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

894.00/791: Telegram

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

Tokyo, May 26, 1938—midnight.
[Received May 26—4:55 p.m.]

333. Our 330, May 25, 7 p.m.¹⁶ and 332, May 26, 8 p.m.

1. Consensus of opinion interprets the Cabinet reconstruction as constituting a victory of those elements within the Cabinet, led by the Premier, who have been in favor of pursuing a more forceful policy with regard to the warfare in China over those elements, led by Sugiyama, whose China policy has not been considered sufficiently forceful. It is surmised that another “February 26 incident” was brewing and that the present reconstruction was delayed only until the victory at Hsuchow permitted a Cabinet crisis to take place without loss of prestige abroad.

2. The complexion of the new Cabinet has obviously been worked out with a view to uniting various heterogeneous elements. Ugaki, a moderate, nevertheless commands the respect of the Army. Ikeda, a sound and conservative financier, enjoys the respect of the business world. Araki as Minister of Education combined with Suetsugu as Minister of the Interior will form a combination satisfactory to the most advanced positivists. The general belief is that Itagaki will shortly succeed Sugiyama, thereby adding strength to the chauvinist camp of the militarists.

3. Another change to be recorded is the relinquishment by Kido of Portfolio of Education to make room for Araki. Kido retains Portfolio of Public Health.

4. There is no doubt whatever that these changes reflect a public demand that the so-called China incident be brought to a close as soon as possible by increasingly positive and drastic measures but it is felt at the same time that the appointments of Ugaki and Ikeda will tend to create a stabilizing influence on Japan’s foreign relations.

5. An interesting and possibly significant side light on the overturn is that Hirota this afternoon remarked to one of my colleagues that he was on the point of going to the Prime Minister to submit his resignation but that he “did not know what it was all about”.

6. Ugaki’s personal rank placed him next to Konoye in seniority in the Cabinet and it is reported that he will act as “Vice Premier”. He is moderate with a following in the army which, although small in number, is of substantial influence.

7. Ikeda was for several years head of the Mitsui interests and later held office as Governor of the Bank of Japan. Notwithstanding his education in the United States and long association with the business world he is understood latterly to have become sympathetic toward “continental policy”. In any event he has recently received several marks of favor from the army. The belief that he is persona grata to the Army is supported by the fact that he will now replace two men who were definitely liberal minded.

8. The most definite conclusion to be drawn from today’s reconstruction is that the new Cabinet will be composed of positivists in the prosecution of the hostilities in China. In fact the public announcement of the changes instead of advancing the customary reasons of health states that they were made “to carry on the China incident with even greater vigor”.

Repeated to Shanghai for Hankow.

Grew

16. Not printed.