THE MANCHURIAN CRISIS
Sino-Japanese Clashes.—The intense friction between Chinese and Japanese in Manchuria came to a blaze on the night of September 18 when after alleged Chinese efforts to blow up a bridge on the South Manchurian Railroad near Mukden Japanese troops attacked the Chinese garrison and arsenal at Pentaying, took over police control in Mukden, and sent troops to Kirin and other points outside the railway zone. Numerous subsequent clashes were reported and the Japanese forces in Manchuria were strengthened from 12,000 to 14,400, nearly the 15,000 permitted by treaty. Of the large number of Chinese soldiers in the region, estimated at 220,000, perhaps a third were disarmed by the Japanese. For a time the tension was keen in view of the agitation for aggressive action among the Japanese military forces, aroused by the execution in August of Captain Shintaro Nakamura as a spy, and also the awakened nationalistic feeling in China. By the close of the month this tension had apparently relaxed and Japan had promised withdrawal of troops.
League Action.—Immediately upon the extension of Japanese control in Manchuria the Chinese government protested the action to the League Council assembled at Geneva as a violation of both the League Covenant and the Kellogg-Briand Peace Treaty. China also protested to Tokyo and made some initial proposal for a joint commission to negotiate a settlement, but when Japan at once responded favorably, China as quickly withdrew the proposal, seeing the advantage of securing international support. The League Council’s first move was to urge both powers to withdraw troops and abstain from hostile acts. It also informally discussed the appointment of a neutral military commission to supervise the withdrawal. This, however, Japan successfully opposed, as in fact any direct intervention by the league, insisting that the matter should be settled by direct negotiations between the two powers. Meantime an account of the league’s action was conveyed to the United States government, and on September 23 Secretary Stimson made a similar separate appeal to both China and Japan. The American communication in this instance was more delicately managed than at the time of the Russo-Chinese conflict in northern Manchuria, and was given at first informally to the Chinese and Japanese representatives in Washington. Japan received it politely, and the cooperation thus established between the United States and the league was hailed as a precedent for future handling of international disputes.
On September 25 the League Council, despite China’s vigorous appeals, decided against any further action, and on September 30 adjourned until October 14, unless an earlier emergency should arise. Some effort was made by China to interpret this definite date for the next session, October 14, as a limit by which Japanese withdrawal of troops should be completed.
China Aroused.—A notable effect of the Manchurian crisis was the war spirit stirred in China and among Chinese throughout the world. September 23 was proclaimed a day of “national humiliation.” On September 28 Foreign Minister C. T. Wang was seriously injured by a student mob agitating for war, and two days later the Nanking government announced his resignation and the appointment to his office of Alfred Sze, then Chinese representative at Geneva. Peace negotiations with the rebel government at Canton were begun, with reports at the close of September of a settlement on the basis of which Chiang Kai-shek would retire from the Nanking presidency but retain supreme control of the Army. General Yen Hsichan, rebel Shansi leader, was pardoned. To this extent the Japanese war scare served to bring China to at least temporary political harmony.
Threatened Break-up of Manchuria.—Local political factions in Manchuria seized the opportunity offered by the September friction to start separatist movements in various regions. In northern Manchuria, Mongolian and Manchu princes set up an organization with headquarters at Harbin; another was established at Kirin by old followers of Chang Tso-lin, who had no sympathy with his son Chang Hsueh-liang’s alliance with Nanking; and a third movement sought Japanese support for a republic in Southern Manchuria. The chief possible effect of this disintegration would be to facilitate an extension of Japanese control. This the Soviet press generally prophecied, declaring that Japan’s aim was to make Manchuria a second Korea, the steps being complete control of the South Manchurian railway, its extension northward and westward, increased immigration, and a further grip on Manchurian trade.
Pacific Institute Postponed.—The Institute of Pacific Relations, which was to have held its fourth plenary session at Hankow on October 21, indefinitely postponed its session owing to the Manchurian troubles. Instead the delegates visiting the East will confer informally with Chinese and Japanese representatives. Russia was to have sent an observer to the conference and has made plans to join the organization, whose membership includes representatives from the United States, Canada, England, Japan, China, Australia, New Zealand, and the Philippines.
LEAGUE AND WORLD COURT
Arms Truce Proposal.—While the September sessions of the League Assembly and Council were much occupied with routine business, such as further codification of international law, amendments to the Covenant to harmonize it with the Kellogg pact, special committee reports, etc., the matters which attracted chief attention in the press were the handling of the Manchurian dispute and the discussion of the proposal of Foreign Minister Dino Grande of Italy for an “immediate general agreement” on suspension of new armament programs. This proposal—which the French press declared was an outcome of Secretary Stimson’s visit in Rome—was referred to the assembly armament commission, and non-member nations, including the United States, were invited to join in its discussion. The final decision of the committee, approved by the assembly on September 29, was a resolution requesting all governments to prepare for the February conference by an armament truce, and also requesting all governments to state before November 1 whether they were prepared to accept such a truce to run for a year from that date. The phrase “to refrain from any measure involving an increase in armaments,” employed in the resolution, was open to a wide variety of meanings. Nevertheless the ready agreement on such a proposal, as compared with the hesitancy six months earlier over a mere public statement of existing armaments, showed how great a change the world economic depression had brought in the general attitude toward arms restriction.
Hugh R. Wilson, American Minister to Switzerland, acted as America’s observer in the league discussion of the truce, and in a statement on September 23 indicated that the United States would join in such action, though he at first made some reservations as regards naval construction in cruisers and destroyers necessary to bring this country up to her treaty strength. Subsequent moves in -Washington indicated that the American government was quite ready to make naval sacrifices also, if they would act as a lever to Western European reductions.
Mexico Enters the League.—Redeeming what M. Briand described as a “lamentable error” when the League of Nations was organized—an error chiefly due to the influence of President Wilson,—the League. Assembly at its opening on September 27 adopted a proposal of the chief powers and Spain that Mexico be invited to become a member. The Mexican government in accepting the invitation made the incidental declaration that it had “never admitted the regional understanding” mentioned in art. XXI of the League Covenant, thus clearing itself of any acceptance of the Monroe Doctrine, the regional agreement there referred to.
Austro-German Trade Pact Barred.—The World Court on September 3 by the close vote of 8-7 declared the proposed customs pact between Germany and Austria incompatible with the Geneva Protocol of 1922, by which the Allied powers in granting reconstruction loans to Austria bound her not to "seek to obtain any special or exclusive economic or financial advantage calculated directly or indirectly to compromise her independence.” Seven judges also considered the pact incompatible with a similar clause in the peace treaty of St. Germain. Even before the decision was reached, both Germany and Austria had renounced the agreement, while declaring strongly for the more general European tariff pact which is being sought for by a special pan-European union committee.
The close division of the World Court on the Austro-German isdue was viewed with some misgiving as apparently a reflection of international political alignments. The judges of France, Italy, Poland, Rumania, Spain, Colombia, Salvador, and Cuba voted against the legality of the pact, while those of the United States, England, Japan, Germany, Holland, China, and Belgium voted for it.
GREAT BRITAIN AND COMMONWEALTHS
England Stops Gold Payments.—Despite drastic economies put into effect by the three-party ministry, the drain on British gold reserves continued in September, necessitating use of a part of the $400,000,000 of new credits obtained from America and France. In this second emergency the government on September 21 put through Parliament a measure suspending for six months the Gold Standard Act of 1925 which required the Bank of England to sell gold at a fixed price. While England has never before in recent times gone off the gold standard save in war emergency, the action was viewed with relief in many quarters as a second necessary step toward economic recovery. It will remain for the government, if possible with international cooperation, to reestablish sterling on a sound basis, even through the pound is fixed at lower than its former value. At the close of September its exchange value stood at about $3.90, with corresponding depreciation in the currency of Canada, India, and other dependencies.
Measures of Economy.—In the budget presented by Chancellor of the Exchequer Snowden early in September, estimated deficits for this year of $374,000,000 and for next year of $826,000,000 were converted into slight surpluses by drastic economies and increased taxation. Reductions in dole, salaries, etc., amounted to $330,000,000 for next year; increased income taxes were expected to bring in $287,000,000; and taxes on beer, tobacco, gasoline, and theaters were counted on to yield $177,000,000 more. By a vote of 306-212 the Commons gave consent to the execution of all these measures by orders in council, without further parliamentary action.
Parliamentary Elections.—The announcement on October 1 that Parliament would end or be dissolved on October 7 was taken as assurance that there would be a call for a general election to be held before the close of October. The cabinet being equally divided, five-five, on the Conservative proposal of a higher protective tariff, it appeared likely that the present government led by Mr. MacDonald—would campaign simply on the issue of continuance of the present regime as best for the country’s economic and financial rehabilitation. The Labor opposition will fight the entire economic program. Chief doubt centered in the attitude of Lloyd George and the Liberal party, who favored continuance of the present government in office without elections, as assuring them a balance of power.
The India Conference.—In a sea of economic difficulties, and with an election campaign impending, the London ministry found it hard to give adequate attention to the scarcely less important problems of the India Conference. In the Federal Structures Committee, headed by Lord Chancellor San- key, and working on the new Indian constitution, Mahatma Gandhi on September 15 renewed in conciliatory terms his familiar demand for “equal partnership” and self- rule. Here, as in last year’s conference, progress was soon held up by the perplexing minorities problem—the question of safeguards for Moslem and other minority representation in the new Parliament. The first meeting of the special minorities committee came on September 28, at which time Premier MacDonald definitely put the problem up to the Indian representatives as a question they must solve among themselves. To this end Mahatma Gandhi began a series of conversations with the Aga Khan and other Moslem delegates, including Sir Ali Imam, only representative of the small body of Moslems who have joined hands with the Hindu Nationalists.
EUROPEAN POLITICS
Scandinavian States Off Gold Standard.—In the train of German and British financial difficulties, the governments of Sweden, Norway, and Finland on September 27 felt the necessity of suspending gold payments as a protection for their national reserves. Similar action was soon afterward taken by Denmark. Of the northern countries, Norway, with Soviet rivalry in the lumber trade and decreased demand for ocean transport, has been hit most heavily by the current depression. Sweden is reported on a sound financial and industrial basis, but nevertheless affected by conditions in the rest of Europe. In none of the countries is a permanent lowering of currency values anticipated.
French Ministers in Berlin.—The visit of Premier Laval and Foreign Minister Briand to Berlin, September 26-28, took on added importance from the widely expressed view that European economic recovery, and in a measure world recovery, is dependent on a political understanding between Germany and France. In the conferences of the French and German ministers, however, political problems were wisely put in the background and efforts centered on easier and more fruitful plans for economic cooperation. It was agreed that a joint committee be appointed, composed chiefly of manufacturing, financial, and labor representatives of both countries, to work out a definite scheme of collaboration in the economic field, with a special eye to the Russian and Central European markets, in which France should supply primarily the financial backing and Germany the means of production. Tentative plans were also made for revision of the Franco-German commercial treaty of 1927.
Coming close before Premier Laval’s visit to the United States in October, the French ministers in their Berlin negotiations were apparently seeking eagerly for results which could be presented in Washington as tangible proof of Europe’s efforts to settle her own affairs.
Germany’s Favorable Trade Balance.—Some prospect of Germany’s being able to emerge from her economic difficulties by her own effort was seen in the increasingly favorable trade balance which has prevailed during the present year. In August the surplus of exports over imports was $77,000,000, and for the preceding seven months $364,000,000. At this rate, disregarding reparations and interest payments, Germany might be able to recover a large part of her short-term foreign credits by the close of the year. The excess of exports, however, has been brought about largely by necessarily decreased purchase of raw materials from abroad, and such purchases cannot be held down indefinitely.
Jugoslavia Ends Dictatorship.—On September 2 King Alexander of Jugoslavia somewhat unexpectedly ended his three years of dictatorial rule by proclaiming a revised constitution and the restoration of parliamentary government. The new constitution is not greatly different from the old except that it creates a parliament of two bodies instead of one—a senate half elective and half appointed by the king, and a lower chamber elected for four years. The recent division of the country into provinces or banats, to break up the old racial groups, is continued, but the provinces receive an increased measure of home rule.
The change back to constitutionalism was viewed abroad as another instance of French pressure facilitated by the loan of $42,000,000 to Jugoslavia last May, the feeling in France being that Jugoslavia’s military and political strength would be increased by ending the dictatorship as a concession to Croatian and Slovene malcontents.
Austria’s One-Day Revolt.—The long threatened putsch of the Austrian Heimwehr, in which organization the nationalistic or Fascisti sentiment of the country is centered, took place on September 13, when Dr. Walter Pfriemer, Heimwehr leader, seized public buildings in Styria, called for an uprising of all Heimwehr troops, and proclaimed himself national dictator. The affair started prematurely and was completely abortive. Only half a dozen casualties were reported and before night Pfriemer was in flight, and Prince von Staremberg, former Minister of the Interior and Heimwehr leader, was in custody. The chief effect was to embarrass Austria’s efforts to secure further financial loans at Geneva.
UNITED STATES AND LATIN AMERICAN
Governmental Wheat Sales.—Success of the U. S. Farm Board in negotiations for the sale of American wheat through foreign government agencies was marked by three large transactions in late August and September. The first was an exchange of 25,000,000 bushels of grain to Brazil for an equivalent value of coffee at current prices; the second was a sale of 15,000,000 bushels to China on credit; and the third a transfer of 7,500,000 bushels to the National Purchasing Agency of Germany at a price of approximately $.50 a bushel, on a three-year credit guaranteed by the government. Preference for shipment in American vessels, not provided for in the Brazil agreement, is stipulated in the arrangement with China, and also to the extent of half the cargoes in the arrangements with Germany.
Revolt of Chilean Fleet.—An affair reminiscent of the Spithead mutinies of the British fleet in 1797 took place in Chile in the first week of September when seamen of the Chilean Navy, threatened with pay cuts, took over control of vessels at the Coquimbo naval base. Initial overtures made by the government through Admiral van Schroeder were unsuccessful. Naval cadets at Valparaiso and forces at the Talcahuano base joined the revolt but were overcome, the latter after considerable fighting. The ships off Coquimbo, short of food and coal and generally demoralized, finally surrendered after a fifteen-minute airplane bombardment which did little or no actual damage. In subsequent courts-martial the death penalty was invoked for only a few leaders. In new skeleton crews for the ships, about 10 per cent of the old crews were retained. While there is plenty of communistic doctrine circulating in Chile itself, press reports traced the beginnings of the uprising to radical ideas picked up in Clyde dockyards when the Almirante Satorre, built for Chile in England in 1911, was modernized there in 1929.
Optimism, therefore, is not always without danger, but pessimism is far more perilous.—Le Bon.