THE Panay incident is closed. The Secretary of State accepted from Japan an apology, somewhat evasive but less so than any ever before offered by that country to a foreign Power. The apology was coupled with some face-saving falsehoods which every one recognized as such and which were not allowed to pass unchallenged. But the incident is closed and with it another chapter of our Far Eastern policy. With far less provocation, the United States has in other days resorted to hostilities in a dozen places in the Caribbean area and in the Far East. But at this moment the American people were pacifist by a large majority. There can be no doubt that the handling of the Panay affair won for the President and the Secretary of State very nearly unanimous approval. However, the United States still has economic and political relations with the Far East. The Sino-Japanese war still continues. And other incidents are certainly possible; some think them probable.

Many people both here and abroad have been wondering for twenty years whether a war between Japan and the United States can, in fact, eventually be escaped. The Panay incident, even though closed like the sinking of the Lusitania, makes the idea of such a war almost plausible. No Japanese statesman, civilian or military, should be deceived by the pacifistic tone of American sentiment in the closing months of 1937. Public opinion in a democracy is liable to a flip-flop overnight. Japan is nearer to war with the United States than she ever was before. To start it, only one or two new Panay affairs would be necessary, or perhaps an attack similar to that visited upon the British Ambassador to China last summer. Anyone who lived through, or has studied carefully, the period from the invasion of Belgium in August 1914 to Germany's resumption of unrestricted submarine warfare in January 1917 knows the wide swings of which American public opinion is capable.

A new chapter is opening in Japanese-American relations. There is, or may be, still time to reconsider policy. While Japan could very easily make it impossible for even the most pacifistic administration to escape a war, it is also true that American foreign policy may still be reshaped to reduce the hazard. To give sharpness of definition to the discussion, let us consider the following hypothetical question: In the event of another Panay affair what line shall the Department of State adopt? Shall it continue, as in December, working on the assumption that only pacific means are possible for a settlement, or shall it work from the contrary assumption that, if necessary, coercive measures may be employed? Secretary Hull, in his report to the Senate on January 8, 1938, laid down principles which might be applied either way. The general policy is, first to afford "appropriate and practicable protection" to nationals in China, and second, to support by peaceful means "orderly processes" of international relations.

The broad choice before the United States in the Far East is between non-resistance and coercion. The American Government can, in the face of continued Japanese encroachment upon American rights, make protests; appeal to reason, honor, fair dealing, and respect for treaties; and "reserve its rights." It may even withdraw from the Orient entirely. Or it may adopt any of several forms of coercion, beginning with threats and widening out through naval demonstrations and economic measures (of which there are many) to military action. The action, of whatever nature, could be independent, or it could be coöperative with other Powers, concurrent, concerted, associated or allied. Whatever the measures adopted, whatever the objective -- whether narrowly to protect American lives and property, to preserve American interests, to avoid war at any cost, or more broadly to promote orderly international relations -- the alternatives are essentially the same: Shall a course be adopted which, followed to the end, places the United States in economic and military conflict with Japan? Or shall the policy be one which adheres exclusively to pacific means?

Before we can profitably discuss either policy and comment upon its probable or possible consequences, we must briefly recapitulate the nature and extent of the American stake in the present war between Japan and China. It is the declared intention of Japan to interpose itself between the United States and China in practically all their direct relations. Two years ago there were slightly over 10,000 Americans in China; on January 8, 1938, the Secretary of State estimated that there were about 6,000. If Japan has her way, as many of these Americans as remain will become responsible to laws dictated by Japan and to police and military forces officered by Japanese. Presumably the economic conditions under which business will be transacted between the Chinese and all foreigners will be determined in Tokyo and will be such as to give Japanese competitors preferred positions. American philanthropic and missionary enterprises, which represent a capital investment of about $40,000,000, will be destroyed or so regulated and harassed that many if not most of the Americans now engaged in them will either withdraw or accept a status similar to that held by the missionaries in Korea.

There are, according to the estimate of the Secretary of Commerce in his letter of January 4, 1938, to Senator Nye, about $132,000,000 of American investments in China. To this sum may be added some $30,000,000 to cover the value of property of Americans permanently residing there, $40,000,000 of Chinese obligations held in the United States which have been in default since the World War, and the missionary and philanthropic property mentioned above. While these sums are important to the owners, they do not in the aggregate constitute a very important fraction of the total American investment abroad. Furthermore, American trade with China represents only about 3 percent of the total annual American foreign trade. It is not to be expected that this commerce will vanish if Japan succeeds in China, nor is it fair to assume that the investments will be wholly destroyed. It is reasonable to suppose, however, that the trade will be routed through Japan, as the formerly free trade with North China is already being diverted. As regards permanent capital investments, the owners will have to trust to Japanese good faith and honesty where now they look to Chinese good faith and honesty.

In short, Japan proposes to take possession of China, or most of it, greatly curtail the free market, maintain such order as she can, take over as much of the trade as she can and, for the balance, become the exclusive broker for all financial and commercial transactions. Possibly the American trade lost in China would be gained in Japan. Quite possibly the aggregate trade of China and Japan with the United States would, for a time at least, increase. The material losses to Americans could not be great, and might be negligible, even though many individuals might suffer while the changes were taking place. For whatever losses there might be, there would perhaps be some offsets. For example, the United States now has something approaching one-third of its Asiatic fleet in Chinese waters, and has for years been spending considerable sums upon naval and military establishments for the protection of American interests there. These forces would be withdrawn from China. Thus the aggregate of American expenditure for military and naval purposes might be reduced. Some think, however, that the net effect on American military and naval policy would be to bring about an increase rather than a decrease of expenses.

To whatever direct material and spiritual losses might follow upon the changes indicated above, there would be others consequent upon the withdrawal of Americans from China. One of the main trade routes to the remainder of Asia and to the Indian Ocean passes down the China coast. This would be less secure with Japan installed in China. The opportunities for Americans to trade with the Philippines, with Borneo, with the Dutch East Indies, with British Malaya and with the South Pacific generally would at least be threatened. There could be no second thoughts, no change of mind, about American withdrawal from the Philippines. The United States would have to withdraw lock, stock and barrel.

The United States has, in the judgment of many students, a further and very important stake in the present war. Secretary Hull wrote to Vice President Garner on January 8, in the letter already cited: "There is a broader and much more fundamental interest -- which is that orderly processes in international relationships be maintained." The allusion is to the influence which Japan's example of utter faithlessness toward treaties ever since the Manchurian adventure would have on the peaceful conduct of international relations all over the world. The question raised is whether there is not some point, short of the invasion of American territory, where the American Government, for its own protection, should apply coercion to a treaty-breaking, law-breaking Power.

The American people want peace not merely within their own borders but all over the world. In that respect Americans are not unique, although they often think they are. Every nation wants peace in the sense that it wants what it wants without fighting for it. However, allowing full measure for the undoubted humanitarianism of the American people, the question remains whether peace is best served by such pacifism as that of the Congressmen who have been introducing resolutions demanding a complete withdrawal from China, or by a show of force backed up with the determination to use it if necessary. On this question Mr. Hoover said on January 15, 1938, evidently with the Far Eastern situation in mind: "We should not engage ourselves to use military force in endeavor to prevent or end other people's wars." Similarly he is opposed to the use of embargoes, boycotts and any form of economic sanctions. Mr. Hoover's position is consistently pacifist as applied to the Far East, except that it omits any consideration of what the American Government ought to do in the event of another Panay incident or in the event that next time the Japanese airmen attack the American rather than the British Ambassador.

With the foregoing in mind let us discuss the probable or possible consequences, first of the pacifist and then of the coercivist position.

Every day that the American Government continues to maintain its military forces or its foreign service in China involves a risk. Every day that the American Government continues to assume responsibility for protecting its nationals in China is fraught with hazard. "Very well," says the pacifist, "let's get out. There is nothing to be gained by staying comparable with the losses incident to a possible war with Japan." There is no law under which the 6,000 Americans now in China can be evacuated against their will, but probably most of them would come out if the Government were to recall its soldiers, marines, naval vessels and diplomatic officers and withdraw all protection. Then no official incident could occur -- although it might be observed that such a decision would in itself be an incident in the history of international relations without precedent on sea or land. Even after official withdrawal, incidents involving Americans might occur and they still might arouse public opinion.

Peace at such a price would cost what? If Japan has her way in China, she will be in the market for many years to come for capital goods, for raw materials, and for loans. (In passing, it may be suggested that as regards loans Japan now represents about the same degree of "moral risk" to bankers as does a gangster who has always paid his debts.) If Japan can secure capital, create order and develop Chinese resources, the market will blossom like the rose. Japan might become rich by the new trade, and so might some Americans. Extraterritoriality would go, but it is already on its way out. Even if the Americans were to turn to and help China defeat Japan, there would be only a brief interval before China would require the United States to surrender extraterritoriality, supposing that it had not already been yielded up voluntarily. The International Settlement of Shanghai might become another Yokohama -- not a very dreadful thought.

It is interesting to speculate on the future of American missionary and philanthropic enterprises in China in the event of official American withdrawal. These are now maintained by American beneficence at a level far above that at which China would have the economic ability to sustain them. Would Christianity disappear from China if American subsidies were withdrawn? It may be observed that historically Christianity has not only survived but has spread from century to century not by such elaborate organization and benevolence as has characterized the modern foreign missions program, but rather by its own indigenous inherent vitality. There are, no doubt, already more Christian converts in China than there were in Western Europe as late as the third century of the Christian era. If indigenous Christianity unaided by the West cannot survive the withdrawal of American subsidies and American military protection, its future is not very promising under any conditions. The missionaries themselves apparently do not desire protection. Many of them regard it at present as an incubus. The direct losses to Christianity consequent upon American withdrawal from China would not, in the opinion of the writer, be great.

There is also the possibility that even though the United States withdraws, Japan may crack before she has accomplished the pacification of her huge neighbor. Japan is already badly extended in a military way and her domestic economy is strained. The Chinese may lead the Japanese into a swamp which will engulf them. Such an outcome is not beyond the stretch of the imagination; many confidently expect it. If China were to win against Japan after the United States had abandoned her to her fate, the future of Sino-American relations would not be quite what they have been in the past. The man who abandons China will not have a niche in China by the side of John Hay, though it is true that the Chinese have short memories of both friends and enemies. However, it is easy to magnify the disadvantages to Americans in China which might follow a singlehanded Chinese victory.

Before examining the probable or possible effects of a policy of coercion, we must consider one further aspect of the pacifist policy. Without doubt there would be consequences to American foreign relations generally if, in the face of Japanese military pressure and insolence, the powerful American Government should pick up its nationals, its soldiers, its fleet, and run away. Could the President carry through such a policy? It would probably cost his party the next election, for while the prevailing tone of public opinion appears to be pacifistic, it is fickle. In the event of another Panay affair there might be a reversal of public sentiment comparable with that which followed the announcement of Germany's resumption of unrestricted submarine warfare in 1917.

Let us, however, assume for the purpose of argument that the American Government can and does abandon its interests in China for the sake of peace. The direct result might be to escape an immediate war with Japan. What the more remote results might be is less clear. Such a policy would certainly be an encouragement to the dictatorships of Russia, Germany and Italy, and, for that matter, to every land-hungry Power, big or little. We have a large degree of international anarchy now. Can one suppose that such an example of American pacifism would either restore or promote the restoration of public order? More probably it would encourage chaos such as the modern world has not yet seen.

The alternative to a pacifistic withdrawal from the Far East -- "a scuttle and run policy," as Theodore Roosevelt used to call it -- is some form of coercion to which the Japanese might find it prudent to yield. The forms of coercion are many. Some like to make a distinction between those which are warlike in character and those which involve "pressure short of war." Others regard this distinction as illusory.

For purposes of argument, let us first assume that the American Government, committed to some form of pressure, sets out to apply it with the firm resolution not to engage in war with Japan unless American territory is invaded. Several forms of pressure readily suggest themselves. There is the non-recognition policy, first invoked by Wilson and Bryan in 1915, and then by Hoover and Stimson at the beginning of the Manchurian affair. It has thus far proved a stuffed club, or, if one does not object to too many figures of speech, a red rag. It had no effect in 1915 and it has had none in Manchuria even when adopted by the League of Nations. This doctrine might be "implemented" by a declaration that the American Government will not permit loans to Japan to be made use of in developing non-recognized territorial gains. This would be very difficult to enforce and would, to be effective, involve cutting off all loans to Japan. Otherwise Japan might borrow for domestic purposes and use capital thus set free in Japan for the exploitation of China. However, if we did cut off all loans, and if the British Government would make a similar declaration and really stand pat, it is difficult to see how Japan could ever realize from its projected conquest the economic advantages which her bankers, manufacturers, and merchants have been promised.

Such a policy would be justified only by its results. If its promulgation now would make Japan stop the war, it would be a success. If it could be sustained over the years it might create a spectacle of failure which would give pause to all other Powers similarly tempted to go on the loose. On the other hand, the objections raised by A. Lawrence Lowell against the Stimson nonrecognition doctrine still remain valid.[i] It establishes a no-man's land in which foreigners have practically no legal "rights." Moreover, could an implemented non-recognition policy be sustained very long? If Japan were to ignore it, were to continue her conquest, and were to succeed, there would be great pressure on Washington and on London to "stop nursing a grudge." A nonrecognition policy seems valuable only as a threat.

Other forms of economic pressure comprise the boycott and the embargo. They are measures short of war, but not much short -- not much shorter than the severance of diplomatic relations has usually been. Probably they would provoke almost instant retaliation by Japan, and the ensuing incidents might well lead directly into war. Furthermore, the boycott and the embargo are weapons which no political party can advocate with impunity. There is possible kudos for a president and a government which leads a fight; there is none for depriving citizens of the chance of securing a material advantage. Already Mr. Hoover, speaking to Republicans, has raised the issue. The Democrats have betrayed no desire to argue the point. A private boycott is even now in effect, applied by individuals who thus find some satisfaction for their private sense of rectitude; but its effect on American trade with Japan is and will be relatively slight, perhaps diminishing it by ten percent.

There remains one other measure short of war, though again not very far short, which must be examined. The United States may without further legislation move its fleet almost wholly into the Pacific; and it may by action of the present Congress hasten its program of armament. To the pacifists that would be a bitter pill; to them it would appear as the first step toward war, and in fact it might be. There would ensue an impassioned debate over the probable effect of preparedness programs, whether they make war more probable or whether they are likely to deter the potential enemy. There would be many appeals to history, though the experience of the past is far from clear. Perhaps the answer is that in the short run preparedness makes for peace and in the long run for war. Who knows? England used her huge navy effectively for a long time but in the end it did not save her from war. On the other hand, the United States did not prepare and eventually found herself in the same big war. If the United States had been prepared in 1914 the course of the World War would certainly have been different. Perhaps there would have been none. In any event the peace would have been different, but in what respects is pure guesswork. Whether preparedness increases or reduces the probability of war is still a highly speculative question.

The argument is advanced, and is worthy of very respectful consideration, that the employment of military measures short of war in the present juncture would suffice to cause Japan to pause. Probably that would be the effect -- but not certainly. At any rate, it would be a mistake to undertake such a policy with any reservation expressed or implied as to what the next step would be in case the first one proved inadequate. The movement of the fleet into the Pacific, where the spring manœuvres are already being held; its retention there based on Pearl Harbor; and adoption of the naval building program now recommended by the President, should be neither advertised nor considered as a bluff. If the American people are prepared to follow through the course these actions indicate, perhaps nothing more would be required.

And what, asks the pacifist, would preparation to use military force against Japan, or eventually its actual use, accomplish? Would it settle the Far Eastern question? No. Would it result in the overthrow of militarism in Japan? What if it did, and out of the resulting revolution there came such a government as followed similar revolutions in Russia and in Germany? Would a war undertaken by the United States, prosecuted to the success which it certainly would eventually attain, restore orderly processes in international relations? Not wholly, but it might help; certainly it would for a long period reduce the area of the world in which a Power could do what Japan has done in the last five years. On the other hand, if the United States had to fight Japan and to conquer her, it would be left with continuing obligations in the Pacific and the Far East which would make the retention of the Philippines in 1899 look by comparison like kindergarten children playing one of Shakespeare's tragedies. The core of the political instability in the Far East is the weakness of China. Intervention by Western military force will never transmute China's weakness into strength. At best it can only relieve the pressure against China and create favorable external conditions for an internal development which in any event will require a long, long time, and which may never take place at all.

It has been suggested that some interposition of force at this time, whether for the narrow purpose of protecting American nationals or for the broader purpose of vindicating orderly international procedure, would be for China such a help as in the future to build up among the Chinese a very profitable fund of good will toward the United States. This is the gratitude argument. It flows from the fundamental assumption that nations, like individuals, are capable of moral responses. This argument is very congenial to the Wilsonian school of political thought. Woodrow Wilson ascribed to humanity, mankind and the world (synonyms apparently for people and antonyms to governments) both conscience and intelligence in their corporate responses. If that concept is correct, probably we might count on the gratitude of China. But before giving much weight to such an argument one would like to see it supported by some clear illustrations of gratitude in the past on the part of other nations. If there have been occasions where sentiment turned a decision of high policy, political or economic, either way, the writer has overlooked them. Of all nations in the world, Japan has most reason to be grateful to the United States. No, nations are never grateful, nor are corporations, nor any considerable group of people organized for corporate action. The gratitude of a nation is no more substantial than the conscience of mankind.

Of all the arguments advanced in support of a strong policy toward Japan only one appears to the writer to be very sound. Intervention in the Sino-Japanese conflict will produce no certain material advantage for Americans engaged in Far Eastern trade. Far from solving the Far Eastern political question it may easily muddle it still more. If the United States is to undertake a strong policy against Japan it must shape it not as intervention in the Sino-Japanese war but rather as a defense of orderly processes of international government in the Pacific, and it must confine its efforts severely to that declared purpose.

Thus far we have considered possible coercive action against Japan as an independent American policy. Some who advocate such a policy assume that at least England and perhaps also France would adopt concurrent or concerted action. The Singapore naval base is now developed to a point where England can defend it by a fleet for which she would have ships available if France and she were to agree on concerted naval arrangements in the Mediterranean. With an adequate British naval force at Singapore, and with an American naval force at the Panama Canal and around Honolulu, Japan, already deeply entangled in China and dependent on foreign trade routes for many essential supplies, could hardly fail to be impressed. Such "associated" action would in America revive many controversies and for the opposing party in the next political campaign, now without a platform, it would seem like a veritable answer to prayer. On the other hand, should Japan supply another Panay incident, the domestic political picture would be very different.

Those who oppose warlike measures usually resort to the extreme illustration of "sending our American boys to die in Asia." That is, of course, a possibility, though a remote one. Provided American public opinion in a war once begun could be restrained from hysteria, it would be quite feasible to fight a successful war with Japan in which no troops would be landed in any Asiatic region. There could be a naval war in which Japan would be instantly cut off from the use of all American ports and from the Panama Canal. By similar action on the part of England at Singapore, Japan would be separated from Europe except through Siberia, where the U.S.S.R. stands in the way. In the first stages of such a limited conflict, Japan could perhaps occupy most of the American territory west of Hawaii, although where she could get the men and money to do even this is not clear. To accomplish the desired result, American forces would hardly need to do more than hold the lines already indicated. That sort of a conflict might not prove immediately successful, and meanwhile the losses to British, French and American property in Japan and China would be heavy. But, sustained steadily and persistently, the strategy indicated could not fail to bring about Japanese withdrawal from China, and probably it would bring on revolution in Japan itself.

It is perfectly obvious that the American people are not now prepared to support a war against Japan. Nor is there any vigorous demand for the application of the Neutrality Act. On many scores the country is more sharply divided politically than in many years. Some Americans who under other circumstances might favor a stiff policy toward Japan would for the moment rather lose in the Far East all remaining American "face" than acquiesce in giving the present Administration any "war powers." They would fear that under the guise of war powers the Executive would seize other powers now obviously desired but thus far expressly withheld. The present administration could not at this moment lead a united people into war as Woodrow Wilson did in 1917.

But Japan would make a mistake to count too heavily on this situation. Nearly three years were required to bring the United States into the World War. Within three years there will be another presidential election in the United States. This fact is mentioned, not to conclude this article on a partisan note, but rather to remind the reader that we have been discussing alternative trends of policy rather than an immediate choice between peace and war. Even though a strong policy is eventually approved, it would begin not with a sudden declaration of war but rather with a series of measures short of war which would or would not prove effective as a means of avoiding war.

All that can be said for the moment is that both Japan and the United States are living dangerously, the one by a policy of ruthlessness, the other by indecision. The United States vis-à-vis Germany in 1916: the United States vis-à-vis Japan in 1937. The parallel is not complete, for whereas the Germans in 1916 might doubt that the entrance of the United States into the World War would materially change the odds, the Japanese, dependent on the United States now for supplies and later for capital, well know that war with us would be something like suicide. In view of this, the present policy of the Japanese is to be explained only on the grounds that without warrant they have assumed that under no circumstances will Americans fight. In this the Japanese are mistaken.

The notes to Japan of Britain, France and the United States of February 6, reported to be identic and ostensibly asking for information as to Japanese naval building plans, were little less than blunt warnings. Under the London naval agreement of 1936 the three Powers were acting together to the extent of warning Japan not to provoke a naval armament race. To such concurrent action even the most consistent pacifist and the most hardened isolationist can hardly object; this is collaboration for peace. No one, however, least of all the Japanese Government, should miss the fundamental implications. These Powers, already aroused to the point of issuing a concurrent warning, also indicate a determination to go much further in the way of naval preparations if Japan does not alter her naval policy. Thus is posed again for Japan the problem which faced her in Washington in 1921.

Japan's course in the Pacific and on the mainland of Asia in the last fifteen years raises the solemn speculation whether if there had been no agreement at the Washington Conference, if each Power there represented had retained its freedom of action as to naval building and fortifications in the Pacific, if the naval preparations then projected had been carried through, Japan would ever have embarked upon the Manchurian adventure, and Japanese airmen would ever have ventured to bomb a British Ambassador or sink the Panay in the Yangtze River. The results of the collaboration of the Powers at the Washington Conference were at the time regarded with much satisfaction by both pacifists and isolationists. Yet as long-range peace measures the Washington treaties must now be regarded as failures. Perhaps any long-range peace measures are impracticable. Perhaps what is required is day-to-day adaptation of appropriate means to meet changing situations.

The next step for the United States would appear to be adequate preparation for a possible war in the Pacific, which now more obviously than in 1922 is not to be warded off by such measures as were adopted at the Washington Conference. The alternative policy -- the pacifist policy -- offers no better assurance of permanent peace in the Pacific than it did for the United States vis-àvis Europe in 1914-1917.

[i] "Manchuria, the League and the United States" by A. Lawrence Lowell. FOREIGN AFFAIRS, v. 10, no. 3, April 1932.

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  • TYLER DENNETT, former President of Williams College; formerly Historical Adviser in the Department of State; author of "John Hay: From Poetry to Politics" and other works
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