The Japanese have abandoned direct government for the present. They would defeat their own purposes by assuming a task for which they have insufficient personnel, which would be very costly, and for which their army is ill-equipped in morale or technical ability. Difficult though it may be to employ pro-Japanese Chinese associates, it would be even more difficult to find Chinese now ready to profess direct loyalty to Japan. The only Chinese thus far Japanized are a number of Taiwanese (Formosans), whose island was ceded to Japan forty-six years ago. Chinese by blood and language, many of them have been reared in the third generation of Japanese rule. Some are fighting with the Chinese forces, but others, loyal to their lawful superiors, betray their fellow-Chinese. The Formosans are insufficient in number to govern China, or to provide Japan with even the most elementary foothold. The Japanese have hence turned to the peculiar form of indirect rule identified by the popular appellation, _puppet states_. THE PROBLEM OF PUPPET STATES Lawful, well-established indirect rule is a familiar feature of colonial practice. Constituting an internationally recognized legal relationship between the paramount power and the encompassed state, it has been applied extensively by the European powers in Africa and Asia. The Indian and Malay states, under Britain; Cambodia and Annam-Tonkin, under France; the East Indian sultanates, under the Netherlands--these offer a rich repository of precedent. Unacknowledged intervention involving no legal relationship is also a known feature of modern politics. The practices of the United States in the Caribbean and Central America, particularly during the 1920's, are familiar, but the leading case of intervention without responsibility occurred in the relationship between the Soviet Union (first the R.S.F.S.R.) and the Outer Mongol People's Republic. Four features of what has since come to be called political puppetry are here made fully manifest: first, the establishment of the subordinate through the military aid of the superior; second, the continued effective control, unacknowledged in law, of the subordinate by the superior, coupled with economic coordination of the two; third, bilateral insistence upon the formal independence of the subordinate state; fourth, the claim of the superior that it _has not_ intervened, coupled with international non-recognition of the new relationship. The four features--establishment, coordination, fictitious independence and international nonentity--were clearly defined by Soviet political practice in Outer Mongolia and Tannu-Tuva long before Manchoukuo was created.