893.00/3102: Telegram
The Consul General at Shanghai (Sammons) to the Acting Secretary of State
[Received May 17, 4.58 a.m.]
Replying to your May 14, 5 p.m. Ostensible cause disagreement parliamentary problem. Understand Tuan willing reinstate old Constitutional Parliament if his army and China and Japan secret treaties are sustained. Understand President Hsu also willing reinstate old Parliament if he is assured reelection. In this connection understand President Hsu deems it impracticable for his official safety to definitely oppose Tuan and Japanese party. Reliably reported Peking has advanced General Lu Yung-ting, Southern Canton Governor and military leader, one million half Mexican dollars. Obviously continuance Peace Conference deadlock strengthening Japanese preponderating position, although Shantung incident has precipitated unusually vigorous Chinese boycott on Japanese goods. Under pressure from Peking and Canton Governments urging delegations reconsider prospects and make mutual concessions, agreement may be reached on vital questions concerning army and financial reorganization under expert foreign supervision, such supervision to be provided in proposed army reorganization loan of two hundred million. Accepted here by foremost Chinese of all parties. Tuan with Japanese support growing more dominant. Copy to Legation.