The previous chapter has emphasised the international context and the domestic political situation in analysing the first two phases of the War of Resistance. This chapter turns to an issue equally fundamental to Nationalist war-making: wartime mobilisation. I shall discuss military recruitment, the collection and distribution of grains, other agricultural products, and primary sources for industry, setting out Nationalist approaches to these tasks and analysing their effects on the Nationalists' military capacity, Chinese society, and the position of the Nationalist state.
Until 1941, I suggest, the Nationalists coped with the problems of wartime mobilisation reasonably well. Initial chaos in recruitment was overcome when the Nationalists abandoned their pre-war efforts to implement a national military service system. Instead, recruitment was located in areas that traditionally had produced most army recruits and mercenary recruitment was permitted but also subjected to a degree of central control. The Nationalists further followed agricultural policies that kept productivity at reasonable levels and shielded the rural population from the cost of war. These policies enabled the Nationalists to continue resistance to the Japanese invasion.
Afterwards, however, the Nationalists were hit by a broad economic, fiscal, and financial crisis as a result of developments on the battlefield, the tightening of the Japanese economic embargo, Japan's strategic bombing offensive, financial policies of the Japanese and Wang Jingwei's rival National Government, and China's isolation from world markets. The severe disruption of markets and the destruction of transport lines worsened the crisis, as did the collapse of fiscal structures and ballooning bureaucracies. In addition, Nationalist recruitment had exhausted the pool of men who could be easily recruited without damage to local economies.
In response, the National Government reduced recruitment, off-loaded forces it could not sustain, and encouraged armies to live off the land. It located the war out of the country so that others would take some of the strain, Chinese armies could be armed by foreigners, which no longer was possible in China itself, and the Nationalists would last the course until the end of the war in Europe. This background explains Nationalist strategy better than easy assumptions about a patriotic deficit, an obsession with Communism, or a backward cultural preference for the defence. The Nationalists also switched to taxation in kind of the land tax. This shielded public finance from the imploding financial and monetary systems. The National Government at the same time sought to discipline the bureaucracy, ration scarce goods, and provide social services to key constituencies such as officials, industrial workers, and educators.