Foreign Relations of the United States Diplomatic Papers, 1938, The Far East, Volume III

893.00/14242

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

No. 37

Hankow, May 23, 1938.
[Received July 5.]

Sir: I have the honor to submit the following, which is intended somewhat briefly to review events in China since the beginning of 1937.

The year opened with a domestic political situation upset by the kidnapping of Chiang Kai-shek during the closing days of 1936. There was a definite impression that the Generalissimo’s release from his captors, who comprised a group made up of Chinese communists, officers of the northeastern army under Chang Hsueh-liang, and officers of the Shensi provincial forces under Yang Hu-cheng, had been effected as the result of an understanding between the Generalissimo and those forces calling for a more active policy of opposition to Japanese encroachments on China.

Up to this time China’s policy vis-à-vis Japan had been one of conciliation tempered by passive resistance. The Generalissimo and those who immediately surrounded him, feverishly working on plans of national reconstruction and dominated by business interests in Shanghai, feared a policy of active opposition to the Japanese lest it bring war, for which they felt the country was unprepared and which would bring reconstruction plans to a halt. The Government was in no position to make a formal settlement of outstanding issues with Japan, however, because it was too weak to accept a settlement along the very onerous lines laid down by the Japanese Government—amounting almost to complete capitulation—and to lead the rest of the country into accepting such a settlement. Its policy was one of weakness and depended for its success upon domestic developments in Japan: there was always the hope that in Japan the advocates of a strong policy in China would lose, in the conflict which it was known was going on between them and those who advocated a more liberal China policy.

Since Japanese occupation of Manchuria in 1931 and the advance of the Japanese southward into eastern Hopei, there had arisen among the Chinese a longing for a cessation of the domestic strife which had racked the country since the Revolution of 1911. People high and low realized that domestic disunity made China an easy prey for the kind of aggression which Japan seemed prepared to wage. The kidnapping of the Generalissimo at Sian in December, 1936, did more than anything else to crystallize public attention upon this main weakness in China’s domestic politics, and centered all eyes upon the Generalissimo as a symbol of Chinese unity,—as opposed to Chang Hsuehliang, the Young Marshal, who became overnight the symbol of that disunity which the people hated and were ashamed of. It was not so much the popularity which the Generalissimo as an individual may have enjoyed that brought the country as a whole suddenly to his support, but the feeling that the forces in favor of unity had won a victory. The people began to feel that the Generalissimo and those who stood with him at the head of Government had done more for Chinese unity in the past ten years than any other group which had come forward to leadership.

But this victory for unity had not been achieved without a price. The price paid was the terms which apparently were made at Sian before the Generalissimo was freed. It was believed then—and I know no reason to change that opinion now—that, as the result of conferences which the Generalissimo had with communist leaders at Sian, he agreed that there would be no further active hostilities against the communists, who would be allowed to remain in peace where they then were in northern China; that the communist forces would be given financial assistance by the Central Government; and that by gradual stages officials sympathetic to the communists would be introduced into the Central Government. More important and more fateful for the Government’s course of action, though, was the understanding that the Government’s policy vis-à-vis Japan would stiffen. A stiffening of the Government’s policy vis-à-vis Japan was acceptable not only to the communist groups concentrated in northern Shensi, but also to the Kwangsi group led by Li Tsung-jen and Pai Chung-hsi. Put in another way, the settlement at Sian was understood to mean a shift in policy away from conciliation of Japan to conciliation of Russia, although there is no evidence to indicate that Soviet Russia at that time had anything to do with the settlement. The shift was due to fear of Japan rather than love of Russia.

The Chinese people and their leaders were not interested then, nor are they interested now, in seeking the alliance of any foreign country. There are plenty of Chinese, prominent political leaders among them, whose training was received in Japan and whose tendency was in the direction of closer and friendly relations with the Japanese, a people whose culture and civilization they understood and were in sympathy with. But they feared Japan. They feared the loss of independence which closer relations with Japan threaten, not only because of Japan’s actions in Manchuria and North China, but because such advances as Japan had made indicated a Japanese ambition completely to dominate China politically and economically. To this the Chinese were opposed, and if compromise with the so-called communist group in China meant a drift in the direction of Russia, the Chinese preferred that course with its uncertainties to what they considered to be a certain future with the Japanese. Thus it was that the Sian incident which occurred at the end of 1936 left the Chinese Government and its leadership definitely pledged to a policy of resistance by force to further Japanese encroachment.

[Here follows review of foreign and domestic developments since early 1937.]

In so far as this Embassy has been able to observe, responsible leaders of the Chinese National Government had, by July, 1937, reached the determination that, at the next indication of Japanese encroachment upon China, China would have to throw its entire strength into resistance. They were forced to this decision by two considerations: (1) a review of Sino-Japanese relations during the past thirty odd years revealed a never-ending series of Japanese encroachments upon China’s sovereignty and territorial integrity, which the Chinese leaders believed must lead ultimately to the subjecting of China to a domination by Japan not unlike that which Great Britain exercises in India; and (2) the commitments which the National Government had been forced to make to the communists and other dissatisfied groups as a result of the Sian incident. These commitments, although they were wrested from the Central Government by a small group of dissatisfied leaders, carried the popular support of the nation; and political and intellectual leaders who have guided the destinies of the Chinese people on the road toward national, political, economic and intellectual unity during recent years realized that they could not survive if they permitted the continuation of the gradual process of Japanese aggression without resistance.

From this determination it logically followed that, with the outbreak of hostilities in North China between the Japanese forces and the troops of General Sung Che-yuan—who were reported as being none too determined and not to be counted upon, but who at the same time stood between the popularly-termed Central Government forces and the Japanese—the Chinese should, if possible, do what they could to shape the course of events so as to extend as much as possible the Japanese lines and at the same time make it possible for China’s best troops to grapple with the Japanese forces at a point most advantageous to the Chinese. Therefore, the Chinese were prepared, willing and anxious to see the hostilities extended even to the Shanghai area where foreign interests were concentrated and where China’s cause might be expected to receive the widest publicity in the West. The Chinese were naturally not unmindful of the effect this would have upon Western interests which would be affected.

Whatever the situation might have been before hostilities began as regards the ability of Chinese leadership to Unite the common people of the country in a war of armed resistance to Japanese invasion, the methods used by the Japanese military forces since the beginning of hostilities certainly have resulted in bringing home to the common people of China the realities of what the hostilities mean. The result is that a spirit of resistance has steadily spread throughout the country, uniting the people to their political, military and intellectual leaders as they have never been united before. The country people, in a resistance born of despair, are arming themselves everywhere. It becomes increasingly doubtful whether Japan can by mere force of arms conquer the country except by completely ruining it. From Suiyuan in the North to Hangchow in the South, armed bands of Chinese peasants are attacking Japanese wherever they find them. It is, I think, a fair assumption that when hostilities commenced the Japanese military leaders expected that with the capture of Nanking they would be able to obtain from a defeated Chinese Government a dictated peace which would be along the lines of Hirota’s three points. The Japanese Army lost the war when they took Nanking and failed to obtain such a peace, and when they allowed their soldiers to wage pitiless war upon the civilian population of the country between Shanghai and Nanking, and in the city of Nanking.

This result left the Japanese to face two alternatives: they could either consolidate their positions already achieved and bide their time, or proceed to the conquest of China. It would appear that Japan chose the latter alternative. Indeed, it would have been difficult for them to do otherwise, for an armed China would have remained as a constant threat to the position which they had achieved. An Imperial Conference was held in Tokyo, and it was solemnly announced that the Japanese Government would no longer recognize the Government headed by Chiang Kai-shek. The Japanese Ambassador was called home, and the Chinese Ambassador to Japan was withdrawn.

Attempts at Conciliation With Japan

Throughout all of these difficulties between China and Japan there has existed in China a peace party interested in reaching some peaceful settlement with Japan. The idea of Sino-Japanese cooperation, economic or otherwise, has a certain appeal to Chinese. There is a large group of Chinese who were trained in Japan and who have friends there. This is especially true in army circles. General Chiang Kai-shek who got his early education in Japan has always been considered as one of those; while Chang Chun, who was Minister for Foreign Affairs for a time and who had been a fellow student with the Generalissimo in Japan, was also considered as one of those who were inclined to be conciliatory toward Japan. Wang Ching-wei was another, and, as political heir to Sun Yat-sen, he wielded an influence in politics which should have been available to the Japanese. Dr. H. H. Kung and the War Minister General Ho Ying-chin were also numbered among this group. All of these were men of influence in the Government, and it is believed that if the Japanese had chosen to play their cards differently it should have been possible to have utilized the cooperation of these men to a better advantage.

Chiang Kai-shek has at all times been deeply conscious of the weakness and lack of unity in China. His public utterances at all times indicated a desire to meet the Japanese half way; the sincerity of these public utterances was borne out by statements which he made in private. But the conditions under which the Japanese publicly and privately announced their readiness to cooperate with the Chinese were such that none of these Chinese leaders, no matter how influential they might have been in Chinese circles, could have accepted them or hoped to induce their own people to accept them.

The Chinese were never able to obtain a clarification of Hirota’s three points, which may be set down roughly as follows:

1) Alienation of China from foreign powers other than Japan.

2) Sino-Japanese economic cooperation.

3) Suppression of anti-Japanese activities.

It was generally believed that under these terms the Japanese expected a Japanese Inspector General of Customs with Japanese appointees to dominate the Customs at the several ports; a Sino-Japanese military alliance directed against Russia; Japanese rights to station troops at interior points. The Chinese had always contended that communism is a domestic matter; and they wanted to live at peace with both Russia and Japan, their nearest neighbors. Sino-Japanese cooperation was believed to include an economic bloc, consisting of Japan, “Manchukuo” and the Chinese republic; and a revision of the tariff to permit exchange of products of Japanese industry against Chinese raw materials,—a tariff which in Chinese eyes would have resulted in the complete destruction of nascent Chinese industry which was beginning to parallel Japanese industry. By suppression of anti-Japanese activities the Chinese understood the Japanese to mean the complete revision of Chinese text books of history and the use of Japanese teachers in the schools, with the adoption of an educational policy that would look to a complete denationalization of the Chinese. Thus interpreted—and there was no reason for a different interpretation—no Chinese leader could hope to work out any scheme of cooperation with Japan for which they could win the support of the people of the country.

The Japanese Government apparently expected to dictate peace along these lines with the fall of Nanking. There is no reason why they should have been surprised at their failure, for it has been clear enough to those who have continued among the Chinese that such a peace would be impossible as long as the Chinese Government and its people could resist.

Communism

There has been a good deal said about the existence of communism in China. There has been much said about the Chinese drift in the direction of Soviet Russia. Chinese leadership was no more interested in entering into an alliance with Soviet Russia, with all that that might imply, than it was interested in entering into an alliance with Japan. Soviet Russia and Japan are China’s nearest neighbors. Soviet Russia has been instrumental in depriving China of Outer Mongolia, and is at the present time strongly entrenched in Sinkiang. Chinese leadership had its fill of Soviet interference in Chinese politics in 1926, and does not wish to repeat that experience. China has fought communism on its own soil for ten years.

Chinese communism was a communism which grew out of agrarian discontent. It was essentially an agrarian movement, and in no sense an industrial proletarian movement such as that which took over the cities and established communism in Russia. This agrarian movement in China used the slogans and the catch phrases, and some of the philosophy of Marxian socialism borrowed from Soviet Russian advisers, but it never achieved any position of importance in Government or in the industrial centers. There existed plenty of domestic reason for a spirit of revolt in the rural communities in the provinces of Kiangsi, Hunan, Honan and Hupeh, where there was much discontent among the predominant tenant farmer class and where agriculture was bankrupt.

In 1923 and 1924, when Sun Yat-sen was organizing the Kuomintang with Russian assistance along the totalitarian lines of the communist party in Russia, he permitted Chinese communists to become members of the Kuomintang. These were days of active intervention in Chinese domestic affairs by agents of Soviet Russia who were being used as advisers. But a break came in 1927 between the communist and the nationalist elements in the Kuomintang. Perhaps, to use a popular conception, one might refer to it as a break between the communist and fascist elements in the Kuomintang.

After the break and the departure of the Russian advisers, the communist element in China took to the mountains of Kiangsi and there began a conflict which ended only in the winter of 1936, when the remnants of the determined bands of rural revolutionaries, still burning with the fires of Marxian socialism, were finally permitted by the Government to settle down in peace in the arid and inhospitable regions of northern Shensi. Their leaders who had brought them through the difficulties of the ten years’ war were still with them. Recent visitors to that area tell of meeting men who joined the movement as children and have followed it through all its long struggle, and who still burn with enthusiasm for the cause. It is the only element in China indicating that the Revolution of 1911 has touched and moved the peasant population.

By January, 1937, Soviet Russia was solidly installed in Sinkiang, with advisers employed in the Government at Urumchi. That some intercourse was possible between Soviet Russia and the Chinese communists in northern Shensi there can be no doubt; but that this intercourse went far is doubtful. By January, 1937, Soviet Russia was in the midst of a domestic political purge which indicated the existence of a domestic struggle, with a drift toward nationalism and isolationism.

By August, 1937, an arrangement had been entered into between the Central Government and Chinese communist leaders which brought the communists into Shansi and allied them definitely with the Central Government in the struggle of resistance against Japanese invasion. The function of these communist forces has been to pursue against Japanese invaders the same guerrilla tactics which they had used so successfully in resisting Chinese Government forces during ten years of warfare, and to train the country people of Shansi and Hopei for guerrilla warfare behind the Japanese lines. There is reason to believe that the Kwangsi leader, Pai Chung-hsi, participated in bringing about this arrangement.

It is true that the Soviet Ambassador signed with the Chinese Government, after the beginning of the Sino-Japanese conflict, a non-aggression treaty. It is true also that the Chinese have been able to obtain military equipment from Soviet Russia, and Soviet Russian volunteer aviators, but it is believed that all of this equipment and service is being paid for. The former Soviet Ambassador complained to me of the difficulty which he had had in persuading the Chinese to sign a non-aggression pact, and further, of his failure to negotiate a commercial treaty. The Soviet Ambassador was recalled to Russia with his Military Attaché at the end of September, and was replaced by a new Ambassador who is only thirty-eight years of age, whose entire adult life has been spent in Russia or in Turkestan, and who evidently definitely belongs to the group of young Russians whose experience has been Russia, who are followers and supporters of Stalin and the group of Bolshevist leaders whose services as revolutionaries were rendered entirely within the Government and who never lived abroad as exiles.

The path of Soviet Russia has been a wary one. The Chinese have leaned over backwards trying to avoid an arrangement which might lend color to Japanese accusations of an alliance. One may say the same of the conduct of Soviet Russia throughout these hostilities,—although it is apparent that Soviet Russia has been guided in its relations with China by a hope that the Chinese would continue resistance to Japan to the point where Japan would be exhausted, believing that a Japan exhausted and occupied in China would not be a menace to Soviet Russia.

As this is being written, ten months after the first shot was fired at Lukouchiao, the Japanese, at an enormous expenditure of blood and treasure, are battling determined Chinese troops for the possession of Hsuchow. Japan has withdrawn recognition from Nationalist China, although diplomatic relations have not been broken off and no war has been declared. It is expected shortly that Japan will extend de jure recognition to the puppet régime which is being established in Peiping and Nanking under the protection of Japanese military force. This régime is helpless except in areas immediately occupied by Japanese troops who hold a number of cities and patrol constantly the connecting lines of communication. All of the interior area is controlled by Chinese forces who carry on guerrilla tactics against the Japanese and the forces of the Japanese-fostered régime. This chaos will spread, the farther Japanese forces penetrate into the country. Japan will make a treaty along the lines of Hirota’s three points with the régime which it has fostered at such expense. Japanese advisers will be appointed to aid in the processes of government,—civil, judicial and military. A tariff bloc will be established with tariffs favoring Japanese goods. Extraterritoriality will be abolished as was done in Manchuria. But the time is yet distant when Japan will have succeeded in establishing peace throughout China. The struggle will go bitterly and stubbornly on, and it is doubtful whether Japan, single-handed, can muster enough men or money to complete the task. The East is apparently doomed to a period of warfare and turmoil which will last for years.

Respectfully yours,

Nelson Trusler Johnson