Office of the Historian

711.94/1560: Telegram

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

Tokyo, July 8, 1940—11 a.m.
[Received July 8—8:45 a.m.]

546. Department’s 240, July 3, 6 p.m.

1.
Through believed-to-be entirely trustworthy intermediary, reply has been communicated to Mr. X along lines suggested by Department. The latter expressed views as follows:
2.
To undertake the proposed visit to the United States on his own initiative would render success impossible. The army and the Foreign Office would resent such a proposal as coming from him. The initiative must come in some form from the United States.
3.
His recent visit to Germany developed in the following manner. In a conversation with the German Minister to Manchukuo, the Minister asked him if he could use his influence to expedite shipments of soya beans to Germany. Mr. X replied that he would be glad to do so provided that the Minister would expedite shipments of machinery from Germany to Manchukuo. This led to discussions from which emerged a suggestion to Mr. X on the part of the German Minister in Hsinking, approved by German Ambassador in Tokyo, that it would be well for Mr. X to discuss these problems directly with the German industrialists involved. With this suggestion he was able to make all arrangements with his own Government.
4.
Mr. X repeats his firm conviction that it would be possible with one bold stroke to bring about a settlement of current difficulties between the United States and Japan, involving a perfectly free China, which would be satisfactory to the American Government and people. He states that he is not at all interested in acquiring personal credit or reputation for the settlement of political matters but that he is the only Japanese industrialist who happens to possess the intimate connections and peculiar influence that could bring the army into line at this juncture. Neither Matsui nor Mitsubishi could accomplish this nor could the Foreign Office persuade the army to accept a reasonable settlement.
5.
What Mr. X visualizes is a very large credit to extend over a period of years to be used for the purchase from the United States [Page 391] of machinery for manufacturing, road making and mining, bridges, railroad rolling stock, steel and various other materials. He points out the important effect which such orders would exert on the economic life of the United States.
6.
Mr. X believes that this may be the last opportunity to do anything effective and admits foregoing lines because Japan is at present teetering between alignment with the democratic and the totalitarian powers and if an alignment with the Axis Powers develops such an opportunity will not recur. The army needs and wants to find a way out from the China imbroglio. And economic arrangement with the United States on broad lines would in his opinion tip the scales toward the democracies and would lead in due course to a complete settlement of all outstanding difficulties with the United States.
7.
My comments on the foregoing views are as follows. Mr. X paints on a large canvas with broad and sweeping strokes. He chafes at official procedure and feels that the Japanese Government—as represented in external relations by the Foreign Office is powerless to cut the Gordian knots of the China warfare and the deterioration of relations with America. He appraises in high degree his own influence with the army and his ability to cut those knots through a sweeping and sensational economic and financial gesture which would break through the present impasse. It is impossible to estimate to what extent his apparently genuine conviction in that respect is justified but if it were quietly made known to military leaders that he had been encouraged to come to the United States to discuss economic and financial problems, even without any commitment, it is conceivable that a pause might thereby be given to whatever extremist plans are now under consideration. Judging from his statements to intermediary, it does not now appear that Mr. X will visit the United States without such specific encouragement.
Grew