Chapter Two, Part One: Gearing Up!
Dec 1936 - Jul 1937
The beginning of 1937 brought several important events. In January, Republic of China started the mobilisation of their army. While this move ensures that they will be better prepared for a potential conflict, it also makes them more threatening to their neighbours, which is beneficial for the Empire diplomatically-wise. Still, there are groups which think that that the current Japanese policies are too passive and they are advocating "action". Partially as a result of this, Koki Hirota's government fell and the fascists are becoming more and more popular.
Other news were more comforting. Apparently, the paranoid maniac who rules the Soviet Union started the purges of the Soviet officer corps. This move should benefit the Empire greatly in the short-term, because the Soviet threat is decreased. Still, it is obvious that once Stalin deals with any real or imaginary opposition, he will turn his attention to Manchuria.
The Emperor condemns communism in any shape or form, which ideologically brings the Empire closer to the Axis. Still, the Anti-Comintern Pact remains to be signed.
The unruly and rebellious Xinjiang province is causing trouble to the Chinese. As long as China stays unstable and disunited, the Empire's safety is ensured, so this is good news.
As expected, the socialists lost the Spanish Civil War. This is yet another sign of the inherit weaknesses of the socialist and communist ideologies. On the other hand, fascism is on the rise in Europe and at the moment the fascist block is the only significant opposition to the democratic colonial powers.
Enormous effort has been made into the army expansion and modernisation program. Every day, the Imperial Army becomes stronger while the Empire's enemies tremble with fear. The Emperor is very happy with the results of this program so far, but much remains to be done. Also, it should be noted that the current rate of expansion is possible only because of the strict cooperation between the Army and the Navy and the concessions made by the latter.
The first results of the industrial expansion program are visible. The construction of the next set of factories has been started and the experience gained so far will aid the imperial engineers, businessmen and managers in their efforts greatly.
Since the construction of the new warships should be finished at the beginning of 1938 and the work on the development of new experimental formations called "marine corps" has been recently completed, the Emperor is eagerly anticipating what the admirals have to say about future naval developments.
The budget reserved for research development has been expanded a bit. Since the Naval Treaty now hampers the Empire's technological naval developments significantly,
the Emperor has decided to abandon the Treaty in the second half of 1937. The Imperial diplomats will make sure that this decision is made at an appropriate moment in order to limit its potential effects on the Empire's economy.
Currently, the major Japanese economic concern is the shortage of rare materials. Vast amounts of them need to be imported from the United Kingdom, which makes the Japanese industry highly dependant on the whims of British capitalists and bureaucrats. These trade agreements also put a heavy strain on the Japanese merchant marine, which should be taken into account in future planning.
The Imperial cash reserves are low, but this could partially be remedied by the cancellation of several trade agreements with various Asian countries which provide supplies of all sorts to Japan. Such move would put a greater strain on the Japanese industry, though. Another option is to raise taxes, but it would be a rather unpopular move.
The Japanese intelligence network now encompasses most of China. Some say that it should be expanded into the UK, the USA and/or the Soviet Union in order to better monitor the developments made in those countries.
The Emperor is having doubts about the effectiveness of foreign intelligence actions in the Guangxi and Yunnan Cliques, though. It is unclear how long it will take to convince them to join the Empire's cause. It should be noted that they are very isolationistic and that they do not consider the Kuomintang to be a major threat. For this reason, the Emperor wants to know
when the generals expect to become active in China and when the cliques should be ready to aid the Empire there so that the effectiveness of the foreign intelligence actions can be re-evaluated.
The Army has been reorganised. Most of the Japanese divisions are stationed on the Japanese-Chinese border, but significant forces are tied on the Japanese-Soviet border, too. All ports are guarded by garrison divisions, which are detached from the standard military hierarchy and function semi-independently. The biggest question is the deployment of the Imperial cavalry divisions, which currently serve as reserves.
The Navy has been reorganised according to the admirals' specifications, too. The Emperor is concerned about the large naval "reserve" and wants to know what is its place in the Navy's strategy. Also, several prominent Imperial logisticians raised questions about the organisation of the Japanese submarine fleet.