893.00/4148: Telegram

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

429. Personal attention Secretary of State for consideration in connection with China in Conference.

Marked development in Chinese sense of nationality and patriotism since I was here twenty-two years ago. Then foreign nations proposed partition of China and Chinese seemed indifferent. Today Chinese people are keenly sensitive to and jealous of independence and territorial integrity of their country which indeed [garbled group] and sentiment embraces not only ethnological China, including of course Manchuria, but also Mongolia and Thibet. Hence resentment not only against aggressions of Japan in China proper but also of England in Thibet and of Soviet Russia which now occupies Urga and is rapidly extending control over Mongolia east, west, and south with program of advancing customs station halfway to Kalgan.

Chinese people morally, intellectually, industrially, financially sound and capable of greatest achievements but having for thousands of years left government to a class and that class having now disappeared Chinese people make very bad job of administering government. Public office habitually used as source and opportunity for private profit which in higher positions is immense and in all positions, not excepting judicial, much greater than under the Manchus owing; to shortness and uncertainty of terms of office.

Government does not rest on will of people or approval of provinces but on manipulations military bosses who possess troops; no parliament; President’s own election of more than doubtful legality. Executive and administrative officials appointed by President generally on dictation military bosses from whom even members Cabinet take orders. Government is as puppet with military bosses pulling strings. These bosses have insisted on drawing large amounts from National Treasury and they intercept taxes on way to Peking on the plea of supporting armies whom they and not Peking government, control.

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As result of these expenditures and of official corruption combined with burden of former loans of which proceeds were similarly wasted Government is now financially bankrupt. It is also politically bankrupt for it does not command obedience or even hold the respect of the people and provinces have ceased to remit taxes. Having nothing, doing nothing, Peking government is liable to pass away.

Principal bosses are Chang Tso-lin, Mukden, and Tsao Kun, leader of Chihli party both ambitious to be President. The latter’s follower, Wu Pei-fu, commander of Yangtze troops in military matters, more influential than his chief. Has best army in China and his troops are proud to be his men. Victorious general but poor statesman and politician. Chang Tso-lin clever politician without any illusions and his weapons are force and money. Has army of hundred thousand men and over $30,000,000. Geographically occupies strong position and has support of Japanese. He told Northcliffe in substance he would control China in two or three years. I should say he cannot win enthusiasm, at any rate hold China, but in any event he is likely to retain Manchuria. He is abler than Tsao Kun, has much more money, and while Wu remains in Yangtze, dominates North. His troops control Peking.

Military bosses control provinces by force and political manipulation. Tsao’s Chihli party claims Chihli, Shensi, Shantung, Honan, Hupeh, Hunan, Kiangsi, Kiangsu, Kansu. But Hupeh and Hunan are held only by Wu’s soldiers and were evidently to be left free. Kansu politically unimportant. Christian General Feng Yu-hsiang has too much trouble in Shensi to help outside and Governor Chi of Kiangsu can do nothing because of intrigues against him by Chekiang and Anhui, former Tuan Chi-jui’s province, latter Chang Tso-lin’s.

Chang claims [Heilungkiang], Kirin, Mongolia, Jehol, Suiyuan, and Anhui. He now wants to occupy Kiangsi nominally to assist in repelling advance of Sun Yat-sen’s threatened Southern army but really to effect [offset?] growing power of Wu in Yangtze Valley. I am reliably informed that Tsao Kun is afraid to oppose this scheme.

Canton government claims Kwangtung, Kwangsi, Kweichow, Yunnan and even Szechuan, Hunan and Fukien. Arnold, commercial attaché, returned last week from Canton where I commissioned him to make political investigations. His report sympathetic with the Southern government of which he says all Americans in Canton speak well. Southern platform constitutionalism, provinces autonomy, abolition of tuchuns and subordination of military to civil authority. Chen Chiung-ming told Arnold he favored gradual [Page 317] emancipation of provinces from military rule and afterwards federation. He emphatically declared that he and Sun Yat-sen, friends of over twenty years, were today in complete accord. He conjectured America’s lack of sympathy with Southern government was due to inadequate knowledge of South’s efforts to establish constitutional representative government. He expressed suspicion of Wu Pei-fu who had formerly proclaimed himself friendly to Southern cause and said South if necessary would undertake campaign to emancipate people of Hupeh from his military rule.

From another American observer who traveled through Hunan and Kwangtung in November I learn that Hunan wants to be independent of both North and South and that boasted good government Canton does not extend to Northern Kwangtung. Szechuan has rival leaders and armies but all reports agree that rich and self-sufficient province is not for South or North but for Szechuan. Consul, Amoy, here now tells me Fukien people have Southern sympathies but will follow Tuchun Li who is pretty certain to join [apparent omission] side if fight should come. Kwangtung holds Kwangsi by military force. But I cannot learn that any other province is part of Canton government though Southern provinces have common Southern sympathies. Revenues Canton government seem to be derived from Kwangtung and overseas. No other Southern province contributes anything. Army of over one hundred thousand men, principally Kwangtung, could doubtless be reinforced by troops from other Southern provinces if expedition undertaken against North as Sun Yat-sen advocates though it is understood that Chen Chiung-ming opposes.

Intelligent and well-informed observers here have confidently predicted break between Sun Yat-sen and Chen Chiung-ming on the one hand, and Tsao Kun and Wu Pei-fu on the other followed by alliance of Wu Pei-fu and Chen Chiung-ming on a modified Southern platform. Arnold’s report indicates Chen Chiung-ming now regards Wu with suspicion.

Learned from conversation of trustworthy American with Wu in Paotingfu last week that he felt Chen Chiung-ming was not reliable. He added the following: “Recently he sent his man to see me and suggested to me that no plan of unification would be acceptable to him without including retention of old parliament in power and principles of provincial autonomy. Well-established old Parliament cannot possibly be retained. As to provincial autonomy I can say only that I do not want to see China divided. My aim is to guard Central government on the one hand and protect the people on the other hand. Give me three years and I am convinced I shall be able to get a strong and united China.” No single military boss can [Page 318] unify China, certainly for any length of time. If Wu combined with South they might possibly unify China proper though Chihli party and Chang would oppose this progress and Chang Tso-lin, with the support of Japan, would become practically independent. If the two Northern parties combined against the South they might possibly overrun Southern provinces with their troops but could not eradicate Southern political doctrines which have struck deep root in the minds of young and progressive Chinese.

President, Premier, Minister for Foreign Affairs, have all assured me Peking government wanted peaceful settlement with South. At recent dinner Minister for Foreign Affairs told me Government had cabled Lansing advising him to suggest to his friend Wu Ting-fang political conference between North and South. He added that if South objected to present Cabinet he and his colleagues were ready to resign but it would be different matter if South demanded elimination of President Hsu. At Minister of Navy’s dinner last night Minister for Foreign Affairs told me Lansing had received answer from Wu Ting-fang who made conditions of conference resignation of President and presentation of Twenty-One Demands to Washington Conference. Minister for Foreign Affairs intimated Peking government would like latter condition but he considered resignation of President now would break continuity all governmental authority and create chaos. He said that if new Parliament now being elected met and elected new president difficulty might be overcome. I did not point out notorious fact that South recognizes only old Parliament as legitimate.

At a recent social gathering Minister for Foreign Affairs, in conversation with me, observed that Federal Government was not well suited to modern democracies which were required to take prompt and energetic national action. It is my opinion Northern parties want consolidated central government with control of provinces perhaps something like France. Confronted with Southern demands they insist that Peking government organization is a going concern and they do not see why it should be discarded and a new start made. The South take similar position, claim to have president, constitutional and legal government in China and insist there is nothing for other provinces to do but come in. The provinces outside both Peking and Canton governments want to be left free to manage their own affairs and are not much concerned about any central government.

Meantime there is one hopeful feature in the situation. While the Chinese people generally are absolutely indifferent to government affairs I have noted awaking of interest in financial, banking and mercantile class, supplementing previous interest on the part of [Page 319] student and educated classes. National conference of Chinese chambers of commerce, Shanghai, October, showed from beginning marked tendency to deal with political questions rather than economic and commercial subjects. They held joint sessions with national educational association for consideration political subjects. Both united in calling citizens convention to meet January 1st, call being addressed to provinces’ assemblies, agricultural associations, Chinese bankers’ associations, Chinese press associations, Chinese lawyers’ associations, Chinese Chamber of Commerce and Chinese educational associations. Aims of the convention to bring about complete cessation of hostilities and consolidate foundations of Republic. China’s financial troubles have also contributed to deepening interest of bankers and business men in Government affairs. I believe ignorant inarticulate masses would be content with such government as educated and business interests approve especially if agricultural associations also accepted it.

Political education will be slow, especial benefit. Chinese while learning difficult art self-government must pay off and disband big armies, suppress tuchuns and pay large debts. Political evolution may be accompanied by local revolutions. Impatient and insistent commercial nations must give China time. Only Chinese can solve China’s problems and they will do it in Chinese way. China’s greatest need today is effective guarantee of time and opportunity for that purpose. …

One thing Disarmament Conference could do to help China would be to formulate policy of disbanding troops which now number million quarter men. These troops useless for national defense or maintenance internal order. Wu Pei-fu says China cannot equip, train, discipline one-fifth of number to efficiency as police force. Loans for disbandment not recommended because effective foreign supervision impossible. Best solution is strict embargo on foreign arms and munitions which are much superior to native. Present embargo flagrantly violated. I believe moral effect on Chinese of strong declaration by Conference in favor of disbandment troops would be very considerable. No offense could be taken by Chinese as it would be merely application disarmament to China.

Second assistance Conference might render China would be an appeal to Chinese in their own interests to unite their country politically. Care must be taken to present matter as Chinese interest not foreign. Platform of unification would be left to Chinese but Washington Conference might, it would seem, demand as condition of continuance of recognition the following fundamental principles now disregarded in Peking government, namely, some form of constitution even if temporary and representative legislative council and [Page 320] chief executive legally elected. Possibly Conference might also specify provincial autonomy which, subject to imperial appointment of governors, has always been fundamental principle of Government in China.

Only wise fruitful policy towards China is one of encouragement and stimulation Chinese [apparent omission]. International governmental control if attempted would be paralyzed by passive resistance of Chinese to say nothing of cost, jealousy of powers and ultimate predominance of nearest neighbor. International financial control should be limited to protection of foreign debt and supervision of expenditure new loans. If all debts were consolidated and made charge against foreign administration under international commission would not be objectionable. Control or supervision of salt, wine and tobacco more difficult because of wide area to be covered and more unpopular because of increased contact with China. For these reasons control over land tax which has great possibilities as revenue producer would be still more strenuously resisted. Furthermore, Peking receipts from the salt, wine, tobacco and land rapidly declining and may become a zero. As regards customs administration America should have equal share with other governments.

China is entitled to demand thorough revision of the tariff with differentiation between luxuries and necessaries. Present rate 5 percent or even 12½ percent unscientific and deprives China of large amount revenue. But abolition of likin should go with revision of tariff and Government cannot force abolition of likin if it desires. Local military chiefs depend largely on likin and similar taxes for support. Likin cannot be abolished till troops are disbanded and political unification of country effected and adequate government established.

Chinese postal administration under foreign supervision quite efficient and progressive. Foreign post offices therefore unnecessary also detrimental to Chinese revenues and prestige. They should be abolished. It is different with proposed retrocession of concessions at treaty ports in which however other nations are more interested than United States. While these concessions should be retained for the present as essential to protection foreign business against squeeze exactions and official interference, powers should prohibit their nationals from harboring political refugees in concessions and legations.

As regards abolition of extraterritoriality, proposal premature with Chinese Government what it is today. And even were Government thoroughly reformed extraterritoriality should not be abolished till China has not merely adopted modern codes and procedure but [Page 321] developed sound habits of judicial administration and practice which would prevent return to system of delay, improper influence, squeeze and corruption all but universal today.

China greatly needs more railways. They would not only promote trade and interest [sic] but contribute to unification disconnected provinces. Most urgently needed and I suppose most promising developments financially are Hankow-Ichang and Hankow-Canton Railways, where there seems chance of enlarging American participation and preventing present American sections’ being bottled up. I venture to suggest that Department urge American group consortium to take more active interest in Chinese railway projects. There is some apprehension that the consortium will do nothing for the United States in China and yet have effect of stifling individual enterprise. These first years after war are America’s golden opportunity here. Minister of Foreign Affairs told me last night Germans were coming to China to engage in manufacturing cooperatively with the Chinese so as to escape export duties at home. Americans have far more capital for such cooperative enterprises. I have also thought consortium might be vitalized by introduction group Chinese bankers, cooperation banking groups great power.

Our fundamental policy of Open Door in China should be maintained and applied to new conditions. Just in itself it is equally advantageous to China and America. That policy combined with our unselfish defense of independence and territorial integrity of China has won for America the good will of Chinese people which is an invaluable asset. We are universally regarded by Chinese people as their special friend. Community of republican institutions draws them closer to us. If we can aid in strengthening Chinese Republic through Conference or otherwise America’s position in China will be rendered still more favorable.

  1. Telegram in three sections.