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Britain’s Grand Strategy of Restrained Punishment

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Tokyo had long-range designs on Australia and even India. For Britain, Hitler’s claim to bring into the Reich merely those neighboring areas with substantial German population seemed less objectionable than Japan’s declared goal of a new order in East Asia.

During the mid-1930s, Japan’s leaders announced their intention to implement a “Monroe Doctrine for East Asia.” The Amu statement (1934), Hiorta’s Fundamental Principles of National Policy (1936), and the New Order (1938) all stressed that Japan regarded East Asia as its exclusive sphere of in›uence (in violation of the Nine Power Treaty) and objected to Western intervention in China (Crowley 1966, 187–210, 279–300). The Asian “Monroe Doctrine” ‹rst applied to Japan, Taiwan, Korea, north China, and Manchukuo (the inner ring of Japanese expan- sion). After 1937, the prospect of Japanese penetration into China south of the Great Wall and into southeast Asia (creating an outer empire) threatened Britain’s regional hegemony and the centers of British com- mercial activity in the Yangtze valley and southern China.5 By 1940, Japan openly declared its sphere of in›uence to include East and southeast Asia, known as the Greater East Asia Co-prosperity Sphere, with Japan, north China, and Manchukuo as the industrial base (Beasley 1987, 233–43). The other countries were to provide raw materials and form part of a vast consumer market, building a degree of economic strength that would enable Japan ‹rst to meet and contain any counterattack from out- side, then to incorporate India, Australia, and Russia’s Siberian provinces by further wars (Beasley 1981, 272). The chain of islands stretching from Malaya to northern Australia was of crucial economic and strategic signi‹cance to Japan because of the vital raw materials, especially oil (Lowe 1977, 65).

Japan’s bid for regional hegemony would block England’s future access to its valuable markets, investments, and resources in the locale, especially the potentially lucrative China market.6 Ann Trotter notes that “Japan’s aim was the domination of China and that the failure of western powers to assist China would lead eventually to the formation of a Sino-Japanese bloc which would admit westerners only on sufferance” (1975, 35). The combination of the Depression, the loss of its market share in the Ameri- cas and Europe, and the cost of rearmament meant Britain’s trade with China was more important than ever to maintain a positive balance of trade.

Free traders viewed Japan as a threat to Britain’s existing open regional trading order for three reasons. First, Japan would monopolize trade with

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