The Kaiser pays a state visit to Japan, accompanied by his second son, Prinz Adalbert , a senior ranking naval figure. They meet with Emperor Hirohito and the Prime Minister and tour Yokosuka, Nagasaki, Sasebo, and Vladivostock . Prinz Adalbert is much-impressed with the Japanese aircraft carriers now entering service. Seeing the success of the Kaiser's visit (he is greeted by warm often rapturous crowds) the German government renews its compact with Japan and extends it into an offensive-defensive alliance , with the proviso of fore-warning and consultation. The Kaiser returns as he had come - by battleship from Persia , and before that the new Berlin-Tehran Railway which cuts a route through the mountains of the Caucasus ; its principal calls are at Warsaw, Kiev, Rostov, Tiflis, Baku and Tabriz before Tehran.
The 1936 presidential election in the USA had been fought against the backdrop of the break up of the Ottoman Empire and a great realignment in the relative powers of the European states . The Democratic candidate , the New York lawyer William J Donovan narrowly defeats the incumbent Republican president Hoover. In early 1937 Donovan makes the Utah Declaration (so called because he is speaking initially in Salt Lake City but refines and adds to the speech as he progresses throughout the state). The Utah Declaration is a statement of American interests in the Pacific, intially centred around defence for Hawaii, Alaska and the Philippines it sets 'outer' borders in the Aleutians ,Midway, Wake and Guam , and recognises the important contribution to civilisation made by the British, French and Dutch colonial governments. While stating a long-term aim that these will eventually withdraw and yield up constitutional rights to the inhabitants, President Donovan comes close to issuing an American guarantee of their territorial integrity. In addition he condemns the continued Japanese occupation of Eastern Siberia and cites this act as one which in his opinion has led to 'the most foul unChristian government the world has ever known remaining strong and in power within Moscow'. Japanese 'aggression' within China is also condemned, though the Communist insurgents come in for equal villification, especially in the later versions of his speech. The recent German-Japanese treaty is condemned as the worst of the old joining with the worst of the new.
The Utah Declaration is met with fury in Berlin and consternation within Tokyo. Japanese forces are put on alert , completion of the carrier program being rushed ahead, and a major programme of fortification in Okinawa, the Ryujo Islands, Iwo Jima and the Japanese Mariannas begins.
Within Germany Prinz Adalbert prevails over conservatives within the naval command and Germany lays down its first fleet carriers, four large vessels of the Boelcke class designed to operate the most modern aircraft currently in production by German industry.
September 1937 Stalin launches a surprise attack against Finland. The genesis of his decision are several, For a start NKVD agents had reported on a growing rift between Prime Minister Mannerheim and the German government which has been getting increasingly worse as the Finnish king's health declined drastically and Mannerheim effectively took over as regent. Stalin also needs to rescue the reputation of his regime after defeats in Eastern Siberia and the Northern Caucasus. The establishment of an independent kingdom of Georgia under a Bavarian princeling particuarly riles him. Mannerheim has allowed the German-Finnish mutual defence treaty to lapse (though he renewed the external protocols dealing with economic affairs) and the recent war scare in the Pacific is perceived to have the German government scared. The attack upon Finland is a calculated gamble designed to achieve quick but important goals. Although Viborg falls almost at once and Russian troops overrun Karelia, the assault upon Pechanga in the North peters out and Winter 1937/8 sees a stalemate across the front.
In Rome the Legion d'Italia revives the plans for the attack upon Abyssinia , devoting huge sums to the modernisation of the navy and airforce , and to building up a powerful and elite expeditionary force which it despatches to Eritrea by mid-Summer, under a powerful naval escort and with planes out of Southern Libya overflying British and French territories in a gesture of intended support. The action goes largely unnoticed in France where Laval is attempting to deal with an army mutiny, but in London Churchill seizes upon the fact that Italian aircraft have flown unopposed over the Sudan to attack Cecil's government once again on imperial defence.
The United States switches its main fleet base from Pearl Harbour in Hawaii to Cavite in the Philippines. President Donovan's government also signs a defensive alliance with the Netherlands, whilst the senate passes a substantial loan to the Dutch to allow them to begin work on bringing Surabaya up to the standard of a modern first class naval base.
The renewed Russian offensive takes Pechanga/Petsamo in the North, cutting Finland's access to the Arctic Sea. The Finnish King, acting against Mannerheim's recommendations issues a personal plea to the Kaiser for help and German units begin mobilising whilst German and Soviet delegates meet for emergency meetings in Warsaw (the Habsburg autonomous kingdom of Poland).
Peking falls to Japanese forces who repulse a separate Communist attack and drive on South-West against a Communist stronghold. The Chinese Communists suffering from a withdrawal of weapons from the Soviet Union which coincided with the stalemate of the previous Winter on the Finnish front, withdraw rather than face defeat in a pitched battle.
In India British forces defeat a Baluchi rising and occupy Karachi. Prime Minister Cecil hails this as a major victory for his foreign policies but Lloyd George and Churchill savage these claims in the Commons. MacDonald resigns as leader of the Labour Party, having become simply a voice of protest for minority issues. His successor Aneurin Bevin begins to rebuild the party's organisation across Britain.
British elections are held in July 1938. The Liberals command the majority of the seats in the Commons but fail to gain an overall majority. Cecil's Conservatives and Bevin's Labour Party almost tie in next place ; in a shock result MacDonald loses his seat and retires from British politics. Lloyd George returns as Prime Minister with Churchill his deputy at the Exchequer. The Liberals rule with support from 'interest groups' amongst the other two parties. Churchill and King Edward VIII meet and patch up their differences ; by August 1938 the king is professing his support for the new 'national' government.
Italy launches its much-heralded attack upon Abyssinia. Haile Selassie appeals in vain for international aid for his country and by late October Italian forces have reached Addis Ababa. Only the United States voices a whole-hearted condemnation of Italy's actions but Italy feels it can safely disregard this at least for the time being.