793.94/4189: Telegram

The Minister in China (Johnson) to the Secretary of State

1.
I have the following estimate to make of the situation of Shanghai.
2.
Area known as Chapei, which has grown up around terminal of the Shanghai-Nanking Railway, is surrounded southeast and west by the International Settlement. North Szechuan Road which bounds it on the east connects the Settlement with Hongkew Park, a Settlement public park.
3.
This area has been the object of difficulty between Settlement and Chinese authorities because elements in the Settlement have long wished to add it to area of Settlement. Perhaps a third of the property in Chapei is foreign [owned].
4.
Chapei is where most of the young nationally minded Chinese have gone to live. They have taken pride in it, built the mills and factories there, have their own electric power plant and their own water. Cantonese predominate.
5.
Chapei and North Szechuan Road have been areas where Japanese have settled and prior to January 28th perhaps most of Japanese refugees from up country and Japanese unemployed lived there.
6.
There is reason to suspect that Japanese people ambitious to acquire Chapei and North Szechuan Road area as a Japanese concession, although Japanese authorities deny this.
7.
In the beginning Settlement opinion may have been favorable to such a move by Japanese.
8.
From their experience in Manchuria, Japanese evidently were convinced that they would make short and swift work of the move.
9.
Declaration of emergency as of 4 p.m. on afternoon the 28th not only shows Japan sought for opportunity as North Szechuan Road projecting like a tongue into Chapei and policed by Settlement police was assigned to the patrols of their landing party under defense scheme put into effect by declaration of existence of emergency.
10.
Japanese Navy was anxious to perform a deed of heroism in emulation of Army activities in Manchuria.
11.
Chinese, unlike situation in Manchuria, had had an opportunity to prepare. They had plenty of cover in streets of Chapei which was unexplored field for Japanese marines.
12.
Over-confident Japanese met with a severe defeat and their defeat continues 16 days after initial attack.
13.
Japanese armed civilian volunteers were guilty of all manner of excesses before they were finally removed from field of action. Their work was paralleled by that of Chinese gunmen.
14.
Having been checked in their advance Japanese turned loose everything they had and began systematic destruction of Chapei by aerial bombs, cannonade and incendiarism. This is still going on [Page 319] with increasing vigor and Japanese have gained little beyond the destruction of an enormous amount of valuable property, Chinese and foreign.
15.
Every day situation has become worse for Japanese who have suffered a wound to their pride from which they cannot soon recover. According to our views, prestige in Asia is at stake, their position as a world power is even at stake.
16.
Japanese are now making preparations on a very large scale to batter away here at Shanghai until they have driven Chinese forces from the field.
17.
Chinese 19th Army which is composed of Cantonese has made a great name for itself. It has defeated a foreign force, they are heroes of the Cantonese political faction and of nationalistically minded youth who have fostered the anti-Japanese movement, they are heroes of the purest patriotism China has so far known.
18.
Other Chinese political factions which have counseled conversation and passiveness are jealous of prestige which it and its political Cantonese adherents are achieving but are forced to support it with men and money.
19.
Question is, can the Cantonese troops now retire without loss of prestige?
20.
Chinese leaders, including leaders of the Army, foresee inevitableness of defeat and are anxious to receive advice. They dare not act on their own initiative.
21.
It is dangerous for foreigners to advise lest they will be held responsible for odium attached to retirement of Chinese.
Johnson