Office of the Historian

893.74/522: Telegram

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

[Paraphrase]
Peking, February 5, 1925—9 p.m.
[Received 10:54 p.m.]

61. Your telegram of January 28, No. 16.

(1)
Your information prompts me to propose for the difficulty a second best solution.
(2)
The financial consortium suffers unpopularity in this country and so far has to its credit no positive accomplishment. For a long time I have believed that the one hope of the Consortium’s success rests upon the inclusion of a native group of bankers. The [Page 898] term “radio consortium” would in itself arouse the Chinese to oppose bitterly any combination for developing radio similar to a consortium. Therefore the initial step to be taken in adjusting the wireless dispute is necessarily to constitute China, instead of a helpless subject of the discussion, a party coequal with the others.
(3)
I invited attention, in the Legation’s telegram of January 23, No. 39, to certain of the obstacles with which the execution of the Japanese proposal would be confronted, and also to the fact that it would be necessary to secure the approval of the Chinese Government to any proposed alteration of the method of carrying out the Federal agreement. Obviously, the exact nature of the plan which the Japanese Government suggests would be determined by the details, which so far still remain vague, of its execution. However, there has been formally stated one definite principle, viz., that the Chinese Government shall have exclusive control of the existing and proposed radio facilities. Inasmuch as this is accepted as a guiding principle by the Japanese Government, I make the suggestion that, whether or not the principle in question is practicable, a conference be convoked in this city in which are represented all the companies with which the Chinese Government has radio (and perhaps those having cable) agreements or which reliably evidence that they will be willing investors of capital in enterprises of that kind, the representatives of these companies to consult with Chinese Government representatives and among themselves how best to coordinate the contracts which they respectively possess in order to obtain the most desirable results for everyone having concern in the foreign and domestic wireless field including telephony and broadcasting. Seemingly it would be desirable that an official observer represent the Legation of the nationality of each participating company.
(4)
The submission by the Government of China of a comprehensive proposal could advantageously initiate the discussion at this conference. The Chinese Government, I think, would itself be willing to issue to the companies which are concerned invitations to be represented at the conference, should the plan for a conference be brought to the Chinese Government’s attention as a solution of the existing complications between the nations which are obstructing wireless communications development. Regarding this consideration, it is my respectful proposal that a suggestion be made to the Chinese Minister in Washington that if invitations were issued by the Chinese Government to such a round-table conference, the Department would give no opposition to American interests participating but, on the other hand, would have hope of an outcome of success. It is my opinion that approach by this method is superior to offering such proposals in Peking.
(5)
I see the several following advantages in the convoking of such a conference: When centered on a common object the combined business acumen of the several representatives should be able to work an adjustment of their various interests so that that object would be achieved. The American representatives would, with their present attitude toward the Federal agreement, be so placed with regard to making concessions as to set a commendable example. The respective Governments, through their official observers, would be in a position to make provision that there would be no violation of international policies such as open door, elimination of spheres of interest, etc.
(6)
It is my belief that there would be embodied in an understanding arrived at in this way the most satisfactory feature of the proposal made by the Japanese, that the prestige of each participant would be conserved, the dignity of China would be enhanced, and that the most for the actual development of radio would be promised thereby.
Schurman