THE INFLUENCE OF AMERICAN COMMERCIAL INTERESTS IN CHINA UPON UNITED STATES POLICY TOWARD JAPAN, 1937-1938

The purpose of this thesis is to investigate the degree of influence which American business interests in China exerted upon United States policy toward Japan during the period 1937-1938. On the night of July 7, 1937, Japanese military forces invaded the Republic of China without a prior declaration of war. During the months of undeclared but unrestrained war which followed, foreign investments in the trade and industry of China were threatened with extinction. As hostilities became more widespread, business activity within China was brought to a virtual standstill; and properties owned by foreign commercial groups frequently suffered extensive damage. The Japanese Government, moreover, made deliberate efforts to force the withdrawal of all foreign industry and trade from those areas of China under its control. American business interests in China condemned Japan\u27s war of aggression and called upon the United States Government to defend the commercial rights which were guaranteed by the Open Door Policy. Throughout 1937 and 1938, the commercial groups in China insisted that the government in Washington adopt more spirited measures against the Japanese. The business community was well organized and succeeded in keeping its observations and opinions regarding developments in China before the American Government and the American people. This study will investigate the role which American business interests sought to play in the formulation of United States policy toward Japan. A most valuable source of primary materials was provided by Volume I of the Foreign Relations of the United States: Japan, 1931-1941, a compilation of diplomatic papers published by the Department of State in 1943. The China Weekly Review, an English language newspaper published in Shanghai, reflected the attitude of American citizens resident in China during 1937 and 1938. The Commercial and Financial Chronicle, a leading commercial journal, indicated the opinion of businessmen in the United States toward the war in East Asia. The Congressional Record revealed what was being thought on Capitol Hill in the period 1937-1938. Henry L. Stimson\u27s On Active Service in Peace and War, Joseph C. Grew\u27s Ten Years in Japan, and The Memoirs of Cordell Hull, provided valuable insights into United States foreign policy. Several secondary sources were of special value in this study. John w. Masland\u27s Commercial Influence Upon Far Eastern Policy \u27\u27, published in the Pacific Historical Review, must be rated as of primary importance. An excellent survey of the nature and value of American commerce in China was presented in Miriam S. Farley\u27s America\u27s Stake in the Far East, which appeared in the Far Easter Survey in 1936. Other noteworthy secondary sources were A. Whitney Griswold\u27s “The Far Ea.stern Policy of the United States,” William C. Johnstone\u27s The United States and Japan’s New Order, and Robert E. Osgoodts Ideals and Self Interest in America\u27s Foreign Relations. The major finding of this study is that American commercial interests in China did exert an ultimate influence upon United States policy toward Japan. This influence, however, was indirect and overshadowed by the broader concerns of American national self interest. Although the American government came to the defense of the Open Door in China during 1937 and 1938, it was not motivated by any intrinsic desire to preserve Sino-American economic relations. The United States Government and public opinion in general had never considered the China trade to be of vital national importance. But in 1937 American statesmen were vitally interested in obstructing Japan\u27s efforts to create a new order in East Asia. It was to thwart Japan that the United States upheld the Open Door, and not because of any inherent desire to sustain American commercial interests in China. Although the business community was unsuccessful in its attempts to influence American policy directly, there is a sense in which the commercial interests in China did affect the subsequent course of Japense-American relations. The repeated destruction of American lives and properties by the Japanese gradually angered the people of the United States. As public resentment grew, the American Government was given increased latitude in its efforts to deter Japanese imperialism in East Asia. It is in this way that the violation of American commercial rights in China was to have an ultimate influence upon United States policy in East Asia