Evening star., 1932-02-28
POLICY
ADVISED FOR i. s
Observers in Far East Warn
Boycott Would Mean I'm
mediate War.
BY B. w. FLEISHER.

TOXIC, Japan, February Z7.-Ine
tensest possible situation prevails here.
The press, while editorially critical OF
American Secretary of State Henry L.
Stimsons statement, gives prominence
in the news columns to every incident
duplicating an American or Americans
and hints that the gravest danger is
threatened by an economic boycott by
the United States, for this would not
lead to war, but would mean immediate
war and without hesitation.
AS previously pointed out in these
dispatches, Japan's military strength is
disproportionate to its resources. Its
weakness at present is economic and
financial 1t would prefer a chance at
naval conflict, even with defeat, II
necessary, to strangulation and eventual
bankruptcy imposed upon her through
boycott from America. Japan would
strike with its strength to ward of a
body blow at its weakness.
In the most reliable foreign diplo-
matte quarters here it is stated that the
League of Nations cannot impose sane
tions, as France would not only block
this step, but would also use all its in
iuence to avoid such action, which
would directly lead to another world
wide conflict.
Conservative Leaders Worried.
1t is also stated by a leading diplo-
mat here that the greatest danger now
IS Washington's attitude.
1t would seem to observers that the
wisest policy now is TO give Japan the
rope with the usual inevitable conse-
quences. Japan has already brought
about united China, which China
otherwise could not have accomplished
in decades, and it will have to face
that enormous problem for an intermin-
able time
The next thing Japan is accomplish
ing, as seen by students of the situa-
tlon, is its own economic and financial
ruin and injury to its international
standing.
Conservative leaders here are worried.
but the situation is beyond their con-
troll, as they are only too obviously not
the dominant faction now.
The martial spirit is running high.
Japanese newspapers are catering to
this spirit, playing up glorious deeds of
valor. The same old propaganda that
always accompanies war psychology the
world over is disseminated in its ex-
tremest manifestations and the JAP
anese masses sincerely believe they are
fighting for the cause of justice and to
save the International Settlement at
Shanghai
Advise U. S. TO Keep Out.
1t would seem that Americas own
interest is to keep out of this mess, OBJ
servers here say. Sanity dictates that
it is not up to the United States either
to save China or to save Japan from
its own folly or to rid the world Of
militarism, for militarism will ruin its
own cause If given time and rope
1t is estimated that the new budget
airy deficits and costs of the war and
the unfavorable trade balance will ne
ceSsitate the floating of internal loans
to the value of 800,000,000 yen (about
$400. .000,000) this year. With govern
ment bond yields high, the government
cannot unload them on the public and
the banks will not be inclinded to sub
scribe to them. Therefore the Bank of
Japan must bear the burden and carry
the large bulk Of the bonds, with re-
sultant initiation and depreciation of the
gold coverage
Japans export trade with China IS
completely gone. Raw silk has been
down since the embargo from 260 to
$50, meaning gold value loss Of about
S70,000,000 for the year. South Man
churian Railway bonds to the value Of
El2,000,000 (about SAL ,760, ,000), due in
July, are not renewable, as likewise
electric power loans from America, and
the war costs are piling up.
Importers and industrialists are now
buying heavily from America, because
they prefer to invest the yen at its
present rate to holding the yen, fearing
a coming depreciation in exchange
value.
Japan confronts problems now that
were undreamed of six months ago. It
is Japan's mess, not Americas, observers
emphasize, and it is wise, extremely
wise, for the American to keep out"
A boycott means war-that Is the
warning.
(Copyright, 1s32)