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The actual effect of the Panay incident in OTL was to strengthen isolationism in the US.
As David M. Kennedy writes in Freedom from Fear: The American People in Depression and War, 1929-1945, p. 402: "But the Panay was not to be a modern Maine, nor even a Lusitania. Its sinking produced a cry for withdrawal, not for war. 'We should learn that it is about time for us to mind our own business,' Texas Democrat Maury Maverick declared in the House. A few months later, a Fortune magazine poll showed that a majority of Americans favored getting the United States out of China altogether. When Japan tendered an official apology for the Panay incident and paid some $2 million in reparations, the crisis swiftly blew over. ...