I agree with much of the analysis above. Here’s my addition:
If Japan had overcome the limitations of its Bushido culture and focused on submarine warfare, Japan might have been able to impose high enough costs on the United States that the US got tired of war and agreed to split the Pacific with Japan – but that’s an inherently risky strategy, because the key variable (war weariness) is out of your control. Even if you sink 100% of Pacific shipping forever, you can’t force the United States to make peace that way; the US economy was perfectly capable of surviving and even thriving without any Pacific shipping at all.
So ideally, Japan’s long-term strategy should have involved achieving some goal that would force a win regardless of political conditions in the USA. That’s not realistic as long as the USA is out-producing Japan’s industry by a factor of 10:1…so the only reliable path to a Japanese victory involves tripling the size of Japan’s economy. How do you do that? To some extent you can improve the economy by securing oil, steel, and rubber resources in Borneo, Manchuria, and Indochina…but after that you run into hard constraints based on the Japanese empire’s relatively small population. Japan had 70 million subjects on the home islands, plus 25 million in Korea and 50 million in Manchuria, for a total loyal-ish population about 150 million. The USA had 150 million citizens inside its own borders, plus 20 million people in Mexico, 25 million in Brazil, 20 million in Argentina, 10 million in Colombia, 20 million in the Caribbean, etc., all of whom were officially or unofficially supporting the US war effort. Essentially the entire Western Hemisphere was an economic bloc that was unified in its opposition to Japan – dockyard workers in San Francisco were eating bananas grown in Honduras and using rubber farmed in Bolivia. So in addition to Japan having a much smaller industrial base and a shortage of natural resources, Japan’s population is outnumbered roughly 2:1.
So, you need to expand the loyal population of the Empire. Where can you do that? Not in China; by the time WW2 started, the Chinese already had lots of good reasons to resent the Japanese. Not in Siberia or Australia; almost nobody lived there.
One option is to incorporate the peoples of the former Dutch East Indies into your Empire. There were 60 million people there at the time, and it was actually fairly industrialized for that region of the world – there were 1200 miles of railroads, there were banks and telegraphs and local newspapers and so on. The Javanese welcomed the Japanese as liberators from colonial oppression, and if the Japanese of the time hadn’t also been huge colonialist jerks, they could have made the most of the positive public sentiment.
Another option is to try to convert or at least neutralize a portion of British India. Again, the Indians had very little love for the British by that point in history, and, if they’d been given suitable terms, part or all of the region’s 370 million people might have been willing to voluntarily join Japan. In mid-1942, the British had few assets available for reinforcing India; their tropical armies were heavily committed in Egypt facing down Rommel, and their logistics were stretched to the breaking point by German submarines in the Battle of the Atlantic. Rather than getting bogged down in jungle/mountain warfare that favors the defenders (Burma and Imphal), the Japanese should have smashed the remnants of the British Eastern Fleet and then launched amphibious assaults on the flatlands around Calcutta, Chennai, and Ceylon, carving out fiefdoms along India’s eastern coastline with support from the indigenous population.
Other than that, I would say make peace with the Chinese as best you can – voluntarily withdraw to the borders of Manchukuo as a sign of good faith; you don’t need Shanghai or Wuhan or Shanxi province for any strategically critical goals, and you can’t actually knock China out of the war. Even if China won’t literally sign a peace treaty with you, you can at least withdraw to some more defensible borders and reduce the Chinese motivation to attack you – they are, after all, internally divided between the Communists, Nationalists, and warlords, and if you don’t give them a strong, continuing reason to resist you, they probably won’t attack you very often or very hard.
Similarly, voluntarily withdraw from the Caroline Islands and the Solomon Islands (leaving Iwo Jima and Rabaul as your forwardmost naval bases). You don’t need or even particularly want control over the surface of the Central Pacific, and there’s no reason to waste scarce manpower or shipping on trying to establish an “outer perimeter” that only looks good on a map. Instead, focus your resources on building massive flotillas of destroyers to protect your jugular vein: the flow of oil from Borneo to the home islands. You don’t need to station tiny garrisons on tiny specks of coral in the mid-Pacific; you do need to be able to cost-effectively wipe out any enemy submarines that come within 100 miles of Borneo.
If you can protect the flow of oil, rubber, and iron ore into the home islands while doubling the size of your loyal population by welcoming the Javanese and the Bengals, then at that point you become essentially unconquerable – you now have the same level of population and natural resources as America does. Your industrial base is smaller, but this is offset by America’s need to ship oil, ammunition, food, and men all the way across the Eastern, Central, and Western Pacific. By abandoning most of the Pacific, which is, after all, a vast desert of little or no economic value, you impose maximum supply line disadvantage on the Allies.
I don’t think any of these strategies are realistic – during the real war, Japan was blinded by its contempt for other races, and obsessed with the Army’s grudge match against China. It was not capable of this kind of freeform strategic analysis; Japan’s goals were based much more on politics than on strategy. However, I do think that Japan could have held out indefinitely (and thereby won) if it had focused its efforts on expanding and protecting its population and industrial base, rather than on fortifying and supplying a series of irrelevant outposts in the vastness of the central Pacific and the disease-ridden trails of the Burmese mountains.
