The border incidents in the Far East were disturbing but the Russian forces were still so strong that he did not believe that the Japanese Government intended any serious penetration. He admitted that the danger lay in the independent authority and possible action of local Japanese officers. He mentioned the fact that about two months ago a Japanese force of 100 men or so penetrated into Soviet territory to a distance of between three and four miles; that a comparatively small group of Russians fired upon them and killed eight or nine, but that this fracas had never been mentioned by the Japanese press. He thought that possibly the irritation on the border was kept alive by the Japanese in order to concentrate the interest of the Soviet forces in that vicinity and so leave the Mongolian frontier more exposed.

The Ambassador spoke with great enthusiasm about the morale in the Soviet Army, which he described as far superior to what it had been formerly; the modern army was educated, well clothed and disciplined, and which was of especial significance, had learned courtesy to and respect for women. For instance, he said that in the ordinary tramcars in Moscow, the Soviet soldier would always give his seat to a woman, whereas formerly that had never been the case.

In referring to Germany, he mentioned the generous credit which the German Government had offered for a period of ten years; he supposed the explanation lay in the fact that Germany needed raw materials which it could get from Russia, such as manganese, oil etc.; but the fact that Germany was willing to extend such huge credits indicated that there was no early intention at least of making war on Russia, for in such case Germany would incur great financial loss. The Ambassador thought that Czechoslovakia and Rumania were in considerable danger from Germany; he did not seem to feel that the same danger applied to Memel. He mentioned the fact that England and France were offering credits to Russia, and that there had been renewed efforts on their part for the settlement of debts, but he did not indicate that the Soviets had yielded in this respect. The Ambassador felt certain that the Sarraut's Government in France would ratify the treaty of mutual assistance with Soviet Russia and do so in the near future.

I asked whether the Ambassador had returned to us with any renewed hope of a satisfactory disposition of our problems. He indicated that he had more hope now than he had after his previous visit and return, and I gained the impression that he may have new proposals to offer us.

W[ILLIAM] P[HILLIPS]

500.A15A5/678

The Ambassador in Japan (Grew) to the Secretary of State No. 1665

TOKYO, February 7, 1936. [Received February 24.]

SIR: Reference is respectfully made to the Department's strictly confidential telegram No. 2, January 7, 7 p. m.," and to our strictly confidential reply No. 7, January 9, 6 p. m., both telegrams on the subject of rumored negotiations for a non-aggression pact between Japan and China and a tentative personal proposal made by Mr. Craigie, British Assistant Under Secretary of State for Foreign Affairs, to Mr. Norman Davis that we consider the advisability of concluding non-aggression pacts between the United States, Great Britain and Japan, should a Sino-Japanese pact be consummated, in return for the acceptance by the Japanese of a naval agreement acceding to the present naval status quo. In our reply I stated that we did not think that a Sino-Japanese pact was feasible at the present time, but that should it materialize, the idea advanced by Mr. Craigie should not be turned aside without careful consideration in view of the obsolescence of the present Far Eastern treaty structure and the necessity of revising our future outlook and policy in the Far East. It appears desirable to supplement our telegram with a more detailed explanation of our thoughts on the question, namely that while doubting the feasibility of a Sino-Japanese non-aggression pact for some time to come, and further doubting the advisability at present of bilateral non-aggression pacts between the United States, Great Britain and Japan, we believe that our Government should lose no opportunity to explore every avenue which might lead to a political agreement respecting American rights and interests in the Far East, in view of the fact that new facts and conditions will eventually compel us, as well as other peoples of the world, to revise our outlook upon the political status of the Far East.

It would seem desirable first to examine the "new facts and conditions" in the Far East, mentioned in our telegram No. 7, January 9, 6 p.m., and then consider the course which the United States can most wisely and profitably follow in this part of the world in future. This discussion seems for the moment to be hypothetical and academic. In considering the premises upon which an argument for or against the conclusion of revised political agreements in respect to the Far East may be based, the following points might be taken into consideration:

69

See telegram No. 4, of the same date, to the Ambassador in China, p. 3.

PREMISES

(1) The attitude of Japan in the past toward such collective pacts as have been concluded for the security of the world in general and the Far East in particular has not been such as to inspire confidence in the inviolability of such non-aggression pacts as Japan may adhere to in the future.

(2) Nothing save defeat in war (and perhaps in the long run not even that) will arrest the Japanese movement to obtain eventually at least de facto political, military and economic control of the northern areas of China. This movement may be accelerated by military operations as in Manchuria, or it may develop slowly behind a facade of alleged autonomous governments subservient to the Japanese, as in Hopei and Chahar.

(3) The movement is based on a three-fold urge: (a) to provide broader economic opportunity for Japan's steadily expanding population; (b) to control essential raw materials which Japan lacks; and (c) to consolidate Japan's strategic position against Soviet Russia and thereby to hold Communism in check. The basic and primary urges are the first and second, but the principal impelling force at the moment, at least among the military, is the third urge, namely, to place themselves in such a position on the mainland of Asia as to prevent the spread of Communism, especially into Japan, to preserve a Pax Japonica in the areas adjacent to their own territory, and to consolidate their control of Manchuria by securing a degree of control over Mongolia and North China. These urges in Japan are strong and insistent, and the world cannot expect that they will be eradicated by moral suasion or other peaceful methods.

(4) The Japanese expansionist movement will interfere to a progressively greater extent with American rights and interests in the areas which come under Japanese control, as it has already interfered with our rights and interests in Manchuria. At the same time, it will probably interfere to an even greater degree with British rights and interests which are believed to be more extensive than ours in the areas under consideration.

(5) We as a nation are therefore faced with certain inescapable facts with which it is becoming increasingly impracticable to deal on a legal, moral or idealistic basis-in other words on any of the foundations upon which the policy and acts of the United States in the Far East are traditionally based. This does not mean that the United States should scrap its time-honored belief in the principle of the inviolability of treaties and in the moral and idealistic standards which it has traditionally championed, but it does mean that in dealing with Japan we can no longer rely on those principles and standards and that we must supplement them in whatever effective way may command itself.

(6) If and when China enters into some political agreement with Japan, whether called a non-aggression pact or given some other name, it can be assumed that the agreement would accept, expressly or tacitly, the fact of the existence of "Manchukuo" and of the Japanese political and economic penetration of North China. It is obvious that under such circumstances the present treaty structure governing the relations of the Powers with China, already crumbling, would either juridically or practically have become entirely obsolete. The principle of the maintenance of the territorial and administrative integrity of China would then have lapsed, China herself having accepted the violation of her own territorial and administrative integrity.

(7) The United States would then be confronted with the problem either of endeavoring to uphold an obsolete treaty and to defend a helpless country, or of simply endeavoring to safeguard American rights and interests in the Far East as best we might under the conditions then obtaining. In endeavoring to safeguard our rights and interests we would not have to deal with a general scramble of the Powers for spheres of influence or special privileges as in the past, but exclusively with the activities of one country, Japan.

POSSIBILITY OF A SINO-JAPANESE NON-AGGRESSION PACT

In considering the arguments for and against revised political agreements, based upon the above premises, it might be well first to consider the possibility of a Sino-Japanese non-aggression pact because much of the argument to follow is based upon the existence or non-existence of some such agreement.

In the opinion of this Embassy, it is doubtful if any Sino-Japanese non-aggression or other political pact can be concluded at the present time. The Japanese military, still the dominant force in the Japanese Government, do not wish to have their hands tied by any pacts binding the nation to peaceful methods. They had their experience of such pacts with the Covenant of the League of Nations, the KelloggBriand Pact and the Nine-Power Treaty, and they do not desire any more such pacts, except possibly with Great Britain and with the United States, the only nations in the Pacific strong enough to oppose Japan by sea. This attitude on the part of the Japanese military is indicated by their refusal to consider the various non-aggression trial balloons sent up by the Soviet Union. On the other hand, it appears to be extremely doubtful if the Chinese Government would accept a non-aggression or other political pact with Japan. As was pointed out earlier in this despatch, a non-aggression pact implies some sort of political agreement, and any sort of peace-making political agreement between China and Japan at the present time would

certainly imply the acceptance, de facto or de jure, by China of the existence of "Manchukuo" and of the partial loss of sovereignty over North China. It is not believed that any government in China today could or would conclude such a pact. This view is, I believe, shared by our Embassy in China. At the same time, it must be remembered that Japan is pressing China for a political agreement involving acceptance by China of the status quo, and therefore the possibility exists that China may eventually be forced to acquiesce in Japan's demands, choosing between acquiescence or war with Japan. In either case, however, as far as can now be foreseen, the result will be the partial or complete domination of China by Japan, and it is this fact which we must take into consideration in mapping our future course in the Far East.

POSSIBLE ADVANTAGES OF ANGLO-AMERICAN-JAPANESE

NON-AGGRESSION PACTS

Turning now to the question of a tripartite or a series of bilateral pacts between the United States, Great Britain and Japan in regard to our respective relations in the Far East, it can be argued, as an advantage of such a pact or pacts, that we could stabilize the situation in the Far East to an extent sufficient to warrant the United States and Great Britain in asking Japan to accept the naval status quo, thereby giving us a definite naval superiority over Japan for a period of years. It is believed that any pacts or agreements entered into in the future relating to conditions in the Far East should be made to cover only a definite, limited period, probably for not more than, say, ten years and renewable for another similarly limited period at such time as could best be obtained at the time of renewal. The gradual decay of the treaty structure based on the Washington Conference of 1921 and 1922 is evidence of the impracticability of concluding pacts designed to cover an unlimited period such as in the case, for instance, with the Nine-Power Treaty. If, however, for a period of approximately ten years we could obtain naval superiority over Japan and at the same time avoid an expensive and dangerous naval construction race, something worthwhile would have been accomplished. The question of the quid pro quo-a very large question-will be discussed later when considering the disadvantages of such a pact or pacts.

It is believed possible that the British Government may be seriously considering some sort of political agreement with Japan whereby in return for Britain's acceptance of the status quo on the Asiatic mainland, Japan will agree to respect British rights and interests in Asia. If Great Britain should conclude such an agreement and the United States refuse to consider a similar agreement, we would be confronted with the same situation that the Four-Power Pacific