893.515/608: Telegram
The Minister in China (Johnson) to the Secretary of State
[Received June 11—4:14 p.m.]
262. Your 155, June 8, 4 p.m.2 In conversation with British Minister today he referred to appointment of Ross and stated that character and position of Balfour [Ross] indicated importance which British Government attachés to the matter. British Minister stated that he had informed Soong and the Government at Nanking; that Soong had replied that appointment was too late. British Minister expressed the feeling, however, that [since?] Chinese but for eyeing [Page 592] [have succeeded in carrying] themselves through dragon boat festival settlement they would be able to carry on for another 2 or 3 months and said that he felt sure that arrival of advisers would be helpful as they could assess local situation and be available to confer among themselves and with Chinese should a plan offer.
British Minister stated that Ross could not arrive before August and that his Government hoped that American Government might be able to send similar expert to be available on the spot should opportunity offer to work out some plan for rehabilitation of the Chinese Government.
The fact that British Government is sending to China a man of the caliber of Ross indicates to me that British Government are seriously concerned about financial situation in China and perhaps its effect on British interests generally. British Minister stated that he had seemingly very little of British Treasury’s [plans?] from London.
I find myself still of the opinion expressed in my cipher telegram 140, April 5, 4 p.m. A Havas despatch draws attention to Ross appointment and connects it with the consortium as an indication that the consortium powers are prepared to take some financial action looking to China’s relief. Newspaper correspondents visiting Legation today are [interested in the] significance of British move and our attitude but I have made no comment. I apprehend that there will be reactions from Japan shortly.
I am persuaded from statements made to me during my visit in Nanking and Shanghai that Chinese Government is somewhat desperate over financial situation and that we have perhaps already arrived at the point where China’s paper currency may be considered irremediable for I do not believe that Chinese Government possesses sufficient coin or bullion reserve to redeem. In my estimation it is therefore only a matter of time and that a very short one before Chinese Government will have to relinquish present plan of maintaining Chinese dollar at approximately 41. I do not know what importance to attach to reported statement of Soong to British Minister that appointment of technical experts was now too late. It may have some relation either to the Sino-Japanese situation or to the hopelessness of China’s financial position.
I agree with British Minister that if powers are prepared to consider China’s plan or any plan that may be worked out for financial assistance the presence in China of responsible experts of the type of Ross would be advisable but I still think that it would be useless to send such a delegate unless there is some hope that the presence of such delegates will lead to something concrete and I confess not to be able to foresee that contingency at present.
[Page 593]We should not, of course, forget in this matter that the British are in a sense forcing our hand and it is assumed that the Department will see to it that we are not saddled with responsibility for failure merely because we have no one present capable of examining the situation. The American Government is already in an unfavorable position because of common belief that our silver policy has adversely affected the whole financial establishment in China.
Repeated to Tokyo by mail.
- Not printed; this telegram repeated substance of British Aide-Mémoire of June 7, supra, and asked for any comments the Minister in China might wish to make (893.515/606).↩