793.94/15659: Telegram
The Ambassador in China (Johnson) to the Secretary of State
[Received February 5—2:20 p.m.]
I have just completed a trip on the Yangtze River from the mouth of the Whangpoo to Hankow and back accompanied by Military Attaché Mayer, Naval Attaché Overesch, Assistant Naval Attaché McHugh and Consul Lafoon. We traveled as guests of Admiral Glassford38 on U. S. S. Luzon and stopped at Chinkiang, Nanking, Wuhu, Anking, Kiukiang, Huangshihkong and Sankiangkow to deliver packages and mail to Americans and to give us an opportunity to visit and talk with Americans.
Following comments are made as a result of personal observation and conversations en route:
The Yangtze River from its mouth to Yochow is controlled by the Japanese Army as a line of military communication. This control is exercised by means of occasional small garrisons ashore, river patrol vessels and maintenance of station ships. Nothing moves on the river between points mentioned except with the permission of the Japanese Army.
River is commercially dead, there is a complete absence of Chinese and foreign shipping except for a few small junks and traveling between villages and larger towns. All Chinese merchants of substance and bankers have disappeared. The only shipping on the river consists of Japanese naval gunboats, army transports and numerous diesel engine vessels, most of them small wood ships of a type seen in the Inland Sea of Japan. At one time it was estimated that there were perhaps 5,000 of these on the river. They carry military supplies and cargo. All vessels of whatever types are controlled by the army, most if not all of them being manned by men in army uniform. Not a single naval vessel of combatant value to a fleet is used on this duty. Only obsolete cruisers, gunboats, and patrol boats were sighted between Shanghai and Hankow.
[Page 491]Except for this very real and effective control over the river and the traffic which it serves, the Japanese Army has but little control over areas [north?] or south of the river, except along railroads, highways and canals, that extend back from the river. Chinese life carries on as usual except that there are areas on either bank in which there has been guerilla activity, and here ruthless destruction has been carried out by the Japanese as punishment for damage done to Japanese shipping or to Japanese personnel. The great cities of Anking, Wuhu, Kiukiang, Wuchang and Hankow have been partially devastated and the former enterprising population widely dispersed. In many of the towns along the river Japanese military has demolished whole blocks of buildings just to obtain wood for fuel. Less than 50 percent of the normal population remains. Anking has been reduced from 120,000 to 5,000. Large parts of these riparian towns have been staked out by the Japanese Army and Navy as military zones for the exclusive use of Japanese.
Currency throughout area of river is the Chinese national dollar. Japanese military scrip is used almost entirely among Japanese. Scrip has been used to obtain supplies and goods under forced sale but Chinese quickly dispose of scrip for national currency. Japanese military are acquiring by forced sale or otherwise all of the exportable material, such as cotton, silk, rice, china, grass, sugar, vegetable oils, and shipping it down river in military ships for their own account. Material which they are acquiring consists for most part of accumulated stocks of the past year and a half. When these stocks have been absorbed it is expected the Japanese will begin to find difficulty obtaining new stocks unless they are prepared to offer better terms or better money.
American oil companies had exhausted all stocks before Japanese obtained control of river and have not been permitted to import for their own account since. American buyers of Chinese products have been able to get out stocks on hand but have not been able to purchase new stocks.
There is evidence of a desire on the part of the Japanese Army thus far to be considerate of the personal wants and comforts of Americans. American missionaries furthermore have been allowed to carry on their charitable and religious work. (There is, however, an atmosphere of uncertainty and uneasiness about this situation and there is no tangible assurance that the attitude displayed by the Japanese toward Americans to date has been genuine or other than an attempt to placate public opinion in the United States and to pit us against other foreigners in China who have not been treated thus.[)]
Politically the Japanese military have no control whatever throughout valley except in immediate neighborhood of garrisons and within [Page 492] rifle range of lines of communication. There is no interest among local Chinese population in much discussed Wang Ching-wei plans which if established will merely serve as pseudo-legal heir to business monopolies now functioning as adjunct to military operations. Chinese native Nationalist regime functions and collects taxes on both banks of river except in neighborhood of Japanese garrisons and Chinese residents registered with the Japanese military pay taxes to guerilla regimes that dot the countryside.
Navigationally the river is safe for commercial shipping, and I find it difficult to understand continued Japanese Army restrictions upon foreign trade and shipping except on the theory that such military restrictions are maintained with intent to squeeze out non-Japanese and compel them to relinquish at a sacrifice trading facilities built up over long period of years. At least 60 small ocean-going steamers of from 2,000 to 3,500 tons were observed during the voyage. Chinese booms and obstructions have been largely removed.
Commercially, the Japanese attempt to dominate the Yangtze River is doomed to failure. Temporary benefits are derived by the purchase of certain commodities with worthless military scrip. The use of legal yen is even prohibited. To date the Chinese are able to exchange this scrip back to old Chinese currency. Eventually and rapidly, however, the scarcity of good currency and the impoverishment of the Japanese controlled areas through seizure of goods and ruthless exploitation will create a serious condition.
American goods, even if permitted to be shipped in, will find neither a market to absorb them nor other than Japanese controlled distributors who will, as a matter of policy, discriminate against their distribution. Only the complete withdrawal of the Japanese military with consequent freedom of action of Chinese markets will restore either the market or distributing agencies.
Repeated to Chungking, Peiping, Hankow. Peiping air mail to Tokyo.
Paraphrase by pouch to Commander in Chief, Asiatic Fleet. Naval and Military Attachés request their Departments be informed.
- Rear Adm. William A. Glassford, Jr., Commander of the U. S. Yangtze Patrol.↩