File No. 763.72/3245

The Minister in China ( Reinsch ) to the Secretary of State


The Cabinet met again to-day, and the Minister of Finance informs me that the sentiment in favor of joining the United States is gaining strength phenomenally. He intimates that the chief obstacle to such action is the fear concerning arsenals. If I can be authorized to give to the Chinese Government the assurance that $10,000,000 will be loaned from American sources to improve arsenals and that the United States Government will agree to funding of its portion of Boxer indemnity in long-term bonds and to urge the same course upon the Allied powers, I feel assured that the Chinese Government will forthwith associate itself with the American action. The former is the more important. Should the arrangement for funding the indemnity require action by Congress, it is possible that the Chinese Government might be persuaded to act upon the assurance that the administration would at some opportune time recommend appropriate legislation to that effect.

The Chinese officials recognize the justice of the cause espoused by the United States as well as the desirability of China’s associating itself with the measures taken, but they will not act unless they can have effective assurances that their national independence will be safeguarded by the United States as by the means suggested above, which would be a very moderate amount of support.