Evening star., 1938-05-27

CHINA WAR PLANS
Reorganized Cabinet Holds
First Session to Map
Sweeping Drive.
BACKGROUND
Accumulation OF long effort by
japanese Army to strengthen its
driue into the interior OF China the
Toxic cabinet yesterday Uas dras-
ticdlly reorganised to include tUo
powerful generals and one OF
Jdpdn's financial leaders. Result is
expected to be a more complete
mobilization OF Japdn's economic
and human resources for speedy
completion OF the conflict, tDhich IS
draining her finances heavily.
By the Associated Press.
TOXIC. May 81. Japans new
"ouick victory" cabinet, reorganlzed 10
include two OF her most inhuenual
retired generals and powerful hnan-
cier in four of the most important
posts. held its first session today ana
mapped a more sweeping campaign IN
China.
Details of the revamped cabinets
nolicv were not Immediately made
known in full.
However. Gen. Kazushige Ugaki.
former minister of war and Governor
General of Korea, who succeeded kokl
Hirota as foreign minister, crypticaliy
remarked:
II am going to do something. Wait
and see."
Blocked by army leaders in his ef-
forts to form a cabinet last year, he
long has been noted for his liberal
tendencies.
Finance Policies Outlined.
Harvard Seihin Ikeda,
former directing head of the great
Mitsui business interests and governor
Of the Bank of Japan. who succeeded
Okinobu Kaya as minister OF finance,
outlined three policies.
l. Maintenance of the yen at its
present value:
2. Maintenance of the Bank OF
.Japan's specie reserve at its present
level, and
3. A close study of the possibility
OF alleviating present rigid import
controls.
Gen. Baron Sadao Araki. another
former war minister. who succeeded
MARQUIS Koichi KIDD as minister OF
education. refused an interview, de-
claring, You had better write about
virtuous wives and faithful sons in
stead of my poor views"
Hankow Next Objective.
1t was a foregone conclusion that
Hankow. temporary Chinese capital
far in the interior, would be the next
Japanese military objective.
Troops we're being sent to China in
the largest numbers since September.
1t also was known that the army was
communicating commercial trucks.
One American automobile branch
agency was said to be rushing delivery
of 1900 trucks to Japan, without
waiting for paint or Tenders.
The appointment of Ikeda and his
promise of a study of import restric-
tions indicated the demands of busi-
ness for relief from a shortage of raw
materials.
Clash Over American Machinery.
Significantly, it was learned, the re-
firing minister of commerce and in
dustry and army chiefs clashed Bit
terly recently because an army permit
to import American machinery for
cutting uniforms was delayed month
because Of lack of money.
Import control, established in Octo-
ber to prevent money from flowing
abroad, made government permits
necessary for importation of more than
700 types of articles. and it was esti-
mated it would save Japan s730.OO0,-
900 in 1888.
However, exports diminished to an
even greater extent. Latest tax sur
yeys showed japanese business had
suffered a staggering loss in export
trade.
Other Changes Impending.
Meanwhile. other changes in the
government were impending.
Sources close to the government
continued to insist the minister of
war. Gen. Gen Sugiyama, had pre-
sented his resignation.
1t. Gen. Seishiro Itagaki, one Of !
Japan's commanders in China, first |
vas reported favored as his successor.
and according to unconfirmed reports,
already has arrived in Japan. Pre-
viously it had been reported he would !
arrive Monday.
Cabinet insiders gave two reasons !
for believing 1tagaki would direct the
war ministry. In addition to his great |
personal prestige. it was said. fric-
ton had existed between him and
Gen. Count Juichi Terauchi, another |
commander in North China, and a
way was sought to put distance be-
tween them.
Commerce Official Out
It was said Ikeda. besides the
finance post, also would assume the |
ministry of commerce and industry,
replacing Shinji Yoshino, who re-
signed. Thus all economic and finan-
cial activities would be consolidated |
in support Of Japans military CAM
paign.
It also was reported Kensuke Hori-
nouchi. vice minister Of foreign af-
fairs, would follow his chief. Hirota,
in resigning and that Hirosi Saito,