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location; the ships were clearly marked with American flags both in horizontal and in vertical positions; Japanese naval planes bombed them at, ultimately, low altitudes; Japanese surface craft approached them, fired upon something, boarded the Panay and found her abandoned; and Japanese planes machine-gunned survivors. Both in the whole incident and in its parts Japanese armed forces committed offenses warranting the representations which this Government has made and calling for prompt making of full amends by the Japanese Government.

5. Information has just come that report of findings of Court of Inquiry will be sent soon from Shanghai in clear. Upon receipt thereof, Department will send you comments.97 Meanwhile, in case you receive a copy direct, please have in mind Department's view and suggestion as to procedure, namely, that in pressing this Government's contention, while and although we should not refuse to talk about details, we should avoid argument thereover and should base our case on the undisputed essential facts, which facts by themselves more than suffice in warrant of our position.

HULL

394.115 Panay/192: Telegram

The Ambassador in France (Bullitt) to the Secretary of State

PARIS, December 23, 1937—noon.

[Received 12:35 p. m.] 1764. In the course of a conversation yesterday, the Chief of the Far Eastern Division of the Foreign Office said that he thought President Roosevelt's direct appeal to the Emperor 98 in connection with the Panay incident was “a most wise move”. He said that this appeal, he was sure, had caused "consternation" in the minds of the Japanese military clique; and the impression left on them that the President would resort to the same procedure again, if necessary, would, if anything could do so, tend to have a restraining influence on them.

He went on to say, however, that in his opinion the situation in the Far East is getting steadily worse. He said that the French Military Attaché in Tokyo, an unusually capable and dispassionate observer, had reported the growth of a sort of secret society of younger Japanese military officers whose avowed objective is to drive all foreign nations

07

See Department's telegram No. 371, December 23, 7 p. m., to the Ambassador in Japan, Foreign Relations, Japan, 1931–1941, vol. I, p. 541; for the findings, see telegram of December 23 from the Commander in Chief of the U. S. Asiatic Fleet, ibid., p. 542.

See memorandum quoted in Department's telegram No. 343, December 13, 9 p. m., to the Ambassador in Japan, p. 496, and telegram No. 342, December 13, 8 p. m., to the Ambassador in Japan, sent with President Roosevelt's approval, Foreign Relations, Japan, 1931-1941, vol. I, p. 523.

98

out of China, accepting and even welcoming the risk of war with such nations. Hoppenot said that when the Japanese begin military operations near Canton it will be difficult if not impossible to avoid most serious incidents with the British.

Speaking of reports published in the press to the effect that the French and British were discussing the possibility of the British Mediterranean Fleet going to the Far East, leaving patrol duty in the Mediterranean to the French Fleet alone, Hoppenot said that so far as he knew no such conversations were taking place. He said that despite the seriousness of developments in the Far East neither the British nor the French would make any move to restrain by force Japanese aggression unless the United States participated fully therein. (A member of the British Embassy has made a similar statement to us regarding the reports mentioned above.)

BULLITT

394.115 Panay/205c: Telegram

The Secretary of State to the Ambassador in Japan (Grew)

WASHINGTON, December 23, 1937—8 p. m. 373. Department has been informed from an official source of indiscreet utterances attributed to a Japanese employee of Japanese Navy to the effect that the sinking of the Panay was deliberately planned, by whom not stated, to bring to light the attitude of the United States as bearing on further Japanese action; that a Japanese Navy ace, Captain Minami, was in charge of the bombing; that Minami is stationed at Sasebo and after the sinking of the Panay returned there; and that there have been planned further similar acts against Great Britain and the United States.

HULL

394.115 Panay/198 : Telegram The Commander of the United States Yangtze Patrol (Marquart)

to the Chief of Naval Operations (Leahy)

[HANKOW,] December 24, 1937—10:25 a. m.

[Received December 25—8 a. m.] 0024. Two Chinese messmen ex-Panay now at Hankow state Jap boats who boarded vessel after abandoned exploded two bombs at stern which ended vessel. State they were hidden close to water's edge and Americans had gone farther inland except possibly civilian who took some moving pictures from near river edge. Also state Jap boats machine-gunned them hiding.

* Copy transmitted to the Department by the Navy Department.

394.115 Panay/197 : Telegram

The Ambassador in Japan (Grew) to the Secretary of State

TOKYO, December 25, 1937—noon.

[Received December 25–6:30 a. m.] 680. My 677, December 24, 6 p. m.

6 1. Panay. Complete report of findings of Naval Court of Inquiry received and communicated to the Minister for Foreign Affairs today. Repeated to Shanghai and Commander in Chief.

GREW

394.115 Panay/251

The Navy Department to the Department of State

WASHINGTON (undated).

[Received January 3, 1938.] A confidential and thoroughly reliable source of information discloses that the Imperial Headquarters in Tokyo informed Admiral Hasegawa of the satisfactory settlement of the Panay affair, and directed him to take especial precautions in the future. Furthermore, Admiral Hasegawa was notified by the same authority that, unless American lives and property in China were respected, friendly relations with the United States could not be relied upon. On December 26th Admiral Hasegawa issued these instructions to his command.

394.115 Panay/211 : Telegram

The Ambassador in Japan (Grew) to the Secretary of State

Tokyo, December 29, 1937—10 a. m.

[Received December 29—2:20 a. m.] 694. Department's 381, December 28, 5 p. m. I immediately consulted Prince Tokugawas with regard to the disposal of donations received in connection with the Panay incident and am in constant touch with the officers of the America-Japan Society who have agreed to handle the matter and are now discussing the most helpful way to use the funds in the interests of Japanese-American friendship. They now have under consideration the possible endowment of a hospital bed but it is difficult to reach a decision until the final approximate amount of contributed money can be ascertained. I have urged the importance of an early decision as well as a public statement by Prince Tokugawa as soon as the plans can be settled.

Not printed.

Not printed; see Department's telegram No. 361, December 18, 6 p. m., Foreign Relations, Japan, 1931-1941, vol. 1, p. 530.

* President of the Japanese House of Peers and of the America-Japan Society. GAUSS

GREW

ATTITUDE OF THE AMERICAN GOVERNMENT ON EXPORT OF MILITARY MATERIAL TO CHINA AND SERVICE OF AMERICAN CITIZENS WITH CHINESE AIR FORCE

793.94/9389: Telegram The Consul General at Shanghai (Gauss) to the Secretary of State

SHANGHAI, August 15, 1937–3 p. m.

[Received August 15—10:45 a. m.] 487. John Williamson, aviation instructor of Commission on Aeronautical Affairs of Chinese Government, has disclosed to me today that he and other aviation instructors, all Americans, are expected to advise and to instruct from the ground in the present conflict between China and Japan. (I have heard that unmarried men may be expected to serve as squadron leaders; but he does not confirm this.)

In reply to his question as to whether this would be in violation of the statutes, I have expressed the personal opinion that it would be so, inasmuch as there is actually an armed conflict approximating a state of war and he would be serving the combatant air forces of one power engaged in conflict with the forces of a power with which the United States is at peace.

In the absence from China of the District Attorney, I have informally consulted Assistant Attorney General Robert H. Jackson, at present in Shanghai, and while of course he has no official status in this jurisdiction he has expressed the opinion that such activity on the part of American citizens who are engaged by the Chinese Government in instructing, advising, and counselling military flying under the present circumstances, brings them squarely within the purview of the statutes.

Williamson says he will be guided by any advice I may give him and if it is as I state it above he will leave China at first opportunity. He asks, however, that his colleagues at Nanking be given same advice as is given him. I will communicate separately to the Embassy at Nanking the names of the Americans there who are concerned.

I request any instructions the Department may see fit to give in this matter. Repeated to Nanking.

* For previous correspondence concerning the export of military material to China, see Foreign Relations, 1936, vol. IV, pp. 553 ff.

793.94/9389: Telegram The Secretary of State to the Consul General at Shanghai (Gauss)

WASHINGTON, August 17, 1937-7 p. m. 241. Your 487, August 15, 3 p. m. Department is of the opinion that activities of the American citizens described in first paragraph of your telegram reasonably come within the purview of Section 4090 of the Revised Statutes and may be prohibited by the United States Court for China pursuant to authority conferred on the Court by Section 1 of the Act of June 30, 1906.5

Williamson and other American citizens concerned should be so advised.

HULL

793.94/9510 : Telegram

The Consul General at Shanghai (Gauss) to the Secretary of State

SHANGHAI, August 19, 1937—8 p. m.

[Received August 19—noon.] 518. Reference my No. 487, August 15, 3 p. m. Japanese Consul General informed me this afternoon orally that Japanese have received reports that American aviation instructors are participating in the Chinese Air Force operations. I stated in reply that I had no information to confirm this report; that I knew that two of these instructors were in Shanghai at this time and that I have seen them daily and know they are not participating in any such activity; and that if he would inform me of the name and whereabouts of any American concerned I would put the information in the hands of American judicial authorities for consideration and proper action under the American law. Repeated to Nanking.

GAUSS

893.20/608: Telegram

The Consul at Hong Kong (Donovan) to the Secretary of State

HONG KONG, August 21, 1937—2 p. m.

[Received August 21–9:50 a. m.] Four American aviators, Floyd Nelson, Frank Havelick, Hugh L. Woods, and James Barr have landed in Hong Kong en route to Canton in plane owned by China National Aviation Corporation. Although Pan American Airways has minority interest in corporation, the latter is Chinese controlled and operates commercially in China. It there

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