693.002 Manchuria/109
Memorandum by the Secretary of State
During the call of the Japanese Ambassador this morning he brought up the question of Manchuria and said that he wanted me to know that his Government, while it was technically not responsible for the actions of the Manchukuo, in the exercise of its good offices was trying to bring about an arrangement by which the integrity of the Manchurian customs would be preserved—some arrangement similar to that which had been made in Canton; that there the Cantonese Government was allowed to retain the surplus after the amount necessary for the foreign loans and expenses had been turned over to China. He said he begged me to remember, however, that at the Port of Dairen, which was leased territory from China and which port was by far the largest port of Manchuria, the whole amount of the customs, including surplus, had been regularly paid out to China by Japan. I laughed and said that I hoped Japan, in the exercise of her good offices over this infant republic “over which it had no responsibility” would try to persuade that Government to be at least as regular and appropriate in its behavior as Japan itself had been in Dairen. As [Page 101] the Ambassador went out I reminded him of the importance which he and I had given to the resolution of December 964 appointing the League of Nations Manchurian Commission; how important we both had thought that act had been. I told him I had a very high opinion of the personnel of the commission from what I had heard of it, and I suggested that it would be a good plan to leave this question of customs and the whole decision of the new state of Manchuria until the Manchurian Commission had reported. He said that was a very interesting situation; that he understood they wanted to leave matters in a status quo and that he supposed they might report that the infant should be killed or that it should be allowed to grow up. I said that while I had no idea of what they would report, I thought the most natural thing for them to report would be a middle-of-the-road plan preventing the state from becoming killed or becoming a bandit.