The cruiser race hidden inside the Washington treaty

Would Japan go bankrupt if the United States built fully to the Washington treaty limits?

Japan already used its capital allowance; bankruptcy pressure would come from trying to match unrestricted American and British cruiser and destroyer construction.

The Washington treaty limited capital ships and aircraft carriers but did not impose aggregate ceilings on cruisers, destroyers, or submarines. Japan built to the capital limits it could use. The more dangerous counterfactual is Britain and the United States funding very large cruiser and destroyer programs outside those limits. Japan would try to answer and could exhaust its finances and industrial capacity. The later London treaty was needed because Washington had left this competitive space open.