"Prime Minister, I bring excellent news! The U.S. government has given us a highly favorable response. They have condemned Germany's actions, though they also expressed that they currently lack the means to compel the Germans to cease their atrocities against us," Foreign Minister Kato Takayoshi announced, his face alight with excitement. Even he had not expected such substantial support from the Americans.
"This is wonderful news—truly excellent! Regardless of its practical effect, having a nation speak out on our behalf in the international arena is still a significant advantage," said Prime Minister Shigenobu Okuma, visibly elated.
"Prime Minister, the United States' support does not end there. They have also offered us a loan to help us rebuild our livelihoods and restore our military capabilities," Kato continued.
"What? The Americans are willing to lend us money?" Shigenobu Okuma exclaimed, feeling as though fortune itself had descended upon him. This unexpected development left him utterly astounded. While the war had initially spurred Japan's economy into prosperity, the German expeditionary fleet's merciless destruction of Japan's coastal cities had created an urgent need for significant funding to rebuild. The near-total annihilation of the Combined Fleet had only added to the financial strain, leaving Finance Minister Wakatsuki Reijiro deeply troubled in recent days. Yet now, with America's offer of a loan, the country's pressing problems seemed on the verge of resolution.
"Indeed, Prime Minister. The Americans are prepared to extend a loan of $200 million, disbursed over two years at a rate of $100 million per year. However, the interest rate is slightly high—an annual rate of 11%, with repayment due in full after five years," Kato explained.
"The interest rate is steep, certainly, but do we have the luxury to quibble over such details? Two hundred million dollars represents nearly 60% of our annual revenue from last year. This sum is exactly what we urgently require," Shigenobu Okuma remarked decisively.
"Yes, Prime Minister. However, I cannot help but suspect that the Americans harbor ulterior motives. Such generosity is undoubtedly calculated," Kato added cautiously.
The saying "there is no such thing as a free lunch" is a universal truth understood by all. The Americans, no altruists, were unlikely to offer such assistance without self-serving considerations.
"I believe I can surmise their intentions," Shigenobu Okuma replied. "Relations between the United States and Germany are already severely strained; war is only a matter of time. As the saying goes, 'the enemy of my enemy is my friend.' Our relationship with America currently aligns with this adage. This dynamic is undeniably advantageous for us. Our empire remains in its infancy and must secure external support to grow stronger. With America's backing, we will have greater means to one day exact our vengeance upon Germany."
"Additionally, the Americans have stipulated that we must open our domestic markets to them as a condition of the loan. They've hinted that if we comply, further loans could be made available in the future," Kato noted.
Shigenobu Okuma's expression grew pensive. Japan, with its population exceeding fifty million, possessed a substantial domestic market that had been pivotal to the nation's post-isolation economic revival. Following the arrival of Commodore Perry's Black Ships and the subsequent Meiji Restoration, Japan had managed to reclaim control over its market and foster industrial growth. Reopening this market to the Americans posed a significant threat to Japan's fledgling industries, which were far less developed than their U.S. counterparts.
"This matter must be deliberated by the cabinet," Shigenobu Okuma concluded. He understood that making such a decision unilaterally would risk alienating key stakeholders, a price he was unwilling to pay.
"Understood, Prime Minister," Kato replied with a nod.
Half an hour later, the cabinet convened.
During the meeting, Prime Minister Shigenobu Okuma outlined the U.S. government's pledge of support and loan offer, along with the conditions attached.
"Prime Minister, we cannot accept the Americans' terms! Opening our markets to them would devastate our industries. Our manufacturing base remains too fragile to compete with the Americans. The consequences could be catastrophic!" protested Minister of Agriculture and Commerce Oura Kanetake with fervent opposition.
As Shigenobu Okuma anticipated, Oura's concerns were predictable, but they held little sway. The real deciding factor lay with the military. Should the army and navy favor accepting the American terms, Oura's objections would be disregarded.
Turning his gaze to Army Minister Oka Ichinosuke and Navy Minister Yashiro Rokuro, Shigenobu Okuma observed their flushed expressions, betraying their barely contained excitement.
"Foolishness! Minister Oura, your words are nonsense! Has the empire's industrial growth over the decades amounted to nothing, leaving us incapable of competing with the Americans? If that is the case, then all our efforts have been in vain!" thundered Admiral Yashiro Rokuro, his face dark with indignation.
"Indeed. Surely, our industries are not so feeble as to be swept away by this challenge," Oka Ichinosuke added.
On this matter, the usually fractious army and navy found rare common ground—they both deemed the American loan indispensable.
Admiral Yashiro saw the loan as a lifeline for rebuilding the shattered Combined Fleet. The threat posed by Germany lingered, and with American funding, he could justifiably advocate for the construction of new warships to restore the navy's strength.
Similarly, Oka Ichinosuke viewed the loan as an opportunity to bolster Japan's military. Despite military spending already consuming a significant portion of the national budget, the army comprised only around twenty divisions, totaling just over half a million troops. Expanding and modernizing its forces required substantial resources. The American loan offered a timely solution to their pressing needs.