I accept your criticism, but I would then have to ask: What would you have me do?
Believe me, I understand those concerns very strongly. IRL Japan would never have been able to get away with anything close to what Japan is doing in this scenario. If this was RL, the Japanese military Junta probably would have been overthrown by the CIA in a coup or been crushed in a military conflict with the PRC, and thats at the very least.
But you have to remember, this is not some hardcore geopolitical simulation where everything is done in the utmost accuracy as to what could happen in this scenario. This is an MDS 1.6 HOI2 AAR. This is being done for the purposes of entertainment and enjoyment, not to examine real life geopolitical consequences of Japanese actions like those being taken in this AAR. If I was to play trying to be absolutely positively 100% realistic, this AAR would be boring as hell. What would I do in that case, just play 8 years of screenshots of my production que and flavour events until WW3 breaks out? Nobody would read this AAR if I was to do that! This is especially so because I have some really big shoes to fill with this AAR project. My last one, In Defense of Freedom, really blew people away, and I do not want to disappoint with this AAR. To see people read and comment, I need to do exciting things, like invading tons of countries and engaging in aggressive military buildups and expansions. If I was to play 100% according to realism, this AAR would be dead in the water before it could even get off the ground.
Now, this does not mean that I will completely throw realism away, just that I will try to explain Japanese actions in ways that I think will satisfy other states in this scenario to the best of my abilities, such as using the whole "war on terrorism" excuse. This also means that I will not be invading states that have very close ties to the USA, like Taiwan or South Korea, until I am actually at war with the USA when the time comes.
I hope that this is a sufficient explanation for a lack of heavy handed US response to Japanese actions.