It was meant to be unconditional surrender at first. But at the first meeting between MacArthur and Hirohito in 1945, MacArthur decided to make use of Hirohito as a symbolic emperor without indicting him as a war criminal despite the fact that Truman and the American public wanted a severe punishment. Along with his advisor
Bonner Fellers, MacArthur joined hands with the imperial court to defend Hirohito from his critics, which made MacArthur's job to govern Japan easier. Hirohito also agreed to put Okinawa under direct American rule and it was an American colony for a while.
The Making of the 'Symbol Emperor System' in Postwar Japan
David A. Titus
Modern Asian Studies, Vol. 14, No. 4 (1980), pp. 529-578
After the war, Fellers remained on the staff of MacArthur, who was
Supreme Commander for the Allied Powers in the
occupation of Japan. Among his duties was liaison between HQ and the
Imperial Household. Soon after occupation began, Fellers wrote several influential memoranda concerning why it would be advantageous for the occupation, reconstruction of Japan, and long-term US interests to keep
Emperor Hirohito in place if he was not clearly responsible for war crimes.
[22]
Fellers met with the major defendants of the
Tokyo tribunal. Under an assignment with the codename "Operation Blacklist", Fellers allowed them to co-ordinate their stories to exonerate Hirohito and all members of his family of war crimes.
[23][24] This was done at the behest of MacArthur, who had decided that there was to be no criminal prosecution of the Emperor or his family.