711.94/1795
The Department of State to the Japanese Embassy 72
Oral Statement
The Japanese Embassy’s memorandum does not meet this Government’s complaints in regard to economic measures and restrictions which adversely affect American interests enforced in portions of China under Japanese occupation. The views of this Government on this general subject were set forth in this Government’s note of December 31 [30], 1938,73 which the Japanese Government has not answered. In that note it was stated that, with reference to such matters as exchange control, compulsory currency circulation, tariff revision, and monopolistic promotion in certain areas of China, the plans and practices of the Japanese authorities imply an assumption on the part of those authorities that the Japanese Government or the regimes established and maintained in China by Japanese armed forces are entitled to act in China in a capacity such as flows from rights of sovereignty and, further, in so acting to disregard and even to declare nonexistent or abrogated the established rights and interests of other countries, including the United States. Furthermore, such measures in practice give Japanese interests a definite and wide preference to the corresponding definite and great detriment of the interests of third powers.
With regard to the question of terrorism, the statement that terrorism in Shanghai comprises “in most cases” acts of anti-Japanese agents is not a statement which, it is believed, is borne out by the facts. This Government unreservedly condemns terrorist acts by whomsoever committed and it is this Government’s opinion, looking at the question of the maintenance of peace and order in the International Settlement from a purely practical point of view, that if the Japanese Government would take steps to cause a cessation of acts of terrorism in the International Settlement by Japanese agents or instrumentalities, a long step would have been taken toward enabling the authorities of the International Settlement to suppress acts of terrorism committed by anti-Japanese or other offenders. [Page 882] As the Japanese Government is well aware, the authorities of the Settlement have exerted every effort within their power to maintain order in the Settlement and those authorities have every right to expect the fullest cooperation of the military and civil authorities of all nationalities, including the Japanese military and civil authorities, in that effort. This Government cannot, of course, accept the statement that “the Nanking Government, with the support of the Japanese Army, is the only authority” responsible for order in the International Settlement.
With reference to the statement in the Japanese Embassy’s memorandum to the effect that recent incidents are a natural aftermath of the July 7 incident at Shanghai involving American marines and Japanese gendarmes, it should be pointed out that, apart from any question of accuracy, this statement does not take into account and explain the long series of incidents involving Japanese and American nationals which have occurred over a period of three years.
With regard to the July 7 incident, the statement that a local settlement of that incident had been tentatively reached is not correct. No instructions have been issued by the Department of State “vetoing” a local settlement. That a local settlement has not been reached is due to insistence by Japanese local authorities that an “apology” be made by the American authorities. At no time did the American authorities at Shanghai consider that the circumstances warranted the making by them of an apology.
With reference to the statement that settlement of Japanese-American incidents will be possible “only through negotiations with the local authorities”, it may be observed that, while this Government ordinarily has no objection to the settlement of incidents locally and as a general rule prefers local adjustments, this Government of course reserves the right to present its views to the Japanese Government at any time in regard to any aspect of the relations between the two countries.
In this Government’s opinion the question of the procedure to be followed in the settlement of incidents is of minor importance in comparison with the question of avoidance of incidents, and the fact that certain incidents are adjusted locally as individual cases does not dispose of the important larger question involved in the continued occurrence of incidents. This Government has on several occasions expressed the view, which it continues to hold, that anti-American agitation and instances of mistreatment of Americans by Japanese military and other agents would not occur if the Japanese Government undertook to issue to its military and other agencies and instrumentalities peremptory instructions that Americans should be treated with civility.
[Page 883]This Government is well aware of the “realities” in the Japanese-occupied portions of China. Included among these realities is the long-standing and wide-spread Japanese interference with American rights and interests.
Speaking frankly, the contents of the memorandum are, in our opinion, unresponsive to the complaints of this Government to which the memorandum was addressed.
In conclusion, this Government has noted with regret that the tone and language used in some parts of the Japanese Embassy’s memorandum of August 23 are of a character tending to militate against a reasonable prospect of reaching an adjustment of some of the outstanding difficulties between the two countries. It is possible, of course, that the use of the tone and language under reference is due to language difficulties on the part of the drafting officers.