The Waterbury Democrat., 1937-07-19

China may be forced to defend her. self against Japan, Generalissimo Chiang Kai-Shek said today in ad- dressing educational leaders here.
 "Whether there is the least ves- tige of hope for peace between Chi na and Japan depends on the &C., tion of the Japanese army" Chiang declared.
 He outlined four minimum con- ditions as a basis of negotiation. as follows:
 1. Any settlement must not in- fringe the territorial integrity and sovereign rights of our nation.
 g. The status of the Hopei- Chahar political council is fixed by the central government, hence we should not allow any illegal al- teration.
 B. We will not agree to removal by outside pressure of local officials appointed by the central govern ment, such as the council chairman.
 A. We will not allow any re- striction to be placed on the posi- tions now held by the 29th army.
 No Peace At Any Cost
 we seek peace but we do not seek peace at any cost. We do not want war but we may be forced to defend ourselves.
 During this grave crisis, the gov- ernment may be counted on to guide the nation with calmness and restraint .. in discharging the ob- ligations of our race, let there be no distinction between north and south, age and youth.
 "At this solemn moment, Japan will have to decide whether the Lukolchiao incident will result in 8 major war between China and Japan. Even at the very last sec- ond before we abandon all hope of peace, we still are hoping for peace, we are still seeking a solution through the proper diplomatic channels.
 "There may be people who imag- inc the Lukouchiao incident to have been sudden and unpremeditated. However, month ago there were symptoms that the incident would ensue due to statements from the other side through press and di- plomatic channels.
 Also, we were informed that the other side was aiming to expand the Tangku agreement, enlarge the bogus East Hopei government, drive out the 29th army, force out Sung Cheh-Yuan Commander of the 29th army) and try to impose other demands. Hence 1t Is easily seen that the Lukouchiao incident was not a sudden and accidental de- velopment."
 Fighting Reported
 Tokyo, July 19-(UP)-Fighting was reported along the Russia- Manchukuo frontiers and in Man. chukuo today as the government anxiously awaited news that its crisis with China was ended.
 Russian and Japanese -Manchu- kuan frontier guards have been ex- changing fire for two days, dis patch from Seishin. Korea assert- ed.
 Japanese army headquarters at Hsinking, Manchukuo capital, an- nounced that seven Japanese offic- CTS and men were killed and five wounded in fighting bandits" near Mukden.
 The bandits" are Manchurians who, never accepting Japanese rule, have roamed the country in bands, large and small, raiding wherever and whenever possible. Concern lest the bandits" take advantage of the Chinese crisis entered into the desire here for a quick settlement of the Peiping dispute.
 The grave news regarding the Manchukuo fighting arrived coin- cident with war office reports that the Chinese were strengthening their troop positions near Peiping.
 A foreign office spokesman said that the government regarded the continuation of Chinese troop move- ments toward Peiping as Q most