“hould Japan succeed in controlling the Philippines,” they stated, “eventually the rich assets of the Straits Settlements, Netherlands India, and even the Pacific dominions may fall into its hands.” The closed nature of Japan’s “Co-Prosperity Sphere” was well known to trade specialists. As one 1940 study noticed, “Foreign commerce has been diverted strikingly into the yen-bloc area with a consequent reduction in trade with different components of the world, as a end result of the yen-bloc commerce doesn’t yield any foreign exchange complete a fish-bone chart detailing reasons why an airline customer might be dissatisfied. usable for the purchase of products from other countries.” Administration officers were acutely conscious of these considerations. In July 1940, Assistant Secretary of State Henry Francis Grady mentioned the tactic of international commerce was “a matter of nice concern for us.” Mica was termed strategic because of its worth as an insulator in transformers and capacitors, two vital merchandise without which the communications business could not survive.
On November 21 he discussed with Roosevelt “the question of poison fuel in the Philippines.” The War secretary believed the Japanese have been utilizing fuel in China and wanted to show their very own weapon in opposition to them. Stimson raised the matter privately, and Roosevelt agreed with him. Stimson then ordered General Gerow to arrange the shipments and avoid any leak to the press. The administration was not taking any chances, with Japan or with the American public.
“he Japanese will transfer southward until and until they meet with or discover interposed optimistic obstacles which they can’t or which they estimate that they cannot overcome.” Loans to China and embargoes won’t pose obstacles big enough to halt Japan, he added. Only the clear threat of struggle, produced by a robust army posture within the Pacific, may show to Japanese leaders that the United States meant business. Mark Gayn, a journalist on special task for the Washington Post , summed up the state of affairs. “Japan’s victory in the final weeks’ diplomatic poker game in Indochina was an event of world shaking significance,” he wrote.
But whatever the motives behind U.S. international policy at other instances and locations, the evidence exhibits that in 1940 and 1941 a collection of contingent circumstances elevated Southeast Asia to a position of elementary significance to Washington. These circumstances included the United States’ preoccupation with recovering from the Great Depression, its sense of economic, political, and physical insecurity in a world of rising totalitarian powers, the reliance of its mass-production economy on big imports of uncooked materials, and the extraordinary geographic concentration of many of those supplies in Southeast Asia. As a part of its program of reviving home prosperity inside a liberal worldwide framework, the Roosevelt administration put a high priority on restoring the pre-Depression system of multilateral commerce. Multilateral commerce, versus barter or state buying and selling, would permit capital transfers and currency markets to foster environment friendly commerce between nations, even when their bilateral trade did not steadiness.
The administration knew the nation’s limited stockpiles could not buffer the economic system for long if Japan struck south. With Western Europe falling to the Nazis and the Japanese displaying ever extra aggressiveness, Congress by May 1940 lastly started to point out “feverish exercise” on the stockpiling concern. Talk of spending half a billion dollars to purchase enough reserves became frequent. The Roosevelt administration, following a particular cupboard assembly, decided to treat the matter as certainly one of “urgency and of great nationwide significance.” Welles and the Commerce Department worked out a plan to empower the Reconstruction Finance Corporation to centralize the acquisition of all raw materials. With Roosevelt’s approval, RFC head Jesse Jones went earlier than Congress to seek the required legislation. On June 25, Congress gave it the power to kind subsidiary corporations for acquiring raw materials designated as strategic or critical by the president.
Hull instructed Ambassador Grew simply to tell Arita, through an change of notes, that the United States desired to come back to an understanding with Japan as to the future of the South Pacific. Japan’s fearful setback, followed shortly by the Hitler-Stalin pact, dashed the military’s plans of expansion to the north. However, with the fall of France and the Low Countries in 1940, the prospect of a southward advance against their colonies grew to become an enticing alternative. Unable to read Japan’s intentions or appreciate its inner debates, U.S. leaders tended to imagine the worst.
