894.00/690: Telegram

The Ambassador in Japan (Grew) to the Secretary of State

43. Embassy’s 36, February 2, 7 p.m.

1. Political observers ascribe formation of moderate Cabinet to army realization that it had gone too far in opposing will of rest of nation. The army’s wrecking of the Hirota Cabinet resulting from the former’s quarrel with the political parties and its successful obstruction of Ugaki who was the almost unanimous choice of the Nation exclusive of the army for Premier brought about a suggestive undercurrent of criticism of the Japanese Army’s interference in politics which led army leaders to encourage the formation of a Cabinet with less military and fascist leanings than was expected. Hence the choice of Nakamura instead of the strong Itagaki as War Minister.

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2. Statesmen close to the Throne desired a Cabinet with not too strong leanings either toward fascism or liberalism in order to avoid a frontal clash between the two ideologies. Japanese politics are usually opportunistic and this seemed the moment for a comparatively innocuous Cabinet which would avoid radical change but would gradually enforce necessary reforms.

3. Such is the Hayashi Cabinet, without decided complexion, without the support of the political parties, and without marked convictions or theories although more mature public appraisal is inclined to regard it as less colorless than at first believed. While somewhat more under military influence than the preceding Cabinet it is probable that this influence will be exerted with restraint owing to the attitude of the military leaders described in paragraph 1. There are indications that before further asserting their power the army leaders will await the development of the new reactionary political party which will support and be supported by the army. The facts concerning this new party which had its origin in a grouping of military and other patriotic societies under the incentive of the retired General Tatekawa will be reported by despatch.

4. The Premier is exclusively a soldier, honest, rational, straightforward, not a forceful character, influential in army circles though with little experience in politics and government.

Nakamura and Yonai are good service men but almost unknown outside the army and navy.

Yuki is generally believed to be the strong figure in the Cabinet. A protégé and follower of former Finance Minister Takahashi, he can be expected to follow tenaciously the cautious financial policies of his renowned predecessor. It is the general opinion that he will endeavor to reduce the financial burden on the people as far as the military will permit and will avoid sudden or drastic moves which might endanger the financial structure.

No other members of the Cabinet are outstanding in reputation and few are well known to the public.

5. The indeterminate character of the Cabinet is illustrated by the vagueness of its supposed policies as published in the press:

Thorough clarification of the national policy.
Establishment of a definite diplomatic policy.
Repletion of national defense and development of national industry.
Righteous administration under the Imperial Constitution.

6. The Hayashi Cabinet is generally regarded as a transitional and temporary government meant to tide over a political crisis and perhaps constituting a short step on the road to some sort of Japanese fascism. The absence of support from the political parties (no members [Page 709] of the Cabinet are members of the parties) and its general weakness would appear to presage a short life but such Cabinets often survive for an unexpectedly long time in Japan. Some observers are of the opinion that it will live for about a year unless it is overthrown earlier by some unforeseen cause. It will undoubtedly meet with opposition in the Diet but as too strong opposition would result in dissolution and it is not believed that the politicians will carry their criticism to extremes.

Repeated to Nanking by mail.