711.94/1407
Memorandum by the Secretary of State
The Ambassador of Japan called at his own request. He began to approach matters of difference between our two Governments but I interrupted him to say that we were deferring all these matters to Ambassador Grew and the Japanese Foreign Minister at Tokyo.
The Ambassador then said that he had not come to discuss the various questions pending, but that he did wish to make inquiry regarding the violation of a contract between Japanese agencies and American citizens in connection with certain kinds of the most desirable gasoline. I replied that I was a little surprised that his Government, with a long list of violations of treaties, agreements and American [Page 54] interests all over China, would so much as take notice of a single minor matter such as the question he had in mind. I then said, suppose this small single matter be filed away in a pigeon-hole as has been done in so many cases of injury to American rights and interests in China, so that it could at some time in the future be taken up and discussed to a more or less extent. I remarked that so many countries were engaged in fighting in various parts of the world, either for conquest or for some other unknown and unthinkable purpose, that my Government felt that it should undertake to conserve quite a number of commodities and products in order to be able better to defend itself in case it should be attacked and that the gasoline proposition was a part of this conservation.
I elaborated generally by saying to the Ambassador that, of course, he knew how earnestly I and others have pled with his Government since 1933 to pursue a peaceful law-abiding course of cooperation, economically and financially, with this nation; that it should be five times more desirable and more beneficial to Japan both from the long and short view, but the Army people in particular seemed to brush aside this sort of sound peaceful advice and pleading with the result that they moved into China with their military forces back in July 1937. I stated that my Government was under no illusion as to what was going on over there and what was the real purpose so far as violations, not only of treaties but especially the principle of equality of industrial and commercial rights and opportunities, were concerned; that in due time everyone would be elbowed out, as in the case of Manchuria, so that a preference for Japanese could be established throughout continental Asia. The Ambassador said that exports to Manchuria had increased, to which I replied that 85 to 90 percent were temporary exports in the way of military supplies and implements.
I then brought up the proposed new puppet government and said it was currently believed that this was being organized by Japanese military forces with the result that it would be conducted as in Manchuria altogether for and in the interests of Japan and at the expense of other nations. The Ambassador rather mildly denied this view but not even to his own satisfaction, as it seemed to me. He sought also to indicate that his Government did not expect to deny other nations their rights under the open door policy, or especially the principle of equality of commercial and industrial rights. I brushed aside this theory in view of the concrete facts, adding that the Japanese Government could in short order, if and when it might so desire, make clear to the world its position to this effect, but, of course, there was no real disposition so far for it to do so.
The Ambassador again referred to the alleged breach of the gasoline contract. I said that an additional reply or comment on the matter [Page 55] might well be that, in the language of the Japanese Government relating to the Nine Power Treaty, the gasoline understanding has become “obsolete”. The Ambassador appeared a little amused but not much.