893.51/2343: Telegram
The Minister in China (Reinsch) to the Secretary of State
[Received 10.40 p.m.]
My telegram July 25, 2 p.m. [1 p.m.?]5 Japanese Minister informs me that he believes Peking Government should be supported by moderate monthly advance in order to avoid total break down and consequent trouble with troops. He asked my opinion. I agreed in general. While the Government is weak and many believe that its utter collapse would bring no serious trouble except at Peking, because the military [commanders] pay their own troops, yet President Hsu is the only representative of Chinese unity and the Acting Premier, Kung, is a man [of] honest intentions. Therefore I believe desirable that the American Group should act on the proposal conveyed in my telegram June 11, 3 p.m.6 and the memorandum in my despatch 2883 July 7th7 containing complete schedules of expenses on the basis of $10,000,000 per month; the American and Japanese groups could join in making this advance. Monthly installments should be $5,000,000 so as to enable the Government to share burden of Southern authorities and gain their adhesion as well as gradually to reduce military personnel. The advance ought to be conditioned on acceptance by South and definite assurance as to allocation of funds as per memorandum submitted. Memorandum given to the Japanese is an extract from the first memorandum eliminating items so as to reduce the amount.
I beg to submit that the making of an advance by Japan alone would impede the efforts to put Chinese finance on a firm basis through the new consortium but that a joint advance would assure completion of the consortium while giving time for details to be adjusted.