 He intended by means of tax reforms, improvement of the wage system of government officials, and abolition of the costly army, to ensure the people in Manchuria the benefits of peace labor, while defense was to be entrusted to Japan.Following the Mukden Incident and the Japanese seizure of southern Manchuria, he was installed as chief of the Japanese imposed Northeastern Self-Government Guiding Board on November 10, 1931.As the Chief of the Board, and with Governor Tsang Shih-yi, of Liaoning province, made plans for a new State to be established in February 1932.