The Minister in China ( Crane ) to the Acting Secretary of State
[Received December 28—5:32 a.m.]
464. British Minister has suggested to the diplomatic corps, and I have concurred, that before further divided releases of customs are sanctioned by the diplomatic corps discussion be had of the Foreign Office proposals [to] discontinue such divided allocations in the future. I request instructions of the Department as to its views. The present custom [Canton?] leaders are generally discredited, are without constructive plans, and exercise much smaller effective control than the South did when the policy of withholding 13 percent as Southern portion was initiated. While the Peking Government is admittedly unrepresentative of the whole [of China] it is nevertheless accorded recognition of the powers and is held by them responsible for the national obligations of the whole of China; it seems therefore just to permit entire amount of surplus to go to it. To do so might also improve chances of payment of foreign claims of which many American ones are pending. If corps [consents] it is of course possible that Canton may seize the customs collected in its territory or declare Southern ports free ports or make difficulties for foreign interests in [the South]. However, it may seem to the Department worth while thus to force the issue in this domestic strife.