage to it.
Iokibe: But, Nixon was very irritated and......
Kikuchi: Did he refuse to return Okinawa because of that?
Iokibe: No, that had been previously decided. He had promised it in November of 1969, and he just carried out that promise in 1972. What I'm talking about, for example, is that Nixon's irritation over the textile problem probably influenced the way he dealt with going over Japan's head to China.
Kikuchi: That is absolutely incorrect. I can say with confidence that American's don't have that mentality. The mentality of American's is not to retaliate for something that was done to them on a separate occasion. In that sense, I think that Americans are very good people. They're good people; even after a fight, they soon forget. (Laughter) I was in America for a long period of time, so I understand them well.
Iokibe: But, at that time, he did become upset. President Nixon became angry with the textile problem, right?
Kikuchi: He probably was mad. But, we were the ones who had negotiated the textile problem. I arrived in Washington in 1969, and the year before in 1968, Nixon had made Commerce Secretary Maurice Stans his campaign manager and had won the election. It was just like today when Mickey Kantor became the USTR and then the Commerce Secretary after helping to run the Clinton election campaign. Maurice Stans also had been a campaign manager and became the Commerce Secretary.
Iokibe: Mr. Miyazawa had to be the person he negotiated with.
Kikuchi: I was a witness to it all. Nixon was probably angry. He was human so he probably got angry, but I promise you that he did not go over Japan's head to China because of that anger. That is simply not what happened.
Tanaka: But what about the fact that Mr. Sato was only informed of the U.S. move toward China less than half a day before it happened.......?
Kikuchi: Kissinger was the one behind that. Kissinger definitely didn't trust the Japanese. He thought that the Japanese government would definitely leak the information if told.
Tanaka: It seems that he also didn't trust the State Department much, doesn't it?
Kikuchi: Yes, you're probably right. Kissinger was the source of this. Nixon had nothing to do with it. I had known Nixon since he was the vice-president. I was, of course, a lowly subordinate in the relationship, but it was easy to get a feel of what kind of person he was by meeting him. Nixon was not that kind of person. The Guam Doctrine and the opening up to China were both Nixon. He was a typical American. Simple may be a good word to describe him; he was a person without malicious intent.
Iokibe: But he was quick to change his way of thinking, wasn't he?
Kikuchi: Yes, very quick.
Iokibe: Nixon and Kissinger both acknowledged that they could no longer get a secret agreement on the textile problem by using secret envoy Wakaizumi Kei. During Mr. Sato's 1971 visit to the United States, a promise was made again, and again it was not kept. After that, I think Nixon became very angry.
Kikuchi: What was promised?
Iokibe: The example is the secret agreement that was made at the time of the Okinawa reversion by using Wakaizumi Kei as a special envoy. Recently, Mr. Wakaizumi wrote a large book saying that this promise was made between him and Kissinger, and that this promise was not able to be kept. Neither MITI Minister Ohira nor Mr. Miyazawa were willing to agree to it, so it was continually postponed. Mr. Sato carried it all by himself and the Foreign Minister and MITI would not even discuss it, so cooperation could not be achieved. It was not because he didn't understand the situation, but during the San Clemente summit meetings, Sato promised Nixon that he would work toward a complete change over in the efforts to resolve the textile problem. I have heard that this was the larger problem.
Kikuchi: No, that is incorrect. That wasn't San Clemente, it was Washington. Mr. Sato went to the UN, and on the way home stopped in Washington. Mr. Akatani Genichi translated for the occasion. I was the economics group leader in the Embassy, so I was involved in all of this, and that is how it happened, I think. There was, of course, no document that came out of San Clemente. At the time I asked Mr. Akatani "They are saying that he made another promise, how did you translate what he said?" I'm not sure what Sato said in Japanese when Nixon brought up the problem, but the translation was "I'll do my best." [Note: This is the Foreign Ministry's version]
Iokibe: That happened in Washington?
Kikuchi: In Washington. You see, I don't think Sato really said anything that bad. He put the responsibility on himself to do his best. There was a precedent for his statements, Mr. Yoshida Shigeru had his two arbitrary decisions as well. One, he is the only one that signed the U.S.-Japan Security Treaty. Two, the time that he told the Americans in advance of Peace Treaty that Japan would not mind if U.S. troops stayed in Japan was also completely his decision.
Iokibe: So he said that when Sato stopped in Washington on his way back from the UN, he met with Nixon and his words were translated as "I'll do my best."?
Kikuchi: Yes. I haven't heard about anything that went on in San Clemente. I had just transferred to Washington and my first project dealt with the export restraint of synthetic and chemical fibers. They called them "textile," but they were not cotton goods. They were synthetic fibers.
Tanaka: So, cotton textile goods had been voluntarily restrained for quite a while before this time?
Kikuchi: Yes. They had been regulated from about 1965. There was also the MFA, right?
Murata: After the announcement of Nixon's visit to China, I think Sato and Nixon met in San Clemente.
Iokibe: I'll check the facts again. Excuse me.
Kikuchi: I think too much has been made about that summit. I was in Washington at the time and we didn't consider it very seriously.
Tanaka: MITI Minister Tanaka Kakuei completed the Textile negotiations, were there any threats about an adversarial trade bill before that time?
Kikuchi: Yes, there were. I was the Washington economic group leader, so I would have known about them. If anything had been written, it was up to me to confront the person who wrote it. (Laughter)
Tanaka: There is a book called The Textile Wrangle, written by I. M. Destler, Sato Hideo, and Fukui Haruhiro. It says that during the last stages, the "Trading With the Enemy Act" was applied.
Kikuchi: I was in charge of this subject, and the "Trading With the Enemy Act" was not to be applied to Japan. It was for enemies who were at war with the U.S., and had no peace treaty with America.
Tanaka: That was a law passed in the 1910s, wasn't it? Putting together the things that I have read with what the ambassador has said, it seems that some Americans may have threatened the use of that law, but they really could not have implemented it.
Kikuchi: It is unthinkable. You see, the "Trading With the Enemy Act" had no basis to begin with. I know because before I was in the Ministry, during the periods of 1958-1962 and 1969 to 1971, I was twice in charge of economic issues in Washington.
Tanaka: This was in 1972?
Kikuchi: That agreement was signed just after I returned to Japan. Miyazawa took over Ohira as MITI Minister, and then Tanaka Kakuei took over Miyazawa for a short time. With that, Tanaka Kakuei was in line to become the Prime Minister. The three changed places..... it was not that Ohira and Miyazawa could not help, it was that they didn't even try. Miyazawa was against all regulation. He tried to convince people that even though imports only made up 1 percent of consumption in Japan, there was no damage being done. When he did that, Stans flashed some sheet of the "agreement". Miyazawa abruptly rejected it saying, "I don't know anything about this."
I think this will be even stronger evidence of my involvement in this issue; in 1970, Foreign Minister Aichi and MITI Minister Miyazawa together made an official visit to Washington. They did not give out much information about this trip, but Kissinger and Alexis Johnson, the Under Secretary of State, came to the official residence at the embassy to see them. Ambassador Shimoda Takezo wasn't there at the time, so I was told to greet them and I sat in on the meeting. At that time, Kissinger was highly charged as usual, but he did not speak at all about any "promise."
He spoke a lot about how this had strong ramifications for the political life of the President, something which Aichi and Miyazawa, of course, did not agree. It was Miyazawa, so he asked extremely technical questions like, "what exactly is the injury that is taking place" I don't think that Kissinger really knew the answer to that question, and they didn't argue about it at all. Then the two returned to Japan. This will be only somewhat related to your discussion, but afterwards the Americans coldly commented that, "Two cabinet members came from Japan, but were unable to resolve the textile problem." They had not agreed to the American line, so that was an obvious statement.
What Nixon was most angry about was not the textile problem itself. There was a man who had been a member of the Japan Communist Party, and who had become the president of a major synthetic fiber manufacturing company and was completely against any negotiation. He began an independent campaign and actually gained an agreement with Congressman Wilbur Mills. I think the secretary general of the cabinet at that time was Nemoto Ryutaro. He recognized in his official statement that there was no point in continuing the negotiations at the government level. Nixon became very upset because of this. He wasn't upset at the textile problem in general. In effect, this understanding tried to completely bypass the Nixon administration, and what is more, it brought the president's political opponent, Wilbur Mills of the Ways and Means Committee into things. The legal counsel Michael Daniels was instrumental in all this. I met Daniels when I went to Washington this last April.
What I have discussed today is a beginning, but there are very few who understand what actually happened during the textile negotiations. Mr. Yoshino and myself were in charge of this topic, and we worked together with Yoshizaki Hideo who later became president of Texas Instruments. Ambassador Ushiba came after Ambassador Shimoda, and Nixon brought Peter Flannigan, an investment banker with Dillon Reed Co., and the Ushiba-Flannigan discussions lasted for a long time.
In the agreement with Wilbur Mills, the government negotiations were completely closed. Afterwards, Nixon said again and again that they would be reopened, but while Miyazawa was in charge, Japan would never consent. When Tanaka Kakuei took over, he, in a manner typical of himself, came up with aid of 200 billion yen for Japan's textile industries. What happened was, instead of breaking the agreement by adding more machines in Japan, they were all moved to Southeast Asia.
America had requested a strictly enforced ceiling on exports. It wanted something that was designed to strictly look at the short-term results, not long-term projections. Japan said that this was no way to conduct free trade, and we bureaucrats tried hard for an acceptable solution and had achieved quite a few positive results. Just as these results began to be realized, however, the agreement with Mills was announced to be completed. At the reopened government negotiations, however, it was all for naught as Tanaka Kakuei accepted everything that we had worked so hard to reject in America's former proposals. By that time I was already back home at the Economic Cooperation Bureau, but the Foreign Ministry Economics Bureau had to swallow their pride. They had to agree to the original U.S. proposal, even though they had previously succeeded in getting rid of many of the objectionable items in that proposal. It reminded me of the "Hull (Cordell) Note" of September 12, 1941. Is that similarity discussed in that book?
Tanaka: I don't have a copy with me, so I'm not sure, but there are some things written about a scenario that was decided upon in which Tanaka and others chose exactly what they would agree to.
Kikuchi: That is a bit too dramatic for me. (Laughter)
Tanaka: Thank you for your time.