The afternoon meeting was extremely bitter and stiff at first, but then gradually smoothed out: from the East Asian alliance issue, to the naval disarmament issue, to the issue of the stay of overseas Chinese in the United States, to the issue of Sino-US import and export tariffs, and finally to the division of the European agricultural market, that is, the issue of the world's cotton and tobacco production quotas, all these things that were prepared to be compromised in advance were passed through in the talks, and Weng Wenhao bluntly said that if a naval treaty could be signed, then China would make substantial concessions on these issues.

Roosevelt was very fond of China's generosity, and in normal times, any of them would have made voters and public opinion praise him, but at this time the United States was in the midst of the Great Depression, and more specifically, during the previous term, the government's Keynesian deficit fiscal policy caused inflation was wary of his aides - prices in 1937 rose by 31.25% compared to 1933[note 157], and all the cabinets, including Roosevelt, believed that all efforts should be made to reduce government spending to reduce the size of the deficit. However, the consequence of this was the Great Recession of 1936-1937, when the GDP in 1936 was $75.5 billion, but in the first quarter of this year, the GDP growth rate fell by 7 percent month-on-month, and the unemployment rate increased by 34.9 percent year-on-year.

By this time the government had fallen into the trap of the Keynesian economy – the so-called stagflation: inflation and unemployment rising alternately. If the government continues to run a fiscal deficit and relies on over-issuing money to support government consumption, thereby eliminating unemployment and reviving the economy, prices will rise further and inflation is likely to reach more than 10%. And so on. Price increases and hoarding will become the main means of profit for merchants, and the inflation rate will be further pushed up; And capital that cannot be hoarded and speculated can only be transferred out of the United States. This is because 10 per cent inflation is equivalent to a 10 per cent depreciation of the dollar every year that passes, leading to a further increase in unemployment.

Of course. This is not the most serious, the most serious is the depreciation of the dollar due to the decrease in the purchasing power of the dollar. The Gold Act of 1934 reduced the price of the dollar from $20.67 to $35 an ounce of gold, with the result that the value of the dollar fell by 40%. Originally, because of the economic crisis, prices in 1934 were 70% lower than in 1929, and the depreciation of the US dollar by 40% was only equivalent to the US dollar being deliberately depressed by 10% of the exchange rate.

However, if the annual inflation rate reaches 10%, the export effect caused by the depreciation of the US dollar under the soaring prices will gradually decrease, and the export volume will drop sharply; Meantime. At the beginning, due to the depreciation of the dollar, the international tourist capital that held dollar assets and some countries with huge dollar reserves in their hands will frantically sell off the dollars they have accumulated when they see the dollar depreciating at a rate of 10% per year. There are two results: First, the United States has announced foreign exchange controls, prohibiting the repatriation of foreign dollars and prohibiting the exchange of dollars to prevent sell-offs, which is tantamount to the bankruptcy of the country's credit, and its investment of more than $30 billion abroad and its European war debts will all be lost; At the same time, foreign trade cannot be carried out normally, except in barter or in gold. Another result is to sit back and wait for the huge foreign dollars to flow back to China and gold and foreign exchange to flow abroad, which will completely trigger hyperinflation.

In short, the U.S. economy is an open economy. The U.S. dollar is the second largest international currency after the British pound, and it cannot make international trade settled in U.S. dollars as mandatory as later generations, and let each country's central bank hold huge U.S. dollar foreign exchange and U.S. Treasury bonds, so that the Federal Reserve can collect seigniorage from the world by printing money. Therefore. The consequences of continuing Keynesian deficit finances would be catastrophic, and it would completely destroy the US economy.

But without Keynesian deficit finances, the number of unemployed people will again exceed 10 million. The overall unemployment rate exceeded 20%. Such a large number of unemployed workers are fed and displaced, and it is very easy for a revolution to break out. The Veterans March of 1932 and Senator Huey Lang of Louisiana, who proposed the 'Share the Wealth' program. Such events and characters will emerge one after another. At that time, Roosevelt's middle line of neither left nor right had to be aborted. The United States is certainly not the same as it once was.

The situation of the United States is in such a dilemma, but it is not without surprise that Weng Wenhao, who studied geology, obviously cannot see the hidden worry behind Roosevelt's smile, and his aides and subordinates have no useful hints other than blind worship of the United States and vigorous pursuit of Keynesian economy. So, at the end of the self-conscious Weng Wenhao, he almost thought that he was going to be kept overnight because of the smile of his host - above the second floor was the private living room of the president's family, and it was said that some close visitors would be kept by the president, but in the end Roosevelt still smiled and said goodbye to him.

"It's really ......" Weng Wenhao, who returned to the hotel, touched a handful of sweat, his whole body was soaked with sweat, and it was not until he changed into clean clothes that he sat on the sofa and drank tea tiredly. Gu Weijun, Xu Xinliu, Zhang Jiaxuan, Wu Jingchao, Jiang Baili, and Shi Zhaoji, minister to the United States, sat in the living room and waited for him to hold a summary meeting.

Weng Wenhao, who shook his head, wanted to say, 'I was really embarrassed just now', but when the words came to his mouth, he only spat out two words, probably thinking that it was inappropriate to say this, so he changed his words and said: "Judging from President Roosevelt's attitude just now, the most difficult level is over." ”

Weng Wenhao's optimism made everyone except Gu Weijun and Shi Zhaoji laugh, and Xu Xinliu said: "It's scary to think about this afternoon's events. It was the Prime Minister's endurance and perseverance that convinced President Roosevelt. Back in the country, I want to tell the people how hard it is to come by! What was that ...... at that time, yes, when the Minister of War **** Sheng threatened to go to war, I was simply shocked. What kind of attitude does he have?! If this person is really a blackface, he can't disregard diplomatic etiquette like this, China and the United States are both world powers, how can it be said that it is okay to start a war? ”

"This time it was really up to the Prime Minister to argue with President Roosevelt and push for peace." Xu Xinliu patted the horse tactfully, and Zhang Jiaxuan, the household servant, also followed suit, "When we go back, we should let the representatives who oppose us see." They can carry cages and walk birds in the capital, drink and listen to operas in the eight alleys, and they all rely on the Prime Minister to hold up a piece of heaven here......"

Xu Xinliu and Zhang Jiaxuan are both sycophants. But Weng Wenhao is not an old bureaucrat after all, and he is still a little afraid when he thinks of the threat of **** Sheng at this time. So when Zhang Jiaxuan was not finished, he looked at Gu Weijun, a silent diplomatic scholar, and said with a smile: "Shaochuan also contributed a lot today." What do you think, Shaochuan? Do you think the next negotiations will go well? ”

"This ......" Originally, Gu Weijun just wanted to watch everyone pat Weng Wenhao's ass, but he didn't want to change his head, so he actually talked about himself. To be sure, he had no hope for peace talks—Western thinking was not well known to literati like Weng Wenhao, who had studied and educated in the West but did not know the essence of it. The peace of the Chinese people is the peace of thought and speech, the peace of laughter, and even the peace of groveling, while the peace of the Westerners only refers to the peace without any real threat, and it has nothing to do with harmony and laughter, nor does it have anything to do with groveling. Eliminate the threat once and for all to alleviate the worries.

What is the threat to the United States? The threat is the growing nation of Greater China. Japan, to put it mildly, is just a subordinate of Greater China, even if it sells this subordinate to the United States regardless of morality, the Americans will be relieved? Gu Weijun and Shi Zhaoji, a veteran diplomat who has been in the United States for a long time, are very aware of this, so they have always been not optimistic about Sino-US negotiations, but the essence of diplomacy is to serve politics, before the war really begins. They all have to do everything in their power to prevent the war from happening.

When Gu Weijun was groaning, Weng Wenhao, who was very interested, smiled and said, "Shaochuan, you don't have to worry about it, just say whatever you want." It's all my own. ”

"Prime Minister, I still suggest that we do not have hostility with Japan, or at least do not favor the United States between Japan and the United States." He groaned for a while. Gu Weijun said. At this time, sitting in the carriage in the opposite direction, he could only remind the coachman to watch the road carefully. Proceed cautiously.

"Why?" Xu Xinliu thought that the Bank of Asia did not have any original shares of the Industrial Bank, so he hated the pro-Japanese faction. He wished that China and Japan would immediately fight each other, and then have a big war against Japan. Now that the Americans have such an idea, then he must urge Weng Wenhao to abandon Japan and be pro-American.

"Because ......" Gu Weijun really didn't know how to explain the reason for not making enemies with Japan, so he could only think: "It's morally unjustifiable to really do this......

"Morality?!" Zhang Jiaxuan interjected before he finished speaking, his situation was similar to Xu Xinliu. "How much is morality worth a pound, if we don't do evil to Japan now, the United States will do evil to us, why should we ...... for Japan"

"Public power!" Seeing that Gu Weijun interrupted Zhang Jiaxuan before he finished speaking, Weng Wenhao immediately coughed and stopped him.

“…… Again," Gu Weijun didn't care about Zhang Jiaxuan's interruption, he continued: "What if we make Japan hostile, or even give up Japan, and the United States still doesn't give up?" ”

"Still not stop?!" Weng Wenhao's eyebrows became higher and lower again, "What do you mean by this?" The concessions we can make have been made, and even the compensation they demand can be accepted in a fraction of the circumstances, so what are the Americans not satisfied with? ”

"Prime Minister," Gu Weijun sighed in his heart, "Although the Japanese Navy is stronger than China, its national strength is weaker than China's, and steel, shipbuilding, automobiles, and aircraft, even if they are not completely dependent on China, must be provided by China for raw materials." The United States does not attach importance to such a country, and the reason why Japan agreed to participate in the Washington Conference 15 years ago was because the Japanese Navy's proposal for the 88th Fleet was too expensive for its national strength to bear.

But this is not the case in our country. At the beginning of the founding of the country, China pursued the policy of hiding wealth from the people, the national tax revenue is very small but the private wealth is more, and the central bank's gold reserves are second only to the United States; Agriculture and industry have developed rapidly, and the efficiency of the general production system advocated by the prime minister is completely superior to that of the Ford production system in the United States, and thanks to the low prices and wages, China's commodities are generally ...... more than those of the United States."

"Okay, Shaochuan, I already knew all this." This time, it was Weng Wenhao who personally interrupted Gu Weijun. What he said was actually a reproduction of the 'Sino-US war theory' advocated in the Imperial Daily, and Weng Wenhao knew that what he said was not unreasonable, but he just thought it was true. The United States is a peace-loving democracy and the hope of human civilization, so how can it go to war against our country for no reason? The 'battle theory' seems to be the head of the analysis, but it ignores the most important factor: people.

"Shaochuan, I want to ask you, if our country announces that it will not develop the navy, or even abolish the navy, will there be peace in the Pacific?" After Weng Wenhao interrupted Gu Weijun, he felt that it was inappropriate. It was a bargaining chip after throwing out his painstaking meditation next-to dismantle the navy. Without the navy, there would be no so-called struggle for sea power, let alone war.

"Prime Minister. The Manchus did not have a navy before they built the Beiyang Navy. "Gu Weijun didn't expect Weng Wenhao to have such a plan, but he still has something to say." What really displeased the United States was the competition between China's industrial and agricultural products and American products in the international market. From this point of view. There is no deep conflict between Japan and the United States, but it is our products that have a great impact on the United States. ”

"So you mean that we and the United States are going to end up in war anyway?" Weng Wenhao asked rhetorically with raised eyebrows.

"Prime Minister, just like a tree, it naturally extends its shade farther as it grows." Gu Weijun remembered Yang Rui's speech in front of the Invalides Cemetery in Berlin, and this sentence left a deep impression on him. "Our agricultural products, such as cotton, tobacco, soybeans; Industrial products such as home appliances, motors, vehicles, shipbuilding, and chemicals are all products with competitive advantages in the world. If we really want to force these things not to be exported, we will give up the international market we occupy to the United States. I am afraid that the domestic political situation will be turbulent again. ”

"But can we beat the United States?" Weng Wenhao didn't speak, and Jiang Baili, who was silent, suddenly said. "Although China's industry has occurred rapidly, it has built refrigerators, washing machines, electric ovens, and radios; Although there are many mining vehicles exported, the number is too small, and the others are those two-wheeled motorcycles that can be bought for dozens of dollars and run around the streets.

The last war showed that the future war will be a war of the country's overall national strength, and our combined industry with Japan, Korea, and the entire East Asian alliance is less than a quarter of that of the United States. This is equivalent to four US planes hitting one of us, and four US tanks hitting us, can we still fight four with one? Of course, it does not mean that I have to bow my knee to the United States, but that avoiding war is the most important thing. But if we really want to fight, even if we move the capital to Chongqing and Lhasa, we must stick to the end. ”

Although Jiang Baili was not the chief of the General Staff, he was a military adviser to the prime minister. In military affairs, Weng Wenhao basically adopted his opinions, and it was precisely his advocacy to abolish the navy. Jiang Baili, who does not know much about the world economy and trade, said: "The market has certain restrictions. It can't withstand hundreds of years of interconnection, and there is no room for reconnection. Business is naturally a stagnant ......; Ocean... The transmission of crowns from Greece and Rome, through the Netherlands, Spain, and to England, was of course a natural trend. But when there is no room for the world market, this crown becomes problematic [note 158]'. Therefore, Jiang Baili, who felt that 'commerce had embarked on a suicidal path, that the bankruptcy of commercial culture was certain, and that the trend of a new agricultural civilization had begun to appear', naturally thought that the navy could be abolished.

Gu Weijun is not a military strategist or an economist, and he has no way to judge Weng Wenhao's proposal to cancel the navy under the influence of Jiang Baili, and he only said in the end: "Please also ask the prime minister to think twice." Abandoning Japan would have a negative impact on Korea, Persia, the Soviet Union, and especially Persia and the Soviet Union. If there is really a war with the United States, our country will only be left with two external passages, the Persian Railway and the Eurasian Canal, which are connected by the Western Regions Railway. ”

The first four are the most important to the United States, Japan, the Soviet Union, Britain, and France, and at the same time, the United States and the Soviet Union are the most difficult. At the beginning of his tenure, the cabinet said that it would not ratify the anti-aggression and mutual assistance treaty with the Soviet Union, but Gu Weijun, who was a diplomatic scholar, strongly advised Weng Wenhao to ratify the treaty.

"Okay, Shaochuan, I'm tired. I'll talk about that tomorrow. Weng Wenhao pounded his head, he was indeed a little tired - he already had a headache in negotiations with the United States, and now that Gu Weijun had raised the issue of the Soviet Union again, he had an even more headache.

"That'...... Please rest more, Prime Minister. Gu Weijun wanted to speak and stopped, he saw that Weng Wenhao was really tired, so he said goodbye with Shi Zhaoji.

"This Gu Shaochuan, how to speak and revive will be those tones!" As soon as Gu Weijun walked on the front foot, Zhang Jiaxuan complained on the back foot. "There must be war against the United States, peace with Russia, and pro-Japan, isn't that what he said? Why did you choose such a ...... in the first place?"

Zhang Jiaxuan doesn't like Gu Weijun, but Gu Weijun was recommended by Hu Shizhi, and the former diplomatic secretary Wang Zhengting is deeply trusted by the Revival Association, because everyone is not at ease with his position, but Gu Weijun's strategy after coming to power seems to be no different from Wang Zhengting, and he follows the diplomatic line of 'reconciliation with the Soviet Union, goodwill with Japan, and beware of the United States'.

Zhang Jiaxuan complained, but before the people in the house could answer, Gu Weijun hurried in again. This made Zhang Jiaxuan's face red, and obviously, his complaint was heard by Gu Weijun, who turned back.

"Prime Minister, it's a telegram ......" Gu Weijun didn't look at Zhang Jiaxuan, but just handed the two telegrams to Weng Wenhao.

"This is ......" Weng Wenhao lifted his monocle, his eyebrows raised and lowered again.

"German Chancellor Goering talked about entering the Rhine demilitarized zone in the near future during a meeting, and the League of Nations immediately issued a warning, and the French government sent a telegram to our country, hoping that our country would make our attitude clear about this, and if Germany really entered the Rhine demilitarized zone, I implore our country to send an international coalition peacekeeping force to France." The two telegrams, one from Switzerland and the other from the French Foreign Minister, had several meanings, but the general meaning was to prevent Germany from violating the Treaty of Versailles and the Locarno Convention.

"So what are we going to do?" Weng Wenhao asked, the content of the telegram was indeed as Gu Weijun said.

"Britain and Germany have just signed a naval agreement, and Germany may have the tacit approval of Britain......" Gu Weijun said euphemistically. If we and Japan do not immediately show their support for France, promising to send peacekeeping troops for this, then ...... An indulgent Germany could well provoke war again, and the League of Nations was dissolved. ”

"Then promise France and warn Germany not to violate international treaties." Weng Wenhao said.

"Prime Minister ......" heard that Weng Wenhao wanted to support France, and Jiang Baili immediately stood up. He said: "China and Germany have friendly diplomatic relations, Germany is a victim of the European war, and the Rhine Demilitarized Zone is German territory, so it is understandable for them to march into the army."

The Chinese National Party has always had a relationship with Germany, and the Manchu Beizi Baylors were originally pro-German, and Jiang Baili and Zhang Junli also stayed in Germany, and when the Restoration Society suppressed Germany, they often wrote articles to speak to Germany, and were called pro-Germans; The Kuomintang, on the other hand, was known as pro-American; As for the Renaissance Society, it is pro-Japanese and pro-Soviet, that is, it is not pro-US or pro-German.

Gu Weijun, who understood the preferences of domestic parties, was not surprised that Jiang Baili spoke for Germany, he just said: "Prime Minister, from the standpoint of Germany, the Versailles Contract is of course unfair, but from the standpoint of public international law, since they signed the contract at the beginning, they should act according to the rules." Germany's hasty march into the Rhine demilitarized zone without amending the treaty is a violation of the Versailles Treaty, and we should oppose it. ”

"But the British don't interfere, so why should we join in the fun?" Jiang Baili no longer looked at Weng Wenhao at this time, but stared at Gu Weijun and asked. He couldn't help but think that Zhang Jiaguang had just omitted to say something: 'Pressing on morality' is also the tradition of the Revival Association.

"Britain is Britain and we are us." Gu Weijun really didn't want to argue with a l\'j officer about diplomatic strategy, he only replied one sentence and then said to Weng Wenhao: "Prime Minister, Britain and the United States are one, during the last London Treaty, only France helped us speak, and if we help France this time, then they will also help us speak in the naval treaty." ”

"Hmm." When Gu Weijun's words reached Weng Wenhao's heart, he immediately hummed, and his raised eyebrows began to lower a little.

"Germany will sooner or later provoke another war if it does not suppress, and we will support France this time to maintain the prestige of the League of Nations, and if there is a conflict between China and the United States in the future, the League of Nations can mediate in the middle; Even if mediation fails, the countries of the alliance will support our country instead of the United States. Gu Weijun said what he thought and pointed out the role that the League of Nations could play.

"Okay, then you will immediately issue a statement in your capacity as a member of the Council of the League of Nations, condemning Germany's support for France and promising France that we can send peacekeeping troops if necessary." Every word of Gu Weijun's words fell on Sino-US relations, and Weng Wenhao nodded immediately.

"Prime Minister, how can this be ......" Seeing that the matter was so decided, Jiang Baili was a little unhappy. Germany was our ally, and in this case, China and Germany would really be at odds with each other. ”

"Baili, how can we say that we are sending peacekeeping troops as a member of the Council of the League of Nations to uphold international conventions?" Of course, Weng Wenhao understood the thoughts of Jiang Baili and others, but this was not his position, "Every time we negotiate at an international conference, we speak for the Germans, debt relief, disarmament negotiations, and negotiation negotiations, isn't that time biased towards the Germans?" But he can't mess around. The League of Nations is indeed very important, and if it is really at odds with the United States, we can only count on the mediation of the League of Nations. (To be continued.) )

PS: Note 157: U.S. Department of Labor, Labor Statistics Handbook, p276.

Note 158: Jiang Baili, "Explaining the Basic Principles of Defense Economics from History", The Complete Works of Mr. Jiang Baili, vol. 2