Was Japanese International Bankruptcy a Valid Idea?

[hselassi]

I was reading Bankrupting the Enemy and it listed the US policy against Japan from 1937-40 as an expectation that Japan would run out of specie/hard currency and be forced to end its aggressive policy. The logic was that Japan had to import most things needed to run a wartime economy (and even some foodstuffs) and for that it needed specie or hard currency since it was a bad credit risk and could not access international markets for loans. Its reserves were supposed to run out soon (US calculations based on available data always had the expected bankruptcy one year ahead until they figured out in 1940 that they were wrong and Japan had enough reserves to last until 1943 (or later if it started emergency measures to acquire specie (raiding Chinese and Korean (eventually Japanese) civilian/cultural/religious/government/royal (in case of Japan) precious artifacts)).
On its face value, the policy appears valid if you are willing to wait. My questions are: 1) was it a valid policy at all, 2) did Japan view it the same way (did they see a deadline for their conquests), and 3) if it was a valid policy, what options would Japan have had once the specie and hard currency ran out (the US idea was that it would have to ask for terms and hope for the best).

Regards,
/s/ Harry

[hselassi]

Sorry to push this one back up, but I am hoping somebody will at least reply that it was really stupid, if nothing else.

This book is the only place I have ever heard of such an American strategy and while it makes sense in economic theory, it just looks odd upon reading it apply rules to a nation-state the same as you would an individual (if you remove the ability of somebody to earn money (exchange) eventually they face starvation and have to do whatever is required of them to earn money (exchange) again).

[wm]

Bankruptcy implies inability to repay debts but as far as I know Japan's finances were competently administered and no internal or external debt worth mentioning existed.
But without oil, copper, steel, cotton it would be back to the Middle Ages for Japan, no modern country could have survived without them - especially with such a large heavy industry sector.

[OpanaPointer]

Sorry to push this one back up, but I am hoping somebody will at least reply that it was really stupid, if nothing else.

This book is the only place I have ever heard of such an American strategy and while it makes sense in economic theory, it just looks odd upon reading it apply rules to a nation-state the same as you would an individual (if you remove the ability of somebody to earn money (exchange) eventually they face starvation and have to do whatever is required of them to earn money (exchange) again).

I read the book when I was at Purdue. Unremarkable conspiracy theory.

[R Leonard]

Miller, who also wrote War Plan Orange, is not particularly known for being a conspiracy wonk. And it is true that Japanese financial resources held in the US were frozen. I'm not sure if the purpose was to "bankrupt" the Japanese, but more to seriously constrain their access to financial markets and thus limit their access to US products generally.

On the other hand, I've not read this particular tome, but am merely aware of US limitations placed on the Japanese as war approached.

[OpanaPointer]

https://www.history.com/this-day-in-his ... do%2DChina.

That's July 26, 1941.

Japan was waging aggressive war in China, militarily and economically. Any company of more than the smallest size was required to name a Japanese to the board. They were also expelling missionaries and converting their churches to military uses, such as "comfort stations". (How one gets "comfort" from repeatedly raping a horrified 13 year old girl escapes me.)