Lords Sitting of 3 April 1935

Preamble
The House met at a quarter before four of the clock, The LORD CHANCELLOR on the Woolsack.
VAGRANCY BILL.
Brought from the Commons; read 1a; and to be printed.

SITUATION IN THE FAR EAST.
EARL PEEL EARL PEEL rose to call attention to the situation in the Far East and to the relations between China and Japan; and to move for Papers. The noble Earl said: My Lords, in the department of foreign affairs our attention and the attention of the public generally has been rather concentrated on the developments in Europe. We have all watched with the greatest interest the perambulations of our Ministers through many European capitals, and we have been thrilled almost by the reports of the international tea parties that have taken place in various centres. We have read the statements and speeches of Signor Mussolini and Herr Hitler and perhaps these have too much concentrated our attention on Western matters, to the exclusion of Far Eastern affairs. Indeed, it is not too much to say that during the last few months a new situation has arisen in Far Eastern affairs. We had only last week the final act of a definite severance of Japan from the League of Nations, and a little before that China, no doubt through the arrangement at the League itself, ceased to be a member of the Council.
These two events, coming together, suggested to many minds in China and Japan that there was some weakening of the ties between the Far East and Europe. They created the impression of a China and Japan rather thrown back upon themselves, and the question seemed to be forced to the front of "Asia for the Asiatics," a separatist and dangerous idea in many respects. Indeed, Russia, with her far-spread position touching European countries on the West and Japan and China on the East, rather goes to prove the close connection of all different parts of the world, and condemns this Continental, departmental

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system as unreal and rather absurd. I should like to say at the outset that I wish to deprecate any idea of hostility to Japan or any desire to charge her with underhand or malignant schemes at the expense of China or ourselves. Indeed, I think enough harm has been done by ill-considered denunciations of Japan. The Report of my noble friend Lord Lytton was judicial and impartial in tone but, unhappily, when all this great subject came to be debated at Geneva it cannot be said that everyone there followed his impartial methods of stating the position of affairs. The result, of course, was that Japan withdrew from the League of Nations, and any chance of influencing her at Geneva was lost from that time.
Let me say a word about our position and influence in the Far East. We have still many friends in Japan and also in China. Our interests, it is well known, are vast in the Far East; merely from the point of view of investment alone, we have some£300,000,000 in various forms in China. We have had a long and intimate association with the Far East. We have a right and even a duty to examine closely what happens there and to offer, as a friend with a full knowledge of the situation, advice to both parties. I understand that negotiations are going on between Tokyo and Nanking, though I do not pretend to know precisely what the nature of those negotiations is. But there are rumours to the effect that Japan is trying to get China under her control and to expel all Western influences. Reassuring statements have been made both from Nanking and Tokyo, and I should like in this connection just to refresh your Lordships' memories with part of the statement made last year to Sir Francis Lindley, at that time our Ambassador in Japan, in reply to his representations—a statement made by a Foreign Office spokesman in April, 1934.
The reply, of which I shall read a part, was to this effect: He assured His Majesty's Ambassador that Japan would observe the provisions of the Nine-Power Treaty and that the policy of the Japanese Government and His Majesty's Government in regard to the Treaty coincided. Mr. Hirota stated in conclusion that Japan continued to attach the greatest importance to the maintenance
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of the "open door" in China and reaffirmed her acceptance of that policy. On May I another statement was made to the French Government. I shall read the last paragraph of that statement, which rather seems to express what I may call a different shade of meaning to the emphatic statement made to our Ambassador. The passage I should like to read runs as follows:
"Japan cannot, however, remain indifferent to any possible intervention of third parties which, under whatever pretext it were made, might be prejudicial to the maintenance of order and justice in the Far East and in regions where Japan, if only by reason of her geographical position, has interests of vital importance. Consequently Japan cannot allow Chinese problems to be exploited by third parties with a view to pursuing an interested policy without regard to the conditions indicated above."
I dare say these two statements mean very nearly the same thing, but your Lordships will notice that they are couched in rather different language.
The difficulty is that the whole situation is, unfortunately, full of suspicion. The Chinese Press seems to be possessed of the idea that Japan wants to get entire control of China, and in many quarters abroad the same suspicion is rife. I think it must be admitted that the statement made in April by the Foreign Office spokesman at Tokyo did lend some colour to this view, and it is difficult not to believe that if Tokyo and Nanking are left to themselves to negotiate the only result will be to deepen the suspicion of Japan both in China and abroad, with the most unfortunate consequences.
During the last four years great progress has been made in China. In May, 1931, the National Economic Council of Nanking was established and co-operation with the League of Nations was proclaimed as a fixed policy. Some twenty or thirty officers were supplied by the League of Nations and with their assistance and the aid of the Boxer Indemnity—money returned by Great Britain—over 20,000 miles of railway were made in Central China and public works were prepared and built. There was a better feeling everywhere. The civil wars all died down, and the relations between Nanking and Canton seemed to have been put aside for a time and their perennial jealousies softened. As an example of this, I may perhaps cite the

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co-operation of the two authorities against the Communists when their stronghold in Central China was finally overthrown last autumn. But, unfortunately, there are darker sides to the picture. For instance, control of Nanking over the officials in the interior is still very weak. The peasants are heavily taxed, and the peasantry are the great mainstay of China, and unless they are prosperous there can be no real recovery. Moreover, the Communists themselves, though nattered from Chiangsi, are harrying Central and North-Western China, and their quickly-moving bands are very difficult to overtake and destroy.
Again, may I say a word about the currency? The Silver Purchase Act caused a very large outflow of silver, and attempts to check this outflow last autumn by an export tax on silver merely intensified smuggling. The stocks of silver in China were so greatly reduced that business suffered severely. There was a Monetary Advisory Council set up in Shanghai on February 15, to advise on remedies, but Economic Councils, as we know, are not always completely successful, and unless the stocks of silver can be replenished, the financial and business situation must continue to be indifferent. It may be, of course, that some promise to assist the financial position in China may be one of the levers on which Japan is working. It is true that the relations between Japan and China since 1932 have, in some ways, improved. They have been running mails and passengers between Manchukuo and Peking, and the collection of Customs has taken place at the Great Wall. These perhaps are rather minor matters, but in larger questions China still refuses to recognise Manchukuo as a State, and even if Nanking wished to do so, there would be great indignation in Canton and possibly even civil war, so deeply rooted are the fear and suspicion of China regarding Japan.
A serious disturbance was caused by the Japanese attack on Chinese frontier troops in South-East Chahar, Inner Mongolia, last January. The Chinese were driven back, and the frontier of Jehol, in South-West Manchukuo, was rectified. Since then, however, the disturbance seems to have died down. Very soon after that it was announced that Ariyoshi, the Japanese Minister in China,
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was to open conversations at Nanking with Wang Ching-Wei, the Premier, and General Chiang Kai-Shek. These talks have been carried on semi-officially in Tokyo, and recently there was a rumour that General Doihara, the Japanese Lawrence, was coming to China with new proposals. The question then arose: What are the aims of Japan? The semi-official statements from Tokyo maintain that she only requires that the anti-Japanese boycott in China should be suppressed, but from reports received it appears that the boycott has practically ceased. It can hardly be thought, therefore, that Japanese aims are so limited. Japan, perhaps, can hardly be expected to be an undiluted admirer of the League of Nations, and regards with suspicion the progress of China with League advisers as having a tendency to withdraw China from her own influence and bring her into the orbit of Western ambition.
I may again be allowed to refer to that statement made last year which was interpreted as a Monroe doctrine for China. That statement certainly seemed to imply that Japan wished to have the final say in any projects of the Western Powers in regard to China. No doubt the Military Party in Japan have a dream of Japanese leadership in Eastern Asia. So did the great Shogun Hideyoshi dream at the end of the sixteenth century, and die in trying to realise his dream. Many Japanese also, both soldiers and civilians, hold that the Far East is for Japan and is her special province. They see that the Western Powers have divided up the rest of the world among themselves, and that there is no great zeal to admit Japanese into countries so controlled, whether in the matter of immigration or in the matter of trade. The Far East she is tempted to regard as her special appanage. Of course, the great central truths about Japan cannot be ignored. She has this great population of 65,000,000 in a country which, for purposes of living, is not much bigger than Great Britain, and the increase of her population is something like three quarters of a million a year. Hence we must recognise her need for expansion, her desire for further markets and raw materials, which is growing every day.
Japan, no doubt, stands in fear of the spread of Communism in China. Mr. Hirota referred lately in the Diet of

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Japan to the Sovietising influences in Sinkiang. Another feature of the situation is the Japanese anxiety about Russia, and the unwelcome neighbourhood of Vladivostok. The Russian Air Forces are only within a few hundred miles of the great industrial centres of Japan, and are a fruitful cause of anxiety. Then, too, we must take into account the national movement in Mongolia. Outer Mongolia has passed almost wholly under Russian influence. It is not strictly a part of the Union of Soviet Republics, but it has been thoroughly imbued with Russian teaching and looks generally to the leadership of Russia. Inner Mongolia is ruled by its hereditary Princes, and has much sympathy with the elevation of a Manchu Emperor to the throne of Manchukuo. No doubt there is a strong national feeling running through Mongolia, and the issue is whether, if they were all united, they would turn their face to Russia or to Manchukuo. If towards Russia, the Princes would lose their position, and if towards Manchukuo, the young Mongol Party would lose its influence. There are many differences between the various elements in Mongolia, and if Japan and Russia were drawn into the struggle it would be most important for Japan to have a quiet China on her flank.
Turning for a moment to the point of view of China, the Chinese have observed the unyielding attitude of Japan at Geneva over Manchukuo and her withdrawal from the League, her unyielding attitude in the London naval conversations and her denunciation of the Naval Treaty. All this means, in Chinese eyes, Japan's determination to have a completely free hand in the Far East and to use it at the expense of China. I have already referred to China's loss of a seat on the Council of the League of Nations. This has weakened the position of those who preach co-operation with the League, and it strengthens the hands of the party which says Europe cares nothing for the East and that China must come to terms with Japan because she is near and powerful. Some of the Chinese fear that as she is at present China cannot stand by herself, and that if she does not get moral and diplomatic support from the West she will not be able to resist the advances of Japan. At present reports in Nanking are to the effect that Japan wants China to replace
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her League officers by Japanese officers, to replace the German officers who have been training Chiang Kai-Shek's troops for the past five years by Japanese officers, and to take on several hundred Japanese non-commissioned officers to train Chinese troops; to consolidate their outstanding Nanking loans to Peking, mostly dating from 1918 and amounting to about£40,000,000. In return—of course I am only quoting and I cannot youth for the truth of these reports—Japan would help China to crush the Communists, and would make her a big loan to see her through her present currency troubles.
Already protests are rising in China. Nanking and Chiang Kai-Shek are accused of being pro-Japanese. Canton speaks of their policy as tantamount to making China a Japanese protectorate and ruining China. The conciliatory character of Mr. Hirota's speeches is admitted, but the question asked is: What is behind it all? Suspicion is rather increased than lulled by these agreeable speeches. This division of opinion, if pressed too far, might, of course, lead again to civil war. In that case what would be the result? Would Japan come in to quell it and what would be the reactions in other countries to this action? Mr. Hirota is certainly taking the line that Japan can get all she wants in China—markets and raw materials—by fair means, without detriment to the interests of anybody. The Liberal Party in Japan supports these views. They are alarmed by the state of the national finances—the heavy cost of Manchukuo and the military expenditure. Nearly half of her central Budget is military and the burden of 2,190 million yen lies very heavily on a poor country like Japan. Other events recently have caused some suspicion abroad. In Manchukuo it has been said "If the door is not shut, it is so crowded with Japanese that it is difficult for others to get through." It is certainly very difficult to reconcile the Manchukuo oil monopoly with the pledge of an open door and equal opportunities for all.
LORD NEWTON: It is not coming into force.
EARL PEEL: My noble friend who has recently travelled in these countries informs me that the monopoly is not coming into force. I dare say his information

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is extremely accurate. Note has also been taken of the appointment of a Chief Secretary in the Customs in China—a post which has been given to a Japanese. This official is next in importance to the Inspector-General. What may happen when the present Inspector-General, Sir Frederic Maze, retires? Will Japan claim the post on the ground of her increasing trade with China? Such being the general condition of affairs, is it practical politics for a third Power to let Japan have a great deal of what she wants, to satisfy the Chinese that there is no danger of Japanese aggression, to dispel the atmosphere of distrust and to help China to complete the work of internal restoration which she has so well begun?
First, I ask, would a conference of the signatories of the Nine-Power Treaty be of value? The object of that Treaty, made at Washington in 1922, was to put an end to the old gunboat policy towards China, to respect her sovereignty, independence and territorial integrity, to give her the fullest and most unembarrassed opportunity to develop a stable government and to preserve the open door in the fullest sense. It is an obvious course to take, and perhaps this is the kind of thing for which the Treaty was put into action. But a conference has never been called, I believe, since 1922, and to call nine Powers into conference might have an unduly alarming appearance. It is quite possible that Japan might take offence and the situation would be worse than it was before.
Could not Great Britain offer her services as mediator? The offer would be put, of course, in the friendliest way, but with the understanding that she desires to know what is going on and to have a hand in the affair. May I suggest as a precedent the work done by Sir Miles Lampson, the Minister in China in 1932, who assisted in bringing about the Armistice after the Japanese attack on Shanghai? I do not know whether the noble Earl who is going to reply this afternoon has any taste for foreign travel, because, if so, I might suggest that in view of precedents set in Europe he might find that by a journey to China and Japan he would reinforce by information gained on the spot the admirable information and knowledge that he no doubt receives
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from our official Ministers in Tokyo and Nanking.
There is a great deal of friendly feeling still remaining for us in Japan. The Liberals, at any rate, ought to realise the advantage to themselves of an agreement with China which bore the stamp of our approval and assent. We cannot be accused of any new territorial ambitions in the Far East; we have no, axes to grind, only a general desire for peace and confidence. The Chinese are perfectly ready to trade with Japan, and if we gave our support to an agreement, there would be no suggestion afterwards that it contained clauses detrimental to China. This, I may say to your Lordships, would be rather a good year in which to offer our services. It may be called a Chinese year in London. We have seen the success of the play called "Lady Precious Stream"; we have an exhibition at Burlington House of Chinese pictures, and there are, I believe, at the present moment something like 400 Chinese students in this country who will themselves no doubt take back to China their impressions of our friendliness to that country.
Now we may have a definite policy in China, but I am afraid that it would appear to many people that for the last few years it has been rather uncertain and indefinite in its aim. We have of course very large trade interests in China, but by insisting on the statement that we seek nothing in China but trade, we have succeeded not so much in convincing China of our disinterestedness but, I am afraid, of our selfishness and indifference to everything but profit. We certainly took the lead a century ago in forcing open Chinese doors. We have therefore some responsibility for the disorder throughout China which the introduction of modern and foreign ideas has brought into that country. We are accused by the Chinese of pursuing a waiting and drifting policy merely to stave off trouble. As regards Japan, the present policy may be to breed in her the sense that she is isolated and without friends. Is it not possible that, relying on our reputation for disinterestedness, we may be able to act as a mediator between China and Japan and to bring about a reconciliation of interests between these two great countries which is so difficult for them to obtain as they

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are at present situated, without exciting the suspicions and hostility of other Powers? I beg to move.
LORD NEWTON: My Lords, my noble friend in his opening remarks had something to say about what I will venture to term the peripatetic diplomacy which is so much in favour at the present time. Personally, I have never been able to see the object of this movement. After all, we know everything that is going on in Europe. We know the minds of France, Germany, Italy and so forth; the only European country about which we are partially ignorant is Russia, and Russia is so skilled in the art of making things look different from what they really are that perhaps it might be just as well to avoid it. If, however, this practice is going to be pursued, no better plan could be adopted than that of sending a Minister—an intelligent Minister of course—to Manchukuo, as my noble friend has already anticipated my suggesting.
Now, if this were done and Sir John Simon or Mr. Eden were to go to Manchukuo, he would at once be faced with reality. The real facts would be brought home to him, facts which appear to be very imperfectly appreciated in this country. The first fact which would be literally staring him in the face—I say that with regret in the presence of my noble friend Lord Lytton—would be the fact that the League policy has badly broken down. I might even go further, I am afraid, and say that the Minister would also recognise the fact that the Mission of my noble friend Lord Lytton was, to put it mildly, a failure. It was a failure because, although he and his friends went there, no doubt, with the best intentions, they made proposals which they ought to have realised were never likely to be accepted by the Japanese. If I might venture to point it out to my noble friend, I think the mistake he made was in this. His Report is an admirable Report and, as far as it goes, constitutes an excellent case for the Japanese. If he had confined himself merely to reporting and had not obeyed the direction to make suggestions, I think the Mission would have done nothing but good. He has, however, in obedience to his instructions unfortunately made suggestions with which the Japanese find themselves incapable of
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complying. The Mission, I am afraid, must be put down as a failure.
I have no intention of taking up your Lordships' time in recounting events with which you are all well acquainted, but the rejection by the Japanese of the demands of the League—I suppose I am entitled to call them demands—has led to a perfect avalanche, a torrent of vituperation against that country which is without parallel. In this country there has always been a set of people who are only too delighted to fall upon former friends of this country, and the mere fact that the Japanese had formerly been allies of this country was sufficient inducement for a violent attack. The Labour Party, if I am not maligning them, have gone so far as actually to state that if they had been in office they would have made war on Japan. They may deny it, of Course; they may say that their language did not amount to that, but that is the only meaning you can really attach to the statement made in another place not long ago.
I cannot help thinking that all this vituperation is partly the fault of the Japanese themselves. It has largely been a question of propaganda on the one side and on the other. On the one side the propaganda has been good, on the other it has been extremely bad. The Chinese are extremely clever propagandists, and they started with the initial advantage of being, so to speak, pet children of the League. This is rather a curious fact, because after all, whatever you may say, China is a pronounced xenophobe country. It does not pay its debts, it detests all foreigners, and it does not even pay its subscriptions to the League. Nevertheless it remains, and I suppose it will remain, the pet child of the League and will be supported whenever an opportunity occurs. The Chinese propaganda was, as I have said, remarkably adroit and made a great impression in England. The Japanese propaganda, on the other hand, can only be characterised as more or less inept.
In every step the Japanese have taken they have protested, when remonstrated with, that they were acting for the benefit of humanity and in the cause of civilisation. I think they went so far as to say that they only dropped bombs on the heads of the Chinese in Shanghai for the benefit of the Chinese themselves, and

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that the Chinese should really be grateful to them for what they have done. That sort of argument does not really go down with any one. They ought to have said, and if they had been more sensible—and it is curious that such an intelligent race should have been wanting in common sense—they would have said: "We are extremely sorry, we admit that we have broken a treaty, but the circumstances were entirely exceptional, and if you will look closely into them you will see that we could not really have done anything else. You accuse us of all kinds of crime, and the main crime is that we are in occupation of a country which belongs to another Power." But the circumstances, as I have said, were exceptional.
The Report of my noble friend points out, in the clearest and most unmistakable language, that the position of the Japanese in Manchuria, as it was then called, was entirely exceptional. It was a sort of double control, which only broke down when the situation became intolerable from the Japanese point of view. The Japanese regard, rightly or wrongly, the control of Manchukuo, as it is now called, as absolutely essential to them, not only for political but also for economic and military reasons. They fought a desperate war, in which they risked their very existence as a nation, in order to obtain and retain that control, and they succeeded. Well, now, after the sacrifices and the enormous efforts which they have made, and after all the work which they have done, is it reasonable to suppose that they would accept the proposal that they should clear out and that that country should—in all probability—fall into the hands of their former enemy, Soviet Russia? It is inconceivable that any Power in the circumstances would have done so.
I have said that their position in Manchuria was quite exceptional, but their position in other respects is exceptional too. The Japanese suffer from the curse of being over-populated. They are constantly seeking for outlets for their population, and are unable to find them. On every side they repulsed. They might say to us: "It is all very fine your objecting to what we do, but it is owing to you that we are unable to find outlets. We should like to go to some of your Dominions, if you would let us. We should like to go to America, but they will not let us in. We should like to go
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to Canada, but they keep us out. Above all, we should like to go to Australia, but we are rigidly excluded from there. Yet, when an opportunity occurs, and a sort of no-man's-land falls to us, you charge us with being like brigands, and put every obstacle in our way in order to prevent us from developing this country, which might not be a very suitable place for Japanese migration, but will provide means by which our industries can be greatly assisted, and thereby mitigate this curse of over-population."
They might also say: "If we had mismanaged the place, then you would have a much greater case against us, but we have not." Nobody who has ever been in that part of the world could fail to realise that the place has been literally transformed. I hesitate to use that epithet, so hard-worked in journalism, "amazing" Amazing is hardly sufficient. The transformation in Manchuria is almost magical. It is almost inconceivable. Until you have actually set eyes on it, you can have no conception of what has been done there. Then, again, they might say: "Even if you look at things at their worst, what have we done except what you are doing yourselves and always have been doing? We are charged with being grossly immoral and predaceous in taking possession of this country. What moral right is there for similar actions on the part of other Powers? What moral right, for instance, is there for the occupation and control of a country like Morocco by the French, or Tripoli by the Italians? "They might almost say to us: "How is it you are still in possession of Egypt? How many times have you said you were going out of Egypt, and still you are there—and unless you are bereft of your senses you will remain there permanently. We are doing it for a much better reason, because our actual existence depends upon it."
It might be said that we were in Egypt because of our other possessions in the East, but that argument cannot be used with regard to other of our possessions. Then it might be said by the Japanese: "You denounce us for creating what is called a Puppet State and a Puppet Emperor—which I suppose is very much the same thing as a Constitutional King—but who founded Puppet States? Such a State was founded a few years

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ago by the State which is now loudest in denunciation of Japan. When America started the Panama Canal, which was in Colombian territory, she got into difficulties with the Colombian Government, and she then created a Puppet State and called it Panama, and there was not a bleat of complaint by anybody." So much for that. To return for one moment to the question of what the Japanese have done there, they might say: "We may have been hypocritical to some extent, but no one can deny that we have transformed this country, and turned it from a no-man's-land, populated by brigands and tyrannised over by so-called War Lords, into a modern and civilised State, to the benefit of the whole world. In addition, we offer you the open door, and, in the words of the Commission which lately went out there, there is an opening for the products of every country in Manchuria at the present moment."
These are the arguments which I should have used if I had been the Japanese, and I cannot help thinking they would have been more efficacious than those which have been used; but whether those arguments are well-founded or not, you are up against the solid fact that the Japanese are there and cannot be dislodged. The League, in fact, is up against a blank wall, and cannot do anything. Neither can we, and in those circumstances, what is to be done? I hesitate to speak disrespectfully of the League of Nations in the presence of my noble friend, and I am aware that there are many people in this House who look upon the League as a sort of divine institution, which is incapable of doing wrong, but in my opinion the League is capable of making mistakes, and has made a vital mistake in this particular case. The only thing is to admit it. No doubt it is a humiliating thing to do, and it would have been difficult to get the League of Nations to admit that it was wrong, but some formula could possibly have been devised which would save the face of the League and console my noble friend.
The necessity for that has gone. Lord Peel pointed out that Japan and China are now in consultation, and it is highly probable that these negotiations will end favourably, more especially as the Japanese are ready, as I understand, to pay over a large sum of money to the Chinese, in virtue of some arrangement
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relating to Customs. It seems to me that it is in the interest of everybody that these negotiations should terminate amicably as soon as possible. Certainly neither China nor Japan will gain by their continuing in a state of hostility. It is not only to their advantage that the situation should be eased, but to the advantage of the rest of the world, and civilisation generally, and what I would suggest—as I think was suggested by my noble friend—is that this Government should take, if possible, the lead in bringing about peace between those two countries. It is a curious thing that the suggestion that the matter should be settled amicably between these two Powers does not commend itself to many eminent people, including General Smuts and various members of this House. They seem to entertain fears that if Japan and China are left to themselves, the result will be an arrangement by which Japan gets complete possession of China, and will eventually absorb her. I believe that to be an hallucination. However great the power of Japan, in my opinion she is not in a position, either financially or otherwise, to do any-thing of the kind, and I believe that those fears are unfounded.
So persuaded are these gentlemen of the imminence of this danger, however, that they are actively engaged in trying to promote a sort of Anti-Japanese League, founded upon a bloc consisting of this country and the United States. Personally I consider this a most dangerous solution of the difficulty. It may lead to endless trouble, and even to me, who do not profess to be an authority, it seems that there is a far more obvious and simple plan. Let us do what we can to facilitate an agreement between China and Japan, and in doing so let us eliminate as far as possible the League of Nations. If the League of Nations had not intervened these two countries would have come to an agreement long ago. When that is effected and they have come to an agreement, then let this country take the lead again in proposing a conference between the four Powers which are really interested and which ought to decide the matter—those Powers, of course, being Great Britain, America, China and Japan. I believe that it would be discovered then that the claims of the Japanese were much more moderate than is imagined in this country.

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In any case, anything is better than resorting to the method suggested by General Smuts and his friends. What does it mean? It means that there should if possible be a sort of crusade conducted against Japan, which eventually would develop into a war between races, a war between the white man and the two Asiatic Empires, which certainly would be ready to combine together against Europeans or against Americans. The result, as far as we are concerned, would inevitably be in the end the loss of our Eastern possessions, which already rest upon a basis which is much feebler and more slender than people in this country generally realise.
THE DUKE OF ATHOLL: My Lords, we have heard two very interesting speeches from rather different points of view, and I think that a great many of us probably agree very largely with the speech which has just been made. The only thing I would say with regard to the speech of the noble Earl, Lord Peel, is in reference to his suggestion that Britain might become the mediator between Japan and China. He did not tell us what we were going to mediate about, and I am not aware that there is any very great difference at the present moment between them. I may be a little prejudiced, and your Lordships may wonder why I come in at all in this matter, but I had the honour a few years ago of entertaining for three weeks the present august Ruler of Japan, anti naturally one is interested in a matter of this kind affecting the history of that country, and I have very many friends in Japan in consequence.
But, quite apart from that, I think there are reasons why all of us are interested in the Far East. Many of your Lordships have been brought up in old houses—probably many of them have gone now—where we used to see old Chinese plates and embroidery, and we inevitably got to learn about China and love its art. We were also taught to be rather suspicious of another place called Japan, which faked these articles, or was alleged to fake them. Since that time I have led a fairly varied life. I have been a soldier for thirty years in different parts of the world, I have had to study military problems, and I have also been for many years a member of another place and have studied the problem from another
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point of view. Now I must say that I prefer the stability and the real government in Japan to what I may call the camouflaged one in China. This is just the reverse of what one used to think when one was young.
Japan, as has been pointed out, is a great Island which in some respects resembles Britain. It has something like 87,000,000 inhabitants, industrious and virile people who have more or less Western ideas. They are great fighters and they are no dreamers. In all the discussions of this matter I always wonder what is the idea that people really have when they come down to brass tacks with regard to the surplus population in Japan. We are told that the Japanese are not wanted in America, they must not go to Australia, the islands are forbidden to them, and they must not go to China. Well, where are they to go? They are not to be allowed to trade with anyone, they are, in fact, to be bottled up apparently in their own island and cease to exist. I am glad to see here the noble Marquess, Lord Lothian. He wrote a long letter on the subject and the only conclusion that I could grasp from it was that in his opinion there must be some system of birth control in Japan—otherwise, what was to happen?
Then I was told that Japan was not to be trusted. It was a nation which always broke its pledges and therefore nobody could trust it, and especially in regard to its action at Geneva. I have looked very carefully into history to find out when Japan broke a pledge and I cannot find such a case. I have no doubt that the noble Marquess, who is going to speak, has among his bundle of papers a long list of the pledges that Japan has broken, but I confess that I have not found them. I think this all arises out of people not having read and studied what Japan's intentions were and what she has always said. In every single agreement that she has made, so far as I am aware, she has always said that she meant to go for Manchuria and possibly Inner Mongolia., and that has been her policy right through. She has always said, when you have talked of China, "Please remember when we talk about China that does not include Manchuria," and I cannot find a single case in which that has not been mentioned when the matter has been before the League of Nations, or when it was up at Washing

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ton at the time of the Washington Treaty, or at any other time. I think it is the lack of appreciation of this fact that has made people think that Japan has been breaking pledges.
She has certainly got to have an outlet, and perhaps noble Lords who will speak later will explain what that outlet should be and where it should be. She has given a promise, and there is no reason to believe that she will not keep it—that she will not go south of the Great Wall. She says that she has no intention to go into China with the idea of appropriation, and I believe her, because, after all, though Japan is a strong and virile nation, it is going too far to say that Japan, which has already got enough trouble, and is not too well off, will take China or anything of that sort. There is another people to the north of Manchuria who would probably take the same opportunity to fight. Therefore I do not think she would think of doing anything so silly.
I wrote a letter in The Times which the noble Marquess, Lord Lothian, would probably think was not worth answering, in which I asked him some questions with regard to a very long letter that he wrote. He was, I think, the first person to stir up the recent agitation in the Press, and he said that his letter was the result of numerous telegrams that had been reaching this country during the six or nine weeks before and he felt constrained to write to the Press last February. I have looked in vain for those telegrams. I do not find them in The Times and I do not know what telegrams they can be. I should like to ask the noble Marquess if these telegrams were official, from whom they emanated, or whether they were from purely Chinese sources. He then told us that Japan was likely to present the world with a fait accompli in China, that within two years we should find her in possession of China, and that that was her intention. I should like to know where the noble Marquess found that.
THE MARQUESS OF LOTHIAN: I never said anything of the kind, that I expected to see Japan in possession of China in two years.
THE DUKE OF ATHOLL: I read it as within the next two years. It is as follows:
"Japan hopes to face the world with a fait accompli in China analogous to that
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which she accomplished in Manchukuo by the date of the expiry of the two years' notice during which the Washington Treaties still remain in force."
Is that correct? Perhaps we differ, but I thought the noble Marquess meant what appeared in the Press. He also told us about a high Japanese official who made a similar statement and that that was where he got it. Would he give us the name of this high Japanese official? It would be very useful. There is, apparenty, another man lost in the world. The Japanese Government has been trying to find out his name. If the noble Marquess will restore him to his relatives by telling us his name we shall all be extremely glad, especially his family. I need not go on further quoting the noble Marquess's letter, but I asked him several questions. He made several statements in his letter, and I am sure we shall be very glad to hear the answers to-night to the questions I have raised.
The whole thing is rather a tragedy. It does seem to me that opportunities have been missed. Japan is a wonderful nation, and something has got to be done to enable it to keep alive. On the other hand, we have China, which has fallen into a most unfortunate state. There is no Government in China which can be called a Government and which is capable of carrying out anything. The small thing round Nanking is a mere semblance of Government and alone cannot carry out its duties and desires. I am not saying anything against it. The noble Marquess, Lord Lothian, I think, has an idea of bringing in various nations, including Russia, to finance China. I do not think that would be the best plan. I am quite certain that the best plan is to leave Japan alone to occupy Manchukuo, which is not part of China and for which she has already paid very handsomely both in blood and treasure to China, and to leave her alone in Inner Mongolia.
If you do that, that will keep her busy for a long time and it will give you a stable Government round the outside of China. China would then have an opportunity of pulling herself together and it is there that the nations of the world would be able to help, although "foreign devils" are not popular in China. Next, after settling Mongolia, if you worked

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down to the Yangtse in the north of China and settled the position there, by degrees China herself would be able to settle the south. There are many people who think that because Japan came away from the League of Nations she has done something absolutely immoral, but you have got to remember that what may be a mere study for us on this side is vital to Japan and her interests. Although we have abrogated the Treaty with Japan, which many believe should never have been done, Japan still looks upon us as her "elder brother." Long may she do so!
THE EARL OF GLASGOW: My Lords, I shall not keep you more than four and a half minutes. In common with some of your Lordships I look upon the Japanese nation with respect and admiration. We are told by some people that they are aggressive and that they have seized territory which does not belong to them, but that is exactly what our own country was doing when many of your Lordships were at school and before that. If the Japanese have done these things, which I do not admit, they have done them for the same reason as ourselves—namely, for the security and necessities of their Empire. At the same time, as a British subject, I realise that the Chinese frontier marches with Burma. Your Lordships will remember that when the Japanese consolidated themselves in Manchuria—I prefer to use the old name because I cannot pronounce the new one—they took good care that all important passes leading from the Province of Jehol into Chinese territory were in their hands. Only last year the Japanese again encroached upon part of Mongolia and took possession of a strategic pass leading into that Province.
The point I want to make is this, and I hope the noble Earl will give me some answer. I understand that arrangements have been made for the setting up of a Commission to settle the boundary line between China and Burma. It was hoped that the expedition would have started this spring, but since the conversations which have taken place between the Nanking representatives and the Japanese representatives, the whole question of the delimitation of this boundary has been postponed. I do not say it was because of these conversations, but the fact is it has happened. If in
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the future we find that, perhaps owing to the advice of a friendly nation, the Chinese occupy all the strategic passes on this frontier, posterity will not necessarily blame the Chinese Government or their advisers, who, after all, have really done what was done in the past by ourselves, but posterity will certainly blame our statesmen for lack of foresight. Can any information be given as to when this Boundary Commission is going to start operations on the frontier between Burma and China?
LORD LAMINGTON: My Lords, my noble friend Lord Peel, in the course of his speech, referred to the fact that China had not recognised Manchukuo. I do not know what exactly he meant by that. Why should China recognise Manchukuo? Manchukuo, or Manchuria, was never part of the Chinese Empire. It was, first of all, in 1644 occupied by the Manchus. The Manchus carefully kept it as their own special preserve and did not allow it to be joined in any sense with China proper. So much so that Chinese were never allowed to enter it until 1907, when, owing to Russian expansion, it was thought desirable that Chinese should come in as a counteracting influence. Then when the Chinese rebellion took place, General Chang Tsolin occupied Manchuria but still kept it absolutely separate from China proper. He had a large army there for the express purpose of keeping out any possible rival Chinese Generals. After his mysterious death his son instituted anti-Japanese propaganda in Manchuria which led to every kind of outrage being practised, banditry and the like, with the connivance of the Chinese authorities. It is not surprising that the Japanese took steps to make good what they had done in Manchuria. Perhaps they were very ill-advised not to inform the world generally, and more particularly Geneva, how much they had suffered at the hands of the War Lords and bandits in Manchuria. Had they made the world more alive to the fact that they had incurred great detriment, it is quite possible that there would not have been shown the feeling that was shown when they seized Manchuria.
My noble friend Lord Newton referred to negotiations between the Chinese and Japanese at the present time. This is not an altogether favourable opportunity for ourselves, Japan and the United States to try to come to some agreement.

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Only last January, the Japanese Minister of Foreign Affairs stated before the Diet that in order to safeguard Japanese overseas trade the Government had yet to discuss various matters with Great Britain, and that there was in his view no part of the globe in which an adjustment of interests between the parties was unattainable. A good understanding, he added, between the two former allies was really an important contribution to the peace of the world. In yesterday's Times, in an article dealing with the islands in the Pacific mandated to Japan, there is quoted a statement by Admiral Suyetsugu regarding the Japanese possession of the mandated islands, and stating that Japan's possession of those mandated isles was not a menace to any Power. I think those are both very hopeful statements. Surely the United States and Japan have really no cause to fear any hostility on the one side or the other.
The fears of America are largely caused—this I can say on the authority of an American writer—because the people of the Pacific Coast want to have a large navy there so as to get the money spent by the sailors on that coast, and also because there Are large armament contractors, and they want to keep their works employed. I will read what is stated by an American writer in a book just published called Ways that are Dark, which is well worth reading by everyone interested in the Pacific question. He says:
"Almost nobody in California liked the Japanese. Among the reasons, possibly first of all should be mentioned the less affable manner of the Japanese. Next in order, I believe, uneasiness at Japanese ambitions in the Pacific inspired distrust. This latter factor was, and is, fanned as vigorously as possible by California business men and chambers of commerce, who want the United States Government to increase navy yards and army bases on the California coast …A good deal of estimating goes on as to the amount men…would spend per month, etc., but the reasons advanced in the newspapers have to do with safety for Pacific Coast residents …and the 'adequate defence' drum is the one thumped. This line of talk is not analysed in its particulars by the illiterate in the State, and they are thus driven to a state of alarm, whereby they look under the bed for a Jap every night before retiring."
This was written by an American writer, who was in the Consular Service for many years in China, and he lays stress upon the point that Americans in Washington
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and the rest of America are ill-informed with regard to the Japanese and the Chinese.
He states that it is impossible that there should ever be an understanding with the Chinese owing to the fact that they have no national characteristic. Every man is for himself, and corruption is rife throughout all aspects of life. As my noble friend Lord Newton said, they are most astute and adroit in their propaganda. They make marvellous pronouncements and declarations to satisfy the credulity of European nations, but those pronouncements and declarations are not carried out. For instance, they are not carried out in regard to the cultivation of the poppy. The poppy is still cultivated on a large scale, and very often by compulsion from the War Lords. It seems to me that this is a desirable opportunity for Great Britain, the United States and Japan to come together, if possible, and arrive at a common policy in the Pacific. I do not believe anybody can rely upon co-operation with China, which would not be possible. China has not had a united Government for hundreds of years; it has always been some foreign Power that has held sway in China, and given her anything like a united Government.
LORD BARNBY: My Lords, it is with some diffidence that I intervene in this debate, but having recently returned from the quarters which are now under discussion, I hope I may be pardoned for making a few remarks. In dealing with questions of this kind, it is desirable to avoid being misunderstood. I, like other noble Lords who have studied this question, have had the pleasure of listening to a very happy exposition of the fundamentals of the position from the noble Earl who raised the question. Fundamental points have already been dealt with by various noble Lords who have spoken, and I shall confine myself to two or three points which do stand out to anyone who has any familiarity with the situation, and who particularly deplores some of the misinterpretations which are put upon various factors in connection with the actions of Japan. Particularly does one deplore these easily-made suggestions that Japan has an aim of extended aggression and domination, which causes much disturbance to those who watch the Far East. One wishes, at this

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stage, to avoid being drawn into any political discussion, and I wish rather to state facts as I know them.
Looking at the economic side of the question, it has been pointed out what fundamental requirements Japan has, but surely this suggestion of an aim of a very wide domination disregards the essential question of finance. Thanks to the courtesy of the Japanese Government and the Manchukuo Government, and the assistance of those of our own nationality who are on the spot, we are familiar with the prevailing conditions, and know that there is a limit to the capacity of what a relatively recently rich country, if you like to call it so, like Japan can undertake. One must remember that the Westernization of Japan, which is internally going on very fast, in its factory expansion requirements, puts a vast strain on her national finance. In addition, she has, as is well known, undertaken to assist financially the new State of Manchukuo. That State has a population of 25,000,000 people, and is a great burden. Surely with the urgency that there is to maintain wide aims in the immediate future, councils of prudence will prevail upon a nation so clever as Japan and cause her to modify any action she may take in the immediate future.
It is true that her population is increasing at a very rapid rate and that her fundamental requirement is either emigration of her people or exportation of her products. For a reason which is not sufficiently understood, that the Japanese standard of life is so high that her people cannot live in competition with the inhabitants of the Asiatic mainland, emigration is impossible. That seems sufficient assurance, if it is carefully analysed, that the suggestion that Japan can absorb a large part of China, or aims at doing it in the immediate future, is unreasonable. The plea I would like to make to your Lordships' House is that we should look at this in a practical way. The way to lead China to realise the necessity of reliance upon herself and collaboration with Japan, is to give evidence that for our part we wish and are ready to help. If we get Japan and China to collaborate, it is not unreasonable that Great Britain should collaborate with the two, and that, logically, would bring the United States to collaborate also. Too often it is said that the United
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States must inevitably have a policy at variance with that of Japan. Surely, apart from jingo politicians from California, who wish to make an impression at Washington and try to make trouble, there is no fundamental reason for discord between Japan and the United States.
I come now to the question of the State of Manchukuo. The question of recognition has been referred to already by noble Lords who have spoken. Surely there is no reasonable person who expects that Japan is going to back-pedal from the position as it is to-day. If we look at it from the angle of British trade it is surely to our advantage. Present conditions in the State of Manchukuo, in comparison with what existed a few years ago, must not only benefit the world at large but the inhabitants of Manchukuo and Japan in particular. For that same reason—that order has been restored in Manchukuo—if by association between Japan and China more orderly conditions can be developed in China, then Japan would be indeed foolish to resent the penetration of other Powers in China, because whatever business those other Powers bring to China will develop the buying power of China, and by reason of her proximity Japan must always have a great advantage in supplying China with consumable goods.
Permit me to say in conclusion that the drift of affairs in the Far East is indeed rapidly changing. The fact that registrations in the Imperial University of Tokyo in the last six months have expanded to 2,500 Chinese students as against some 600 a year ago, coupled with the strong demand in China, particularly in Peking, for instructors in the Japanese language, shows that the drift at the moment is towards a better understanding by China that collaboration with Japan is to her advantage. If that promises a composure of the position on the mainland it must be to the advantage also of this country.
LORD ADDINGTON: My Lords, five years' residence in Shanghai at a critical time has roused in me a deep interest in the problems of the Far East. I am therefore proposing to make some remarks on the Motion moved by the noble Earl. In the first place I would like to urge, like other noble Lords who have spoken, that we should do everything

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in our power to keep China and Japan within the family of nations. Were they to become entirely dependent on themselves and each other, both they and the rest of the world would, it seems to me, be very much poorer. There is so much that we can exchange and share with each other, not only in the spheres of trade and commerce but also in those of art, literature, culture, philosophy and religion. Japan's recognised need for expansion, which is one of the main causes of the situation, is apparently being met by industrialisation rather than by emigration. Here I differ from the noble Duke. It seems to me that the Japanese have never emigrated readily. They have had opportunities in Manchukuo and Korea which they have been very loath to take. On the whole I think they are going to stay at home and not go far afield. Perhaps the noble Marquess, Lord Lothian, will deal with some of the other points raised by the noble Duke.
A peaceful, well-governed, orderly and prosperous China will surely provide for Japan both a better market for her goods, which she will have to export in very large quantities, and also a far better source for the food and raw materials, which she will have to import for her growing population and expanding industry. The interests of China and Japan are not necessarily conflicting but rather are complementary. It must be clear, I think, to any of your Lordships who have followed at all closely the events of the last few years in the Far East, that the clash of those interests has caused grave conflict and that the situation now is by no means without danger. If that is so, surely, as the noble Lord suggested just now, what is needed is some other member of the family of nations to play the part of mediator, to study, understand and appreciate thoroughly on the one hand the needs of Japan, her fears and her sense of destiny, and on the other hand the difficulties and aspirations of Young China, and then to work out in consultation with them both jointly and severally a solution which will meet the fundamental needs of each and benefit both of them and the whole of the Far East.
As the noble Earl pointed out, it seems that we in Great Britain are uniquely qualified to play that part. We have a
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long tradition of friendship both with China and with Japan. Englishmen have played a great and noble part in building up the new China. Take, for instance, Chinese Gordon; take Sir Robert Hart; a distinguished line of British Ministers, among them Sir Miles Lampson, reference to whom was made by the noble Earl; the Commission led by Lord Willingdon, who went out to settle the Boxer Indemnity, and the work of Sir John Hope-Simpson and his helpers regarding famine relief. In regard to Japan, as has already been pointed out, we have the tradition of the Anglo-Japanese alliance, which played such an important part in preserving the peace and prosperity of the Far East.
I would suggest further that we might well carry this another step. Both China and Japan, though their civilisations are very old, have only emerged recently from comparative isolation. They have effected within themselves, in a generation or two, changes which have taken us perhaps the greater part of our known history. It is therefore perhaps only natural that their religious and moral ideas should be somewhat in a state of flux. Cannot they recapture some of their old ideals, such as Bushido in Japan, which was somewhat akin to our idea of chivalry, and apply them to the needs of the hour? Could we not encourage in Japan those leaders who already see that in co-ordinating the needs of others with their own lies the highest type of leadership, so that that leadership should be a moral leadership which alone can provide a life-line worthy of a great nation? In China, can we not really help the leaders to understand each other and to cooperate for the rehabilitation of the national morale and the constructive development of the whole country? Such an internal rapprochement has already taken place in South Africa, and if we have learned the secret of unity within the Empire, could we not impart that secret to those without?
It seems to me that here, again, we in Great Britain are peculiarly fitted to take the lead in that direction. The problem of the expansion of England in the eighteenth century was somewhat similar to that of the expansion of Japan to-day, though I am quite aware that the analogy must not be pressed too far. That expansion of ours was in many

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cases based upon principles of stewardship and real concern for the welfare of the inhabitants of the territories we administered. We should be prepared to place our experience in these matters at the disposal of Japan. It is surely almost a commonplace to say that the forces that threaten peace in the Far East, as elsewhere, are fear, hate, pride, national selfishness and suchlike. These forces deal with the moral and spiritual sphere, and can best be met by their positive antidotes: love, humility, appreciative understanding and generous co-operation, drawing out the best in them by giving them the best in us. Further, public policy needs the support of public opinion and cannot very far advance ahead of it. Cannot we therefore encourage and co-operate with those who are working for the regeneration of these countries—for example, the originators of the New Life movement in China, the political and social leaders in Japan, such as some members of the House of Peers, and certain movements of public opinion in both countries the leaders of which have been deeply influenced by the present spiritual renaissance emanating from Oxford?
We must not forget, again, that these problems are Eastern problems. I do not pretend to expert knowledge of the Far East, but I was there long enough to realise that the Eastern mind proceeds from different premises, so that only those who understand those premises, the historical background and the present movements, can really help. There are many Englishmen who are in a position to give that help. So I would urge on His Majesty's Government first of all to make up their minds that these issues are of great importance; such great importance that, in spite of their preoccupations in Europe, they will give them real attention. After all, as we have been reminded this week in another connection, "Peace is indivisible." These issues affect a large part of the world and a large proportion of its inhabitants. We have very important interests in the Far East and in the Pacific, and we expect that they will given their due place, as we are equally prepared to see that Japanese interests have the place that is their due.
Secondly, I would urge upon His Majesty's Government to make up their
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minds at once. Those who follow events in China must surely realise that there is a grave risk of economic collapse. The large adverse balances of trade cannot continue much longer unless a remedy is found. To judge from unofficial statements, we may at any time be faced with a fait accompli in the shape of an Asiatic Monroe doctrine. There appears to be a real danger of some conflict arising that could well have world-wide implications, so that it may soon be too late to prevent disaster. Finally, His Majesty's Government must be prepared to face the implications of such a policy and to carry it through. A strong lead in a constructive and conciliatory policy and in one of understanding co-operation would, I am convinced, find a ready response in China and Japan and lay a sure foundation for the peace and prosperity of those countries and the whole of the Far East.
THE MARQUESS OF LOTHIAN: My Lords, I ventured a few weeks ago to say that there were two major problems confronting the world, one the problem of finding a place for an "equal" Germany, and the other that of meeting the needs of Japan and the Far East; and that if these two problems could be solved, we might hope for peace in the world for fifty years. I heartily congratulate the mover of this Motion this afternoon on having brought this Far Eastern question before your Lordships' House. I feel that one of the serious things in the Far Eastern situation during the last year has been that, when great events have been taking place in that part of the globe, there has been no public discussion of those questions either in this House or in another place. If there are suspicions rampant—and they are rampant—it is particularly so because we have not received authoritative information as to what is going on and what is the policy of His Majesty's Government. We are therefore liable to believe things which are not wholly true. I venture to believe that if the situation is faced with that tolerance and wisdom for which so many noble Lords have asked this afternoon, it is possible to solve Far Eastern problems with reasonable justice for all concerned.
I would venture to put before your Lordships a little history, because from

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some of the remarks which were made this afternoon I think there is a slight tendency to forget certain things which have happened in the past. The history begins, perhaps, with the Anglo-Japanese Alliance, which was a very good arrangement in the anarchic world which existed before the War and which benefited both the signatories very considerably. There is an illusion going about that we got all the benefit from the Japanese Alliance and the Japanese got none. I am quite certain that any scrutiny of history would prove that to be untrue. The Alliance gave Japan the opportunity which she has seized, and rightly seized, to solve her problems in the Far East in relation to Russia. That was due to us. On the other hand, it kept Japan on the side of the Allies during the War, though for her co-operation I venture to say that she was very handsomely paid.
But what happened after the War? It was not just a question of continuing with the old Alliance. There was a very dark war-cloud across the Pacific through the growing antagonism between the then great American Navy, which was being built up to the largest standard then in the world, larger even than the British Navy, and Japan. The Four-Power Naval Treaty was the wisest way of removing that antagonism and reaching an agreement between the four major Powers in the Pacific that they would solve the problems of the Pacific without antagonism and in agreement for the next ten or fifteen years. Noble Lords have said that it would have been wiser to continue with the Anglo-Japanese Alliance. Even if it had been possible, and I believe it was not possible, it would have disrupted the Empire, as the Canadian Government at that time made perfectly clear. I venture to think that the Washington Treaties were the wisest treaties which were made at the end of the War, and their justification is that for ten years or more they have preserved peace in the Far East, until the events which began with the Putsch in Mukden in December, 1931.
What were the basic principles upon which the Washington Treaty rested? I do not believe you are going to solve the Far Eastern question until you go back to those principles. They are two-fold. The first was that the Contracting Powers, other than China, agreed, in the terms of the first Article of the Nine-Power Treaty that "they respect the
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sovereignty, the independence and the territorial and administrative integrity of China," and promote her development. After all, that is a treaty which Japan, this country, China and the United States have signed, and it is still in force.
THE DUKE OF ATHOLL: Might I interrupt to ask the noble Marquess whether Japan did not exclude Manchukuo, an exclusion to which President Wilson had already agreed in 1918?
THE MARQUESS OF LOTHIAN: It is the first I have heard of it and if the noble Duke can find any reference to that I shall be surprised. The word "China" has always included Manchuria.
THE DUKE OF ATHOLL: It was not in any of the maps before the War.
THE MARQUESS OF LOTHIAN: Then why was not Manchukuo represented at the Nine-Power Conference. The second Article is as follows:
"To provide the fullest and most unembarrassed opportunity to China to develop and maintain for herself an effective and stable Government."
The third Article is:
"To use their influence for the purpose of effectually establishing and maintaining the principle of equal opportunity for the commerce and industry of all nations throughout the territory of China,"
and the fourth reads:
"To refrain from taking advantage of conditions in China in order to seek special rights or privileges which would abridge the rights of subjects or citizens of friendly States, and from countenancing action inimical to the security of such States."
LORD BARNBY: Would the powers of Japan with regard to the railway zone by previous treaty be affected?
THE MARQUESS OF LOTHIAN: This treaty did not purport to abrogate any treaties or agreements previously in force. There, anyhow, is the first principle of the Washington settlement, and I think noble Lords can only believe it is a fair and just one, and there can be no peace in the Far East unless it is accepted. The second principle was embodied in the Naval Treaties which gave equality and security to those great Naval Powers. This security was provided for as follows. Inside the great triangle represented by Japan in the North, Hawaii in the East and Singapore

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to the South no fortifications of any sort were to be made. These naval bases were three thousand miles away from one another, which meant, in fact, that no major fleet action could be fought between fleets so far separated, and that each country had complete security in its own zone. The naval ratio of 5:5:3 was fixed, not through any abstract idea of the relative importance of the three Powers, but on the basis of their then existing Navies. This naval arrangement provided for equality of security for the three major Powers. The Armies were unlimited, and everybody knows that the Army of Japan is very much larger than the Army of either the United States or Great Britain.
These two principles of the Washington Treaties, were, as I see it, fair, and I do not personally see any chance of a lasting peace in the Far East unless fundamentally they are observed. Why has there recently been a certain measure of anxiety which has caused the suspicions to which the noble Duke and others have referred? I venture to think it, is derived from one fact, and that is, that while in many ways the situation has changed, and while the economic anxieties which Japan has have become more difficult, as the noble Lord so eloquently described, and which I think no one in this House fails to recognise, she has taken action unilaterally instead of after consulting her co-signatories to those two Treaties. I venture to think that that is at the root of the trouble. This unilateral action began even during the period of the Anglo-Japanese Alliance. The famous Twenty-one Demands made on China in 1915 were made without any previous consultation with her British Ally. It is this kind of unilateral attempt to upset treaty arrangements which, I venture to think, is the root of all the difficulty, and until we get back to the principle that those very difficult problems in which I, personally, and I think all noble Lords are prepared to give the greatest weight—with friendly consideration to the needs and difficulties of Japan—must be considered collectively, there will be no lasting settlement.
This unilateral action was resumed at the unexpected and unannounced putsch in Manchukuo in September, 1931. I have always thought, as Lord Lytton in his Report admitted, that the status quo at that time was impossible. To continue
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two sovereignties within a single State was impossible, but the gravamen of the charge against Japan has been that her action was taken unilaterally and in disregard of her obligation to consult other nations who were co-signatories of the Treaties and the Covenant. Then, in April, 1934, you had that curious series of semi-official pronouncements made by various official Japanese Ministers in different parts of the world, proclaiming, without prior consultation with their associates, a new policy in China. I will quote a pronouncement by Mr. Sato, the Japanese Ambassador to the United States, made on April 22, 1934. These are the words quoted in The Times:
"Japan does not desire to interfere with legitimate foreign business in China, but it wishes to be consulted by those who want to deal with China before they conclude any transactions."
That was the beginning of the so-called Monroe doctrine for the Far East. The Times correspondent in Tokyo, on April 18 of that year, stated that the effect of this pronouncement was that "Japan will oppose international projects for assisting China." The Manchester Guardian correspondent referred to these statements in the following words:
"They rank in seriousness with the twenty-one demands of 1915."
So serious was the outcry that the Foreign Secretary, Sir John Simon, had to make what was then called an inquiry in Tokyo as to what those statements really meant. As the result of that a semi-official statement—not an official statement—was issued, very considerably toning down the effect of the original demands, and the incident, which provoked grave anxiety in China, and graver anxiety in the United States, gradually died down.
That was again unilateral action. That is why the statements which emerged in February last in connection with the Ariyoshi-Chiang Kai-Shek conversations also caused such concern. If the noble Duke will permit me, I will just interject here that my authorities were The Times, the New York Times and the Manchester Guardian. But there were statements issued which caused a good deal of anxiety relating to the policy which Japan was said to be pressing on China, and which was embodied in the words "Asia for the Asiatics," that China

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was being pressed to withdraw from her association with European Powers and the League of Nations, and pursue a policy which would ultimately mean the exclusion of British and other interests from the Far East. I am not in a position, I frankly admit, to say whether those statements are wholly true or not, but they are precisely the sort of thing which gets circulated and believed when nations begin to take unilateral action; and the remedy, and the only remedy, is a frank and open conference between all the Powers concerned, with all the cards on the table.
That is why I greatly hope that the Government will be able this afternoon to say that it is their intention to have a full and complete discussion of these problems with the other major signatories of the Far Eastern Treaties in the near future. We had not long ago the naval discussions. I think it is quite useless to have an armaments discussion unless you are first agreed about policy, and I thought it was ominous that before the naval discussions took place an official statement was issued from Tokyo that political subjects were to be ruled out of discussion. It is quite obvious that if there is going to be a settlement in the Far East there has to be some modification of the Washington Treaties—not of the basic principles, but of the details of the Washington Treaties.
A new situation has arisen in the last fifteen years, and I for one think it is far better to face the facts honestly and squarely, and try to reach an agreement between Japan, China, the United States, ourselves and Russia, the main parties concerned. As to the principles which are to govern the Far East in the next ten or fifteen years, I believe that if that is done, no doubt first in private conversations through diplomatic channels, but afterwards at a more formal conference, these clouds of suspicion will be dispelled, and will do for the next fifteen years what the Washington Treaties have done for the last. Therefore, I hope it will be possible for His Majesty's Government to say that conversations are taking place leading to the kind of conference that will take place, as it ought to take place, now that the Naval Treaty has been formally denounced by Japan.
LORD MARLEY: My Lords, as I understood, the noble Earl who introduced this discussion desired to help in a loosening of the tension in the Far East. I think his speech was a very thoughtful contribution to a very difficult problem, and during the discussion this afternoon we have had a number of speeches of very great value. I want to deal for a moment with a few of the factors affecting the possibilities of peace in the Far East. As regards the position of Japan, the House has been told of the very serious economic position affecting that Empire. It, is perhaps more serious than is generally understood and I think it was brought out in an article in The Times in December, 1933, headed "A Million more mouths to feed." It was pointed out that in Japan the average farm is only 2.7 acres and has to feed six persons, and that no countryside in the world is so crowded as Japan is, with 959 inhabitants to every square kilometre of cultivated land as compared with only 394 in Belgium. The Japanese, therefore, are quite incapable of feeding their people from Japanese sources and are impelled to seek overseas the means to keep their people alive; that is, sources of raw materials for their factories and a market for the products of those factories. A nation so crowded, with such limited agricultural land, cannot live on agriculture alone. It must live on industrial production.
That is the reason why it is wrong to take up a purely anti-Japanese attitude in considering this problem, because that is not facing realities, it is not facing the needs of the Japanese people and it is merely encouraging an obstinate continuation of a policy which has caused a great deal of misgiving in the rest of the world. Equally I venture to think a purely uncritical support of Japanese action will not lead to the solution the noble Earl desired, because it will merely encourage the continuation of a policy of expansion on the mainland without reference to other nations, which has been rightly condemned by the noble Marquess, Lord Lothian, and which in the end leads to a state of affairs which will merge into war.
In facing the problem and in studying the factors involved, I think it is important to realise the accuracy of a point made by Lord Addington and a point entirely misunderstood by the Duke

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of Atholl, and that is that the Japanese are not, in fact, colonisers. The noble Duke talked about the Japanese being bottled up; but they are not trying to escape out of the bottle, they are trying to live inside the bottle. It is a fact that during the last three and a half years' occupation of Manchuria by the Japanese only 35,000 Japanese have actually left Japan to live in Manchuria, and those are mainly engaged in looking after the Japanese troops in Manchuria and are not, in point of fact, colonisers.
THE DUKE OF ATHOLL: What I meant was that they could not remain bottled up where they were unless they had something for their industries, and that they hoped to get that by opening up trade with Manchuria and Mongolia. That was my point.
LORD MARLEY: If the noble Duke did not say that they intended to colonise I at once accept that and withdraw any such suggestion. But in dealing with this matter, it is quite clear that the Japanese are not seeking a place to colonise, and therefore a good deal of the suspicion of Japanese aims may be discarded, particularly, for example, the suspicion quite widely held recently in Australia, I believe, that the Japanese were seeking to colonise the Northern part of Australia. It is true that the Japanese have adopted what is called a Continentalpolicy with regard to Asia, and it is true that they have done this against existing treaties. They have, against existing treaties, seized Manchuria, and that Continental policy, that unilateral policy, as it has been called, is the reason that has been given for the possible holding of a conference of all the Powers involved.
But up to the beginning of the operation of that Continental policy there was no sign that other nations were prepared to discuss with Japan what was involved if one faced up to it—that is, the giving up of some of our privileges and handing them over to Japan. We believe this matter can never be adequately dealt with until sacrifice on the part of other countries is realised as a practical necessity in dealing with the problem. If is possible that the Japanese have very serious further developments in view, and competent observers are pointing out the possibility of the development of a Mongolian Empire to the north of China which
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would act as a barrier between China in the south and the Soviet Union in the north. That is a factor which wants very careful watching and, whether it is for good or evil, I believe we shall never-get a satisfactory solution of the tension in the Far East unless we watch with sympathy and judge how far we can aid developments such as that proposition.
In dealing with the relationship between Japan and China I think a mistake is made in talking of China as though it were a. complete entity. In point of fact, China consists of a number of separate Governments. They are opposed to one another, they are not co-operating they are so far separated that they are hardly in communication. It is a, known fact, for example, that the Nanking Government in the north is quite unable to be in communication with Sinkiang or Chinese Turkestan in the west. The Canton Government, as has been pointed out, is actually opposed to many aspects of Nanking policy, but the Chinese Soviet Government, which has been mentioned, has the support of many millions of Chinese, particularly the peasants and working masses, and is succeeding in existing in the face of a continual series of attacks aided by other nations. China therefore has many sides, and to refer to China alone is not accurate but is misleading.
If we are talking about the Nanking Government, that Government is in very serious financial difficulty, and it is, I understand, one of the propositions of the Japanese Government to make a loan to the Nanking Government provided that Government carries out the policy dictated or advised by Japan. That policy was the policy that the noble Earl, Lord Lytton, called "internal reconstruction in China," which appears to me to be an encouragement of the Nanking Government to continue an impossible civil war. British newspapers published in China, such as the North China Daily News, have long advised that the Nanking Government should limit their activities to those Provinces which they actually control and should devote foreign money from Japan or wherever else to the development of social services, roads, and communications in the Northern Provinces instead of throwing into the maelstrom of war millions upon millions

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of pounds in continuing internal civil war.
We must take a share of responsibility for the fact that the Western nations are supplying large quantities of arms to the Nanking Government which are being used for this purpose. I see that in the recent return of the League of Nations Great Britain's exports of arms to China, in gold units, increased from 900,000 in 1932 to 1,450,000 in 1933, and that France increased her exports of arms into China from one per cent. of her total exports to China in 1931 to 29 per cent. of her total exports to China in 1933, a rise from 2,000,000 to over 4,000,000 gold units. We are told that the bombing operations of Chiang-Kai-Shek, the Chinese General, have been carried out by 200 American bombing planes, and other nations are involved in this trouble. We cannot say we are helping in a solution of a difficult situation when we must bear a share in the wickedness of supplying arms to enable that state of affairs to continue.
There is one factor which has been mentioned by one or two of those who have taken part and which is a factor of very great hope and optimism in the Far East—that is, within the last two or three days, the generally recognised pacific intention of the Soviet Union. Russia is a very great power for peace in the Far East. I think it would be generally recognised that she has proved that by her offer of a non-aggression pact with Japan and by her sale of the Chinese Eastern Railway because it was a constant source of possible irritation in the relationship between Japan and the Soviet Union. The recent speech of the Foreign Minister for the Soviet Government, Litvinov, is of very great importance. It was reported in the Daily Telegraph of March 15 and it reads as follows:
"When the present situation slackens, Russia will be ready to discuss the reciprocal withdrawal of a certain part of her armed forces, including military aeroplanes, to a definite distance behind the Soviet-Manchurian frontier. For that purpose it is important to disperse the unfavourable impression created in Russia by Japanese refusal to accept the Soviet offer of a pact of non-aggression."
That offer is one which should be followed up, because it is of vital importance in easing the tension which has
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existed for too long between the Soviet Union and Japan in the Far East.
We on these Benches believe first of all—and we agree in this with the noble Marquess, Lord Lothian—in the maintenance of the treaties which govern or are supposed to govern the position in the Far East, and we would support a full discussion by all the nations involved of the problems in the Pacific. The noble Lord, Lord Newton, in his proposal for a Four-Power Conference, carefully omitted the Soviet Union, but I hope he will get over that feeling of dislike and will follow what is, I think, the growing opinion of thoughtful people in this country that the Soviet Union has a very great deal to contribute towards the peace and stability of the world. Then again, we on these Benches believe that we must control the arms traffic in the Far East. That arms traffic should be one of the factors to be considered by such a conference as has been proposed by so many speakers. We believe that we must secure the political and economic integrity of China, and that that political and economic integrity must be for the benefit of the Chinese masses and not for the benefit of this or that Government, temporary or permanent; and not for one portion of China only. The factor of the non-unity of China must be taken into account in any such conference. Finally, we believe that such a conference must reiterate and underline the fact which has been stated before, but which has never been put into practice, that the Powers concerned have no intention of the continuation of the domination and exploitation of the Chinese people.
THE UNDER-SECRETARY OF STATE FOR FOREIGN AFFAIRS (EARL STAN-HOPE):My Lords, when I saw upon the Paper the Motion of my noble friend, I realised that I should probably be faced with a variety of opinions about China and the Far East, many of which perhaps would be contradictory one of the other, and that I should be faced with a very difficult debate to which to reply. The differences of opinion have perhaps been less than I anticipated, but my difficulties are none the less. Several of your Lordships have referred to the financial situation of China, and it reminds me that some two or three years ago we had a debate on bimetallism in this House, in

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which several of your Lordships took the point of view that if the price of silver were raised then both India and the Far East would find themselves in affluence and everybody would be well off.
EARL PEEL: I did not.
EARL STANHOPE: My noble friend, course, was not one of them, but I found myself somewhat alone. I did not even get the support of my noble friend when I took the opposite point of view, that any great appreciation in the price of silver would probably mean a slump in prices in China, and that so far from China being better off as a result of the increase in the value of silver, we should find things very much worse than they were before. I regret to have to say that, at any rate on that occasion, I was right. We find that China is suffering in exactly the same way as we did when gold was at a very high price. We found a vast amount of unemployment and difficulty, until, eventually, we had to go off gold. I am not going to suggest that it is China's plan to cease linking her currency with silver, but I wish to remind your Lordships that the situation in China now is one of considerable difficulty in that respect, not only in regard to her trade and unemployment, but also in regard to her currency. But it is, I think, going too far to say that China is on the point of collapse from that point of view, and that unless we do something immediately there will at once be general chaos and a break-up of the Far East.
Recently China has been enquiring of this country whether we would be prepared to support her with a loan. The scheme was put before us, and we considered it with sympathy and with care, but we came to the conclusion that the scheme, as proposed, would have had only a temporary effect and, therefore, would have been of no real value to China. We have consulted with other Powers about this matter, and we have done as several noble Lords have suggested. We have taken those Powers who were particularly interested in the Far East into conference about the matter, and have told them what action we were taking with China. At the present moment the situation is that the Chinese have appointed a Committee of their own people, who are considering the matter, and I understand that they are drawing up a report on the whole situation. When
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that report is handed in, then we, in common with other countries, will consider it with every possible sympathy, and see what we can do to alleviate the situation in regard to China.
Several of your Lordships have remarked that there was a possibility that Japan would be prepared to grant a loan to China on her own account in return for various privileges and rights which would be conferred on her alone. I have no information of that kind, and no such information has come in any kind of way to the Foreign Office, although we are the receptacle for a good many rumours from all parts of the world. But I think your Lordships would agree that it is an unlikely rumour to be true, because, as several of your Lordships have pointed out, the situation of Japan herself is not so extraordinarily favourable, from the financial point of view, that she could really consider making a loan to some other country. In some respects Japan's financial position is very secure. She has a small national debt; I think it works out at something like eighty-four yen per head of population, not a very large sum; hut it is quite true that she has only been balancing her Budget during recent years by raising bonds in her own country to an extent of something like one-third of her total expenditure. That, of course, is not a policy that any country can pursue for any length of time with impunity, and, therefore, she will have, in the comparatively near future, either to reduce her expenditure very materially, or greatly to increase her taxation.
There is a possibility that she may be able to reduce her expenditure in Manchukuo. A great deal of the expenditure there was of a military character when first her Army went into the country, but a good deal of it also has been, as several noble Lords have remarked, upon the very great developments which have taken place in Manchukuo since 1931. That, to some extent, is likely to continue. I think, probably, the building of railways will now slow down, but there is the making of roads, and there is still the suppression of banditry, which has to be brought to an end. No doubt banditry is much less prevalent than it was, but, none the less, the expenditure which Japan has to face in Manchukuo in the near future must still remain, I think, considerable,

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and it will be some time before she can expect to get a return from the money she has put into Manchukuo. Several of your Lordships have gone in considerable detail into the events that occurred when Japan proceeded to take possession of Manchukuo. I do not think I am called upon, in view of the Motion on the Paper dealing with the situation in the Far East as it is at present, to go into past history, and I am all the less inclined to do so when I see sitting on the Cross Benches the noble Earl, Lord Lytton, who went into the matter so fully in the Report he made to the League of Nations.
My noble friend referred to the fact that neither China nor Japan any longer was represented on the Council of the League of Nations. That is quite true, and it is most unfortunate, but I think it was unavoidable. I am very grateful that he mentioned the subject to-day. As your Lordships all know, Japan herself resigned her permanent seat on the Council, and, therefore, there was no alternative but that she should disappear. China was in a different position. China was elected to one of the temporary seats on the Council, and at the end of her period of three years, she was again re-elected for a similar period. But when a nation has been re-elected once as a temporary member of the Council, I understand that it requires the vote of the Assembly of the League in order that she should be re-elected for a third term. In fact, I think it has only been done on one occasion and that was in the case of Poland. Therefore your Lordships will see that there was no alternative but that the seat allocated to Eastern countries should cease to be occupied by China, and it was then occupied by Turkey in her stead.
EARL PEEL: I merely said it was unfortunate.
EARL STANHOPE: I quite agree, and I know that no accusation was made either against the Government or against the League of Nations, but the noble Earl did say that there was a feeling in the Far East that the League of Nations was no longer interested in Far Eastern matters because these two nations were neither of them represented. I wanted to put it that the League had no alternative, and that so far from having lost interest in the Far East the exact
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contrary was the case. I think the noble Marquess, Lord Lothian, said that if we could only settle matters as regards Germany and Japan we should probably have peace throughout the world for fifty years. That is a big assumption. Incidentally it leaves out South America which we have heard of in regard to war. I agree with him, however, that if we could find a satisfactory solution of these questions our troubles would be very materially reduced.
The noble Lord, Lord Marley, was very much distressed at the quantity of arms sent into China. I wondered why, until I remembered that those arms were being used principally against Communists and that as he is a supporter of the Communists he would naturally feel somewhat hurt about the matter. He entirely exaggerated the situation in China. It is quite untrue to say that there is no Central Government and that there is no control by the Central Government, and it is even more untrue to say that there are many million Communists in China at the present day.
LORD MARLEY: May I be allowed to interrupt for a moment? I did not say there was no control by the Central Government. I said that the Central Government control was limited to a certain number of Provinces. With regard to the number of Chinese who are supporting the Soviet Government in China, I only quoted the Report of the noble Earl, Lord Lytton, in which he pointed out that there were something like eighty million people—I think that was the figure, at any rate it was something astronomical—under the control of that Government.
EARL STANHOPE: Yes, but as probably the noble Lord knows the support of troops in China depends entirely on who pays them. Therefore when pay stops the number of troops goes down with a rush on one side or the other. It is no longer a figure of eighty million or anything approaching eighty million. My information is that the Communists are now being definitely rounded up into one part of China—mostly in Kiangsi but also in Szechuan—and there seems every probability that General Chiang Kai-Shek will be able to bring to an end the greater part of the Communist danger, at any rate in Central China (I am not talking about Chinese Turkestan) and to

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get orderly government over the greater part of China.
LORD MARLEY: That is not my information.
EARL STANHOPE: Perhaps mine is rather better. If that is true, and I profoundly hope it is, quite a new situation will begin to arise in China. The trouble is that it is not only Communists but various War Lords who keep fighting each other. Therefore it is very much in the interest of China herself and of the great trading nations of the world that there should be a Central Government powerful enough to prevent civil war going on in any part of China. I was going to say that it is money well spent, but at any rate I will say that until you get a powerful Government in China dealing with a vast, population there is no real hope of getting a solution of the difficulties that beset us and other nations in that part of the world.
Several noble Lords suggested that we should become the mediators between China and Japan. Well, I do not very much like the word "mediation." It usually means that you interfere with other people in their quarrels and one has known cases where two people who were quarrelling have turned to fight the mediator. That is not the position we wish to get into. There is, indeed, a great difficulty in the Far East and I do not think that everybody who has spoken has quite realised the change in the situation. China has got, as so many other countries have, a much stronger national sense than she had sometime ago, and it is quite impossible in these days to go to China and suggest that she should employ advisers, British or other, to help her out of her difficulties. We have suggested, and we continue to suggest, that where there are difficulties then if we can help we shall be only too glad to do so. That is a different way of doing it, but it is the effective way and the right way.
In another place a day or two ago it was stated in reply to a question that three experts, two from the Great Western Railway, are going out to China, starting from this country to-morrow, to advise on the reorganisation of the whole of the railways of China. That was not put forward by us. The Chinese approached our Minister and asked him
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if he could suggest someone who could assist them in reorganising the railways and getting them on a sound financial footing. We were able to give him names and as a result these advisers are going out to China. They are going out entirely at the request of the Chinese Government for temporary service and, of course, they will be temporary servants of the Chinese Government. That is rather different from the position in Egypt in the old days, when advisers sent out were British and in some ways were the servants of the British Government rather than the servants of the Government of the country in which they were serving.
Several of your Lordships suggested that we should call a conference of the interested Powers in order to consider all these questions. I am very doubtful whether we should get any real advantage from that at the present time. When you get a conference, unless the way is very well prepared beforehand, you have each country taking up its own position to support its own interest and its own point of view. The result is that those views become intensified and as they have been made public it becomes difficult for any country to withdraw them. What in fact we have been doing without a great flourish of trumpets is to try to bring about a détente between the various countries interested in the Far East. The noble Lord opposite mentioned the case of the Soviet Union. We welcome warmly the détente that has now occurred between the Union of Soviet Socialist Republics and the Manchukuo Power. If they can settle their differences perhaps the most obvious cause of war, as it appeared some two years ago, will be eliminated and we shall be so much to the good in that respect.
Similarly, in regard to China and Japan, there seems to be a notion in the House that there was very strong hostility between China and Japan, and that—I forget the exact phrase that was used—conferences and so on were taking place. There are conversations taking place, which is rather a different matter, and both sides I am sure realise that if we can assist in any way in easing difficulties that may occur or in explaining the situation from one country to another, then we shall be only too glad to do what we can. Every one,

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I think, of those in authority both in China and Japan realises that we are very strongly of the opinion that it is to the interest not only of China and not only of Japan that they should come to terms together, but also to the interest of the whole world.
China is such a vast country and is peopled with so many millions that there is no question of any one nation being able to get a monopoly of trade in that country. As she becomes more settled, with a stronger Central Government, she will require more and more trade and more and more products as the years go on. Therefore, if we can succeed in getting this détente among the nations of the Far East, we shall all prosper by it, including China herself. We believe that that is the best way to deal with the situation and, although it is perhaps not one that looks well in a firework display, it may be none the less effective for that.
I entirely agree with most of what my noble friend Lord Addington said, and particularly with his remark that the Japanese are dealing with their expansion more by industrialisation than by emigration. I think the noble Lord, Lord Marley, also agreed with that statement. That is quite true. There has always been a difficulty with the Japanese in getting them to face either great heat or great cold. As they have a climate very much like that of this country, they do not readily go to places either north or south of Japan where they do not get such an equable temperature.
My noble friend Lord Glasgow asked me about the boundary between Burma and China. The situation there is that there has been no delay about the matter. The Boundary Commission can only work during the dry months of the year, which in that part of the world begin in November. I understand that Notes have not actually been exchanged at present to set up the Boundary Commission, but we are expecting to be able to do so in the course of the next few days; at any rate, we are expecting to get it settled at a very early date.
I think I have dealt in the course of my remarks with most of the questions that have been put by noble Lords. If I have missed any, I apologise, and perhaps the House will allow me to rise again if they wish to have any further
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remarks from me. It is such a vast subject that I am afraid I have had to deal with it very generally, and perhaps my speech has been rather disconnected. In view, however, of the many different points of view that have been put forward by your Lordships, I hope you will forgive me if, instead of reading out a brief as I once did on a former occasion, and getting into trouble for it, I have been rather more disjointed.
EARL PEEL: I am extremely obliged to the noble Earl for the answer he has given us on many points. As I think that I was a little time ago the author of some criticism of him for reading out a rather stereotyped reply, perhaps I may thank him for the fluidity of his present deliverance. There is just one point I may mention. I am very glad, if I may say so, that the noble Earl has given support to the Central Government and has rather dwelt upon the advantage which the growing strength of that Central Government at Nanking constitutes to the whole of China. May I say that I am also very glad that he has given official expression to the idea that a conference should not be called. That was a suggestion I advocated myself, and I am naturally gratified that it is the official view of the Foreign Office. May I also say that, as regards the efforts that he has told us the Government are making to bring about a détente of the countries, I do not know whether I could translate that into meaning friendly relations between the countries. If the Government are taking an active part in that line, that meets some of the points which I was suggesting to the noble Earl. The only other point I should like to make is to say that I am very interested to hear, on the highest official authority, that conversations are not conferences. I beg leave to withdraw my Motion.
Motion for Papers, by leave, withdrawn.

"THE NATIONAL GOVERNMENT."
LORD MOUNT TEMPLE LORD MOUNT TEMPLE had given Notice that he would draw attention to the Ministry of Transport Circular No. 419 (Roads); ask His Majesty's Government why in that Circular His Majesty's Government is referred to as "the National Government"; and move for Papers. The noble Lord said: My Lords,

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I rise to ask the Question which appears on the Order Paper to-day in my name. I am not going to suggest that this departure from traditional practice is going to wreck our Constitution. I am not going to say that it has been done on purpose, but I think it is of sufficient importance to bring before your Lordships' House, so that what I consider a bad innovation may be scotched at its Very inception. The Prime Minister, poor man, is not the origin of this practice, as most people seem to think, but the chief villain of the piece is the Minister of Transport. Now the Minister of Transport, in the Circular which I quote in my Question, dated the 5th February of this year, is quoted as saying that the "National Government" had decided on a five-year plan. That he was quite entitled to do, if he had been using that phrase at a political meeting outside Parliament and not in an official Paper. In the same Paper, however, which is signed by the chief permanent head of the Ministry of Transport, this is written:
Sir, I am directed by the Minister of Transport"—
so the Minister of Transport is responsible and is the directing person behind it—
"to acquaint you, for the information of your council, that he has had under consideration representations made by the County Councils' Association…With the object of meeting these representations, the National Government has decided"—
to do so and so.
What I take strong exception to are the words "the National Government has decided" to do something, in an official document. I submit, my Lords, that, in accordance with practice and with courtesy to the Crown, the phrase ought to have been "His Majesty's Government" and nothing else. Then, led away by this bad example, the Prime Minister does the same thing in his White Paper dated the 11th March, which was issued when the discussion took place on the increase in His Majesty's defensive forces. In that document he twice used the words "National Government." On page 4 the words "National Government" are used, and on page 10 they are used again. That Paper is signed "March 1st, 1935; J. R. M." So we have, not once but twice in the last three months, an official document issued by His Majesty's Government ceasing to call
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the Government "His Majesty's Government" and substituting for its name "the National Government." It follows that if this is not stopped the next Government, whether a Socialist or Conservative Government, will cease to use the expression "His Majesty's Government" any more, but we shall learn that "the Socialist Government" or "the Conservative Government" decided so and so. I submit that this is against all precedent and ought to be stopped, and I hope that the noble Earl who answers for the Government will stand in a white sheet and say "Peccavi, I will not do it again." But in all seriousness, this matter has a certain constitutional importance. After all, His Majesty the King appoints Ministers, he receives their resignations, and in case of a crisis no doubt he could use his Prerogative to dismiss them. Therefore what has been done is not only bad taste and against tradition, but it is also historically wrong, and in my submission it is not the way in which the Crown ought to be treated by this or any other Government. I beg to move.
LORD PONSONBY OF SHULBREDE: My Lords, perhaps I might save the noble Earl the trouble of replying by giving an answer to the noble Lord. That sort of error would not have occurred while he was at the Ministry of Transport, and I am sure would not have occurred whilst I was at the Ministry of Transport. The noble Lord will remember the almost incomparable genius for publicity which is possessed by the present Minister of Transport, and he therefore thought it as well to kill two birds with one stone—not only to regulate the traffic, but also try to give as much publicity as possible to the present Government. I entirely agree with what the noble Lord said, but I am afraid we shall not correct them—they are incorrigible.
THE EARL OF MUNSTER: My Lords, the object of the Motion is to call attention to Circular No. 419, issued by the Minister of Transport on May 5 last, wherein the words "National Government" were inserted instead of the words "His Majesty's Government," which, of course, should have been used. The Circular of that date follows the language of, and makes quotations from, the Minister's speech at Birmingham, in

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which he announced that the National Government had decided on a five-year plan for the roads. My honourable friend the Minister of Transport will, however, take note of the points raised by my noble friend, and there is, of course, no intention of employing the phrase to which exception has been taken.
LORD MOUNT TEMPLE: My Lords, I ask the leave of the House to withdraw my Motion.
Motion for Papers, by leave, withdrawn.

TRAFFIC IN ARMS.
VISCOUNT CECIL OF CHELWOOD VISCOUNT CECIL OF CHELWOOD had the following Notice on the Paper: To ask whether it is true that the representative of the British Government on the Sub-Committee at Geneva dealing with the manufacture of and trade in arms has finally refused to agree to international control on the spot; whether any other Power is supporting this point of view, and if so, which; and what is the reason for which the British Government is taking this attitude which, in the view of several other Governments, is fatal to the success of the negotiations; and to move for Papers.
The noble Viscount said: My Lords, I have put this question in fairly full form, and I hope that it will be intelligible to the Government. When the so-called deadlock occurred in the disarmament proceedings, it was decided that there were two or three subjects which might still be discussed in the Committees of the Disarmament Conference while the main questions were in suspense, and among those subjects was that of the traffic in arms. In order to permit a discussion of that, it was referred to a Committee of the Conference, and that Committee was called together a few weeks ago. When it was called together the American delegation put forward certain proposals for the regulation of the traffic, and the main point of those proposals was that each Government should assume responsibility for the sale of arms. It is not exactly the solution that I personally should have liked—I would have gone further—but it was, many of us thought, a very important proposal which might, at any rate, do something to remove the undoubted difficulties which have been deplored by
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the head of the present Government and by others in connection with this traffic in arms.
There was a discussion in public. The British Government, while expressing general friendliness to the proposals, announced that they were going to move important amendments which it was an open secret that the American delegation regarded as a very serious deterioration of their proposals. The matter was discussed in public, and then it was referred, I think very unfortunately, to a Committee sitting in private for further discussion. We do not, know, we have not been told by the Government—I believe, in fact, they have refused to tell us—what amendments they have moved, or given notice of in this private Committee. I deprecate that attitude. I think it very important that in a matter of this great moment, which excites very great feeling in the country, we should have been kept fully informed of what exactly the Government were doing. However, they thought differently.
It is now stated in the Press—I do not know with what accuracy—that on a very important matter, with the details of which I do not propose to trouble your Lordships, but which is sufficiently referred to in this Question, the British Government insisted on moving an amendment which was opposed, as is stated—of course, I do not know—by almost the whole of the other Governments represented. Indeed, I am told that only one Government supported the British Government in their proposal. I am told that they moved a second amendment, dealing with another matter affecting the nature of the returns that were to be made to show what traffic in arms was actually going on, and on that occasion the British Government received only the support—so I am told: I do not know whether it is true—of Persia and Afghanistan. I think it only right that we should be informed whether those reports which have been printed in the Press are accurate or not. We should know what is the attitude of the Government on this matter, and that there is no danger of a repetition of what has happened so frequently in the Disarmament Conference, where discussions in public have seemed to be so near to leading to an agreement, and then there has been a reference to these private Committees

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when all hope of agreement has vanished. I beg to move.
EARL STANHOPE: My Lords, I am, of course, not at liberty to state what is happening in the Sub-Committees at Geneva. My noble friend knows that these Committees are sitting in private, and therefore if I tell him and other people what is happening in private, obviously I am transgressing the rules that prevail in any assembly which meets under those conditions. I am certainly not going to tell him or anybody else whether the suggestions made by the Press are accurate or otherwise, but I am in a position, of course, to tell him that naturally our delegation is taking the same general line in regard to these matters that I took in the open sessions which I attended at Geneva last month.
From the remarks which my noble friend has made before, I think he is not quite aware of what is the actual intention of this Convention, and therefore I think it would be advisable, if I may, to tell the House the history and the objects of this Convention and how it arose. The mandate given to the Committee which is sitting on this proposal was given to it by the Bureau of the Disarmament Conference, and it was of a strictly limited character. The Committee was instructed to draw up three separate protocols on three different subjects, and the one with which we are concerned was for the regulation of the manufacture of, and trade in, arms. Now the objectives which we had before us in that Committee I defined in the speech that I made at Geneva in the early part of the proceedings, and if I may I will quote them, because they have, I think, been generally agreed by all the delegations which attended the Conference.
I suggested that the objectives were these:

"(1) To introduce adequate and practicable measures of regulation and publicity, internationally agreed upon, in regard to the operation of arms manufacture;

"(2) to devise a similar system of regulation and publicity in regard to the trade in arms, whereby that trade is confined to legitimate channels and only passes through responsible hands;

"(3) to ensure that the world should have timely information of any material increase in the armaments of any country whether by import or manufacture."

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Then I ventured to add a further one which was rather outside the terms of reference given to the Committee by the Bureau—namely:
"To provide the machinery for the immediate imposition of an effective embargo on the export and import of arms if and when such action should appear to be advisable."
That was generally agreed by all the various delegations as being an accurate description of the objectives which we had in view.
The House will recognise that of course the task before the Committee had nothing to do either with the reduction or limitation of armaments. The proposals submitted to the Committee by the United States in their draft protocol were based on two principles: (1) National control of arms manufacture and trade on internationally agreed lines; and (2) international publicity and supervision to ensure that the objects of the Convention are attained. The system proposed by the United States seemed to us unnecessarily complex for the object in view. We were all of us agreed that the control both of manufacture and trade should be of a national and not international character, and therefore when it was proposed in the United States draft that there should be set up international committees, who should be in every country, to supervise this control and to supervise the returns, we felt that such a system was unnecessary. We proposed instead that it would be sufficient if the returns which were given on a national basis were to be supervised at Geneva by the Permanent Disarmament Commission which it had been proposed should be set up there.
Supposing that the United States proposal had been accepted, and supposing these committees had been set up in every country, what would these committees have had to deal with? I do not know whether my noble friend knows about the manufacture of arms. Of course the manufacture of arms is very much ate same as the manufacture of any other kind of product. It is a continuous process, and if you have to decide how many and what kind of arms have been produced in a particular factory, it would be necessary to have the committee there very often, in order to see what was happening and to see whether the amount put forward as the production was accurate or not. Supposing

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the committee had discovered that the return was incorrect? All that would happen would be that the country in question would say: "Oh, we are very sorry, the proper figure should be so-and-so"—because under the Convention as proposed there was absolutely no question of any limitation of any sort or kind, qualitative or quantitative, and therefore any country had a perfect right to make any number of any kind of arm it pleased.
Therefore your Lordships will see that to set up these committees was really getting us nowhere, and we—that is the United Kingdom delegation—felt that it was extremely unlikely that anybody would commit a mistake deliberately in order to falsify a return. There was really no reason why they should, for they could make as many, and as many different kinds of arms, as they pleased, and if they did there was nobody who could object to their action in any sort of way. The proposal which I put forward on behalf of the Government was that the Permanent Disarmament Commission should have the right to supervise these returns, when they came to Geneva, and should have the right to call for further documents, and to send for individuals and examine them. That is by no means a new system. A somewhat similar system works admirably, I understand, in regard to the drug traffic, and one of the greatest things to the credit of the League is the way in which the drug traffic has been controlled. I am told that similarly, with regard to publicity, the Budgetary Publicity Committee is proposing to set up exactly the same system, by which further returns can be sent for and verbal examination made of witnesses, in order to verify those returns.
Your Lordships will see that we are not by any means opposed to supervision. It is merely a question of degree. The United States proposed to set up supervision in each country, on each article, and we proposed that supervision should be at Geneva, on the returns for which each country is responsible. The noble Lord asked if we were not alone in our proposal. Far from it, but once again I am not in a position to tell the noble Viscount who was with us and who was against us on this matter. He must possess his soul in patience, because I think presently the Committee will make
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its report in public, and then he will be able to find out who agrees with us.
Apart from the reasons I have given, I want to put forward two very cogent reasons for taking up this attitude. The first is that we know that if we put forward a Convention setting up permanent and automatic supervision in each country, which is not attached to a Limitation of Arms Convention, there are certain countries who are not going to ratify that Convention and therefore it will never come into force. Personally I am extremely doubtful whether, when it comes to the point, the Senate of the United States will agree that an International Committee with Japanese and other representatives upon it should be allowed to go and inspect American factories in order to see whether the United States Government is telling the truth and rendering an accurate return to the League of Nations. It seems to me it is a matter we may find ourselves in some difficulty about, and on which the Senate may take a view not less contrary than that which it took in regard to the International Court.
But quite apart from the United States and ourselves, there are in fact other countries who have intimated that they are not prepared to have this inspection in their own country unless it is accompanied by a Limitation of Arms Convention. The result of that will be that the Convention will not have come into force, and once again a proposal will have been put forward by the League of Nations which will have fallen to the ground. A further failure of this kind—and unfortunately there has been more than one—does not tend to the prestige of the League of Nations. We advocated a short step because we believed a short step would prove to be effective. We would not be tempted into an ambitious one which would only lead to failure.
But we had a further reason, perhaps the most cogent of all, and it is this. We still believe that a Convention for the limitation or even for the reduction of arms is possible. I may be accused, and the Government may be accused, of being hopeless optimists. I admit I think a Convention of that character will have to be on very limited lines, possibly merely on the qualitative line that guns over a certain calibre or tanks over a certain tonnage shall be destroyed and shall

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never be manufactured; but at any rate let us try to take a small step, even if it is a small step, because sometimes from a small beginning you may in the end get a great achievement. To try and make these large Conventions which are not ratified leads us nowhere, and only causes doubt and suspicion as to the effectiveness of the League of Nations.
My noble friend knows better than I do that there are certain nations who are extremely anxious to get this inspection sur place in each country, but they are also in some cases the nations who have raised considerable difficulties in regard to the reduction of armaments. It would be folly for those who, like ourselves, hope for a Limitation of Arms Convention to give away now one of the greatest inducements we have to offer by agreeing to local inspection when we are not at the same time getting a limitation of arms. Not only should we be destroying the prospects of this Convention by agreeing to local inspection when we know other countries will not accept it unless it is coupled with limitation, but we should throw away the chances of getting a Limitation of Arms Convention by having already surrendered our most telling inducement. I believe your Lordships will agree that in adopting the attitude we have, in refusing to accept inspection on the spot and going for inspection at Geneva of documents and individuals, we have not only taken the right step for this moment, but one which is wise in looking to the future of the possibility of a Limitation of Arms Convention.
VISCOUNT CECIL OF CHELWOOD: My Lords, I am very much obliged to my noble friend for the fullness of his answer, but I confess I am a little puzzled by the reasons which he gives. I take the last one first, because I really am at sea as to exactly what it means. If I understand him rightly, he says we are holding back the concession on the question of local inspection because we hope, by giving it later on, to induce other countries to agree to limitation of armaments. It seems to me a very unlikely calculation that if there is a real objection to limitation of armaments they will agree to it by being offered the possibility of local inspection. It may be so, because anything may be so, but it seems to me a most extraordinary and
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unlikely state of things. The other argument was that he was afraid, if too much were put into this Convention, it would be rejected by certain Powers. I do not deny the force of that as a reason, but I think it is perfectly hopeless to speculate as to what the Senate of the United States will do with regard to any treaty. No one can tell, and they are just as likely to reject a treaty on the ground that it is too small as they are to reject it because it is too large. You cannot tell, and the only thing to do is to do the best thing for the interests of the treaty itself and hope for the best when it gets to America.
EARL STANHOPE: I do not want my noble friend to think I was referring only to the United States. In fact I was referring less to the United States than to other countries.
VISCOUNT CECIL OF CHELWOOD: It was the only country my noble friend actually mentioned. That is why I mentioned it. I do not know to what other countries he was referring. I shall not go into the question of drugs, because there is no doubt that anybody who has watched that tremendous struggle will admit that, though a great deal has been done, the actual proposals with regard to drugs are constantly being evaded, and every year the authorities at Geneva have to stop a new hole that has been created in the system. That was the reason for my hesitating to accept the example of drugs as an altogether encouraging one for any other proposal. But it was the first part of my noble friend's reply which puzzled me most, because he said this is to be a Convention for the national control of armaments. I understand that thesis, but it involves also international supervision, even on my noble friend's thesis, because he proposed international supervision, only it is to be international supervision at Geneva and not on the spot. I do not see what bearing that prelude, that the thing was to be constructed on national grounds, had on the difficulty that has arisen in this matter.
The real issue is simply this. Granted that it is of importance for the purposes of the Convention that there should be some kind of international guarantee that the returns made by the various

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countries are accurate, that is common ground between my noble friend and myself. The question is what that international guarantee shall be. That is the only question. It is admitted there must be some guarantee. The whole question is what guarantee. In spite of the discretion of my noble friend, it appeared even in the open discussion that the majority of the countries represented on this Committee supported local inspection. They say that is the best guarantee. I do not know whether that is so or not. That is a matter on which I can only form a kind of man-in-the-street opinion; but on that kind of ground it would certainly appear to me to be more likely you would get a valuable guarantee by going to the country itself and seeing what is done than by taking the returns at Geneva and cross-examining some official as to their accuracy, which I understand is the proposal of my noble friend.
I should have thought it was clear that local inspection is more likely to be of service than such a system as my noble friend suggests. From my point of view it is not so important whether local inspection or inspection at Geneva is the better plan. But here is a proposal, a very mild, moderate proposal, dealing with a great international and national evil, and it does seem to me a great pity that in these circumstances, without overwhelming reasons, the British Government should appear in an obstructive capacity. I think it is very disastrous and I do deeply regret the action which the Government have taken in this matter. And not only on this question. As my noble friend knows, there were one or two other amendments of a similar character. I hope and trust that when it comes back to the full Committee it may be possible for the Government to take a more generous view of these questions and agree with the proposals of the United States. I beg to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

LONDON BUILDING ACT (AMENDMENT).
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MIDDLESEX COUNTY COUNCIL BILL. [H.L.]
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