811.42700 SE/5–2747: Telegram

The Ambassador in China (Stuart) to the Secretary of State

1155. Reference the Department’s restricted airmail instruction No. 293, March 26,12 which enclosed tentative draft of an agreement13 for the implementation of the Fulbright Bill.

Embassy is in general agreement with the draft as proposed, particularly approving its very general terms on the establishment of a foundation which leaves ample latitude for adjustment of the proposed program in the light of changing conditions. The Embassy would stress in particular the desirability of ensuring that any Chinese voice in the establishment of policy or the administration of the program should be wholly advisory. There will otherwise be strong and inevitable Chinese pressure for a kind of program of which we would in all probability not approve. Experience with this type of foundation has amply demonstrated that joint control seldom if ever has proven successful and would have even less prospect under current conditions in China. The Embassy would propose that there be no Chinese members of the board of directors but that there be attached to the board a number of Chinese advisers whose opinions and suggestions could be solicited as the occasion demanded.

Pending the receipt of Chinese reactions it would serve no useful purpose for Embassy to offer more detailed criticism of the draft agreement. Chinese authorities are not yet prepared to express any opinion, having had the draft only a short time. The Foreign Minister14 4 months ago asked the Minister of Education15 to draw up Chinese suggestions. This has not yet been done. From preliminary conversations it is, however, apparent that the Chinese attitude can be expected to be widely at variance with the American. The Vice Minister of Education16 has spoken in general terms about a large-scale research program to which the entire fund would be devoted, completely under Chinese control, and perhaps administered in somewhat the same fashion as the Boxer Indemnity Fund.17 It is not unlikely that the Chinese Government will propose that the United States supplement Fulbright money with large dollar credits in the [Page 1270] United States in order to enable the Chinese Government, without depleting its own reserve of dollar exchange, to send scholars to the United States.

The general impression obtained by the Embassy is that the Chinese Government is not at the moment any too anxious to conclude this agreement. There are undoubtedly serious struggles between the various factions desiring control of the fund, but there is also an apparent reluctance to undertake in the current inflationary situation any program which, from a Chinese financial standpoint, simply involves printing large additional quantities of money.

The Embassy is continuing to press the Ministry of Education for its views, which will be reported as soon as received.

  1. Not printed.
  2. Dated March 14, not printed.
  3. Wang Shih-chieh.
  4. Chu Chia-hua.
  5. Han Lih-wu.
  6. The original concept of the indemnity fund was set forth in “Proposed Regulations for the Students To Be Sent to America” issued by the Chinese Government; for undated translation, see Foreign Relations, 1908, p. 71.