Private Pact

Having had the Open Door to China slammed in its face by Japan, the U. S. Government has recently tried to jimmy the lock. Fortnight ago it lent China a $25,000,000 credit for purchases of U. S. goods. Last week it extended further credit against Chinese gold held in the U. S. (see p. 16). These gestures, called "dangerous, regrettable acts" in Tokyo, made Japanese and U. S. business interests seem more than ever at cross purposes last week. Yet there was one notable spot of conciliation in this warp & woof of imperialism: Wreathed in smiles, Japanese and U. S. cotton textile men renewed their unique, two-year-old private trade pact.

The U. S. cotton textile industry two years ago noted with alarm that Japanese shipments of cotton textiles had grown from 1,115,000 square yards in 1933 to 155,000,000 in 1937. With a U. S. trade pact or a discriminating tariff impossible to arrange, Claudius Temple Murchison, president of the Cotton-Textile Institute, packed off to Japan with a delegation of businessmen. Somewhat to his own surprise he negotiated a private pact limiting imports from Japan to 255,000,000 yards for 1937 and 1938 (TIME, March 8, 1937). Last week, declaring the pact a great success, Dr. Murchison signed an extension providing a 100,000,000-yard annual quota for 1939 and 1940, thus guaranteeing Japanese textile men that they at least need not worry over U. S. reprisals for Japanese encroachments in China.

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