Papers Relating to the Foreign Relations of the United States, With the Address of the President to Congress December 4, 1917

File No. 893.811/245

Minister Reinsch to the Secretary of State

[Telegram]

American Legation,
Peking, February 2, 1917, 5 p.m.

Japanese newspapers publish a report from New York that the International Corporation proposed to Japanese capitalists to make canal work a joint enterprise and that the Americans have no objection to the Japanese desire to represent the company but that China objects to this. Please inform Straight of this misleading disclosure.

Initial comment in Chinese papers is extremely unfavorable as they conceive that Americans are guilty of breach of trust and that the object of Japan is to neutralize Chinese distrust by exploiting confidence enjoyed by Americans in China and to fetter freedom of American enterprise.

The situation is serious and extremely embarrassing to the Legation. It is essential that Corporation should immediately publish true facts as to the source of the original suggestion because the Chinese officials concerned will be questioned on this point.

Reinsch