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

No. 600

Sir: The Department has received from the Consul General at Shanghai a pamphlet entitled “Report of the Annual Meeting of the Associated American Chambers of Commerce of China, Shanghai, October 16 and 17, 1923”, a copy of which has doubtless been transmitted to the Legation. Much of this report is devoted to criticisms [Page 595] of the conduct of the foreign relations of this Government with respect to China, which suggest to the Department the desirability of making, for the information and guidance of the Legation, such observations as appear pertinent to the criticisms made by the Chambers of Commerce.

The statement will be noted, in the introduction to the Report, that

“the lack of a definite program on the part of the American Government in respect to China …28 has been nothing short of disastrous to American interests in this country”.

The introduction also contains the statement that

“the resolutions adopted … do not attempt to outline an American program suitable for coping with the serious situation which has developed in recent years.”

While, therefore, complaining of the “lack of a definite program”, the Chambers do not offer any suggestion as to measures which the Department might consider with a view to improving the very serious situation which unquestionably exists with respect to the adequate protection of the rights of all foreigners in China. The business men who have adopted the sixteen resolutions contained in this report presumably represent the leadership of American business in China. They are doubtless well informed with respect to conditions in that country. Although they may not have in general as full a knowledge of the political conditions, of which they complain, as diplomatic and consular officials have, they nevertheless come in even closer contact, in some respects, with the resulting practical conditions, than do government officials. They have a first-hand access to many sources of information which the Government’s representatives lack; and the information obtained by Government officials comes in large part from the business firms represented by these Chambers of Commerce.

It may furthermore be remarked that the problems to be solved in connection with the maintenance of our treaty rights in the protection of persons and property are not, in general, of a technical character. The problems, and the practical remedies to be applied, if such may be found, are such as may appropriately be made the subject of discussion and recommendation by any group of intelligent persons having an accurate knowledge of the existing conditions. The question of the adequate protection of American interests in China is one in which these business men may be presumed to have a vital interest; for the failure to receive an adequate degree of protection means the serious impairment, if not the ultimate destruction, [Page 596] of the business interests which they have built up. The Department, accordingly, notes with surprise that (with such few exceptions as will be noted later) these resolutions are phrased in the most general language and contain almost nothing which is of assistance to the Department either by way of concrete proposals or by way of suggestions from which it might be possible to evolve some practical method of dealing with the situation.

By way of example, your attention is invited to the recommendation with respect to illegal taxation (page 529) that

“… the American Delegation to the Special Conference … give serious consideration to this matter of illegal taxation before agreeing to China’s request for further increases in the Customs tariff.”

On the subject of disorders in China, the Chambers are of the opinion (page 8) that

“nothing short of a definite stand on the part of the Powers would be sufficient to bring China’s military dictators to a realization of the obligations of China … Until such time as the nations … are prepared to adopt a definite policy in respect to China, it is vital that the United States take steps to secure to American citizens their just treaty rights in China.”

In the section entitled “American Policy in China”, it is stated (pages 13–14) that

“Unless all governments concerned ratify the Washington Conference treaties without further delay, the Associated American Chambers of Commerce of China recommend that the United States Government take up this question with the governments prepared to adopt a united policy in respect to the protection of their nationals and the general improvement of conditions in this country.”

Under the heading of “Publicity Campaign in America”, reference is made to the “necessity of a definite policy in respect to the situation in China” (page 22). The Report closes with the recommendation, relating to the unpaid accounts due from the Chinese Government for materials supplied by American firms (page 27), that

“The State Department instruct the American Minister to bring more pressure to bear on the Chinese Government and that he insist that immediate arrangements be made to meet the obligations incurred by the Chinese Government.”

The phrases underlined above indicate the vagueness of the resolutions forming this report; and I cannot but acknowledge my regret that, in matters so vital to their interests, the Chambers have not found it possible to make, for my consideration, more definite and [Page 597] more helpful suggestions as to measures that might prove practical to adopt for the better safeguarding of American interests in China.

This sense of disappointment is deepened by a consideration of the one or two concrete suggestions which the Chambers have offered. On page 8 occurs the statement:

“… we feel that at the present time the maximum of protection in China for our interests can only be obtained by increasing our military and naval forces to the strength we are entitled under treaty rights. This involves the bringing of our military and marine forces stationed in Peking and Tientsin under the Boxer Protocol of 1901 up to their full strength, and additions to the China section of the Pacific fleet, and the Yangtze Patrol Squadron.”

To the best of the information and judgment of both this Department and the War Department, the contingents now stationed at Peking and Tientsin are sufficient in point of numbers for the purposes of their detail; and, in the absence of any special emergency, there would appear to be no special advantage to be derived by adding to the number of Marines at Peking or by transferring from Manila to Tientsin another battalion of the 15th Infantry. As to the latter of these alternatives, it should be understood that such a disposition of troops is considered by the War Department not to be feasible, in view of the requirements to be met elsewhere with the limited available military establishment which the Congress has determined in accordance with the manifest desire of the people of this country. Quite apart from the administrative impracticability of this proposal, however, it seems plain that the presence of these few hundred soldiers would have no effect whatsoever upon the general protection of the persons and property of American citizens scattered throughout China, and would afford no remedy for the widespread conditions of which the Chambers complain.

It is not clear what is the interest in the Chamber’s recommendation that “additions to the China section of the Pacific fleet” should be made. The cruising ships of the Asiatic fleet, including a large number of destroyers, have been readily available at Chinese seaports; and this Government recently assembled at Canton a larger number of vessels for a naval demonstration than did any other foreign Power. On this point, it would appear that the Chambers are in error as to the facts, and that there is no paucity of naval units of this character for the purpose of such conditions as exist at present. The recommendation with respect to an increase in the force of the Yangtze Patrol is, on the other hand, most pertinent; and as you are aware, the Department has for a long time been endeavoring, in cooperation with the Navy Department, to obtain legislative authority for the construction of new ships for this purpose. You were informed in the Department’s instruction No. 578, [Page 598] of February 20, 1924,30 that the Navy Department has, with the sanction of the Director of the Budget, introduced appropriate legislation into Congress for the construction of six high-powered lightdraft gunboats for service on Chinese rivers.

In view of the serious actualities which confront Americans in China, both business men and missionaries, the Department does not regard it as surprising that they should feel strongly upon the subject of obtaining adequate protection, and should feel some anxiety lest the Government should prove indifferent to their interests. And it is no doubt but natural that, in their concern for those interests, they should fail to realize that the state of domestic opinion in this country would not permit the despatch of any further considerable military forces to China unless in the event of some impending catastrophe such as the Boxer movement of 1900. The extent of possible protection is, and must remain, substantially that which may be obtained by Diplomatic means and by the presence, actual or potential, of our naval forces in Chinese waters. Under these circumstances, I regard it as unfortunate that the American Chambers of Commerce should so far fail to appreciate the essential nature of the situation and the limits of action permissible to this Government as to give publicity to the resolutions contained in this report. Such publication serves but to emphasize the very precarious condition in which the whole system of foreign treaty rights in China now, unfortunately, finds itself in consequence of the great changes which are taking place in China which it is not within the power of the interested foreign nations to control or to restrain in any effective degree. It is my opinion that it would better serve the ends of American business and other interests in China not to invite public attention to this regrettable but unavoidable state of affairs, but, carefully and quietly, to give thought to the devising of practical means by which the problems involved may be met. I would heartily welcome the considered expressions of American residents in China upon this subject.

Deploring the evident existence of a feeling of dissatisfaction and misunderstanding among American business men in China as to the attitude of the Department toward the protection of their interests, I hope that, in the exercise of a sound discretion, you may find occasions to acquaint representative business men and others with the facts of the situation in such a way as will lead them to bring a less impetuous judgment to bear upon the question of dealing with those common American interests, with the protection of which this Department is charged. It is particularly suggested that you might find it possible to impress upon the more responsible and influential members of the American community the futility and the danger of [Page 599] the reiteration of threats of intervention, which, when for any reason not carried out, tend inevitably to lead the Chinese to the conviction that the remonstrances of the foreign Powers may safely be ignored.

The unfortunate state of domestic politics now existing in China, approaching a condition of political chaos, has likewise, and even to a greater degree, affected adversely the interests of foreign missionaries. The very great extent of American enterprise in this direction, constituting, both in the number of persons engaged and in the amount of capital invested, a larger element of American activity than is found in trade, adds materially to the problem of affording protection to our nationals in China. The right of residence in the interior, of which this group of our citizens has taken full advantage, has resulted in a diffusion of American missionaries throughout even the most remote and isolated parts of the country. This movement, over which the Government cannot exercise any degree of positive control, and which it would only reluctantly use, its influence to restrict, has, in the growing disorder now so general, greatly complicated the problem of protection. In this particular, it is not possible to separate the interests of the trader from those of the missionary; and an act of violence to a member of either group reacts equally unfavorably upon the safety and well-being of both. It is felt that this has possibly not been wholly appreciated by the Chambers of Commerce, although the recent report of the formation in Shanghai of a joint committee, composed of both traders and missionaries, for the study of matters affecting their common interests, would indicate a quickening perception in this respect.

It may be remarked, furthermore, that the missionaries, as a group, have reacted to the present adverse situation in a somewhat different manner than have the business interests. With the exception of the Lincheng outrage, cases of actual violence to American persons and property have occurred chiefly to the missionaries. In so far as the Department is informed, however, missionaries have refrained from public resolutions of the kind passed by the American Chambers of Commerce, and have sought rather to keep their Boards at home informed of the very dangerous trend of Chinese affairs and to bring to the attention of the Department through various agencies, the difficulties of their situation and the very real need of such protection as the Government is able to extend. This attitude has suggested to the Department the desirability of obtaining a measure of direct cooperation with these interests in matters relating to the direction of their policies in China, in so far as such policies have a bearing on the problem of protection; and it has been felt that a frank exchange of views with representatives of the various Boards, in confidence, would be of service to this end. For this purpose I authorized the Chief of the Far Eastern Division [Page 600] to meet in New York, on February 21, with representatives of the Foreign Missions Conference of North America. In the course of this conference he made it clear that the Department had no intention of dictating to them or even of advising them, but desired only to give them an exposition of the present situation in China from the viewpoint of the Department, in order that they might be in a position to understand the problems of protection involved, and make their own decisions accordingly. He quite unreservedly explained the impossibility of controlling the situation by a display of force, or by such diplomatic methods as a proposal to withdraw recognition from the Peking Government; and he pointed out that this Government would in all probability find it increasingly difficult to give adequate protection to our missionary and other interests in the interior of China, and that it is possible only to rely upon our moral position, and to deal with each individual case as it arises. Under such circumstances, the mission Boards would have to take into consideration, in formulating the policies of their respective organizations, the very considerable limitations upon our ability to afford protection, especially in isolated stations, against the dangers likely to result from the revulsion of Chinese feeling against the special privileges enjoyed by foreigners and from the greatly lowered prestige of our western civilization in the eyes of the Chinese. The response of those present seemed to indicate an understanding of the limitations imposed by the changed situation in China, and the consequences involved therein.

It may be of interest to the Legation to note that there was a report from one of the representatives present of a strong and growing movement among the missionaries in China against any reliance upon such special privileges as extraterritorial rights, or upon any form of force, since it was not thought consistent with missionary ideals to ask indemnities for depredations, or even to expect to be forcibly rescued or ransomed in case of capture by brigands. To such an attitude, Mr. MacMurray made it clear that the Department is unreservedly opposed: in the interest of all our residents in China, and in the interest of China itself, it is felt to be necessary to hold the Chinese Government to as rigorous fulfillment as we may of the obligations due to foreigners. He pointed out that it is untimely to yield our rights in the face of an effort on the part of the Chinese to break them down, and that the interests of all Americans would be jeopardized by making any such renunciations so long as China does not in good faith and effectively live up to existing obligations.

The Department is hopeful that the discussion of these matters will prove of value in assuring sympathetic cooperation between [Page 601] the missionary interests and the various agencies of the Government charged with the protection of American interests in China.

I should also be glad to receive from you such comments on the matters herein discussed as may suggest themselves to you.

I am [etc.]

Charles E. Hughes
  1. Omissions here and in the excerpts that follow are indicated on the original instruction.
  2. Refers to the page number of the original pamphlet.
  3. Not printed.