(3) a period of counter-attack in which the Chinese, having prepared themselves technologically during the stalemate and having weakened the enemy by a test of endurance, should drive the Japanese back into the sea. The strategy of this type of war was based upon the plan of retreating in space in order to advance in time--that is, to yield area slowly and purposefully, without too great cost to oneself, in order to outlast the enemy and reach victory. In thus purchasing time by the mile, the Chinese could not afford to yield intact cities, factories, communications, mines, docks, warehouses and the other goods of business; such cessions would only profit Japan: hence _the scorched earth_ policy. The strategy was obviously suited to a country rich in territory and population, but poor in _matériel_. It not only made both regulars and guerrillas effective against Japan but made each truly reliant upon the other. Without the Nationalist regular armies, who in attempting to suppress the Communists had done almost everything which the Japanese now had to do--guarding railroads, pacifying disaffected and hostile rural areas, promoting industries and watching agitation--the Japanese forces might disperse enough to enable Japan to patrol and pacify enough of China to pay for the occupation. Chiang had to hold the Japanese together, immobilize large bodies of their troops, keep their war expenses up, and wait for the time to counter-attack. Meanwhile the guerrillas, together with the Communist veterans, were to prevent the Japanese from settling down, to worry them with agitation, to sabotage their economic efforts and to wear them out for Chiang's _révanche_. One of the first governmental changes in wartime was the re-institution of an effective propaganda service under the Political Department of the Military Affairs Commission. In this Department, many of China's most active controversialists, censored or exiled for years, found officially sanctioned scope for their energies. Formal unity came slowly. Although Shanghai was attacked on August 13, 1937, it was not until September 10 following that a fairly definitive arrangement was reached in regard to the Communist-occupied zone in the Northwest.