ASIA U)a Gon OSS Moy as CORNELL UNIVERSITY LIBRARY CHARLES WILLIAM WASON COLLECTION ON CHINA AND THE CHINESE oi Cornell University Library e far eastern question :an examination THE FAR EASTERN QUESTION AN EXAMINATION OF MODERN PHASES OF THE FAR EASTERN QUESTION, INCLUDING THE NEW ACTIVITIES AND POLICY OF JAPAN AND THE SITUATION OF CHINA BY THOMAS F. MILLARD AUTHOR OF “THE NEW FAR EAST” MAPS AND ILLUSTRATIONS T. FISHER UNWIN Lonpon: Lerpsic: ADELPHI TERRACE INSELSTRASSE 20 1909 2 Wa, “Dope Wie: DSs" roe Ee. COPYRIGHT, 1908, IN THE UNITED STATES OF AMERICA BY MOFFAT, YARD AND COMPANY \N3545 Wyi5 INTRODUCTION SINcE the publication in March, 1906, of THE NEW FAR EAST, I have again twice visited the regions in- cluded in the scope of the Far Eastern Question, and have further observed and studied conditions there. The pres- ent work takes up the situation where my previous book quitted it; brings it forward, extends its prospect, and criticizes some results which have become apparent. I have avoided extensive use of statistics, and when any views and conclusions are based upon them I have exer- cised my own judgment in accepting or rejecting figures presented by governments and individuals. In the East, in perhaps a greater degree than elsewhere, statistics often are prepared to sustain’ an hypothesis. This is espe- cially true, at the present time, of some statistics which relate to the economic and fiscal situation of Japan. I expect that some persons will profess to find in this, as many did of my previous work, an anti-Japanese preachment. This it is not, in the sense that a desire to injure Japan is among its objects. I wish the Japanese nation and people success in aspirations which do not tend to cause international dissension and strife by impairing in- terests of other nations. ‘That the present policy of Japan has this tendency is a conclusion I have reached after closely observing its trend for several years, and from studying its practical effects in localities where it is di- rectly applied. Having formed this opinion, I express it without hesitation, and endeavor to present facts and con- ditions upon which it is founded. To those who may INTRODUCTION think that in considering the activities of modern Japan I dwell on unfavorable phases, and ignore favorable ones, I will say that it is with the more significant aspects of Japan’s policy that this discussion attempts to deal, and that admirable traits of Japanese character are not often mentioned does not mean that I am ignorant of them. These characteristics are in a large sense common to all peoples, and it is only by possessing them to a considerable degree that any people can make its activities widely felt; moreover, favorable aspects of Japan have been pre- sented by a thousand writers, and are kept before the world by an organized publicity with which no individual can compete. In juxtaposition with what I consider to be disturbing and probably unattainable ambitions of mil- itant Japanese statesmen, I have tried to show counter- balancing interests and forces which are involved. To the extent that I have approached the subject espe- cially from the point of view of the interest of the United States of America, and in this only, the discussion is par- tisan; and this will, I hope, be excused when it is remem- bered how little American interests are considered in the extensive literature of this question. While I hope that the book will have some effect upon the solution of prob- lems which are reviewed, by bringing to bear upon them enlightened public opinion and advanced statesmanship in America and elsewhere, I have not had effect only in mind when writing it. I thank the publishers of The New York Times, Scrib- ner’s Magazine, and Appleton’s Magazine for their per- mission to reproduce matter previously printed in those publications. Tuomas F. MILvarp. New York, February 1, 1909. CONTENTS CHapP. PAGE I— THE WAKING ORIENT... . . I The Greatest International Question — Issues In- volved — Rapid Evolution of Conditions — Sentimen- tal Influences at Work in the East — Effects in India and China— The Lesson of Japan’s Victory — Ef- fects Upon the Anglo-Japanese Alliance — New In- ternational Agreements — Realignment of Interests —France’s Attitude—Germany’s Policy — New Balance Wheel Needed — Position of the United States— Turning Point in American Diplomacy — Importance of Relations With China — Oriental Checks on Pan-Orientalism — A Disturbing Factor. II— JAPAN’S NEW ECONOMIC REGIME .. 15 Japan’s Advantages in Embarking Upon a New Policy — Features of the Policy — Paternal Concep- tion of Government — Economic Situation of the Nation — Genesis of the New Idea — Need for Rev- enues — Government Control of Industry — Forms of Encouragement Applied — Part Played by the Banks — Their Relation to the Government — Meth- ods Employed — Use of Subsidies — Command of Transportation Facilities — Suppression of Internal Opposition — The New Protective Tariff — Re- sources of the Country — Optimism of the People. III.— JAPAN’S FOREIGN TRADE POLICY . 27 Broad Political Purpose Involved — Japan’s Geo- graphical Position — Its Relation to this Question — vil vill CONTENTS CHAP. PAGE Japan’s Aspiration to Oriental Leadership — Prem- ises of Industrial Control — Political Domination Important — Economic Elements— Competition to be Met — Oriental Obstacles — Japanese Methods — Legitimate and Illegitimate Methods Considered — Their Application to Asia — International Bearing — A Hypothetical Example — Japan and China — The Lion in Japan’s Way — Interest of the West in This Problem. IV.— JAPAN’S FOREIGN RELATIONS . . 39 Present Demoralization — Possible Effects Upon Other Nations— Japan’s Modern Foreign Policy Examined —Its Origin and Development — After Effects of the Peace Treaty with Russia — Fall of the Katsura Cabinet — Hayashi’s Administration of Foreign Affairs — Basic Principle of His Policy — Its Chief Objective — Relations With China — Dip- lomatic Moves and Errors — Disintegration of Hay- ashi’s Policy — Reasons for Its Failure — Decline of Japan’s Prestige — Her Rupture With America — Effects of This Incident—’The Attack Upon Hay- ashi. V— AMERICA AND JAPAN... . 49 Japan’s Modern Attitude Toward Meciiee a. tempted Isolation of America in the East — Diplo- matic Moves by Japan — ‘The San Francisco School Incident — The Immigration Question — Weak Atti- tude of the Washington Government — Ignorance of Conditions — Change of Heart at Washington — Ambassador Wright’s Difficulties — Turn in the Sit- uation — Transfer of the American Fleet — Some Results of This Move — Elimination of Trivial Mat- ters — Revelation of the Real Issue — Disadvantages of Obscurity in Diplomatic Matters -— America’s CuHap. CONTENTS ix PAGE Superior Position — Alteration of Balance of Power — The Old Japanese-American Entente Finished. VI— JAPANS MILITARY AND NAVAL PROGRAMME Efforts at Secrecy — Revelations of the Budget — Some Comparisons of Expenditure — Debate in the Diet — Foreign Attention Attracted — Discontent of the Conservative Element in Japan — Explanations and Arguments of the Government — General Te- rauchi’s Utterances — Popular Propaganda for NMIili- tary and Naval Expansion — Creation of War Fund — International Interest in the \Iatter — Object of the Military Policy — Directed Against China — Re- lation of the United States to the Question — Un- reliability of Diplomatic Pronouncements. VIIL—JAPAN’S MILITARY AND NAVAL SCREMG EE Japan’s Immunity from Invasion — Not the Object of Hostile Ambitions — Her External Belligerency Estimated by Comparisons — Some Fallacies About Militant Japan — Her Army and Navy Scrutinized — Conditions of Military Service — Composition of the Army — Term of Service — Japanese Officers — Passing of War Conditions — Exaggerated State- ments — Equipment of the Army — Mistaken Con- ceptions — The Japanese Navy — Personnel and Equipment —Its Present Condition — Significance of Japan’s Preparations. VIII.— POLITICAL TENDENCIES IN JAPAN Structure of the Government — Basis of Popular Participation — The Suffrage— The Parliament — House of Lords — House of Representatives — The 62 73 88 x Cuap. IX.— CONTENTS PAGE Elder Statesmen — Political Parties — Control by the Oligarchy — Political Corruption — Gradual Awak- ening of the Masses — Their Exploitation by the Oligarchy — The Burden of Taxation — Policy of the Saionji Ministry —— The Commercial Class — New Political Forces — Government Worship ”’— ‘The Emperor — The Imperial Household in Trade and Finance — Growth of Socialism — Prospects for Reform — Influence of Western Sentiment. THE FISCAL SITUATION IN JAPAN . Some Results of Economic Innovations — Intrusion of the Government Into Business — Its Creation of Assets — Nationalization of the Railways — Stalking the Foreign Investor — Optimism in the Saddle — Increase in Capitalized Industries — Basis for This Expansion — Shyness of Foreign Capital — Reasons for This Disposition — Collapse of the “ Boom ”— Fiscal Condition of the Nation —— Increase of Taxa- tion — Wages in Japan — Proportion of Per Capita Taxation to Earnings— Decline of the National Ownership Policy — Discontent of the People — Ex- ternal Pressure Upon Japan -— A Crisis Approaching. X.— FOREIGNERS AND FOREIGN INVEST- MENTS IN JAPAN . The Opening of Japan — Intrusion of Foreigners — Establishment of Their Status — Their Influence Upon the People and Nation — The Abolition of Ex- tra-territoriality — Alteration of Conditions — Per- sonal Rights of Foreigners—— Treaties, Laws and Their Enforcement — Change in Sentiment Among Japanese — Reasons for This Change — Attitude of Japanese Courts Toward Foreign Residents — Exclu- sion of Some Classes — Property Rights of Foreigners 102 113 CONTENTS xi Cuap. PAGE —— Basis for Foreign Investments — Defects in the Laws — Inducements to Foreign Investors — Placing Japanese Securities Abroad — Western Influence Upon the Development of Japan’s Industry and ‘Trade — Foreigners Still Needed. XI— THE SUBJUGATION OF KOREA .. . 128 Establishment of Japan’s Suzerainty — Administra- tive Reorganization of Korea — Japanese ‘‘ Advisers ”’ — Creation of the Residency — Marquis Ito’s Posi- tion — Struggle Between the Military and Civil Fac- tions — Deposition of the Emperor — Final Extinc- tion of Korean Autonomy — Disbanding the Korean Army — Japanese Attempts at Reform — Practi- cal Effects of Japanese Reforms — Situation of the Koreans — Their Distress Under Japanese Rule — Japanese Immigration— Attempts to Jap-ize Ko- rea—— Exploitation of the Country——- The Insur- rection —A Hopeless Struggle -— Position of the Korean Court— The Emperor a Prisoner — Chris- tian Missionaries in Korea-— A Deplorable Situation. XII.— THE OPEN DOOR IN KOREA. .. . 149 A Pat Example — Unique Position of American Interests in Korea — The Policy of Japan — Elimina- tion of Pseudo-Political Interests — Assurances to the United States — Severance of Foreign Diplomatic Re- lations With Korea — Japan’s War Upon Foreign Interests — The Fight on Collbran & Bostick — Underhand Methods— Persecution of American Firm — The “ Kapisan” Case — Discrimination Against Foreign Interests and Trade — Uses of the Railways — The “Open Door” a Farce — Remain- ing Obstacles to Complete Annexation — Korea a Japanese Preserve. xil CONTENTS CuHap. PAGE XII]. THE BALKANS OF THE EAST . . 163 Manchuria a Danger Spot — Course of Recent Events There-— The Termination of Hostilities — Various Political Entities Involved — Russia, Japan and China — Chaotic Conditions — Russia’s Position —Her “Sphere” the Larger — Japan’s Position More Significant — Reasons for This Analyzed — Japan and China— The Yuan-Komura Agreement —The Supplementary Articles— Antecedents of This Treaty — The Status of Japan —“ Police ” and “ Railway Guards ’— Occupation of the Country. XIV.— THE EVACUATION PERIOD. . . 176 Drift of Japan’s Policy in Manchuria — Signifi- cance of Internal Dissensions in Japan — Military and Civil Factions —— Considerations Involved — Dif- ferent Opinions, One Desire—- The First “‘ Open- ing” of Manchuria — General Oshima’s Attitude — Marquis Saionji’s Visit—Shift of Japanese Head- quarters — Real Situation at Moukden — The Vice- roy’s Position — His Excellency Practically a Pris- oner — Visit of a Foreign Official to Moukden — Situation of Chinese Inhabitants— The Second “Opening” of Manchuria— Opposition in Japan — Temporary Retirement of Viscount Hayashi — Partial Restoration of China’s Autonomy — Further Negotiations. XV.— PROPERTY RIGHTS IN MANCHURIA 188 A Puzzling Question — Japanese Rights Inher- ited From Russia— The South Manchurian Rail- way — Mines and Other Concessions — Additional Requisitions by the Japanese — Validity of Titles in Dispute — Japanese Settlements — The Case of An- tung — Seizure of Land— Methods Employed — Cuap. CONTENTS Xili PAGE Monopoly of Facilities — The Case of Newchwang — Civic Improvements— A Speculative Project — Confiscation of Rights — Use of Chinese Revenues — Acquisition of Chinese Private Property — Japan’s Moral Shift — Bearing of These Propositions Upon China’s Sovereignty — The Yalu Timber Industry — ‘A Deadlock. XVI.— THE OPEN DOOR IN MANCHURIA XVII. Commercial Aspects of the Military Regime — Russia Not an Aggressive Factor — Japan’s Com- mercial Activity — Part Played by Japanese Immi- grants —— Attitude of Japan— The Exploitation of Manchuria — Japan’s Proprietary Tone — The “Open Door”—Elements Involved — Conditions Affecting Incoming Commerce — Japan’s Control of Transportation Facilities — Use of Japanese Shipping Lines — Encouragements to Japanese Trade — Ja- pan’s Assumption of Sovereignty — International In- terests Affected — Japan’s Denial of Alleged Dis- criminations. — THE OPEN DOOR IN MANCHURIA — Continued - Japanese Closure of the Country — Injury to For- eign Interests — Policy of the Military Administra- tion — Passports Refused to Foreigners — Such Re- strictions Unnecessary — Visit of Foreign Merchants — Their Report and Recommendations — Evasion of Chinese Customs — Pretense of Military Necessity — Protests of Chambers of Commerce — Japanese Re- fusal to Pay Likin — Chinese Officials Ignored — Usurpation of Chinese Private Property — Character of Japanese Immigrants—A Foreign Missionary’s Views — Japanese in Non-treaty Towns — The Prin- ciple Involved. 202 213 xIV CONTENTS Cuap. PAGE XVIIIL— THE OPEN DOOR IN MANCHU- RIA — Continued . . . - . 226 Commercial Effects of Japanese Administration Upon the Chinese — Governmental Aid to Japanese Immigrants — Petty Japanese Traders — Their Real Function — Auxiliaries of the Great Japanese Firms — The Mitsui Bussan Kaisha — Effects of Japanese Evasion of the Likin — Chinese Collectors Ejected — Cornering the Bean Cake — Discrimination Against Foreign Firms — Some Pertinent Examples — Expe- riences of an American Firm — Japanese Counterfeits and Imitations — Japanese Manipulation of the Cur- rency — The Yokohama Specie Bank — Japan’s Use of Dalny. XIX.— THE OPEN DOOR IN MANCHURIA — Concluded & ot « 246 Test of This Commercial Principal — All Practi- cal Conditions Here Defined — Accessibility of Man- churia—— Causes for Trade Stagnation — Gradual Alteration of Japanese Methods — Diplomatic Pro- tests — Normal Conditions Outwardly Restored — Petty Evasions Continued — Attempt to Injure New- chwang — Japanese Railway Rate Discriminations — The Fakumen Railway Dispute — Basis of Japan’s Objections — Alleged Secret Clause —The Chinese Version — Weakness of Japan’s Position — Relation of the Fakumen Question to the ‘‘ Open Door ” Prin- ciple — Japan’s Railways in Manchuria — Their In- ternational Status— Keeping the Chinese Railway Out of Moukden — Marketing Foreign Products in Manchuria — Situation of Japanese Traders. XX.— POLITICAL ISSUES IN MANCHURIA 259 Present State of the Country — China’s Efforts to Recover Autonomy — Policies of the Viceroys — CONTENTS xv Cap. PAGE Japanese Evacuation of Moukden— Troops With- drawn — Slight Alteration of Political Status — Japan’s Grip Retained — Japanese Garrisons — Is- sues Between China and Japan — China’s Authority a Fiction — The Question of Railway Administration — Claims of Russia and Japan — Basis for These Claims —— The Chinese Eastern Railway Agreement — This Instrument Analyzed — Railway Settlements — The Issue at Harbin — Railway Administrative Zones — Usurpation of Chinese Administrative Func- tions — Posts and Telegraphs — Lawlessness of Japa- nese Immigrants — The Antung-Moukden Railway — Chinese Sovereignty Overruled. XXI.— RUSSIA IN EASTERN ASIA . . . 274 Russia’s Repulse— Her Post-bellum Position — Revising He: Eastern Policy — Russia’s Position in Manchuria — Her Commercial Policy There — Con- trast With Japan — The Door Opened — Russia and Japan — Issues Between Them — Railway Adminis- tration — The General Convention of 1907 — This Document Analyzed — Railway Strategy in Man- churia— The Position of China— Baron Goto’s Visit to Russia — Russia’s Advantage — Conditions in the Russian Sphere — Harbin — Russia’s Real At- titude. XXII— THE REFORM MOVEMENT IN CHINA eee tS : . 289 Real Struggle for Reform Begun — Fight Be- tween Conservative and Progressive Elements — Bases for Practical Reform — The Chinese Govern- ment Analyzed —7The Court— Not Opposed to Moderate Reform — The Empress Dowager — The Metropolitan Administration — Provincial and Local Administrations — Various Branches Interdependent xvi CONTENTS CuHap, PAGE — The Reform Issues — Extra-territoriality — The Foreign Settlements— The “Right of Recovery” Doctrine — Popular Vitality of the Reform Move- ment. XXIII.— THE REFORM MOVEMENT IN CHINA — Concluded a 8 So Be BOs A Leaderless Movement — Reform Parties and Groups — The Ka-ming-tang — Reforms Advocated — Influence of the “‘ Students’””— The Conservative Reformers — Yuan-shih-k’ai — The Proposed Consti- tution — The Kao-lao-hui— Ideals of the Extreme Revolutionists — Seeking a Chinese Napoleon — Spo- radic Attempts at Armed Revolution — The Confu- cius Group — Course of Practical Reform -— China’s Fiscal Situation — Excellent Condition of the Em- pire— The National Debt — Fiscal Possibilities — The Specter of Foreign Interference — Dangers to China’s Autonomy — Competent Officials Needed — Education of Chinese Abroad —- Waning of Japanese Influence — Reform Movement Should be Taken Se- riously. XXIV.— MODERN INDUSTRY IN CHINA . 322 Beginnings in Modern Manufacturing — Elements Involved — Chinese Labor Conditions — Vast Sup- ply of Human Energy — Adaptability of Chinese to Modern Industrial Methods — Development of Mod- ern Industrial Capability-— Wages and Output — Comparative Cost of Production — Oriental Standard of Living — Probabilities Estimated — Raw Mate- rials — Capital — Hidden Wealth of the Chinese People — Lack of Adequate Banking Facilities — The Chaotic Currency — Status of Modern Indus- trial Projects — Railways in China— Their Earn- ing Power—Future Development — Opportunity CONTENTS Xxvil Cuap. PaGE for American Enterprise — Backwardness of Ameri- can Business Interests in China — Chinese Attitude Toward Modern Methods — Possibilities of the Chinese Market — Possible Effects of China’s Indus- trial Development Upon America. XXV.— AMERICAN TRADE IN CHINA... 337 Development of China’s Foreign Trade — Condi- tions Which Surround It —‘The Maritime Customs — Proposed Modifications — Elements Involved — Possible Effects — Comparative Position of Foreign Powers — Growth of American Trade — Second to Great Britain — Progress Without Encouragement or Stimulation — America’s Commercial Rivals in China — Possible Developments — Land-borne Trade Reg- ulations — Factors in the Coming Struggle — Meth- ods of Competitors — Foreign Banks in China — In- creased Consumption of Foreign Products — China’s Power of Commercial Retaliation — The Guilds. XXVI.— CHINA AND THE UNITED STATES 352 A Storm Center — America’s Relation to the Fu- ture of China— Some Aspects of This Question — Major and Minor Premises — The Pacific Ocean Powers — Their Comparative Rank Estimated — Factors Involved — Material Interests of the Nations — The Element of Territory — Riparian Rights — Commerce — The Position of America — The Dis- turbing Element — America’s Efforts in China’s Be- half — Attitude of the Powers —“‘ What Will Amer- ica Do?”—Should the United States “ Interfere ”? —vVarious Kinds of Interference — Phases of “‘ Agres- siveness ”— China’s Need for Advice and Aid — America Cannot be Indifferent Need for an Ag- gressive Asiatic Policy. xvill CHap. CONTENTS PAGE XXVII— CHINA AND THE’ UNITED STATES — Concluded Diplomatic Weathervanes —The Root-Takahira Note — This ‘‘ Agreement” Analyzed — Its Ante- cedents and Conditions Precedent — Its Relation to China — Disquieting Features — Japan’s Apparent Objects — The American Viewpoint — Essence of This Incident — Efforts to Prevent a Chinese-Amer- ican Understanding — Genesis of These Efforts — International Jealousies Invoked — A Significant In- cident — Visit of the American Fleet to China — Op- posing Intrigues—— Part Played by the American Minister to China — Diplomatic Ineptitude — The Fleet at Amoy — Effects of This Incident. . 363 XXVIII.— FOREIGN RESIDENTS IN CHINA 386 XXIX.— THE PHILIPPINES TO-DAY The Foreign Settlements— Their Development and Growth — Modern Shanghai — Government of the Foreigners — Their Character — Double Stand- ards of Life — Gradual Reversion to Normal — Es- tablishment of Foreign Courts — Process of Social Evolution — Position of the United States — Regula- tion of Social Evils— Attraction of Undesirable Classes to American Jurisdiction Creation of a United States Court for China— Attempts to De- stroy It— Their Failure— Uses of the Court — American Consular Needs — Foolish “ Economy ”— Present Status of Foreigners — Their Anomalous Po- sition — The Foreign Missionaries. A Shuttlecock of Politics — The Situation in Evo- lution — The Military Regime — Civil Govern- ment — Heritages from the Insurrection — Essence of the American Policy — Predictions of Failure — . 404 CuHap. XXX.— THE PHILIPPINE ASSEMBLY CONTENTS XIX PAGE Growth of Racial Antagonism — Attitude of Some Americans — The Problem Presented — Evolution of Filipino Participation in the Government — The Situation Now — Americans in the Government — The Bureaus — Their Relation to the Whole Work — Americans Losing Heart — Reasons for this Senti- ment — The Dilemma — Disintegration of the “ In- dependence” Movement. A Significant Episode — Conditions Precedent — Extension of the Suffrage — Qualifications of Voters — The Special Election Law — Qualifications of Delegates — Filipino Political Traits —— The Regis- tration — Popular Indifference— The Campaign — Parties — Pre-election Promises—-The Katipunan Flag Incident — Indignation of Americans — Result of the Election — Character of Delegates. XXXI— THE PHILIPPINE ASSEMBLY — Concluded Convocation of the Assembly — American Senti- ment — Powers of the Assembly — Limitations Upon It— Election of a Speaker — Protested Seats — Elimination of Party Lines — External Influences — Powers of the Commission — The Provincial Elec- tions — Reaction From Radicalism — Work of the Assembly — Character of Measures Proposed — Popular Interest —Some Aspects of This Experi- ment — Possible Commercial Effects —— Some Com- parisons — Hypothesis of the American Policy —A Good Beginning. . 418 as be- tions of Japan and Russia about the “‘ open door’ ing “‘ equally sincere” is peculiarly apt. However, there are few outward evidences of an in- tention by Japan to provoke presently a rupture with China. On the contrary, it apparently will best serve her end to delay yet awhile before permitting her con- tinental policy to take more positive shape. While she probably could at present overwhelm China in war, she realizes that China might be able to summon assistance, and Japan must be prepared for this contingency. In regard to the relation of the United States to the question of Japan’s unusual military and naval prepara- tions, one hopes that those in authority at Washington will not fall into the error of placing too much emphasis upon the recent rapproachment of the governments, as removing all cause for friction between the two nations. Upon the occasion of Baron Takahira’s arrival in Amer- ica, in February, 1908, to replace Viscount Aoki as Jap- anese Ambassador, he repeated to the press the usual formula. Among other things, he was reported as say- ing: “For the United States and Japan to go to war would be a crime against civilization. Certainly nothing could be further from Japan’s thoughts than war. Her atten- tion is devoted to the development of the material re- sources of the nation, and the uplifting and enlightenment of her people.” I was in Japan when this utterance was made, and I could mentally picture the chorus of comment in which this inane utterance was described as “setting at rest ” all talk of a possible embroilment of the two nations; indeed, it was not necessary to work one’s imagination, for the 4% THE FAR EASTERN QUESTION press af Japan shouted in full chorus. As nearly as I can conclude, at about the same time when Mr. Taka- hira was delivering this statement, the Japanese Diet was passing, over protests of commercial and _ industrial bodies, a budget which included the following items: Army and Navy (exclusive of special expenses held: OVEn) <3 coc acsianhbtieslne Se A acore-ced aces aie Yen 193,000,000 Education (exclusive of Prefectural funds) .. 8,236,940 There are important factors which may, which prob- ably will operate to check the military policy of Japan; but a comparison of Baron Takahira’s statement with the foregoing items of the Japanese budget seems to justify the world in regarding Japan and her policy through other light than that provided by conventional diplomatic as- surances. CHAPTER VII JAPAN’S MILITARY AND NAVAL STRENGTH JAPAN’S IMMUNITY FROM INvAsION — Nor THE OBJECT OF HostTitE AMBITIONS — HeER ExTEeRNAL BELLIGERENCY EsTI- MATED BY COMPARISONS —SomeE Fatvacitrs AsBouT MIILI- TANT JAPAN— HER ArMy aNnp Navy ScRUTINIZED — Con- DITIONS OF MILitTary SERVICE — ComposITION OF THE ARMY — TERM OF SERVICE — JAPANESE OFFICERS — PassING OF WAR ConpITIONS — EXAGGERATED STATEMENTS — EQUIPMENT OF THE ARMy— MisTtaKeEN ConcepTIONS— THE JAPANESE Navy — PERSONNEL AND EQuiIpMENT— Its PRESENT CoNDI- TION —- SIGNIFICANCE OF JAPAN’S PREPARATIONS. THE military and naval strength of Japan possesses interest to the world more through its possible relation to the solution of the eastern problem than as a defensive factor; for the most imaginative of those writers who are fond of predicting international collisions have yet to con- ceive a successful invasion of Japan by a foreign foe. This not only is impractical as long as Japan maintains a moderately large and efficient army and navy, but no nation is now suspected of designing a conquest of Nip- pon; nor is there any probability that any ever will aspire to such a difficult and profitless undertaking. It is, there- fore, only force that Japan may be able to apply ex- ternally that need concern other nations. Such matters usually are judged by comparison, and the course of re- cent events has induced comparisons between the bellig- erent power of Japan and the United States. In this discussion ‘it is assumed by many that should a hostile 73 74 THE FAR EASTERN QUESTION collision between these two nations occur in the near future, Japan will have advantage over America, owing to her presumed military and naval efficiency and pre- paredness, and that her comparative superiority in these things will offset our advantages in other matters. This view has been widely disseminated, generally by persons who somewhat vaguely base their conclusions upon certain results of the war between Japan and Russia; but often, also, by commentators of accepted standing in rela- tion to military and naval affairs, whose opinions carry some weight. While there is perhaps little reason to fear detrimental effects upon American interests and prestige through acceptance of such views, probability that the so-called Japanese question is destined to take a permanent place in our Government’s policy may warrant a presentation of some phases of this proposition which so far have received small public attention. A consideration of the present condition of the Japanese army and navy, compared with those of other nations, involves the usual elements — personnel and equipment. It is probable that in any collision between Japan and the United States the navies of the two nations will be the decisive factors; but an army more nearly touches the con- ditions of national existence than does a navy, or at least rests upon a somewhat broader base, so I will discuss the status of the Japanese army first. All armies are divided into two general grades, the rank and file, or the officers and enlisted men; and these grades usually are recruited under widely varying circumstances. In countries which pretend to modern efficiency officers must undergo some process of selection, and commissions are granted only to men who have studied in military schools or who pass prescribed examinations. Of course, there are exceptions to this in all countries, but the con- JAPAN'S MILITARY STRENGTH as dition may be accepted as sufficiently general to estab- lish the rule. Officers have no regular term of service, and are expected to retain their commissions during good behavior, and as long as they are physically capable of attending to their duties. ‘There is, nevertheless, a constant loss of officers from various causes which amounts in most armies in time of peace to about 20 per cent. in comparison with the period covered by the enlistment term of the file of the army. Losses in war should be consid- ered separately. The regular term of service for enlisted men in most modern armies to-day is three years, although the French and Japanese governments already have reduced it to two years, and it is announced that Germany will make a similar reduction. This means that the entire enlisted personnel of an army will be renewed every two or three years, as may be, less the number of re-enlistments. Some armies also have a five-year enlistment, (like the United States Army, ) carrying with it special inducements, and some governments which do not employ the conscript system offer bonuses to secure re-enlistments, and thus keep experienced men in the service. The fact that the United States Govern- ment gives liberal bonuses, together with the generally better situation of enlisted men in its service, makes re- enlistments in our army and navy larger in proportion to those of other nations. The Japanese army is officered by men recruited in the usual way. A majority of the younger officers have studied in the military schools of Japan, but many were appointed from civil life upon passing an examination. The conditions under which young men in Japan enter the army as officers do not differ materially, when ex- amined, from the method employed for recruiting officers in England and the United States, nor are results sensibly 76 THE FAR EASTERN QUESTION different on the average, which means that a fairly ca- pable lot of men are secured. Imminence of war stim- ulates enlistment in most countries, and before the war with Russia there was a rush of the best intelligence and blood in Japan to get commissions in the army and navy, which were freely granted, as it was necessary to augment the official personnel. This movement began perhaps a year before hostilities against Russia started, and culminated in 1903-4, four or five years ago. The war was fought, with great attendant loss of officers; and the official personnel has been further reduced by retirement and resignation of thousands of officers who tendered their services for the war, and for whom no place can be found in the regular organization on a peace basis. Without further details, an estimate indicates that probably not more than half the officers of the present regular Japanese army were in the service when war with Russia was commenced, the remainder being men who entered the service during and since the war. In respect to the file of the army, somewhat different conditions apply. It is now known that for at least two years before the Russo-Japanese war the Japanese Gov- ernment gave bounties for soldiers and sailors who re- enlisted, so as to begin war with as many experienced men as possible. But these bonuses now are discontinued, and it may safely be assumed (such information as is ob- tainable bears out this view) that the enlisted person- nel of the Japanese army to-day is composed of new recruits and rather less than the ordinary proportion of re-enlistments. The Japanese enlistment method is founded, as are most of their military regulations, upon that employed by Germany, and is based upon universal conscription. Owing to lapse of time, only those men JAPAN'S MILITARY SPRENGTH 77 who enlisted at the very end of the war, and perhaps never saw active service, are still in the ranks. Experi- ence has shown that after a long and severe war there is a disposition among even that segment of army personnel, usually called “ regulars” because they have got into the rut, to get out and enjoy personal liberty at least for a while, and there is no reason to believe that this rule does not apply to Japanese as well as to other races. With these precedents and conditions for a basis, it is doubtful if the proportion of enlisted men in the Japanese army to-day who have seen service is more than 10 per cent. and within two years even these probably will have returned into the body politic. A statement recently was published, having as alleged sponsor a retired naval officer of the United States, that Japan could immediately put 1,000,000 veteran troops in the field. It is difficult to understand why a military man would make such a statement. ‘The present Jap- anese regular army approximates 120,000 officers and men under arms, and any increase must be by methods similar to our own under such circumstances. It is true that there are organizations designated as first and second reserves, but these ‘“‘ reserves”’ exist only on paper, and are organized only in the sense that certain classes are designated as belonging to them, and are lia- ble to be called upon for active duty without previous notice or consent. All European nations have similar reserves. ‘The necessity for fiscal economy, if no other reasons existed, required Japan to reduce the personnel of her army and navy to normal as soon after hostilities ended as was possible, aside from the fact that a majority of soldiers had been conscripted only for the war. Turning from personnel to equipment, let us consider that of the Japanese army to-day. The rifle with which 78 THE FAR EASTERN QUESTION the troops were armed during the war is known as the Arisaki rifle, named after a Japanese officer of ordnance; and is almost a replica of the Mauser 1893 model, for- merly used by the German army. The Japanese Gov- ernment, following its customary course in such matters, simply appropriated the mechanism of the Mauser, with a few modifications, such as a shorter stock adapted to the short arms of Japanese soldiers, and a shorter barrel. As a weapon, the rifle was not improved by these changes, although lightened a little, for the calibre was decreased to give velocity and a flatter trajectory, which, as ex- perience demonstrated, perceptibly diminished the “ stop- ping power’’ of the ammunition. While about equal to the rifle used by the Russian army (the 1891 Mann- licher) the Arisaki rifle is inferior to rifles with which the United States, German, French, and British armies are now supplied. This is fully recognized by Japanese ord- nance officers, and plans to re-arm the army entirely now occupy the attention of the general staff. The stub bayo- net with which the Arisaki rifle is provided is now be- lieved to be inadequate, and a number of minor deficien- cies were demonstrated during the war. But if the fact that the old model Arisaki rifle is obso- lete, (judged by modern standards it is not as good a weapon as the Krag, recently discarded by our Govern- ment,) did not supply a sufficient reason for providing the Japanese army with a new weapon, one exists through the wearing out of the rifles used in the war. The number of Arisaki rifles in Japanese arsenals when the war began is not definitely known, except to the Japanese staff, but it was noticed that even early in the war rifles captured from the Russians were used to arm supernumeraries which were attached to the Japanese armies, and foreign military attachés noted that late in the war some Japanese JAPAN'S MULITARY STRENGIM 79 soldiers carried Russian rifles; which indicates that the supply of sArisaki rifles was limited, since any military man knows the objections to introducing into an army arms requiring different ammunition. The erosion of small calibre rifles using smokeless powder is very great compared to former methods, and tests have demon- strated that rifles rapidly deteriorate after having been fired one thousand times, or less. There was, of course, a great variation in the number of times different rifles were fired during the war, but it is known that tens of thousands of Japanese rifles were totally incapacitated, and that when the war ended but a small proportion of the rifles in use were in good condi- tion. During later battles the self-inflicted casualties in both armies due to defective rifles noticeably increased, and must have given serious concern to commanders and governments. It is possible that by this time Japanese arsenals could have, by manufacture and repair, replaced worn-out rifles with others of the same pattern; but it is improbable that such a course was adopted, for with plans under way to provide a new weapon, and in the absence of urgent necessity, this would seem a useless ex- pense. Although Japanese artillery, especially in early stages of the war, exceeded that of the Russians in effective- ness, this was entirely due to superior handling and pre- ponderance of guns. ‘The field pieces used by Japanese, which followed a French design now superseded, are as a weapon inferior to that with which the Russian army is provided, both in mechanism and range; and are con- sidered out-of-date weapons, in comparison with models with which German, English, French and United States armies are now provided. Moreover, the powder used proved very erosive, and deterioration of guns was rapid. 80 THE FAR EASTERN QUFSTION In later battles it was noticed that Japanese artillery was less effective than it was earlier in the war, which was at- tributed, probably correctly, to deterioration of the guns from use. Since the war Japanese officers have visited Europe and the United States for the purpose of inspecting the new- est military appliances and formulating a report which may, added to experience gained in the field, serve as a guide for improvement of their own equipment. Some results of these investigations already are apparent. A new model Arisaki rifle recently has been issued to some regiments, which is considered to be an improvement upon the old model, having a longer barrel and a larger calibre; but it is not definitely known whether the entire army will be supplied with this weapon. It is, therefore, fair to assume (indeed, such information as can be ob- tained bears out this assumption) that the Japanese Army still to-day is largely armed with rifles which were used in the war with Russia. A new field piece also made its ap- pearance at the last maneuvers, being a replica of a late French model, and provided with steel gunner shields; but only a few batteries of these guns are now in use. It is doubtful if models for new rifles and field pieces have been finally adopted. When this is done it will take sev- eral years for Japanese arsenals, even with increased capa- city, to produce an equipment sufficient to supply an army in a great war. Many reforms of minor equipment and impedimenta, suggested by experience during the last war, are under consideration by the general staff, and it will be some time before these details are worked out and the results become apparent in the efficiency of the army. A considerable number of guns and rifles were captured from the Russians, which might be used in a pinch, but JAPAN’S MILITARY STRENGTH 81 they are hardly worth considering in any scheme to estab- lish the army on a more modern basis, owing to funda- mental differences in construction and calibre, which can- not easily be made to harmonize with that uniformity of armament which is considered indispensable to modern efficiency. Much exaggerated comment about supposed marvel- ous appliances invented and used by Japanese against the Russians, wonderful explosives and devices, and so forth, has been printed. The truth is that in all es- sentials of modern military and naval art Japan’s relation to the West is still that of a “copy-cat.”” During the war the western world heard a good deal about the won- derful success of the Japanese in keeping their military equipment and appliances secret. ‘The gist of this matter is aptly illustrated by an anecdote related about a pass- age between a French military attaché in Manchuria and a Japanese staff officer. The military attachés were dis- gruntled about their treatment, and the refusal of the Jap- anese to let them see the operations. On this occasion the French officer had requested permission to inspect some Japanese field artillery, only to meet with the usual eva- sion and delay. Finally, becoming impatient, he pressed for a definite answer to his request. “But,” suavely replied the Japanese officer, ‘‘ you must appreciate the. importance to us of keeping our military secrets.” “Your secrets. Bosh!’ exclaimed the French officer, his disgust for a moment getting the better of his man- ners, ‘as if you hadn’t stolen everything you have from us; ¢ It took considerable palavering, so I am informed, to span the diplomatic gap caused by this blunt, if truthful 82 THE FAR EASTERN QUESTION utterance. The fact is that all of Japan’s major military and naval appliances are directly taken from the West, usually without any regard to patent or copyrights. The personnel of the Japanese navy is drawn from practically the same sources as the army, but the condi- tions are slightly different, owing to variations in the two branches of the service. It is harder to train a good man-of-war’s man than to make a fairly competent soldier, a fact which is recognized in most modern naval regu- lations and enlistments. In Japan naval service is compulsory, the regular term being four years, while, as in most navies, special inducements for longer enlist- ments are offered. As to the army, bonuses were given just prior to the war to retain experienced men in the service, with about the same results. The perpetual existence in Japan of a large seafaring population insures plenty of good naval material, although conditions sur- rounding modern naval service do not demand a large number of “ sailors’ in the old meaning of the term. An active, clear-headed boy off an inland farm is apt to make as good a gunner, or what not, as a youth raised within sight of the salt water. In Japan the human material is good enough, neither much better nor worse than the average run of such ma- terial in European countries, and not so good as en- listed men in the United States navy. But the problem which confronts the Japanese admiralty is the same as elsewhere, the task of continually whipping a lot of green recruits into an understanding of their duties and develop- ing competence therein; and in this it has no advantage over any of its rivals for naval supremacy. The present naval personnel has followed very much the same course since the war as has the army; which means that probably not more than 20 per cent. of enlisted men now serving JAPAN’S MILITARY STRENGTH 83 saw anything or very much of the war with Russia. Any assumption that the average Japanese is capable of absorb- ing military or naval instruction more rapidly than the average European or American has, so far as I know, no foundation upon fact. As to naval units, expressed in ships, Japan’s equip- ment on sea is by this time tolerably well known, through numerous statements which have been published. Much comment assumes that the equipment of the Japanese navy is as efficient to-day as it was when war with Russia began. This, in reason, must be far from the truth. Aside from wear upon the vessels and machinery, and damages sus- tained in action, (which may or may not have been fully repaired,) there is the vital factor of armament. No modern naval armament has ever before been subjected to such a strain as was put upon that of the Japanese navy during the recent war. ‘The limited life of large guns, when fired with full charges, is well known. They be- gin to deteriorate after a score or so of shots, and about one hundred shots is considered the maximum consistent with safety. It is then necessary to insert a new rifling, which requires that the gun be taken from the ship. It is known that new guns were placed upon several Japanese ships during the war, and that many guns were re-rifled. Notwithstanding the care taken to keep such details secret, it is now known that damage sustained by the Jap- anese Navy during the war was far greater than is pop- ularly supposed, and that during the closing period of the war many Japanese ships carried guns which could not, for various reasons, be fired. This condition, which would be disastrous if a navy had to meet a formidable enemy, made no practical difference in the closing stage of the war. I learned directly from an expert, who was on board one of the Japanese armored cruisers shortly 84 THE FAR EASTERN QUESTION after the fight in the Korean Strait, that this vessel had to be towed into Sasebo during the battle, and that not a single gun of her primary battery could be fired. Yet in no report of the engagement that I have seen was any serious damage to this ship stated. I have information of many similar instances. It may be pointed out that, assuming the truth of all this, ample time has elapsed within which full repairs could have been made, and all the larger Japanese ships fitted with new guns, including modern sighting and fir- ing appliances, with which few were provided during the war. This is true; but there are circumstances which in- dicate that the task of refitting the Japanese fleet has not progressed so rapidly as the Japanese admiralty would have the world think. It is pretty well established (as I learn from reliable sources which I am not at liberty to divulge) that in the last great naval battle many Jap- anese ships carried defective guns, which were used with- out regard to risk or loss in accuracy, while some carried guns which could not be fired at all. If this is true, the reason must have been that guns to replace defective ones were not then available, for it will be remembered that a prolonged period of compar- ative inactivity preceded the arrival of the Russian fleet, ample for docking and repairing, in turn, of most of the Japanese ships, without weakening the fleet to a dangerous point. It is reasonable, then, to conclude that there was a shortage of large guns in Japan when the war ended. Such guns can be obtained in two ways — by manufacture in Japanese arsenals and by purchase abroad. If any large purchase of naval guns by Japan has been made abroad since the war, it has so far escaped the vigi- lance of rival admiralties. But Japan has announced that she will in the future build her own guns, and JAPAN’S MILITARY STRENGTH 85 has made extensive preparations to do so. National se- curity is given as the chief reason for this policy, for dur- ing war such materials are contraband; but another rea- son, and one which applies to Japan’s present fiscal situation, is economy. Why should Japan pay a high price to English, German, or French gunmakers, when, by appropriating the patent rights and importing machinery, she can provide them much more cheaply herself? This is the key-note of Japan’s re-equipment policy, which applies to both the army and navy. Had there ex- isted an urgent need for rearmament, rush orders would have been placed abroad. But there was no immediate need, apparently. So shops and arsenals have been built, and others planned, whose industrial basis is the employ- ment to be afforded by rearming and re-equipment of the army, and navy. Examination of certain phases of Japan’s new industrial policy indicates her intention in this matter. As to the ships captured from Russia, they were, as a rule in even worse condition than the Japanese ships, and many required to be floated, which was accomplished with difficulty in many cases, and at great expense. Any assumption, therefore, that the Japanese navy, as a whole, is to-day on a high plane of efficiency as to equipment, com- pared to other first-class naval powers, does not seem to be well founded. It seems to follow, then, that the Japanese army and navy, instead of being composed of veterans fully equipped with the most modern appliances, is really largely composed of recruits chiefly armed with worn and comparatively out-of-date weapons. An almost invariable experience of war, especially of nations which wage success- ful wars, is that a perceptible slump in military morale and efficiency immediately follows the conclusion of peace. This is partly due to conditions tending to material de. 86 THE FAR EASTERN QUESTION preciation, and partly to natural reaction. ‘There is no reason to believe that Japan is any exception to this gen- eral rule; on the contrary, there is much evidence that the usual condition exists in full measure. I hold the opinion that if the Japanese army and navy were to-day suddenly called upon to confront on equal terms those of any first-class power, excepting Russia, they could do so only at a disadvantage; for if we assume that personnel and training are approximately equal, deficiency in equip- ment would throw the balance out of plumb. The small numerical strength of the United States army, and the fact that many months must elapse after a declaration of war before large bodies of troops can be brought into collision, lessens the practical effect of com- parative efficiency of standing armies upon the ultimate result of any war in which our Nation may become en- gaged. But naval affairs are different, and here such comparisons hold good. ‘The fact that, under ordinary circumstances, it will be several years before the Jap- anese army and navy is fully rearmed and equipped, provides other nations who may fear a collision with doughty Nippon sufficient time for preparation should they wish to take advantage of it, and conveys tolerably definite assurance that in the meantime Japan will not be belligerently aggressive in any diplomatic differences which may arise between her and another great nation. That Japan is as rapidly as is possible, considering her fiscal difficulties, placing herself on a war footing, cannot be doubted. Extensive fortifications are being made at Port Arthur; at Masan-po and Gensan in Korea; and in Formosa. Japanese naval parties were detected survey- ing a number of uninhabited islets, now unclaimed by any nation, in Philippine waters, whose only conceivable value would be as locations for wireless stations. The navy JAPAN’S MILITARY STRENGTH 87 has been augmented by the addition of two vessels of the Dreadnaught type, and by several cruisers of almost equal strength, while preliminary naval estimates plan for two additional ‘‘ Dreadnaughts ” and two ‘“‘ Dreadnaught ” cruisers a year, beginning with 1909, and to continue until the navy shall have reached a “ desired strength.”’ One is somewhat at a loss definitely to determine just where the extraordinary sums which have been spent since the war on the army and navy have been applied. It seems probable, as is alleged, that some of the money has been put to indirect military uses; such as the so- called Oriental-Development Company, which is expected to export annually 4,000 Japanese to Korea and Man- churia to be there converted, it is stated, into gendar- merie to replace the standing army in those localities. There are some who regard this and similar moves as merely indirect methods of reinforcing Japan’s military strength on the continent without attracting attention. Significance also is attached by some to the fact that many army recruits of the 1906-8 drafts have been released after from three to six months’ service, which intimates a desire to make available a large number of men who possess some military training. These are but catch- straws, it is true, and may have no positive bearing upon Japan’s militant policy; but the East is now in a nervous state, and Japan’s slightest acts of this nature attract at- tention. CHAPTER VIII POLITICAL TENDENCIES IN JAPAN STRUCTURE OF THE GOVERNMENT — Basis OF POPULAR Par- TICIPATION — THE SUFFRAGE — THE PARLIAMENT — HousE oF Lorps—HovusE oF MREPRESENTATIVES— THE ELDER STATESMEN — POLITICAL PaRTIES— CONTROL BY THE OLI- GARCHY — POLITICAL CORRUPTION — GRADUAL AWAKENING OF THE Masses— THEIR EXPLOITATION BY THE OLIGARCHY — THE BurDEN OF TAXATION — POLICY OF THE SAIONJI MIN- IstRY — THE COMMERCIAL CLass— New Po tiTicaL Forces —‘ GOVERNMENT WorsHip”— THE EmprEror— THE Imn- PERIAL HousEHOLD IN TRADE AND FINANCE — GROWTH OF SoclaLIsM — PROSPECTS FOR REFORM — INFLUENCE OF WEST- ERN SENTIMENT. CERTAIN tendencies of the internal political situation of Japan indicate that the nation is rapidly approaching a point when it must choose between two widely diverging courses: whether to be controlled indefinitely by the aris- tocratic military oligarchy which now directs the Govern- ment, or whether to accept the guidance of a new party which primarily aims to develop, by peaceful means, the resources of the country. This question is interesting to the world both as an example of some forces in human evolution, and because the conditions which attend and must in time determine its course will decide, also, the policy of Nippon in the whole East. The forces which are pressing the nation toward a crisis are already sufficiently outlined to intimate distinctly that administrative reorganization, if it comes, will touch the 88 POLITICAL TENDENCIES IN JAPAN 89 foundation of the national edifice; and this invites some passing notice of the Government of Japan as it exists to-day, of its structural theory, and of the system by which this theory presumably is put into practice. While the Government has the outward form of a con- stitutional monarchy, it is an error to assume, as many persons do, that it approximates liberal principles as these are understood in America. ‘The form is here. There are a constitution, a responsible ministry, a Diet composed of two houses, and a judiciary which interprets and en- forces the laws. But scrutiny of the method through which these familiar entities administer government re- veals that the essence of liberal institutions is largely ab- sent. In framing a constitution for Japan it was natural and perhaps then necessary that the fiction of Imperial su- premacy, as the head and source of all authority, be adopted in the phraseology of the instrument. So the fact that the constitution apparently makes the executive, legislative and judicial branches mere appendages upon the Emperor’s authority and subject to his will might be disregarded if in practical administration of government the people exercised substantial control. But this is not the case. Under modern conditions the basis for popular partici- pation in administration of government is the suffrage, and in Japan the total number of voters in national elec- tions is under 800,000; less than 2 per cent of the total population, as compared with 25 per cent in France and 21 per cent in the United States. In addition to the aris- tocracy, the suffrage is granted to commoners under prop- erty and tax paying qualifications which confines its exercise to the upper and a limited middle class. The great labor- ing class, comprising go per cent of the population of the Empire, and constituting the productive force of the na- 90 THE FAR EASTERN QUESTION tion, is practically unrepresented among the voting section, and the only constitutional privilege which it has is the right of petition to the Throne. In constitutionally distributing the balance of power among the various classes, care was taken to circumscribe the influence of even this limited electorate. “he upper branch of the legislative body, the House of Peers, is composed of male members of the Imperial family and the hereditary nobility, some additional life members nominated by the Emperor for meritorious service to the State (usually military and naval heroes) ; and one mem- ber nominated by the fifteen electors in each Fu or Ken who pay the highest taxes, the nominations to be affirmed by the Emperor, such members to serve for seven years. The House of Peers thus is composed of a large majority of Princes and nobles, and a minority of members nomi- nated by a very limited and wealthy class comprised of less than 700 voters. The so-called popular branch of the Diet, the House of Representatives, is elected by gen- eral vote; that is, by the 1.6 per cent who possess the suf- frage. There are 368 seats, distributed among the forty- five cities and prefectures, or Fus and Kens; giving an av- erage of some 2,000 voters to a district which would have in the United States, on an equal basis of population, about 26,000 voters. The House of Representatives, therefore, lacks any essential democratic quality except that a democratic spirit is evinced by individual members; and really is an aristocratic body whose political aspirations are chiefly to further special interests, and secure a place in the ministry or a seat in the House of Peers. The Diet which together with the ministry thus directs the Government nominally is composed of parties. ‘These so-called parties are not exactly comparable to political parties in England, Europe and the United States; in POLITICAL TENDENCIES IN JAPAN 91 fact, Japan has not yet developed a system of govern- ment by party, although she has adopted the nomencla- ture of such institutions. The House of Peers scarcely has gone this far, for while its members sometimes divide into groups, none of these groups has developed any permanency or adopted a regular party name. The House of Representatives is divided into groups which take party names, but these names are not always carried over into a new Diet. This disposition affords a clue to the real relation of the people and the Government. The Gov- ernment is not, apparently, presumed to represent the people and to carry out their wishes; but in so far as the proletariat is permitted to participate in political matters it is in the attitude of being graciously invited by the Emperor to assist him in administering the Gov- ernment by nominating a few Peers and electing a House of Representatives, which will support the Emperor in caring for the welfare of his subjects. When a general election for a House of Representatives is ordered, the campaign usually is not carried on by parties or along party lines. Each candidate makes a personal campaign on his own issues. It is not until the new House is organ- ized that parties are formed, and their composition de- pends upon how the men who are elected will di- vide upon issues which come up for discussion. Thus party lines rest lightly, and parties are more a grouping of individuals for mutual advantage than means to promote definite political programmes. The present parties in the House of Representatives are: Seiyu-kai, Progressist, the Daido Club, the Yuko- kwai, and a number of scattering votes not attached to any regular group. Of these parties, the Seiyu-kai is the Gov- ernment group. The Progressist is the opposition. Of the two lesser groups, the Daido Club really is a branch of 92 THE FAR EASTERN. OL-ESTION the Government forces, although it poses as independent. Its nominal position in the House is the Center, and it holds the balance of power in most divisions, which gives it considerable influence. None of these parties has any definite principles or programme, and all are ready to trade votes with other groups as occasion may arise. The remaining factors in the Government are the Em- peror, the ministry and the Genro, or Elder Statesmen. The ministry is here organized much as elsewhere, usually being’ composed of men who represent different influen- tial political groups, and holds office until its resignation is accepted by the Emperor. In this matter authority rests with the Emperor, and the influences which direct his action are not always easy to trace. In any crisis it is usual for the Emperor to consult the Genro, and it is pre- sumed that he attaches great weight to its advice, although he has power to reject it. One hears in Japan varying opinions about the personality of the present Emperor. Many regard him as the usual figurehead, occupying him- self, after Oriental fashion, with sensual pleasures, and leaving the cares of government to his ministers. The Crown Prince is generally regarded as being dull, almost a booby, and is not entrusted with responsibility. The estimation in which the Emperor is held by the masses also is a disputed matter. Outwardly, he is venerated as the spiritual and temporal head of the nation; but indi- cations that this sentiment is only skin-deep may be ob- served, and an idea that the Emperor is used as a cloak for the oligarchy which really rules the nation is percolat- ing among the people. The Genro has no specific entity or regular membership, and is composed of distin- guished men who have no definite political position except seats in the House of Peers, and that gained through their personal influence. Count Okuma, himself an El- POLITICAL TENDENCIES IN JAPAN 93 der Statesman, recently said in public that the Genro has outlived its usefulness and must, with other obsolete forms, give way to more modern administrative methods. But Okuma is known to be a democrat at heart, and usually is found among the opposition. When analyzed, the Government of Japan is found to be entirely in the control of an aristocratic oligarchy, com- posed of the Imperial family, three or four of the greater clans of nobility, the military class, and a strata which in- cludes the chief financial and commercial groups together with minor representation of the superior business ele- ment. The House of Representatives, which is presumed to represent the popular influence in Government, real- ly, as now elected and organized, fails to do so. There is little doubt that seats in the House of Representa- tives may be purchased. This decline in political mo- rality is attracting attention in Japan, and several or- ganizations having as an object the purification of politi- cal methods are taking up the work. The last prefec- tural elections were attended, it is alleged, by such whole- sale coercion and fraud as to compel the attention of the ministry, and caused a leading vernacular newspaper to assert that ‘the Japanese political world is rotten to the core.’ It was openly asserted that votes were bought for two Yen, and seats in prefectorial assemblies were estimated to be worth Yen 2,600.00. I am, of course, not able exactly to determine the truth of such allegations, but evidence that modern forms of political corruption have found their way into Japan may be noted on all sides. It is probable, however, that the oligarchy might have continued to rule without being disturbed by any except internal dissensions had it pursued a conservative course and managed affairs with ordinary success. But the last few years have brought an awakening among the peo- 94 THE FAR EASTERN QUESTION ple of Japan, or at least of an influential segment of them, and the oligarchy is now confronted with a fight for a division of its power; indeed, its very existence is at stake, although perhaps not immediately threat- ened. Several major causes have contributed to create this situation. These are: the nationalization of indus- try policy; the diversion to the oligarchy, by means of subsidies and other forms of governmental preference, of most of the advantages and pecuniary increment which the national expansion is creating; the expenditure of so large a proportion of the national revenue for armaments; the increase of taxation which, as a direct consequence of the foregoing policies, has been indefinitely saddled upon the people; and the bringing of the nation to the brink of a financial precipice which is a result. The real crux of the trouble lies in the economic situ- ation of the country; but the causes which have reduced it to its present extremity need here be considered only in the light of their incidental political effects. One of the more conspicuous examples of exploitation of the people by the oligarchy is afforded by the encroachment of the Imperial Household upon commerce and industry of the nation. The extent to which the Household is interested in modern enterprises cannot exactly be ascertained for ob- vious reasons, but it is known to have large holdings (a controlling share in some cases) in two of the great ship- ping companies, two of the greater banks, an iron foun- dry, cotton mills, a paper mill, a lumber company, ship yards, and some minor concerns. With two or three exceptions, this interest has been acquired in the course of the sudden industrial expansion which followed the war. It is significant that all important enterprises in which the Household is interested derive heavy subsidies from the Government; indeed, in forming some of these POLITICAL TENDENCIES IN JAPAN 9§ companies it seems to have been understood that to enlist the Household was to insure direct Government support and backing. Corporations in which the Household is largely interested are not open to foreign investment, and are not included in brokers’ lists of the share market which are issued to investors. It is assumed that this exclusion of foreigners as shareholders in these corporations is to avoid possibility of litigation which might compel elucida- tion of their ownership and methods in court. Examina- tion reveals that a large proportion of the major activities of new Japan are virtually controlled by the element which composes the inner circle of the ruling oligarchy. In no other important nation is special privilege so strongly en- trenched as in Japan, or is able to deflect to itself so large a percentage of the wealth which the people create. This condition, which is here attended by the usual complexities, would hardly have attracted the attention of the ignorant proletariat had it not made necessary and been accompanied by imposition of burdensome taxation. When, during the war with Russia, the taxation, which ten years ago was less than Yen 6.00 per capita, was raised to Yen 15.00 per capita, popular discontent was assuaged by assurances that the increase was temporary, and that the nation would recoup by exacting an indemnity from Russia which would pay expenses of the war. Thus the people accepted the burden without serious objection, and readily invested their surplus funds in domestic war loans. The first shock came when it was learned that no indemnity had been obtained from Russia. The second came when the Government was compelled to extend the extraordinary war taxes for thirty years, with no assur- ance that they can be reduced even then. In this connection it is interesting to examine how tax- ation is distributed, In Japan, as in most countries, the 96 THE FAR EASTERN QUESTION indirect method of taxation is used whenever practicable; and in revising the fiscal system to meet the swelling bud- get this plan was adopted. In both the customs tariff and internal revenue laws an evident attempt is made to give an impression that the burden will fall upon the middle class, but scrutiny reveals that quite the contrary is true. To raise any considerable revenue, taxation must be placed upon articles and matters widely used. So analy- sis shows that while the middle class in Japan seems to bear the greater part of the burden, it is only a middle- man between the Government and the consumer who even- tually pays the tax. In adopting this policy the Govern- ment utilized the commercial class as a means of collection because it can be regulated and controlled, not that it bears more than its proportion of taxation. To assume that the camparatively well-to-do middle class in Japan pays a larger proportion of taxes is like asserting that tobacco and liquor manufacturers in the United States pay the internal revenue on their products because the Govern- ment, for its convenience, makes them the medium of col- lection. It is dificult to determine this matter with exact- ness, but I believe that the segment of the Japanese peo- ple which has no vote pays 80 per cent of the national and local taxes. ‘The proletariat in Japan to-day is in a state of political and industrial peonage, and really has less influence in the Government than has the moujik in Russia, or the coolie in China. After this glance at political conditions, some effects of the policy of the Saionji ministry may be better under- stood. The last Diet passed a budget which appropri- ates 40 per cent of the total revenue for armaments, and preliminary proposals for the year 1908-9 contemplate devoting 60 per cent of the revenue for this purpose. In order to carry out this programme, the Government pro- POLITICAL TENDENCIES IN JAPAN 97 posed and the Diet passed a new extraordinary tax law, which increases the per capita taxation to over Yen 16.00; and the increased schedules are not yet completed. This is the third in the series of shocks which has shaken popu- lar faith in the oligarchy, and started a movement to check its power and compel an alteration of the national policy. The forces by which this movement is propelled extend downward through all strata; but any hope for success de- pends upon that part of the commercial class which is not included in the preferential distribution of national sup- port, and which now finds that it is being seriously handi- capped by this discrimination. Although the masses are keenly conscious that their situation is growing worse, they have no direct means for political expression, except by riotous demonstrations. But the commercial class includes a majority of voters, and has a means for developing political cohesion ready to hand in the local and national chambers of commerce. When the extraordinary tax bill was before the Diet in 1908 a general agitation against it was begun by the chambers of commerce, which passed many resolutions condemning the economic and fis- cal policy of the Government, and took part, through the members which they could influence, in the attack upon the budget in the House of Representatives. The agita- tion failed, for the moment, to have any result except that the Government somewhat brusquely rebuked the guilds for mixing in political affairs, and warned them that fur- ther agitation might lead to revocation of their charters. This implied threat, however, only fanned the flame. Many of the guilds retorted that they have a right to be active in politics when the economic interests of the na- tion are under consideration, and intimated that they in- tend to take part whether they have a right or not. Steps were taken to contest the next general election for the 98 THE FAR EASTERN QUESTION House of Representatives on this issue, and the movement developed a vitality which causes the Government some uneasiness. In instituting this campaign, it was pro- posed, for the first time in Japan, to nominate candidates for the House of Representatives along party lines and on a definite platform advocating reforms. If this should be done it would carry the struggle for control of the lower house directly before the electorate and compel a popular discussion of the issues. The Govern- ment is anxious to avoid this, for no one can foresee what the effect would be upon a people just waking to a desire to convert the forms of popular institutions into a reality. Newspapers in Japan nowadays are openly criticizing the extension among the people of certain obsolete ideas, which are lumped under the head of ‘‘ Government wor- ship.” It is argued that this popular idea is injurious to progress of the nation along modern lines by making it dificult for any enterprise not directly backed by the Government to succeed, which is creating an industrial and commercial centralization calculated to eliminate competition and confine profitable enterprises to a favored few. In discussing the matter some native papers use the word “ superstition ” to describe this popular idea, and assert that superstition has no place in Japan today. As such criticism clearly touches the halo which surrounds the Imperial throne, and which is an important asset to the oligarchy in perpetuating its rule, it will be understood that such disposition is not regarded favorably by the Government, and in some quarters it is rebuked as being directed askance at the Imperial authority. Indeed, this may be true, for there are indications that socialism is taking root in Japan, and a powerful though ignorant cooliedom is beginning to clamor for its political rights. POLITICAL TENDENCIES IN JAPAN 99 While these incidental political signs forcibly strike the foreign observer, it is very doubtful if their potential force is now appreciated by the oligarchy. There is no doubt that the Government for months before its down- fall realized that the Saionji ministry must go. Marquis Saionji and his colleagues several times tendered their resignations, but were compelled to retain office until the budget and other administrative matters were got out of the way. The Government did not want a general elec- tion to come while its failure (from the Japanese view) in the immigration issue with America was in the popular mind, and while the agitation against increased taxation was strong. The election was first set for April, 1908; then it was postponed until June. The course of the Gov- ernment indicated that notwithstanding willingness of the Saionji ministry to resign, it would not bring on an election until sure it could carry it. The result of the general election held in June, 1908, conclusively demon- strated that, notwithstanding talk of serious opposition, the oligarchy is still in full control. The Government lost a few seats in the House of Representatives, but re- tains a substantial majority. While some foreign observers of Japan’s political insti- tutions and present situation believe that the views of the chambers of commerce will find substantial expression in the policy of the present and forthcoming ministries, I am unable to feel this assurance. However, an attempt is being made to give an impression throughout the world that Japan intends to call a halt upon the military party, which has, by imposing on the nation the expenses of large armaments, brought its finances to their present pass. The need to create this impression abroad is obvious, since it has been distinctly intimated that foreign investors are reluctant to contribute funds for an unnecessary military 100 THE FAR EASTERN QUESTION and naval expansion in Japan at the expense of activities which may resuscitate her depleted resources. But when one looks about in Japan for tangible evi- dence of a radical change of policy it is not easy to discover. It is difficult for Americans to conceive the arrogance of the military party there, although they may understand its reluctance to relinquish the place to which popular post-bellum enthusiasm for the army and navy raised it. Seeing the approach of the storm, the Saionji cabinet was anxious to quit office before it breaks, but was retained for a time because of the difficulty in forming a ministry to succeed it. Of the men who were suggested to succeed Marquis Saionji there is none who is not inti- mately associated with the military party. Marquis Kat- sura was several times invited to form a ministry, but was reluctant to do so, it is thought, because he apprehends the downfall of the present regime. Of others prominently mentioned, from time to time, for the premiership, there is none whose career does not warrant a presumption that he inclines toward the present order. It is probable that financial and commercial interests of the nation will have recognition in the policy of the new cabinet; but this does not necessarily mean a sincere reaction from present pol- icy, for most of the financial and commercial leaders are beneficiaries under existing conditions. It is quite likely that some of these men feel that the nation has been forced too far in this direction, and that some reformation is necessary to prevent disaster. They need not be ex- pected, however, to strike very deeply into the heart of existing evils. Of the Progressist party, it may be said that its opposition to the Government is that of the “outs”? to the “ins,” and is advanced more to embar- rass the ministry than in a truly reformatory spirit. It is significant that casual Progressist attacks upon the for- POLITICAL TENDENCIES IN JAPAN 1o1 eign policy are not because it threatens to embroil the na- tion with formerly friendly powers, but because it has not adopted a more belligerent attitude in conducting nego- tiations with America and China. Considering all the elements presently applicable to the situation, it is doubtful if political forces which can effect a regeneration of the Government now exist in Japan in a form so they may quickly be called into play; and that a ministry capable of really reforming the administration can now be organized. An attempt must be made, it is true; and that the Katsura cabinet took office attended by many fair promises was to have been expected, as prob- ably will be the case with its immediate successors. But the oligarchy and its concomitant, the military party, are too deeply rooted to be pushed aside easily, and none need expect that they will yield without a struggle, al- though they may temporarily bow to necessity to restore the national credit. But one can hardly doubt that Japan is nearing a parting of the ways. The forces of reform may distinctly be felt pressing upward from the bottom, and the struggle to break through the oligarchic crust can- not fail to attract the sympathy and notice of the western world. CHAPTER IX THE FISCAL SITUATION OF JAPAN Some RESULTS OF ECONOMIC INNOVATIONS — INTRUSION OF THE GOVERNMENT INTO BusINEss —ItTs CREATION OF ASSETS — NATIONALIZATION OF THE RAILWAYS — STALKING THE For- EIGN INVESTOR — OpTIMISM IN THE SADDLE—INCREASE IN CaPITALIZED INDUSTRIES — Basis FoR THIS EXPANSION — SHYNESS OF ForEIGN CapiITAL — Reasons FoR THis Dispost- TION — COLLAPSE OF THE “ Boom’ —FiscaL CONDITION OF THE NATION — INCREASE OF TAXATION — WAGES IN JAPAN — Proportion OF Per Capita TaxaATION TO EARNINGS — DeE- CLINE OF THE NaTIONAL OwnersHIpP PoLicy — DISCONTENT OF THE PEOPLE— EXTERNAL PRESSURE Upon JAPAN—-A Crisis APPROACHING. IN attempting to estimate Japan’s position among the powers, the economic condition of the nation should be considered. ‘This induces some further examination of her modern activities, and of antecedents of the commer- cial and financial depression which followed and is partly a result of the new policy. Enough time has elapsed since this economic innovation was inaugurated to indicate some results of it both exter- nally and internally. The external results are significant, but perhaps they may better be viewed from a different angle. It is the internal effects which have more directly contributed to create the crisis through which the national economies are now passing, and with which the Govern- ment is compelled to reckon before it can aggressively proceed with prosecution of external expansion. 102 THE FISCAL SITUATION OF JAPAN 10% While there are many correlative forces, the intrusion of the Government into purely business affairs of the country is a principal cause of the trouble; which makes a brief review of the progress of the national ownership policy pertinent. It has been said that in adopting this policy Japan introduced no novelties — only extremities; and this is substantially true. And the circumstances which attended its initiation, as already has been pointed out, conclusively intimate that expediency played a deci- sive part in its adoption. ‘The first pressing need of the Government after the war was revenue; and a Govern- ment obtains money, as a rule, in two ways: by taxation and by borrowing. It had been necessary to hypothecate most of the available assets controlled by the Govern- ment to secure foreign war loans, and it was felt that it was not practicable to immediately again increase tax- ation. On the contrary, the Government, then facing the popular indignation which failure to get an indemnity roused, felt it necessary to defer announcement that the extraordinary war taxes must be indefinitely continued. In this extremity the Government set to work to create assets amenable to its control and which it might if oc- casion demanded hypothecate, and also to attract for- eign capital to the support of Japanese enterprises. It is not necessary here to examine in detail the various meth- ods pursued to accomplish this end, since the purport of the policy may be illustrated by a few pertinent examples. Among these is nationalization of the railways, and the method which was employed in this case is interesting. The Government arbitrarily took over the railways at a valuation, paying for them with bonds. The project en- countered strong opposition, but the measure was forced through the Diet, the occasion of its passage being at- tended by disorder in the House of Representatives. 104 THE FAR EASTERN QUESTION In this way the Government secured properties which can be made to produce considerable revenue, since there is no competition, and which may, in a pinch, be further hypothecated to secure a foreign loan. Stim- ulated in many cases by governmental assurance of in- terest on their bonds, numerous industrial projects were capitalized, and an attempt made to induce foreign capital to invest in them. For a time this plan had some success, but the support of the Government was so obviously a plan to aid Japanese enterprises to enlist the support of foreign investors that it soon lost force and effect, and in time produced a reaction. But during the period when optimism was in the saddle, which continued for at least a year after the war, the com- mercial and industrial activities of the nation experienced an enormous inflation. Recent statistics show that since July, 1905, the total capitalization of new enterprises is Yen 1,843,224,240.00; of which Yen 1,307,758,800.00 is invested in new enterprises, and Yen 535,465,440.00 is increased capitalization of concerns which already ex- isted. An idea of the economic ratio of this expansion to the normal commercial and industrial condition of Japan may be given by stating that this increase of cap- italization, which immediately followed an exhaustive war that more than quadrupled the national debt and tripled general taxation, amounts to one-sixth of the es- timated total wealth of the country when the war began. It is perhaps hardly necessary to say that this astound- ing expansion is more apparent than real, and was to a considerable extent accomplished by the familiar process of “watering.” To the extent that they possessed re- sources, the Japanese enthusiastically threw themselves into the “‘ boom” movement stimulated and directed by the Government. In now attempting to explain the Gov- THE FISCAL SITUATION OF JAPAN fos ernment’s reason for so actively taking control, it is as- sumed that Japanese are deficient in modern industrial in- itiative, that they always have been accustomed to follow the lead of the Government, and that unless the Govern- ment had taken the lead it would not have been possible to so quickly stir the people to action. This may be true; but the Government has actively promoted many enter- prises with which governments usually do not concern themselves. In stimulating national enthusiasm, Man- churia and Korea were represented as great potential as- sets, and Japanese were encouraged to emigrate to those countries. The movement did not progress far, however, when it began to appear that the factor chiefly relied upon to pro- vide the sinews of war, namely, foreign capital, was be- coming shy. There were many minor indications of this as the “‘ boom” advanced, but the first serious check to an enterprise directly fostered by the Government was the fail- ure of the South Manchurian Railway loan. The manner of first advancing this project revealed clearly, to one acquainted with conditions in Manchuria, that it was grossly overcapitalized, and that a large part of its alleged assets consisted of property of uncertain value and whose title is in dispute with China. After being tentatively ad- vanced in three western countries, with no success, the pro- posed loan was withdrawn as originally presented, and the last announcement was that the Government has decided to itself finance the project. The political and practical considerations which, by undermining Japan’s credit abroad, have contributed to bring her national expansion policy up with a round turn, have already been partly reviewed, and are essentially ex- ternal factors. Briefly, they turn upon suspicion and re- sentment in the West at Japan’s policy in Manchuria and 106 THE FAR EASTERN QUESTION Korea, and realization in some quarters that western cap- ital loaned to Japan is in her hands being directed against western interests in the East. Whatever may have caused the change, western investors now have an aversion to Japanese securities. “To some extent the financial depres- sion in the United States, in the year 1907-8, and which affected the European market, may be presumed to have helped to precipitate a crisis in Japan. But it is reason- ably sure that the new expansion movement had lost mo- mentum before the so-called panic struck America. Experience frequently has demonstrated that nothing will collapse more quickly than a “boom” which has exceeded its legitimate basis, and reaction in Japan took the usual course. The spirit of optimism was succeeded by a period of doubt, quickly followed by one of appre- hension. ‘This inevitably led to a scrutiny of the Gov- ernment’s policy, which is now being subjected to severe examination. A result is revelation of a condition which well may cause the most optimistic believer in the fortu- nate destiny of the Empire to pause and take stock before advocating continuance on the present course. Of vital importance in this connection is the financial condition of the nation. The national debt is now ap- proximately Yen 2,617,000,000.00, and the annual in- terest charge is Yen 166,000,000.00; which means a per capita debt of Yen 45.00, and an annual interest charge per capita of Yen 3.50, or about 8 per cent. per capita of annual earnings. While there is nominally a sinking fund to liquidate the debt, investigation shows that the exist- ence of this fund is due to manipulation in bookkeeping, and that it is to some extent a financial fiction. Although the admitted deficit in fiscal accounts for the year 1907-8 is not large, it was asserted in the Diet that it will reach Yen 120,000,000.00, which must be cared for by the new tax- THE FISCAL SITUATION OF JAPAN 107 ation. The apparent deficit is less than this sum, but cer- tain estimated revenues, such as those derived from some Government monopolies, are believed greatly to be exag- gerated and based upon expectations not likely to hold good if present conditions continue. It may occur to some that this debt is not a very great burden for a nation in modern times; but such matters are comparative, and Japan’s financial situation must be judged by her resources. These in turn depend upon her national productiveness, as expressed in earnings of the people who must pay the taxes. The new extraor- dinary taxation law raises the annual per capita taxation to Yen 16.00 ($8.00), which may not strike Americans as burdensome. Let us examine the situation of the aver- age Japanese taxpayer. In 1904 an economist estimated the monthly economies of an average Japanese family, consisting of man, wife and two children, as follows: EXPENSES. House: tent ss cathe e See es Yen 0.75 Ri@e cater a ists Sui ees attra) Gane 3.25 Pel and light. scccsccaceesaccuuadors -4I Vegetables: oc. eee iw aiid ciety .60 Nish led eet ce alates aicnceen elude acetal eh aaa .60 Soy amd: Mists sina enaa ale tae 228 “WOBACCO) sawrecavicigd inode AGdeoee tices .25 » Hair Cutting, €t@cs cee seeesee cenngne .18 Bath? xa kawtiee ae cine Hee tabiy sree .20 Panic AONE Y. acdc aisle Bars Gen teaver eelaceie Sadece .60 Sundries, including interest on debts.... 2.39 Total 23acccwiiadenccttae eats Yen 9.44 Monthly income .................. 8.28 Dents, advo tase ieee iets Yen 1.16 108 ‘THE FAR EASTERN QUESTION If this accurately represents the income of a lower class Japanese family, such a family will to-day be paying an annual taxation of 65 per cent. of its income. ‘This esti- mate was made in 1904, and it is generally agreed that since then the earnings of the poorer classes have in- creased. No one seems to have gone into the matter with the care of the investigator whose estimate is quoted, but since 1904 the foreign trade of the nation has in- creased 58 per cent., and it is assumed that the productive capacity of the country has advanced in about equal pro- portion. It is also, however, true that the average cost of living has increased, chiefly due to a rise in the price of commodities caused by raising the import tariff; or, in other words, is indirectly due to increased taxation. Well informed people differ as to how much wages have ad- vanced since the war, and the following extracts from an official report recently compiled may be taken as an ap- proximation of the facts: MEAN WAGES OF WORKMEN IN JAPAN. Bricklayers . ccc. .seeeeceee es Yeno.60 per day. Masons we vensteneea wy acece au -50 Blacksmiths .o2s.0c2s00ss 0% 45 IPFINtOTS! 5 2a3icse aioe Wiebe oasse -53 Carpenters: 2. i450 dbaderecivwie .70 Weavers og :c6eiaweseoe oe ynes =33 Silversmiths: Avciocews weweeens -45 Shoemakers .............+-- -55 These are wages paid in Tokyo, where they are higher than is usual throughout the country. Monthly wages in Tokyo are as follows: THE FISCAL SITUATION OF JAPAN 109 MEAN MONTHLY WAGES IN JAPAN. Sake=distillers: wan cikusdy Wa ete gans Yen 7.00 Menservant’: ca.caeie Reeve owes ached 3.32 Mardservant’. soc. c4cecagadausa ems acs 2.92 Silk-worm breeders.............0.0005 9.00 Raw: silk spinners..4.4.. 06.040 cease a be 6.55 Pari: laborers: s.2.5.5.$5 3-3. coated ce aes 2:33 These figures show a slight increase over wages paid before the war. Several persons whom I have ques- tioned estimate the average earning of a Japanese family of four in the lower class at Yen 160.00 annually, which requires the children to work. None whom I asked placed the figure higher than Yen 200.00 annual income. Taking Yen 160.00 as a fair average, the average Japanese now pays 40 per cent. of his total earnings in taxes. Other comparisons may contribute some light. In five years the unproductive charge upon the earning ca- pacity of the people, including interest sent abroad and military and naval expenses, has increased from Yen 119,- 000,000.00 to Yen 359,000,000.00, while the population has increased 5 per cent. [he comparative increase of certain pertinent items in the national economies from 1898 to 1908 follow: Increase of population............. 8 per cent. Average increase of earnings....... 30 “ Increase of taxation............... 400 7 It may be assumed to be possible for superior states- manship to extricate a nation from this situation by adopting a policy at once reassuring to its creditors and calculated to restore fiscal equilibrium by economy in the expenditures of the Government, and by beginning a re- construction of industrial conditions from the bottom up. But there is little evidence that the Japanese oligarchy 110 THE FAR EASTERN QUESTION realizes the imperative necessity for such reformation. On the contrary, the Government persists in its policy of try- ing to lift the nation to power and prosperity by tax- ing the people to subsidize industries which the Govern- ment desires to promote, often without proper consid- eration of whether they can be made profitable. An example of this is afforded by the Imperial Iron Works at Wakamatsu. In the course of a recent inquiry into the condition of this enterprise before a budget sub-com- mittee, it was revealed that during the ten years of its existence it has cost the nation Yen 56,412,000.00, with no reasonable prospect that it will become a paying busi- ness. The chief reason for establishing this foundry was the alleged necessity for certain materials required for the army and navy to be produced in Japan. Shipping lines in which the Household is interested now receive sub- sidies amounting to treble the annual dividends which they pay, and it is proposed to increase this subsidy. None of the conspicuous instances of Japan’s Govern- ment ownership policy has caused such popular dissatis- faction as the nationalization of the railways. From all parts of the country now come complaints that the Gov- ernment is permitting the railways to run down, that the service is bad, and inadequate to meet the business needs of the nation. It is known, also, that in other in- dustrial enterprises backed by the Government dividends have been paid out of subsidies when the concerns were not earning a profit, and by permitting upkeep and im- provement to lapse. The publication of such matters in Japan gradually sapped public confidence and brought on a period of liquidation. The year 1908 witnessed a large number of business failures, and hardly a month passed without bringing to the surface facts which im- paired the standing of some prominent bank or firm. THE FISCAL SITUATION OF JAPAN 111 Comparison of leading securities with quotations of the same period during the previous year shows an average depreciation of about 35 per cent. The money rate has steadily advanced for three years. Few new projects are being actively pushed, and there is stagnation in most important lines of business. This condition is attributed by some partially to increased taxation, which, by raising the price of commodities, has had a tendency to diminish consumption. Confronted by this condition, the Government seems to recognize that it must modify its fiscal policy, but there is divergence of opinion as to the plan to pursue. The situation quickly could be relieved by striking out of the budget the extraordinary expenditure for armaments, but the military party has so far refused to yield an iota in its demands, and has succeeded in forcing its budgets through the Diet. However, something must be done. In the course of the next few years, a succession of for- eign bond issues must be met, and difficulty in refunding is anticipated. Japanese financial interests are uneasy concerning the situation, although they publicly profess op- timistic views. It is feared by the Government that Eu- ropean investors will insist upon the employment by Japan of a foreign financial adviser. To be required to thus again take a seat in the class, after all that has been said about Japan’s ability to teach the West, will be so galling to Japanese pride that the Government will give any as- surance or grant almost any terms to avoid it. It is, I think, becoming appreciated in Tokyo that if Japan wishes to retain the confidence of western investors she must do something else beside borrow money and in- crease her armaments. With conservative administration and a revulsion from certain centralizing tendencies, there is a field for legitimate investments in Japan, but it is 112 THE FAR EASTERN QUESTION becoming evident that many enterprises actively pro- moted and supported by the Government are indirectly aimed at western industrialism. The need of effort to avert a collapse of her policy may compel Japan to at- tempt reformation, but it is doubtful if this will be sin- cerely undertaken except as it is induced by external pres- sure. CHAPTER X FOREIGNERS AND FOREIGN INVESTMENTS IN JAPAN THE OPENING OF JAPAN — INTRUSION OF FOREIGNERS — ESTABLISHMENT OF ‘THEIR STaATUS— THEIR INFLUENCE Upon THE PEOPLE AND NaTION — THE ABOLITION OF ExTRA- TERRITORIALITY —- ALTERATION OF CONDITIONS — PERSONAL RIGHTS OF FoREIGNERS— TREATIES, Laws AND THEIR EN- FORCEMENT — CHANGE IN SENTIMENT AMONG JAPANESE — REASONS FoR THIs CHANGE — ATTITUDE OF JAPANESE CourTS Towarp ForEIGN RESIDENTS — ExcLUSION OF SOME CLASSES — Property RIGHTS OF FOREIGNERS— BASIS FOR FOREIGN INVESTMENTS — DEFECTS IN THE LAws— INDUCEMENTS TO ForEIGN INVESTORS — PLACING JAPANESE SECURITIES ABROAD — WESTERN INFLUENCE UPON THE DEVELOPMENT OF JAPAN’S INDUSTRY AND TRADE— FOREIGNERS STILL NEEDED. THE discussion which, during the last two years, has attended the relations between Japan and the United States, has had a tendency to bring into prominence is- sues bearing upon the status of Orientals in western coun- tries, and of Occidentals in eastern countries. Much has been printed about alleged mistreatment of Japanese who reside in America, and an impression sown broadcast that the Washington Government is delinquent in its treaty obligations, and that Americans are disposed to adopt an attitude offensive to Japan, which gives that nation some just ground for diplomatic complaint. Little, however, has been said about the status of Americans and other for- eigners in Japan and in regions temporarily or permanently 113 114 THE FAR EASTERN QUESTION under her control. This phase of the matter possesses at least equal importance in any correct estimate of the inter- national balance, and in view of the persistence of the dis- cussion and the dissemination thereby of numerous miscon- ceptions, it may be interesting to examine the reverse of the picture. The residence of foreigners of western origin in Japan dates from the early activities of traders and mission- aries; but for the purpose of this discussion it is not necessary to consider their condition and status before the movement which has resulted in Japan taking place among modern nations was begun, a period extend- ing back, approximately, half a century. Modern inter- national relations between the West and Japan really date from the time when her foreign commerce began to de- velop, and its possibilities came to be appreciated by Japanese. Commercial reasons, which need not be re- viewed here, led to the residence in Japan of foreigners in considerable numbers. ‘The presence there of foreign colonies and the need of regulation of foreign trade caused the promulgation of treaties, which stipulated the conditions under which westerners might reside and do business. The earlier treaties were based upon the principle known as “ extra-territoriality.” Under extra-territorial- ity there was a great development of Japan’s domestic and foreign trade, and the nation made steady strides along the path of modern progress. It would be too much to say that in accomplishing this transition the foreigners took a predominating part, but it is certain that they were largely responsible for it, and that by example, advice, and active assistance they materially contributed to the result. This was the period during which the founda- tions for the New Japan were laid; and while foreigners INVESTMENTS IN JAPAN 11S could not have constructed it by themselves, it ts probable that it never would have been built without their presence and influence. When Japan felt ready to take her place among the nations on equal footing, she petitioned the powers to abolish extra-territoriality, which was granted, (not without misgiving,) and new treaties substituted. The treaties which now define the relations between Japan and other nations vary somewhat in minor details, but do not, as a rule, depart from the customary formula. By consenting to abolition of extra-territoriality, which they could then have continued to impose upon Japan, the western nations accepted her assurance that such provi- sions were no longer needed to assure to foreigners resid- ing in Japan security for person and property and equality under the law. In setting Japan completely upon her diplomatic feet the United States took a prominent part. Consideration of the present legal status of foreigners in Japan may be simplified by dividing the subject into two general headings — personal rights and property rights. Broadly speaking, the personal rights of foreign resi- dents in Japan are presumed to be the same as are en- joyed by foreign residents in western countries. This is stipulated by treaties. But a treaty is only a sort of international contract, and cannot be directly applied to the domestic administration of a nation. In practice it 1s only the law of the land which specifically applies. While laws which run directly contrary to the wording or spirit of an important treaty are seldom wittingly enacted, it is well known that the actual effects of laws in any country must be sought not in their phraseology, but in the way they are interpreted and administered. In civilized countries personal rights turn, as a rule, upon ordinary conditions of life; liberty as to time and 116 THE FAR EASTERN QUESTION place of residence, equality in respect to the conditions surrounding and circumscribing existence, business and social relations. None of these is a fixed element any- where, and in respect to foreigners in Japan there has been a constant evolution accompanied by some illumi- nating manifestations. In the beginning, foreigners were regarded by Japanese as superior persons, worthy of emu- lation, and capable of imparting valuable instruction. They not only were tolerated, but were for a long time regarded as being indispensable to the progress of the country. Foreigners assisted in the administration of government and the revision of laws; supervised construc- tion of railways and the installation of modern conven- iences; directed the construction of manufacturing plants which were industrially to resuscitate the nation. For- eigners formulated the nation’s commercial activities upon a modern basis, formed a nucleus upon which finan- cial stability could be built, and through which a bet- ter conception of commercial morality might be dissem- inated. The foreigner was the avenue through which foreign capital, so badly needed to finance the new activi- ties, could be introduced. In fact, the foreigner was use- ful in a thousand ways. But as conditions in Japan have gradually shifted, so have shifted the views of Japanese about foreigners and the attitude of the Japanese Government toward them. As Japanese learned the methods of westerners and be- gan to feel confidence in their own efficiency in modern ways of endeavor, they developed a disposition to dis- pense with the advice of foreigners, and also to resent their presence in Japan to the extent that it results in activities which Japanese might otherwise monopolize or involves competition with Japanese industry and commerce. We are here concerned not with the justice or injustice of this INVESTMENTS IN JAPAN 1 disposition, but only with the fact, which cannot success- fully be disputed. That in issues between foreigners and Japanese the for- eigners can appear in Japanese courts only at a disadvan- tage, especially when the matter involved is too trivial to become the subject of diplomatic representations, has long ago passed into a proverb among residents of foreign colonies in Japan, and is so well recognized that foreign- ers will submit to any tolerable injury before they will re- sort to the courts. Only in recent years, however, since the presence of foreigners has begun to touch the edges of Japan’s internal industrial situation, and their direction of important enterprises has begun to rub the growing self-pride of Japanese, has the Government resorted to direct and indirect methods to render their situation un- comfortable and unprofitable. To illustrate fully this tendency would require elucidation of many laws, and hundreds of legal rulings made by Japanese courts, and citation of numerous cases in point, space to do which here is lacking. While this tendency had been noticed and made the subject of much bitter complaint, it did not fully develop until after the war against Russia, which had the effect of dispelling in the mind of the average Japanese all lurking doubt of his ability to cope with the westerner on equal terms. Since the war legislation has been enacted which has the thinly disguised object of put- ting pressure upon foreign residents. The fact is, in my opinion, that the only foreigners who are wanted in Japan to-day are tourists and sojourners, whose financial contri- butions represent quite an asset to many classes. Since much of the discussion about the situation of Jap- anese in the United States turns upon that class denomi- nated as laborers, it is interesting to consider a ruling of a Japanese court, made before the controversy about Jap- 118 THE FAR EASTERN QUESTION anese immigration to the United States and Canada arose, which placed a limitation on the treaty clause guar- anteeing to foreigners the right to reside and do business outside the former foreign settlements, by especially ex- cluding artisans and laborers. As a result of this ruling, which undoubtedly was made at the instigation of the Government, (being bascd on an Imperial ordinance,) a foreign artisan or laborer cannot engage in his occupa- tion outside of the former concessions without special per- mission from the Minister for Home Affairs, which per- mit, if granted, may be revoked at any time. ‘The great Japanese shipping lines and commercial houses long ago commenced the removal of foreign employes, and are rap- idly replacing them with Japanese. The economic reason which applies to foreigners of this class (i. e., that Jap- anese will work cheaper,) does not equally apply to the exclusion of skilled foreign artisans and laborers, for whom there now is no substitute in Japan. It seems clear, then, that this action of the Government, through the courts, was a concession to Japanese labor guilds, which at present are animated by a strong anti-foreign (they call it patriotic) sentiment. The occasion for this ruling was, I believe, the desire of a foreign corporation engaged in establishing a manu- facturing plant to employ foreign artisans to install machinery and other appurtenances, as it had long been the custom to do. A Japanese firm which had proposed without success to undertake this work invoked the clause of a treaty which concedes to each nation the right to con- strue its provisions so they shall not interfere with a na- tion’s police power, or the laws, ordinances and regula- tions with regard to trade, or to the immigration of labor- ers. Since the policy of the Government to establish all im- portant enterprises in Japanese hands has developed, in INVESTMENTS IN JAPAN 11g many instances foreign firms and foreign-owned corpora- tions have been involved in specious litigation with the evident purpose, and frequently with the result, of com- pelling them to sell to Japanese purchasers. It may be pointed out, in this connection, that, after all, these matters are but pin-pricks; that a government should be permitted to regulate its internal affairs, and that if foreigners in Japan fret under the conditions which cir- cumscribe their residence there they always have an al- ternative, if not a remedy, by moving elsewhere. As a general rule this is perfectly true, although many seem to have overlooked its bearing upon Japanese in the United States. But some aspects of the status of foreign property rights in Japan and in regions now controlled by Japan have a wider bearing, and cannot thus be dismissed. In civilized countries the conditions under which prop- erty may be acquired and held are the basis for indus- trial and commercial activity and general prosperity; so it followed, naturally, that in making it difficult for foreigners to secure a stable foothold in Japan, the Goy- ernment chose this medium. I have before me a treatise and digest of Japanese legal codes, and the western pro- totypes (chiefly German) from which they were de- rived, but it is not necessary specifically to examine them here. Formerly a foreigner could not acquire real property in Japan, except within the limits of the foreign settlements. The Government soon learned, however, that the much-desired foreign capital would not enter the country under these circumstances, and so the law was modified by creating a legal fiction known in Japan as a juridical person. Put understandingly to the lay mind, this juridical person must be a Japanese, in whom actual title to any real property owned by a foreign individual or corporation is vested. When this law was promulgated an 120 THE FAR EASTERN QUESTION attempt, (passably successful,) to reassure foreign in- vestors was made by representing that this was merely a way of getting around an ancient Imperial law which forbids alienation of the national domain, and that prop- erty can be securely held under such a title. It formerly was also impossible for a foreigner to take a valid lease upon real property, and here again an equivo- cation, or what practically amounts to one, was resorted to by the creation of a right in land called superficies. Superficies, as a right in land, is, I believe, unfamiliar to British and American jurisprudence, although in some of our older States there exists a partial equivalent in a sort of ground rent. As outlined by Japanese law, superficies is a form of leasehold of vague and uncertain character whose intricacies, if examined in full, would only cloud this discussion. Its chief defect seems to be that the exist- ence, in reversion, of a right of escheat vested in the Gov- ernment, makes tenure uncertain and almost amounts to a definite cloud upon title. Several cases involving this superficies in which foreigners are implicated have been dragging along in Japanese courts for years, with little prospect of a satisfactory (to the foreigners) settlement. A foreign authority on Japanese law who has long resided in Japan told me recently that in his opinion superficies is not legally sound, from the standpoint of the foreigner, either as security or investment. On the face of the statutes the title involved in the juridical person seems more secure, and it at present represents the better legal basis for foreign investments and property rights in Japan. But it is by no means satisfactory to foreigners there, who find it necessary to place their interests to some extent at the mercy of Japanese. Cases involving the use of the juridical person when foreigners either have lost their INVESTMENTS IN JAPAN tot property or been put to great expense and vexatious litiga- tion to secure it might be cited by hundreds. Several years ago John Schroeder, a foreigner who has long resided in Japan and is happily married to a Japa- nese lady, and who has studied the economic situation of the country, was requested by a European economic jour- nal to define the status of foreign investments there. He summed up the conditions and questions involved as fol- lows: ‘“The points, then, where the basis for foreign invest- ments in Japan is defective, or insecure, are: ‘“t. The reversal of the common order of things in all matters of labor, in that the demand for skilled labor is always far in excess of the absolutely insufficient supply. ‘9. The absence of laws regulating the relations be- tween masters and servants, and the absence of courts in which disputes and differences between masters and serv- ants can be quickly and cheaply settled. “3. The impossibility of filling the deficiency in the supply of Japanese skilled labor with competent foreign labor, on account of regulations hampering the introduc- tion of foreigners, and the exorbitant cost of living for foreigners in Japan, who are surrounded by rings of Jap- anese dealers in league with Japanese servants to defraud their employers. And when the new tariff [this was writ- ten before Oct. 1, 1906] comes into effect the cost of liv- ing for foreigners will be further enhanced from 40 to 50 per cent., as the heaviest increases are upon articles principally consumed by foreigners. Everything seems to point to the fact that Japanese policy is directed to- ward closing the country to foreigners so far at least as permanent residence is concerned, by creating a condition 122 THE FAR EASTERN QUESTION which will make it unprofitable for foreigners to live and carry on business in Japan. This is the opinion of for- eign merchants with whom I have spoken on the subject, and it is my own opinion. As things now are, there are few foreigners who do not regret that they ever came to Japan to reside. ‘4. The fact that foreigners may not purchase and own real estate in Japan, except such lots of land in the small former foreign settlements which are held under the old title deeds, so that no permanent enterprises to which the ownership of real estate is essential or indis- pensable can safely be undertaken by foreigners in Japan. ‘“s. The defects in the legal codes, and the still greater defects in the administration of the codes by the Japanese courts, which tend to make business in many cases an unqualified risk, so that many foreign merchants refuse now to enter into new lines of business and to accept new connections.” Personal investigation in Japan has convinced me that the views of this writer, who is well known and re- spected, are those of the major part of the foreign busi- ness community, although under existing conditions most foreign residents hesitate to express them publicly. Some tolerant critics of Japanese character attribute the dis- position of Japanese courts to lean toward the interests of their own nationals in litigation between them and for- eigners to unconscious rather than calculated partiality, and as based upon traditions of Oriental jurisprudence which the West does not fully understand or appreciate. This charitable view does not, however, alter effects upon foreigners who are compelled to seek justice in Japanese courts, either in regard to personal or property matters. INVESTAIENTS IN JAPAN 123 Japan is still far from the stage when her torch of civiliza- tion can enlighten the world. In view of the general attitude of the Japanese Gov- ernment and people toward foreigners who reside there, and toward foreign investments in Japan, the optimism with which some phases of the new national activities were advanced causes astonishment. Especially is this true of Japan’s effort to induce the extensive investment there of foreign capital. The method by which the Govy- ernment stalks the foreign investor operates, as do so many of Japan’s new activities, through the banks. It is usu- ally something like this: a stock company will be organ- ized, its stock duly subscribed for, and part of the capital paid in. ‘Then bonds will be issued, and placed, if the Government is supporting the enterprise, with the Nippon Ginko or one of the other Japanese banks which have branches and agencies throughout the world, to be pre- sented to foreign investors. The Japanese bank will not do this directly. It will split up the bonds in portions to be distributed in various countries, as the financial and political situation seems to warrant, and allot the portions to agents or correspondents of the Japanese banks in those countries. For instance, the bonds of an electric lighting and power company with a charter to conduct business in Japan, or of a concern holding a mining con- cession in Korea or Manchuria, may be sent to a bank- ing house in Wall street, which is the correspondent, let us say, of the Nippon Ginko. These bonds, by means of the customary process, will be offered by the American bank or house to its customers through its regular chan- nels, with the statement that the Japanese Government guarantees interest on the bonds. To the average inves- tor in such securities this probably will be considered 124 THE FAR EASTERN QUESTION satisfactory, and he may put his surplus funds, if a bet- ter investment does not just then offer, into the bonds. This money goes to Japan, less the commission of the American concern (usually very liberal. In the case of some of the Japanese foreign loans it netted nearly three per cent.), and there helps to finance the new national sys- tem. Foreign investors in such securities may figure that even if the enterprise, of which they probably know noth- ing, should fail to make money their interest is assured; and under ordinary circumstances this would be true, since governments nowadays habitually meet their obligations. But clearly here is a different condition. ‘The Japanese Government is going into this thing on a large scale; which means that it is really taking the same chance as the foreign investor in the success or failure of the en- terprise. If the Japanese Government had unlimited financial resources it might not be seriously affected by any miscarriage of its scheme. Under its present fiscal circumstances, it is possible that if the new system fails the finances of the Japanese Government will go down with it. In this connection the status of foreign investments in Japan becomes pertinent, for if enterprises in which for- eign capital is invested cannot be operated at a profit and consequently fail, the only security for the capital will be whatever property may be owned by the corporation. Assuming that such a company fails, this question will arise in cases where the interest on its bonded debt is guaranteed by the Government: Is the Government, after the company has gone into bankruptcy and ceased to operate, obligated to continue to pay the interest on the bonds of an extinct enterprise? I put this question to a foreign lawyer in Japan, of many years’ experience in INVESTMENTS IN JAPAN 126 practice there, and he declined to express a definite opin- ion on the legal point involved, but he said: ‘““In the long run it would depend on what kind of a settlement the investors could make with the Govern- ment.” To put it flatly, the attitude of Japan toward the for- eign investor whom she hopes to induce to financially support her new economic system amounts to this: ‘“We want your money, but you must absolutely trust it to us.’ The present disposition of the Japanese Govern- ment toward foreigners, as exemplified by their legal status in Japan, hardly justifies foreign investors in accept- ing this condition. Examination of Japan’s industrial situation reveals that it is entirely founded upon western forms, and that it is still largely dependent upon western ideas for vitality. This is particularly noticeable in respect to her export trade, of which the United States takes 30 per cent., our country being Japan’s best customer. While the use of Japanese curios is extensive in America, and gives a su- perficial impression that they are an important item of export, such articles really are unimportant in comparison with Japan’s staple exports upon which her new trade expansion is founded. Articles made in Japan which have a large and steady sale abroad are chiefly utilitarian, and in manufacturing them western habits and taste must be considered. Many factories in Japan depend entirely upon foreign consumption. Speaking to me recently about this phase of Japan’s development, an American who has had twenty years’ experience as an importer of Japanese products, and who makes an annual visit there, said: ““T notice among Japanese commercial classes a grow- ing disposition to assume that they can now dispense with 126 THE FAR EASTERN QUESTION western advice and ideas. ‘This is a very short-sighted view. Take the products which I import to America. None of them is in any way necessary to my customers. We have taught them to buy them by cultivating a taste for them, and by inducing Japanese manufacturers to follow our ideas and designs. Indeed, I may say that many important articles of export from Japan have sprung entirely from the brains of foreigners. Japanese them- selves would never have thought of doing half the things which now constitute their modern industrial system, and where they are in error is in assuming that in the future they can dispense with western brains. J brought over this time more than fifty new designs and ideas to be put into effect here, and to the extent that they become popu- lar they will make for Japanese trade. Most Japanese goods which we sell are articles which we have thought of and induced them to make. Unless we continue to push these articles our customers will substitute others. For twenty-five years western commercial and industrial ideas have been flowing into Japan and contributing to the stim- ulation of her industry. A trouble with Japanese to-day is that they now assume that they have done all this them- selves, and do not seem to realize that if, for any reason, this injection of western ideas should stop it will mean the deterioration of Japanese trade and industry. Indus- trially, Japan has contributed practically nothing to the West, while the West has given freely to her of its best ideas and knowledge, and will continue to do so unless they are rejected. I believe that if it was possible to again isolate Japan, and entirely cut her off from contact with the West and western ideas, fifty years from now would find the nation back where it was fifty years ago.” It may be that this American has an exaggerated view of the part which the West has played in creating the INVESTMENTS IN JAPAN 127 Japan of to-day, and underestimates the initiative qualities of Japanese, but many westerners who have long resided in Japan hold similar views, especially those who have devoted time to studying the industrial aptitude and meth- ods of the people. Comprehension of her real relations to the West may in time be restored in Japan, and perhaps improvement of the situation of foreigners there will be among its results. In estimating some matters Japanese are a bit out of perspective just now. CHAPTER XI THE SUBJUGATION OF KOREA EsTaBLISHMENT OF JAPAN’S SUZERAINTY — ADMINISTRA- TIVE REORGANIZATION OF Korea — JAPANESE “ ADVISERS ”’— CREATION OF THE ReEsIpENcY — Marguis Ito’s PosiTion — STRUGGLE BETWEEN THE MILITARY AND Civit FacTIons — DEPOSITION OF THE EMPEROR — FINAL EXTINCTION OF KoREAN AuToNoMyY — DisBANDING THE KorEAN ARMY — JAPANESE ATTEMPTS AT ReEFoRM— PracticaL EFFECTS OF JAPA- NESE REFORMS— SITUATION OF THE KoreaNS— THEIR Distress UNDER JAPANESE RULE— JAPANESE IMMIGRA- TION — ATTEMPTS TO JaP-IZE KoREA— EXPLOITATION OF THE Country — THE INSURRECTION —A HOopELEss STRUG- GLE — PosiITION OF THE KorEAN CourT— THE EMPEROR A PRISONER — CHRISTIAN MISSIONARIES IN KorEA— A DeEptor- ABLE SITUATION. Ir is no longer possible to describe Korea correctly, in a political sense, as a nation. And, although the country is governed by Japanese, it is not a part of Japan. Polit- ically, Korea is a vassal, stripped of the last vestige of administrative autonomy, and without a voice in directing even the more trivial of her internal affairs. It is, there- foré, interesting to ascertain the conditions under which ten millions of Koreans, who five years ago constituted an independent Empire with a government and a civiliza- tion thousands of years old, and which had diplomatic relations with all the greater nations of the world, are now living. It is not always possible, especially in the East, to 128 “INOAS NI LaaMLS Vy THE SUBJUGATION OF KOREA 129 judge the administration of a country by its governmental forms; but these forms provide a basis for comparison. The series of so-called ‘‘ agreements,” signed by the Em- peror under Japanese coercion in 1904 and 1905, by which the substantial suzerainty of Japan was interna- tionally established (it had already been actually estab- lished by military occupation) need not be reviewed.! They formed the basis for administrative reorganization of Korea under Japanese direction. The Emperor re- mained titular head of the State, presumably assisted by a ministry composed of Koreans. The interests of Japan are cared for by a Resident General, with the usual ad- ministrative departments of foreign affairs, finance, rev- enue, justice, posts and telegraphs, etc. Each member of the Korean cabinet is compelled to employ a Japa- nese “adviser,” with whom he is expected to consult in regard to administrative matters. Until the summer of 1907 some outward remnants of Korean authority were permitted to exist, although they could exercise no initiative. Among these was the Korean army of 6,000 to 8,000 troops, and the palace guards. However, even before the final extinction of Korean autonomy in July, 1907, the Emperor was kept secluded in his palace, and his ministers were under constant Japanese military sur- veillance. Under this arrangement Japanese, during the years 1905-8, took over all branches of the central government. Feeling that her administration of Korea would be keenly watched by the world, Japan induced Prince Ito to accept the place of Resident General at Seoul. It prob- ably was felt in Japan that Ito then enjoyed a greater repu- 1An account of the seizure of Korea by Japan, in 1904, is given in the author’s The New Far East. 130 THE FAR EASTERN QUESTION tation in the West than any other Japanese, and that his name would carry weight. Ito’s assignment to Korea, which was hailed in many quarters as a guarantee of a wise and humane administra- tion, soon developed a schism in the Japanese party there. When Ito came the military was in full control and, as invariably is the case in such circumstances, was reluctant to yield its authority to a civil government. A less force- ful man than Ito would have been bent to the military yoke, but he quickly forced an issue and informed the Tokyo Government that he would remain-in Korea only with understanding that he have full authority. Al- though compelled outwardly to take a subordinate position in the Government, the military party was not defeated, but has remained a power which Ito has been able to restrain but not entirely to control. Among Japanese in Korea there are, then, two factions — civil and mili- tary; and of these the military is by far the more numer- ous and influential, although the civil party nominally directs the administration of affairs. Prince Ito is absent in Japan much of his time, and even when in Korea can- not be fully cognizant of conditions throughout the country, or of minor administrative details, and there is no doubt that much goes on about which he is ignorant or only partially informed. This was the general situation when Japan seized the opportunity afforded by the appearance of the Korean delegation at the Hague conference in 1907, to take a step which had been contemplated for some time — the deposition of the Emperor. The Emperor, (he is now officially called the Retired Emperor,) is bitterly hostile to Japanese occupation and was constantly trying to de- vise ways to regain his kingdom. Japan probably feels that she cannot yet dispense with some kind of an Imperial THE SUBJUGATION OF KOREA 131 figurehead in Korea, but she was glad of a chance to re- place the old Emperor by a more tractable man. Such a one was ready to hand in the Crown Prince, who is little more than an idiot about most matters, and who is utterly without strength of character or wit to resist Japanese dom- ination. On July 16, 1907, the Korean cabinet, acting under instructions from the Resident General, waited upon the Emperor and proposed to him the alternatives of abdica- tion in favor of the Crown Prince or agreeing to the fol- lowing stipulations: (a) That he sign with his own seal the suzerainty agreement of November 17, 1905. (b) That he agree to the appointment of a regent. (c) That he proceed to Tokyo and personally apolo- gize to the Emperor of Japan. The two latter clauses are self-explanatory, but the first may require some elucidation. After Japan had an- nounced to the world the so-called agreement ? of Novem- ber 17, 1905, by which Korea recognized the suzerainty of Japan, the Korean Emperor managed to elude the vigilance of his Japanese guards and published a state- ment in which he denied having signed this agreement, and called attention to the fact that the document did not contain his seal. The first stipulation meant, therefore, that Japan required the Emperor formally to seal and ratify the agreement which he had repudiated. Of course, whether he acceded or not could not alter the status quo, for Japan was exercising sovereignty any- how. The stipulation that he proceed to Japan fright- ened the Emperor very much, as he, whether rightly or not one can hardly determine, believed that he would be 2 Appendix I. 132. THE FAR EASTERN QUESTION detained there as a prisoner. He is a prisoner in Korea, but he shrank from the prospect of exile. The Emperor refused to accede to the stipulations without having time for consideration, and the ministers left without obtaining an answer to Japan’s demand. That night the Emperor sent word to E. H. Bethell, editor of the Korean Daily News, informing him of the situation and asking that news of his predicament be published, which was done in both the English and ver- nacular editions of this paper on the following day. As soon as the news was disseminated among the people a large crowd assembled near the palace for the purpose, in accord with an ancient Korean custom, of petitioning the Emperor to not agree to the stipulations. The crowd was orderly, and it was dispersed by Japanese soldiers without a disturbance. Meanwhile, further pressure had been put upon the Emperor, and on July 18 he appointed the Crown Prince to be Regent. When this was an- nounced to the people another crowd assembled outside the palace. An attempt by Japanese troops to disperse it led to rioting, during which a number of Japanese and Koreans were killed and wounded. The people finally were dispersed and the streets cleared. For several days the resentment of the Koreans smoul- dered, but there were no further popular demonstrations. It was supposed by Koreans that the regency was only temporary, and that the Emperor would resume the throne. On July 23 a new agreement defining the rela- tions between Japan and Korea was signed by Prince Ito and Yi Wan Yong, the Korean prime minister, who acted for the Regent. As this document affords a clue to certain methods of Japanese administration, I give it here in full: THE SUBJUGATION OF KOREA 133 Article 1— The Government of Korea shall follow the direction of the Resident General in connection with the reform of the administration. Article 2— The Government of Korea shall not en- act any law or ordinance, or carry out any important administrative measure unless with the previous approval of the Resident General. Article 3 — The judicial affairs of Korea shall be kept distinct from the ordinary administrative matters. Article 4— No appointments or dismissals of Korean officials of the higher grade shall be made without the consent of the Resident General. Article 5 — The Government of Korea shall appoint to official positions under it such Japanese as may be recommended by the Resident General. Article 6 — The Government of Korea shall not en- gage any foreigner without the consent of the Resident General. Article 7— The first clause of the agreement between Japan and Korea signed on the 22nd day of the 8th month of the 37th year of Meiji is herewith abrogated. By this agreement the Korean Government is reduced to a position where it cannot enact any law however trivial, cannot appoint or dismiss any official, cannot put into execution or suspend any administrative measure, and shall appoint .all Japanese officials recommended by the Japanese Resident General; in other words, it can no longer exercise any of the functions of a government. Simultaneously with the promulgation of this agreement, the Resident General compelled the Emperor to sign a revised abdication, making it final and absolute, thus making the Crown Prince Emperor. When news of the deposition of the Emperor spread 134 THE FAR EASTERN QUESTION through the country it greatly excited the people, and an insurrectionary movement sprang up in the provinces, which was fanned by the action of the Japanese in dis- banding the Korean army. Japanese allege that they had information of a plot in the Korean army to revolt and restore the retired Emperor to the throne. There seems to be no tangible proof of such a plot, al- though there is no doubt that the army was dissatisfied, as nearly all Koreans are, with Japanese rule; but the Residency decided upon drastic action. At 6 o’clock on the morning of August 1, 1907, an order from the Residency and approved by the new Emperor, was pre- sented to the commanders of the four Korean barracks at Seoul. This order instructed the officers to parade their troops without arms and read to them an order of dismissal. There had been no previous intimation of such an intention, except rumors, and the order came as a surprise to the Korean officers and men. In fact, this action of the Japanese was brutal and tactless. The Ko- rean army undoubtedly contained many wretched speci- mens of humanity, but it also contained thousands of hon- est men, who might at least have been paraded with their arms and thanked for their services, as is usual under such circumstances, before being disbanded. At all bar- tacks except one the order was quietly obeyed. MHard- ly had the Korean regiments broken ranks when detach- ments of Japanese troops, which were stationed outside, entered, occupied the barracks and took charge of the arms and equipment. At the West Gate barracks a striking scene occurred. The Colonel paraded his troops as ordered and read to them their dismissal. He then advised the troops to dis- band, saying there was nothing to do but submit, retired to his quarters and fell upon his sword.’ The news of THE SUBJUGATION OF KOREA 135 his suicide quickly spread, and some soldiers seized their arms and began firing at a detachment of Japanese troops which was preparing to occupy the barracks. Others joined the rebels, and the firing became general. Jap- anese troops were hurried to the scene, and a heavy fire from rifles and machine guns was poured into the bar- racks. As the Japanese had for some time kept the Korean troops on a short allowance of ammunition, this was soon expended and the rebels were left without means of resistance. A majority of them abandoned the fight and attempted to escape, which many succeeded in doing. Some continued to fight until the Japanese troops had penetrated the barracks and entirely surrounded them, when they were shot down. Eventually hundreds of ex- soldiers made their way into the country and joined the “volunteers,” as the insurgents are called, thus giving the movement fresh vitality. In pro-Japanese reports about the situation in Korea it is almost invariably represented that hostility to Japanese rule (it is usually called ‘“‘ reform”) springs from and is incited by corrupt Korean officials who find their “graft”? abolished under the new regime. Quite the contrary is true. A majority of corrupt Korean ofh- cials have been provided for by the Japanese. Many of them retain high office, drawing the emoluments but not performing the duties of their positions, and those who could not be quieted by this method have been de- ported, imprisoned or executed. Since the alternative to bending to Japanese power is exile or penury, or both, the mass of corrupt Korean officials have accepted the inevita- ble and obey the orders of their new overlords. The in- surrection which began in 1907 sprung entirely from the people, the very class in whose interest the so-called Jap- anese reforms are presumed to be administered. Why the 136 THE FAR EASTERN QUESTION Korean people, who bore almost without murmuring the exactions of their own officials and Government, have taken up arms in their feeble way against the Japanese is worth inquiring into. It may be granted that, in a general way, the Japanese are gradually improving the structural form of the Korean Government, and modernizing its administrative method. In a pamphlet entitled ‘‘ Administrative Reforms in Ko- rea,” recently issued by the Residency, its aim is stated to “‘ sive a general idea of the kind of assistance the Gov- ernment of Japan is extending to Korea in carrying out administrative reforms in that country.” Japanese re- forms in Korea are, in this report, summarized under the following heads: Reconstruction of roads. Waterworks undertakings. Extension of educational system. Hospitals. Reorganization of police system. Purification of the Imperial Court. Reforms of local administrations. Reforms of the judiciary. Financial reforms. 10. Codification of laws. 11. Reform of mining administration. 12. Protection of emigrants. 13. Encouragement of productive industries. OI ANBWDH Ne} This is quite an imposing list, and all the matters con- tained in it are, stated in general terms, presumed to be beneficial. Such matters cannot, however, be judged by their pretensions, but by their results. Many of these ‘‘reforms’”’ are merely business enterprises, such as water works and other utilities, which are expected to pay divi- ~ THE SUBJUGATION OF KOREA 137 dends to Japanese shareholders, although they will, if properly operated, be of public benefit. Fully half of the so-called reforms instituted under the Japanese regime be- long in this category, being a part of the application here of Japan’s system of exploitation, and would hardly be termed administrative matters in most countries. Such af- fairs as education, finance, police and justice lie wholly within the province of governmental administration, and Japan has tried her hand at revising all of them here. So far, reform in education chiefly consists in replacing Korean and European teachers with Japanese, and the partial substitution of the Japanese language for the Ko- rean and Chinese formerly used. It may be that in time this will work out beneficially, but its immediate effect has been to impair the standard of efficiency in teaching and to anger the Koreans, many of whom have withdrawn their children from the schools. The police system has been reorganized by creating a gendarmerie composed ex- clusively of Japanese, which is distributed throughout the country, replacing the former Korean constabulary. A reform to which Japan points with pride is her re- vision of the judicial system. It is announced that the revenue saved by disbanding the Korean army will be devoted to improving the administration of justice. A Court of Cassation has been created, with a Japanese judge, and in time Japanese judges will act in the inferior courts. The codes will be revised and put upon a modern basis. ‘This is commendable enough, but Jap- an’s haste in this matter springs from a desire to gain the consent of the powers to the abolition of extra- territoriality. Meanwhile, there is no perceptible im- provement of administration of justice; in fact, the Ko- reans are probably worse off than they were under their own corrupt and inefficient government. The country is 138 THE FAR EASTERN QUESTION divided by the Japanese into sub-residencies, administered by vice-residents, who supersede the Korean governors just as the Resident General superseded the Emperor. In each district the resident is supported by Japanese troops and gendarmes. ‘The inferior courts are still presided over by Korean magistrates, but a Japanese usually sits with veto jurisdiction. Practically, this system places the lives and property of Koreans entirely at the disposal of Japanese. In many branches of administration this system has re- sulted in a dual authority. Where the Korean used to have to bribe one petty official he now has to bribe two, and so on up the line; for corruption in Japanese adminis- tration extends to the door of the Residency, is even be- lieved to have penetrated the inner circle which immedi- ately surrounds the Resident General. So far as I could learn, the probity of Prince Ito is not questioned; but it is known that his chief advisers keep him in the dark about much that transpires, and mislead him in many mat- ters. On the whole, the character of inferior Japanese officials in Korea is even lower than in Japan, and while at home their venality is circumscribed, here it finds ample opportunity. ‘That Japan intends to in time substantially exclude Koreans from official life in Korea is evident. There are now nearly 5,000 Japanese in the employ of the Korean Government. The Japanese are making a clean sweep of all the offices high and low. Even Korean coolies who were employed to build fires and sweep out the palaces and government buildings are being replaced by Japanese coolies. No position is too mean to be beneath the desire of some Japanese immigrant. In Seoul some Koreans are still employed as police, but only Japanese police are permitted to carry firearms, and the number of Koreans is constantly being reduced. At the present ratio 7... — ma 4 iI Bien i - 1 j oe 2) } . " ea > S.. k Toe ai Nhe Why ' vo ait Fy! Daye ew eg > Pe: me eer BRANCH AT SEOUL OF THE D’ar IcHo Ginko (Now BANK oF Korea). STREET IN THE JAPANESE QUARTER OF SEOUL. THE SUBJUGATION OF KOREA — 139 of increase, by the end of 1909 there will be more Japanese officials on the payroll of the Korean Government than were Koreans when Japan occupied the country, for it not only is Japan’s policy to replace Koreans by Japanese, but to make as many new positions as the revenue will bear. A calculated attempt is being made to convey an impres- sion that Japan is ‘“‘ assisting’ the Korean Government to reform itself at her (Japan’s) expense. This is not true. The expenses of the Korean Government, including ‘reforms’ instituted by Japanese, are borne by the Ko- rean treasury, which is administered, of course, by Jap- anese. Already taxation has been raised, and measures for further increasing it are being considered. It is claimed by the Residency that most of the increase in rev- enue, as shown by the budget, is the result of economical process of collection and the elimination of “ squeeze ” which formerly went into the pockets of Korean officials. I think it is true that most of the ‘“‘ squeeze’’ has been eliminated in collecting revenue, but this has not resulted, as Japanese apparently wish to convey, in lightening the burden upon the people. On the contrary, there is much evidence to show that it has considerably added to this bur- den. The new Japanese officials, like the Koreans, are poorly paid, and having now to pass practically all the taxes on to those higher up, instead of being able to reserve a proportion for themselves, as formerly, compels them to exact their portion from the taxpayer by other means. In the field of finance, the Japanese substituted the yen for the old Korean dollar, which is a desirable change and has resulted in giving the country a stable circulating me- dium. Notes of one yen and upward are issued by the Dai Icho Ginko (now the Bank of Korea), and are sup- posed to be backed by a specie reserve held in Japan. The subsidiary coinage also is minted in Japan, and represents 140 THE FAR EASTERN QUESTION a profit in the coinage of about 40 per cent. Whether this profit is credited to the treasury of the Korean Gov- ernment or goes to the Bank of Korea is not generally known. As the Korean Government (that is Japan) has needed more money to carry on the work of reform it has borrowed (from Japan) through the Bank of Korea. The expenditure of the money thus secured cannot be definitely traced by one outside the inner circle of the Residency, but it appears that most of it has been used upon works re- quired by the Japanese; while Korean and other contrac- tors have practically been excluded from public contracts which, by thus eliminating competition, have provided good profits for Japanese contractors. When the Japan- ese took the country Korea was out of debt, and Sir Mac- Leavy Brown, then Inspector General of Korean customs, told me, in 1905, that he thought the country could easily support an efficient government without increasing taxa- tion. The Japanese already have begun to put the country into debt, and if the present policy is pursued there can be little doubt that within a decade the Koreans will be supporting as heavy a burden of debt and taxation as the people of Japan are now. The scope of this work will not permit relation in de- tail of detriments which Koreans of all classes suffer under the Japanese regime. Bare mention of specific in- stances which, supported by reliable testimony, were called to my attention during my last visit would fill pages. These detriments may be summarized as follows: seizure of land and other property of Koreans by Japanese with- out proper compensation or legal warrant; exclusion of Koreans from participation in commercial and _indus- trial development of the country; subjection of Koreans to abuse and indignities at the hands of Japanese immigrants, military and civil officials; the practical impossibility for THE SUBJUGATION OF KOREA 141 Koreans, except in flagrant cases, to obtain justice in issues against Japanese; superior advantages of Japanese over Korean tradesmen and merchants, through preferential treatment accorded by the Japanese administration; de- bauching of Korean morals by Japanese immigrants, by the introduction of thousands of Japanese prostitutes and by the introduction of pernicious vices, such as opium and lotteries. The detriments thus summarized are not based upon scarce or isolated cases, but are so numerous and widespread as unmistakably to indicate that they are the result partly of premeditated general policy, and partly due to laxity and indifference of Japanese administrators. As a single greater instance of Japan’s policy in Ko- rea may be cited the Oriental Colonization Company, which recently has been granted a charter by the Japanese Government. This corporation has a capital of Yen 10,000,000.00, and is authorized to issue debentures up to Yen 100,000,000,00. To aid the company to secure capital, the Government is to grant for eight years an annual subsidy of Yen 300,000.00 to secure interest upon the investment. Thus launched with active governmental support, this concern is provided with a blanket charter under which it may engage in almost all kinds of business in Korea: commercial, banking, agriculture, marine indus- tries, mining, manufacturing, purchase and leasing of land, etc. A primary object of the corporation is to col- onize Korea with Japanese. Certain fundamental provi- sions of the charter are aptly illustrative of Japan’s activ- ities in Korea. The company is to be composed exclusive- ly of Japanese and Koreans. The president must be a Japanese; of the two vice presidents one may be a Korean; and two-thirds of a]l managers and employes must be Jap- anese. The president and one vice-president must be ap- pointed by the Japanese Government, and the other vice 142 THE FAR EASTERN QUESTION president may be appointed by the Korean Government (which is Japan). Thus even in Japan’s exploitation of Korea is the fiction of Korean participation outwardly preserved; and a way provided by which Koreans who consent to serve Japan, and whom Japan considers it politic to placate, can be given lucrative appointments. Here is a plan to Jap-ize Korea on a grand scale, and it will be supported by all the ramifications of Japan’s gov- ernmental process, including her shipping lines and rail- ways. The scheme looks on the surface like a disguised revival of the Nagamori land project,? which the indigna- tion of Koreans caused the Japanese to abandon in 1905. It is proposed to develop unoccupied lands in Korea by the introduction there of Japanese farmers, and also to purchase improved agricultural lands for occupation by Japanese settlers. On its face it appears that such a corporation as the Oriental Colonization Company might be of great help in developing agriculture in Ko- rea, but friends of the Koreans fear that its practical op- eration may result in great hardship to the poorer class of Korean land owners by eventually causing them to lose their farms without adequate compensation. This fear is not chimerical. Since the Japanese occu- pation many petty Japanese private banks have begun to operate in Korea, whose chief business is to lend upon real property at usurious interest, often as high as three per cent. a month. Few Koreans have much business acumen, and the average Korean readily will borrow to meet needs or fancies of the moment; with a result that thou- sands of them already are in the grasp of Japanese money lenders. Koreans have been used to lax business methods, and usually expect to be able to renew their notes until prepared to liquidate them; but the policy of Japanese 8 This project is described in the author’s The New Far East. THE SUBJUGATION OF KOREA 143 has in many cases been, especially when a desirable piece of property is involved, promptly to foreclose. In this way thousands of Koreans, particularly away from the cities and larger towns, have lost their farms and often their personal property as well. ‘This often is caused by ignorance and lack of foresight; but such knowledge and foresight does not now generally exist among Koreans, who fall easy prey to unscrupulous money lenders, especially when the latter are indirectly supported by the Japanese administration. ‘The operation of the Oriental Coloniza- tion Company will, therefore, be watched with some anx- iety by friends of the Korean people. Japan now hardly takes the trouble to disguise her intention to convert Ko- rea into a Japanese colony; indeed, a prominent Japanese official recently made a comparison between the Koreans and the Ainu aborigines of Japan, intimating that the na- tive population of Korea may have to make way for the superior Japanese. Since Korea offers no special attrac- tions even to Japanese immigrants under ordinary condi- tions, and they cannot be induced to come in large num- bers except by promises of betterment, the Oriental Col- onization Company will be compelled to establish condi- tions favorable to Japanese colonists, and with conditions in Korea as they are it is not apparent how this can be done except by making the situation of Koreans relatively inferior. That the situation of Koreans in their native land to- day is comparatively inferior to that of Japanese cannot be doubted by any investigator who escapes from the leading strings of the Residency and opens his mind to the re- verse of the picture. I cannot think of a better illustra- tion of this general condition than that which is afforded by a daily scene at the railway station in Seoul. Just outside the station is a stand for ’ricksha coolies. The 144 THE FAR EASTERN QUESTION observer whose eyes are open to such evidences could note, when I was last in Seoul, that only Japanese ’ricksha cool- ies occupied this convenient stand. Some distance off, across a space which is either very dusty or muddy as the case may be, is another line of ’ricksha coolies, all Koreans. The Korean coolies are not permitted to come nearer, and to get a fare they must either wait until all the Japanese ’rickshas are taken or depend upon persons who will take the trouble to cross over to them. The fact that this petty discrimination does not, in this instance, prevent the Ko- rean coolies from earning a living is because Koreans and Europeans who are familiar with the circumstances usual- ly give them preference over the Japanese, even at some inconvenience to themselves. I saw an American mission- ary walk some distance in the mud rather than enter a Jap- anese ‘ricksha, which is a western way of expressing sym- pathy with any man who is not given fair play. That all Koreans do not now feel this form of discrimination is only because the comparatively small number of Japanese in Korea reduces this kind of competition to a negligible quantity. Of the insurrection, which has now been dragging along for nearly two years, one hears little outside of Korea, and not much even in Seoul. About the only reminders of it there are an occasional “‘ volunteer ” appeal posted by night in the city, and daily brief reports of colli- sions between Japanese gendarmes and troops and the in- surgents which are printed in the official gazettes. It is positively known, however, that some districts have been almost devastated, scores of villages having been obliter- ated, and hundreds of noncombatants killed and wounded. Koreans who are peacefully inclined, who are a great ma- jority, are caught between two fires: they cannot safely re- fuse supplies to the insurgents, and if they give them they THE SUBJUGATION OF KOREA 145 are summarily punished by the Japanese. Some villages have been twice destroyed, once by the insurgents and again by Japanese. An unofficial compilation based upon reports issued by the Residency shows that since the in- surrection started the number of Koreans who have fallen exceeds the total casualty list of both sides in the Spanish-American war. Apparently the insurrection has as much vitality as when it began, and the so-called ‘‘ vol- unteers” continue to fight bravely notwithstanding lack of arms and supplies. In so far as any alteration of the situation could be observed when I was in Korea, the movement was gaining rather than losing strength. In some of its aspects this hopeless struggle has fea- tures which command respect, although that it never can accomplish the hoped-for restoration of Korea’s indepen- dence is evident. That Korea is not entirely without pa- triots, even though they be mistaken ones, is shown by the assassination of D. W. Stevens at San Francisco. Stev- ens’ nominal position at the time of his death was foreign adviser to the Korean Government. His real position was that of legal adviser to the Japanese Government, a place he held for many years. When Japan seized the reins of power in Korea, Stevens was brought there and es- tablished as foreign adviser of Korea, where his job, to put it flatly, was to advise the Korean ministry and Emperor to do whatever the Japanese Residency wanted them to do. By Stevens’ ‘‘ advice” were drafted and signed the series of agreements by which Korean independence was abro- gated. Rightly or wrongly, Koreans regarded Stevens as the arch-destroyer of Korean liberty, and it is safe to say that his death gave general satisfaction to them. For months before he left Korea the last time Stevens went armed, usually was attended by a Japanese guard, and dur- ing the disorders of 1907 in Seoul he sought refuge at 146 THE FAR EASTERN QUESTION the Japanese club. This in itself conveys an impression of the position and policy of Japan in Korea. I was in Seoul when Stevens was assassinated, and there, where he had helped to deprive millions of Koreans of their na- tional birthright and where daily scores were falling in a fruitless struggle to regain it, Stevens’ tragic death somehow did not seem so terrible as it may have in Amer- ica. It was intimated at the time that evidence of com- plicity of some Korean officials in the assassination of Stevens had been obtained, which caused an old foreign resident to remark: “I suppose we will soon hear of more ‘suicides,’ ” emphasizing the last word. It may be remembered that at the time when suzerainty was promulgated, in 1905, some Korean officials who supported the Emperor in his refusal to sign the agreement were reported to have com- mitted suicide. To-day the situation of the Korean court would be ludicrous if it was not pathetic. ‘The Retired Emperor is actually a prisoner between four walls and constantly guarded by Japanese gendarmes. His son, the present Emperor, is permitted to visit his father only once every month or two, when father and son are allowed to remain together for an hour in the presence of Japanese officials. The present Emperor cannot leave his palace without permission of the Residency, or receive any visitors. Even at public functions he is not permitted to converse with anyone except in the presence of a Japanese official. The situation of members of the Korean cabinet is al- most the same. They can perform absolutely no admin- istration acts except as they are ‘‘ advised” to do by the Japanese vice ministers, and on the rare occasions when they go out each is accompanied by a guard of four Japanese gendarmes, who never let the minister out of THE SUBJUGATION OF KOREA 147 sight. At a Korean Christian wedding which occurred when I was last in Seoul, and which was attended by sev- eral Korean officials, the lobby of the church resembled the ante-room of a Japanese barracks. At Imperial garden parties Japanese soldiers with rifles are stationed about the palace grounds. ‘The Residency states that these precau- tions are necessary to protect the Emperor and his cabinet from assassination by Koreans. What a condition! High Korean officials and the Emperor were in no danger from Koreans under the old regime. Nothing well could be wider of the mark than compari- sons so frequently made by special pleaders of Japan’s administration in Korea to America’s policy in the Philip- pines. In every essential respect the two propositions differ; indeed, no just comparison is possible, and that at- tempts to do so have not called forth indignant repudi- ation in America shows how little the real situation in Ko- rea is understood there. Having recently investigated conditions in the Philippines, I have no hesitation in as- serting that the Philippine Government to-day is, in all im- portant and essential factors which are inseparable from liberal institutions, in advance of the Government of Japan, and Japan’s administration of Korea is fifty years behind that exercised at home. One hardly can quit discussion of conditions in Korea without some mention of Christian missionaries. Mis- sion work in Korea has had greater success than in any Oriental country, and there now are from 300,000 to 400,000 professed Korean converts. There is consider- able friction between the Japanese administration and the foreign missionaries, who from a favorable attitude toward Japan in the beginning have changed to one of latent hos- tility. The chief reason is that many missionaries believe that Koreans are being mistreated by Japanese, and they 148 THE FAR EASTERN OUESTION sympathize with the Koreans. On the other hand, the Residency is disposed to accuse some missionaries of po- litical activity calculated to embarrass Japan. It is known that many Koreans have lately become Christians, and it is assumed that some have taken this step in order to get partially under foreign protection. Missionaries recog- nize this disposition, and the causes for it, but assert that they endeavor to exclude converts who apply from polit- ical motives. As yet there has been no direct collision between the Residency and the missionaries, but one may come. Prince Ito has unofficially stated that, while he welcomes the presence in Korea of Christian missionaries, who are largely responsible for such modern education as Koreans have heretofore obtained, if they meddle in poli- tics or get in the way of Japan’s policy they will have to go. On the whole, the condition of Korea cannot truthfully be described except as deplorable. When the so-called reforms which have been instituted by Japan are analyzed in respect to their results as distinguished from their pre- tensions (which is the test by which all policies must in the end be judged), it will be found that almost without ex- ception they were designed to and have had the effect of giving to Japanese in Korea some special advantage. Several already are paying dividends to Japanese owners. The busy West may care nothing about the political status of Korea, and little about the condition of Koreans. While there is no probability of agitation bringing about an alteration of Korea’s general relations to Japan, it may be that some form of external pressure, through the pity and indignation of the civilized world, is all that can pre- vent the complete subjugation and exploitation by Japan of the Korean people. ‘VAMOS NI GdVOSANW] ‘IWolda J, CHAPTER XII THE OPEN DOOR IN KOREA A Pat Example — UNIQUE PosITION oF AMERICAN INTER- ESTS IN KorEa— THE Poticy oF JAPAN — ELIMINATION OF Pseupo-Po.LiticAL INTERESTS — ASSURANCES TO THE UNITED STATES —- SEVERANCE OF ForgIGN DipLoMaTic RELATIONS WitH Korea — JAapAn’s War Upon ForeIcN INTERESTS — THE FIGHT ON CoLLBRAN & Bostick — UNDERHAND METH- ops — PERSECUTION OF AMERICAN FirM— Tue “ Kapisan ” CasE— DISCRIMINATION AGAINST FOREIGN INTERESTS AND Trape— Uses oF THE Rattways— THE “Open Door” a Farce — REMAINING OBSTACLES TO COMPLETE ANNEXATION — Korea A JAPANESE PRESERVE. In Korea one finds a pat example of Japan’s real atti- tude toward the principle of the “‘ open door.’ When, early in 1904, she occupied the country under excuse of temporary military necessity, Korea was an independent nation. Accepting Japan’s assurances that foreign in- terests would be safeguarded, the interested powers oblig- ingly acceded to gradual assumption by her of absolute sovereignty. Here, then, Japan has had a free hand; and the broader intent of her political and commercial policy may be judged by its effects. While development of foreign interests in Korea pro- gressed along much the same lines as in other Oriental countries, which means that commercial and industrial enterprise was frequently used as a cloak for political designs, it has been rather noteworthy for providing a striking exception of the success of legitimate enter- 149 17006) THE FAR EASTERN QUESTION prise. In one respect Korea is unique. It is the only eastern country that I know of where American enter- prise predominates among purely foreign activities, and it is gratifying to be able to state that in Korea American interests have in the past enjoyed no special advantages, and have made way on their merits. Dr. H. N. Allen, who for so many years was American minister to Korea, exerted himself to promote legitimate enterprises of his nationals, and, owing to confidence reposed in him by the former Emperor, with marked success. The first railroad in Korea, the principal mining industries, the Seoul elec- tric railways, electric lighting plant, water works and tele- phone system are all monuments to American enterprise, which undertook these matters when their profitable op- eration was problematical. Many Americans have con- tributed to the modern development of Korea, but un- doubtedly the more enterprising and important is the firm of Collbran & Bostick, which operates the Seoul street railways, lighting, water works and telephones, and which has large mining interests. It surprised no one that Japan, when she took control of Korea, sought to eliminate those foreign enterprises and concessions which obviously had been political moves in disguise, and which might be considered obstacles to her administration. As not a single American interest in Korea ever belonged in this category, they did not an- ticipate dificulty. When I was in Korea in 1905, Amer- icans were not uneasy about Japan’s permanent acquisi- tion of the country, which was even then perceived to be coming, although the fiction of Korean independence was outwardly preserved. They had been assured, and the United States Government also was assured, that Japan would treat American interests equitably, and would pur- sue a policy of encouragement and support with a view THE OPEN DOOR IN KOREA ust to inducing other legitimate foreign investments. In- deed, this seemed so reasonable and likely to benefit all interests in the country that even astute men were war- ranted in believing it. It is evident that the Washington Government was then convinced of Japan’s good inten- tions, for it readily acceded to her wishes, recalled Dr. Allen, and. soon after abolished its legation altogether, agreeing to thereafter conduct all diplomatic negotiations with Korea through the Tokyo Foreign Office. As soon, however, as Japan had practically isolated foreigners in Korea by severing their direct diplo- matic relations with the Korean Government, and substi- tuting in their stead relations with Japan, the Japanese administration in Korea began to harry foreign interests, including American. Collbran & Bostick, being the larg- est and most influential foreign firm, was made the chief object of attack; and the details of its fight for its rights are interesting from an American point of view, and also illuminate Japan’s policy in regard to foreign interests in general. Japanese, like most Orientals, rarely pursue a direct method, and their attempt to get Collbran & Bostick out of Korea first took the form of a proposition to purchase its interests. Collbran & Bostick was not anxious to sell, having labored for years to establish itself and having several promising new enterprises under way; but the firm named a price, which Japan declined to give. Some of those who were privy to this proposition thought at the time that the American firm asked too much for its inter- ests, but a Japanese official in Seoul recently told an Amer- ican official that he is sorry that Japan refused the offer. At that time, however, Japan had little doubt of her ability to induce Collbran & Bostick to in time be more reasonable; and a policy of hindrance and obstruction was L§2 THE FAR EASTERN QUESTION inaugurated. This obstructive policy usually assumed in- direct and surreptitious shapes, but upon occasion it took direct form. One of the last acts of the Korean Government before occupation of the country by the Japanese army was to grant a mining concession under the then existing regula- tions to Collbran & Bostick. The conditions, which were those which governed other similar grants, gave the Amer- ican firm a right to locate any unoccupied mining district and to work it, paying the government royalty of 25 per cent. of the profits. This concession, which was approved by the Emperor in conjunction with other matters involy- ing the same parties, was duly signed, sealed and recorded at the American legation. The grant contained a clause requiring that the claim be located within a specified time, and providing that no other similar concession be granted before Collbran & Bostick had located its claim. A few days after this concession was registered Japa- nese troops occupied Seoul without any previous notice, and from that day the Japanese have ruled the country. Japanese military regulations prevented Collbran & Bos- tick from at once prospecting and locating its claim, al- though there were no serious hostilities in Korea after the first few weeks. Immediately after the conclusion of peace, Collbran & Bostick prepared to locate its conces- sion, but Japanese authorities refused to issue a passport to the firm’s expert to travel in the interior. Although no foreigners had been permitted to travel in the coun- try, Japanese engineers had thoroughly prospected the entire unoccupied mining region, and had located every promising claim they could find. Finally the engineer of the American firm managed, by wearing Korean cloth- ing, to reach the desired district and located a claim for Collbran & Bostick. In October, 1905, due notice of THE OPEN DOOR IN KOREA 153 the location of the concession was filed at the American legation in Seoul. When the location of the district came before the Korean Government for final confirmation the Japanese regime was firmly in control of the country, and the Korean Emperor was virtually a prisoner in his palace. An American, D, W. Stevens, who was for years employed as a legal adviser by the Japanese Government, had been brought to Korea and made the adviser of the Korean Government on foreign affairs; where, owing to his na- tionality, he made a convenient cloak for Japan’s assault upon foreign interests. It may be well to state that ever since Japanese occupation the Korean and Japanese gov- ernments have been identical in so far as foreign affairs are concerned, although the fiction of local severance was until recently preserved, and I will hereafter in mention- ing the Korean Government name the real sovereign — Japan. Acting upon the advice of Mr. Stevens (who was no doubt instructed from Tokyo to give it), the Govern- ment refused to confirm the concession of Collbran & Bos- tick on the following grounds: 1. That the district had already been located by Japa- nese, 2. That the Korean Household seals attached to the concession were not legally sufficient. 3. That the Council of State had not formally ap- proved the concession. This compelled a representative of Collbran & Bostick to go to Tokyo (the American legation at Seoul having been abolished) and urge its claim through the American ambassador to Japan, thus transferring, as the Japanese had foreseen, the matter to the hands of persons not fa- 154 THE FAR EASTERN QUESTION miliar with conditions in Korea or the history of this par- ticular grant. Then began a struggle by Collbran & Bostick to secure its rights, which is not yet terminated. I met Mr. Henry Collbran, the head of the firm, in Japan at the time when he first went there to defend its position, and I have followed the contest since. In trying to support its position the Japanese Government resorted to innumer- able petty methods, some of which properly may be called despicable. It transferred the fight to Washington. Japan’s secret service men in America and England were employed to scrutinize the past of Messrs. Collbran and Bostick to discover, if possible, something injurious to their character which might be used against them in this matter. Employes of the Japanese legation at Wash- ington circulated reports, taking pains that they would reach the State Department, that Messrs. Collbran and Bostick are adventurers who managed by fraudulent means to get some valuable concessions in Korea, and which they are now trying to blackmail the Japanese into purchasing at an exorbitant price. Japanese officials inti- mated to American officials in Korea that the Imperial seals affixed to the document granting the concession were stolen and illegally used. Such were the means employed to prejudice Collbran & Bostick’s case at Washington, and in the western press. Officially the Japanese administration in Korea, and the Tokyo Foreign Office, outwardly relied upon technical points to defeat the American claim. It was alleged that a Japanese had previously located the same district, but upon it being shown that this claim was not registered until November, 1905, or after notice of the location of the American claim was formally given, this pretense was abandoned. In the end, as point after point gave JHE OPES DOOR IN KOREA 155 way under scrutiny, the Japanese administration fell back upon the contention that Collbran & Bostick’s con- cession was improperly obtained from the Korean Em- peror. It was alleged that the concession was promul- gated just prior to the Russo-Japanese war, when the timid and frightened Emperor was induced to assent by political representations. Jt is true that the concession was granted just a few days before hostilities between Japan and Russia began, and it is also true that the in- terested parties, anticipating a period of disorder, made all haste to close the matter before the storm broke; which is evidence of business precaution. But there is nothing to prove that political influence was used to in- duce the Korean Emperor to assent; indeed, it is hard to understand what political pressure could have been em- ployed.* The Emperor had had relations with Collbran & Bostick for years, was personally interested in some of its enterprises, and this particular concession had been discussed many times before. The Japanese contention that the documents were improperly or fraudulently sealed seems absolutely to be destitute of foundation, and is a part of the campaign of innuendo. The grounds for refusing to confirm this concession are so artificial and flimsy that the case would perhaps long ago have been decided in favor of the American claimants had not Japan adopted a policy of trying to exhaust them by delay. In this she was favored by cir- cumstances, especially by repeated shifts in American con- sular representation at Seoul, Each new consul had to take up the case from the beginning in order to become fa- miliar with it, and this is no easy task, for by now the oficial documents, reports and correspondence would fill a large volume. The expense of the three year fight to Collbran & Bostick has already been nearly $30,000.00. 156 THE FAR EASTERN QUESTION The firm was crippled in other ways. Soon after the concession was granted, Collbran & Bostick, not feeling able to entirely finance the project by itself, entered into a contract with a British syndicate by which the latter agreed, in consideration of a half interest in the property, to advance, upon receipt of a favorable report from an expert, $500,000.00 for the purpose of developing the mines and building a milling plant. Japan contended that this contract constituted a transfer of the concession to British nationals, and the State Department at Washing- ton was disposed to adopt this view. This compelled Coll- bran & Bostick to cancel its contract (which could have no effect until the concession was confirmed, and then only on a certain specified contingency), which they succeeded in doing at a considerable loss. It now appears that this pluck and persistence will succeed, for the Japanese Government has intimated that the concession will be con- firmed. Even in this tardy act of justice it wants Coll- bran & Bostick to accept the concession under the new min- ing regulations which Japan has promulgated, which the firm is not inclined to do; but these regulations will be con- sidered later. Not satisfied with obstructing the confirmation of this mining concession, the Japanese have encroached upon the interests of Collbran & Bostick in other ways. The American firm owns the Seoul telephone franchise, now eighteen years old. Several years ago the Japanese lega- tion in Seoul put in a private telephone system connecting its various departments. A protest was made by Coll- bran & Bostick, whereupon the Japanese minister replied that the system was for private official use only, and that it would not be extended. When the Japanese seized Korea a settlement was laid out inside Seoul, surrounding the Japanese residency, and recently the legation telephone THE OPEN DOOR IN KOREA Eee system has been extended and made a public service, which now has over 1,000 subscribers. Collbran & Bos- tick, in protesting against this infringement upon its fran- chise, has offered to purchase the Japanese system at a fair valuation and waive all damages in order to adjust the matter, but so far no satisfaction has been obtained, while the Japanese system continues its public service. In re- cently replying to an official representation about this matter, the Japanese Residency advanced the argument that ‘‘ Chin-ko-gai,” as the Japanese section of Seoul is called, is not properly a part of the city; a puerile subter- fuge, since it is entirely located inside the wall and near the heart of the town. The ‘‘ Kapisan ”’ case, as the Collbran & Bostick mining concession is named, is watched with intense interest by all foreigners in Korea, and by persons who have in- vestments there; for it is regarded as a test in many ways. No other foreign interest is so powerful in wealth and influence; the position of the American firm is regarded as being peculiarly meritorious and clear; it is believed that the United States will at present go farther in press- ing Japan than any other power, and that Japan will yield more to that nation. So foreigners in Korea feel that should Collbran & Bostick lose it will be the death knell of foreign interests in the country, and that it will be but a short time before all are forced to sell out to Japanese at a disadvantage, or see their property de- cline under invidious discrimination. This feeling is not sentiment, but is founded upon hun- dreds of instances which have occurred under the Japanese regime. It is recognized that few men would have dis- played the spirit of Messrs. Collbran and Bostick, or could have for so long survived such an unequal contest. It is believed by foreigners in Korea that the firm would have 158 THE FAR EASTERN QUESTION abandoned the struggle long ago, and sold out to the Japanese, had not its honor been impugned at Washing- ton. The firm let it be known that under no circum- stances will it sell out its interests in Korea before all its claims have been fully and unequivocally recognized, thus making it impossible for it to be charged effectively with having blackmailed the Japanese Government into pur- chasing a lot of worthless mining claims. It should be kept in mind that the ‘‘ Kapisan”’ property is as yet little more than a promising prospect; it is not yet a mine, and its owners do not claim that it is; so, in a measure, they have made their expensive fight for principle, fully ap- preciating that the money may never be recovered. Many foreigners in Korea think, however, that it will not be possible for Collbran & Bostick to continue to do a profit- able business in Korea after having antagonized the Jap- anese Residency. ‘The firm’s presence will be a continual reminder to Koreans that Japan is not omnipotent, and it is predicted that the Japanese will never rest until it is gotten out of the country. When one considers the means for annoyance and obstruction which Japan can command, and which she has employed in similar cases, from police interference to browbeating Korean employes of foreign concerns, it seems probable that these fears may be realized. Japanese financial interests tried in vain to obstruct the capitalization of Collbran & Bostick’s Seoul water works and cause the franchise to lapse. As examples of Japan’s policy of excluding other for- eigners from participating in the development of Korea may be cited the new mining and forestry regulations. On their face these regulations are not objectionable, but each contains a “ joker” designed to place concessionaries under the thumb of the Residency. The new mining reg- ulations change the royalty to the government from 25 THE OPEN DOOR IN KOREA 159 per cent. of net profits to 1 per cent. of the gross output, which is an apparent reduction; but there is a clause under which a special land tax may be imposed, thus opening a way to ‘‘milk”’ any property for all it can stand. In the forestry regulations is a clause giving the minister of agriculture authority to “‘ for the public good” cancel any concession and confiscate the property, and there is no appeal from his decision. Furthermore, the Government is not legally responsible for acts of this minister, which means that dispossessed concessionaries have no legal redress. The history of the famous ‘‘ Su-an syndicate,” and other foreign enterprises in Korea which have been involved in Japanese administrative tangles, is interesting; but ex- amples already given must serve. An important factor in advancing Japanese in contradistinction to other for- eign interests in Korea is the railways, which are now all owned by the Japanese Government and are, consequently, a part of the governmental business system. Foreign business firms in Korea complain that Japanese firms ob- tain transportation rebates which are equivalent to a re- mission of import duties, and while these assertions cannot definitely be proven, there is much circumstantial evidence to sustain them. Such a proceeding is in harmony with Japan’s policy elsewhere. The revised railway rate schedules, which went into effect April 1, 1908, are clearly designed to build up Fusan at the expense of Chemul-po, which means practical control over Korean imports by Japanese firms and transportation companies. Foreign- ers are also handicapped by an elaborate system of es- pionage, which has gone so far as to open and retard, often to stop altogether private correspondence and tele- grams. Even consular mail bags have been opened. In the room which I occupied when last in Seoul Japanese 160 THE FAR EASTERN QUESTION secret service men searched, in his absence, the personal effects of Douglas Story, an English correspondent, in a vain attempt to find an important communication which had been sent to him by the deposed Emperor. I was afraid to entrust my correspondence to the post, and sent it to be mailed outside of Korea by a friend. This 1s the situation of foreigners in Korea under the adminis- tration of Japan. Yet the western world not only regards the condition with seeming indifference; it has from time to time applauded Japan in her so-called efforts to civilize that country. Japanese are frequently heard to refer to other foreigners in Korea as “ foreign ad- venturers.” What, I wonder, considering the way Jap- anese are exploiting the country, would they call them- selves? Political Korea is doomed, is indeed already perished; but there remain some minor bulwarks behind which ad- vocates of the ‘‘ open door’ may still’make a stand. One of these is extra-territoriality, another is the Korean treaties with other nations which guarantee most favored nation treatment. Until these treaties are abrogated the conventional tariff schedule cannot be altered without the consent of interested powers. ‘These are two limita- tions upon Japan’s authority in Korea, and she is pre- paring to ask the powers to consent to their abolition. At present other foreigners are not legally under Japanese control, but have the same status as in China, and the conventional tariff is the only obstacle which now pre- vents Japan from applying her new protective tariff to Korea. It is believed in Korea that the real mission of D. W. Stevens to America, which resulted in his death, was to try to gain the consent of the United States to removal of extra-territoriality and the inclusion of Korea in Japan’s THE OPEN DOOR IN KOREA 161 fiscal entity. This accomplished, and acceded to by other treaty powers, the complete annexation of Korea to Japan will be accomplished. In this connection the recently signed arbitration treaty between Japan and the United States, which con- tains a mutual agreement for the protection of trade-marks in Korea, applies to the situation of American interests there. Reports of the contents of this treaty which have been published intimate that the United States has agreed to the abolition of extra-territoriality in Korea to the ex- tent of permitting all trade-mark disputes in which Amer- icans are concerned to be tried in the Korean (Japanese) courts. Under extra-territoriality, if an American is de- fendant in such an action he can defend himself in the American consular court. American firms which do busi- ness in Korea fear that this alleged provision of the treaty will work to their injury. The only trade-mark piracy in Korea which amounts to anything is practiced by Japanese, even the Japanese Government being tainted with this abuse. Under extra-territoriality an American complainant against piracy of trade-marks could get little satisfaction in Japanese courts when Japanese were involved as defend- ants (no more can they in Japan), but they felt secure in the court of their own nationality. If the Japanese courts are now to take jurisdiction of such issues, Americans may find themselves in the position of being prosecuted for using their own trade-marks, especially if the princi- ple of priority of registration, as is the usage in Japan, instead of priority of use, is enforced in Korea. Publica- tion of the exact text of this treaty, which waits formal ratification by both nations, will be interesting to Ameri- can firms which do business in Korea, where it has not heretofore been possible, as has occurred to foreigners 162 THE FAR EASTERN QUESTION in Japan, for Japanese to pirate a foreign trade-mark and then enjoin its original owners from using it. The plain truth is that as rapidly as circumstances will permit Japan is turning Korea, as she already has done with Formosa, into a Japanese commercial and industrial closed preserve; indeed, it is hardly more than this now. To pretend that the ‘‘ open door” obtains there is sheer nonsense. In regard to foreign investments in Korea, prospective investors should know what they may expect. No prudent man will purchase a law-suit. Any new for- eign investments in Korea will almost certainly soon find themselves involved with the Japanese administration, and be compelled to resort to their national representatives at Tokyo for assistance. Under these circumstances for- eign capital will hesitate to enter Korea, and exploitation of Japan’s preserve will be left to Japanese, which seems to be what her statesmen desire, although it may strike many people as short-sighted policy. As to those foreign interests which are already there, bare justice requires that if their position cannot be made permanently tenable, their governments will aid them to get out with a minimum of loss. CHAPTER XIII THE BALKANS OF THE EAST MancHuriA A DANGER Spor—Course oF RECENT Events THERE — THE TERMINATION OF HosTILITIES — VARI- ous PouiticaL Entities INvotvep — Russia, JAPAN AND Cuina — CHaotic ConpiTions — Russia’s Position — HER “SPHERE” THE LARGER — JAPAN’S PosiTION More SIGNIFI- cANT— Reasons For THis ANALYZED — JAPAN AND CHINA — Tue Yuan-Komura AGREEMENT — THE SUPPLEMENTARY ARTICLES — ANTECEDENTS OF THIS TREATY — THE STATUS OF Japan —“ Potice” anp “ Raitway Guarps ’’— OccuPaTION OF THE CouNTRY. MANCHURIA to-day is to the Far East what the Balkan states have for so long been to Europe. ‘This salubrious and fertile region, with an area equal to that of France and Germany combined, is the focus of great political ambitions and designs; and here the issues which may cause another international conflict of vast proportions are again moving toward a culmination. When in August, 1905, Russia and Japan, in the treaty of peace ratified by them, mutually engaged “ To evacuate completely and simultaneously Manchuria, ex- cept the territory affected by the lease of the Liao-tung peninsula,” and ‘To restore entirely and completely to the exclusive administration of China all the portions of Manchuria now in occupation or under the control of Russian or Japanese troops,’ there was a disposition throughout the world to regard these assurances as affording a basis for satisfactory solution of the vexed 163 164 THE FAR EASTERN QUESTION questions involved. In some quarters the fact that eight- een months from the signing of the treaty was fixed as the maximum time limit within which the restoration of Man- churia to China was to be completed gave rise to misgiv- ings; but these were smothered in general rejoicing over the termination of hostilities, especially as the two govern- ments pledged themselves to reduce the period of read- justment if it proved to be practicable. Other nations interested in the future of the Far East were at that time apparently disposed, at least in respect to diplomatic attitude, not to be over-exacting about de- velopments in those regions during the interval, but rather to await its termination before taking decisive steps in their own or China’s behalf. Nevertheless, the feeling of security so widespread in the West when peace was made has gradually been undermined by the course of events in Manchuria and Korea since then, and is now re- placed by an uncertainty tainted by uneasiness. Realiza- tion that peace between Russia and Japan does not neces- sarily mean an adjustment of the situation in Eastern Asia that will satisfy a majority of western powers is growing among those in touch with events and policies. This is none the less true because of the somewhat ominous reticence in diplomatic circles which followed the war, and that public attention, beguiled into temporary repose, was for a time diverted. Since the war ended Manchuria has witnessed the di- rect application, in some measure, of three distinct polit- ical entities, each animated by widely differing purposes, yet compelled by circumstances temporarily to compromise their antagonisms, and to pretend a harmony which none of them feels. These are China, Russia and Japan: China being the recognized sovereign of the country, feebly attempting to resume her governmental functions, THE BALKANS OF THE EAST 165 while Russia and Japan are at present the actual sover- eigns, basing their authority upon military occupation. Only semi-chaotic conditions could prevail under such cir- cumstances; but efforts of the three nations each to have its own way and secure to itself the greater advantage have developed much of significance; and other interested nations, while abstaining from action likely to annoy or embarrass the recent belligerents, have been keenly alive to what is going on. ‘This is necessary vigilance, as it is only by accurate knowledge of the real situation, and the designs centering here, that intelligent action is pos- sible when time for action comes. For it is not to be an- ticipated that civilization will indefinitely tolerate a con- dition so widely detrimental to general interests and so teeming with causes for international friction. So numerous, complex and diverse are the elements through which order and stability are endeavoring to push their way in this uneasy country that only a compre- hensive review of existing conditions, and the conflicting forces at work, can throw light on the subject. Of the territory of Manchuria proper, Russia now occupies ap- proximately two-thirds, embracing the region drained by the Sungari and Amur and the more important tribu- taries of these great rivers. While this part of the coun- try is not now so thickly populated or as thoroughly culti- vated as is the valley of the Liao, it is believed to pos- sess greater potentialities for development. If one as- sumes that the present zones of occupation will represent a permanent division of Manchuria between Russia and Japan, there is no doubt that Russia has much the better of the bargain, considering only the natural resources of the country. Beside Manchuria, nearly the whole of eastern Mongolia is now practically occupied, though not so specifically, by Russia. Here again Russia’s position 166 THE FAR EASTERN QUESTION is better than that of her rival, as Japan’s influence extends over only a small corner of Mongolia lying adja- cent to southern Manchuria, while Russia’s sphere em- braces nearly half of the entire domain of China’s great northern possession. Notwithstanding that Japan’s present control of Chi- nese territory is decidedly inferior geographically, com- pared to regions under Russian control and influence, there are circumstances which give Japan’s position greater in- ternational significance. Chief of these is the present superior military and naval potency of Japan in this part of the world. Then conditions are such that Japan’s immediate policy will be, to a large extent, a powerful factor in determining the course of other powers. It is clear that should Russia, after extreme attenuation of the evacuation interval, show a disposition to hold to what she has, she will find it exceedingly difficult to maintain such a position before the powers and Japan, in the face of a complete and candid fulfillment of Japan’s promises. On the other hand, should Japan hold to what she has gained, a similar attitude by Russia would substantially be justi- fied and her position become practically impregnable. Thus in respect to these two nations the key to the situa- tion now rests with Japan, and gives to her policy and ac- tions the greater immediate possibilities in influencing the destiny of Manchuria, and the future of the whole Far Eastern Question so inevitably involved herein. The fundamental proposition here indicated gives to the actions of Japan in Manchuria and eastern Asia a greater importance and interest, for the time, than is at- tached to those of Russia. Besides, a deep distrust of Russia’s designs in this part of the world, and a suspicion of her diplomatic assurances so strong, in the western popular mind, as to deprive them of power to beguile, LHE BALKANS OF THE EAST 167 insures that her actions will be closely scrutinized. What is not fully appreciated in America is that there is little difference between the theory and working method of a western diplomacy deeply grafted with Orientalism, and an eastern diplomacy which has recently found it convenient and necessary to adopt western forms. I think that among more important nations Russia and Japan, in their diplomatic methods and general foreign policy, are more nearly alike than any other two powers. And a compromise of their differences in eastern Asia, by mutual concessions, is not so unlikely as some imagine it to be. If such a compromise should take the shape of an agreement to retain their present hold on Manchuria and Mongolia, it is unlikely that the world will be taken into their confidence, but will be left to learn the fact from the analogy of events. I will, therefore, in attempting to depict conditions in eastern Asia from the termination of hostilities to the present time, give to Japan the priority which her position demands, realizing that an elucidation of her policy and actions also will touch and illuminate all the principal interests concerned. In addition to the treaty of peace with Russia the pres- ent relations of Japan to Manchuria are presumably cir- cumscribed by a treaty defining certain relations between Japan and China, which was signed at Peking on Decem- ber 22, 1905,! and subsequently ratified. As this docu- ment forms the diplomatic basis for solution of the com- plex relations now existing between China and Japan, it is reproduced here, with the supplementary agreement, omitting the preamble. Article I— The Imperial Chinese Government con- sent to all transfers and assignments made by Russia 1 Appendix C. 168 THE FAR EASTERN QUESTION to Japan by articles V and VI of the treaty of peace. Article Il — The Imperial Japanese Government en- gage that in regard to the leased territory as well as in the matter of railway construction and exploitation, it will, so far as circumstances permit, conform to the original agreements concluded between China and Russia. In case any question arises in the future on these subjects, the Japanese Government will decide it in consultation with the Chinese Government. Article III — The present treaty shall come into force from the date of signature. It shall be ratified by their majesties the Emperor of Japan and the Emperor of China, and the ratifications shall be exchanged at Peking as soon as possible, and not later than two months from the present date. In witness whereof, etc. (Signed. ) SUPPLEMENTARY AGREEMENT Article 1:— The Imperial Chinese Government agree that as soon as possible after the evacuation of Man- churia by the Japanese and Russian forces, the following cities and towns in Manchuria will be opened by China herself as places of international residence and trade: — Shingking Province — Fengwangcheng, Liao-yang, Hsin- mintun, Tieling, Tungkiangtzu and Fakumen; Kirin Province — Changchun, Kirin, Harbin, Ninguta, Hun- chun and Sansing; Heilungkiang Province — Tsitsihar, Hailar, Aihun and Manchuli. Article 2: In view of the earnest desire of the Im- perial Chinese Government to have the Japanese and Russian troops and railway guards in Manchuria with- drawn as soon as possible, and in order to meet this de- sire, the Imperial Japanese Government, in the event of THE BALKANS OF THE EAST 169 Russia agreeing to the withdrawal of her railway guards, or in case other proper measures are agreed between China and Russia, consent to take similar steps accord- ingly. When tranquillity shall have been reéstablished in Manchuria, and China shall have become herself capa- ble of affording full protection to the lives and property of foreigners, Japan will withdraw her railway guards simultaneously with Russia. Article 3:—- The Imperial Japanese Government, immediately upon the withdrawal of their troops from any region in Manchuria, shall notify the Chinese Gov- ernment of the regions thus evacuated, and even within the period stipulated for the withdrawal of troops in the additional articles of the treaty of peace between Japan and Russia, the Chinese Government may send necessary troops to the evacuated regions of which they have al- ready been notified as above mentioned, for the purpose of maintaining order and tranquillity in those regions. If, in the regions from which Japanese troops have not yet been withdrawn, any villages are disturbed or damaged by native bandits, the Chinese local authorities may also dispatch a suitable military force for the purpose of cap- turing or dispersing those bandits. Such troops, how- ever, shall not proceed within 20 Chinese Ji from the boundary of the territory where Japanese troops are sta- tioned. Article 4:— The Imperial Government of Japan en- gage that Chinese public and private property in Man- churia, which they have occupied or expropriated on ac- count of military necessity, shall be restored at the time the Japanese troops are withdrawn from Manchuria, and that such property as is no longer required for military purposes shall be restored even before such withdrawal. Article 5:—The Imperial Chinese Government en- 170 THE FAR EASTERN QUESTION gage to take all necessary measures to protect fully and completely the grounds in Manchuria where the tombs and monuments of Japanese officers and soldiers who were killed in the war are located. Article 6: —— The Imperial Chinese Government agree that Japan has the right to maintain and work the mili- tary railway line constructed between Antung and Mouk- den, and to improve said line so as to make it fit for the conveyance of commercial and industrial goods of all na- tions. The term for which such right is conceded is for fifteen years from the date of the completion of the im- provements above provided for, the work of such im- provements to be completed within two years, exclusive of a period of twelve months during which work will have to be delayed owing to the necessity of using the existing road for the withdrawal of troops. The term of this concession is therefore to expire in the 49th year of Kuang Hsu (1923). At the expiration of that term, the said railway shall be sold to China at a price to be determined by appraisement of all its properties by a foreign expert to be selected by both parties. The conveyance by the railway of the troops and munitions of war of the Chi- nese Government prior to such sale shall be dealt with in accordance of the regulations of the Eastern Chinese Railway. Regarding the manner in which the improve- ments of the railway are to be affected, it is agreed that the person undertaking the work on behalf of Japan shall consult with a commissioner dispatched for the purpose by China. The Chinese Government will also appoint a commissioner to look after the business relating to the railway as is provided in the agreement relating to the Eastern Chinese Railway. It is further agreed that de- tailed regulations shall be concluded regarding the tariffs RaILway STATION AT \IOUKDEN. Tue Ratway Station, LrAo-yanc, MANCHURIA, IHE BALKANS OF THE EAST 171 for the carriage by the railway of the public and private goods of China. Article 7:— The Governments of China and Japan, with a view to promote and facilitate intercourse and traffic, will conclude as soon as possible a separate con- vention for the regulation of connecting services between the railway lines in South Manchuria and all other rail- way lines in China. Article 8:—- The Imperial Chinese Government en- gage that all materials required for the railways in South Manchuria shall be exempt from all duties, taxes and likin. Article 9:—- The methods of laying out the Japanese settlement at Yinkow (Newchwang) in the province of Shingking, which has already been opened to trade, and at Antung and Moukden in the same province, which are still unopen although stipulated to be opened, shall be separately arranged and determined by officials of Japan and China. Article 10: — The Imperial Chinese Government agree that a joint-stock company of forestry, composed of Japanese and Chinese capitalists, shall be organized for the exploitation of the forests in the regions on the right bank of the Yalu river, and that a detailed agreement shall be concluded in which the area and term of the con- cession, as well as the organization of the company and all regulations concerning the joint work of exploitation, shall be provided for. The Japanese and Chinese share- holders shall share equally in the profits of the undertak- ing. Article 11:—- The Governments of Japan and China engage that in all that relates to frontier trade between Manchuria and Korea the most favored nation treatment shall be reciprocally extended. 172 THE FAR EASTERN QUESTION Article 12:—-The Governments of Japan and China engage that in all matters dealt with in the treaty signed this day or in the present agreement the most favorable treatment shall be reciprocally extended. (Signed) This treaty, in itself, merely records China’s assent to those articles of the Russo-Japanese peace treaty by which Russia agrees to turn over to Japan Port Arthur, Dalny and the territory embraced in her lease of the Kwang-tung peninsula, and the Chinese Eastern Railway south of a specified point; and also to the terms for the mutual evacuation by Russia and Japan of Manchuria. Although no outward friction developed at the confer- ences, it was well known that China acceded to the treaty with great reluctance, especially in the matter of the trans- fer of the Kwang-tung lease to Japan. China would have preferred to have rescinded this obnoxious lease al- together. She also was dissatisfied with some of the con- ditions for the evacuation of her provinces in Manchuria. However, she was powerless to resist, and agreed to Ja- pan’s proposals. One phrase in the treaty may be spe- cially mentioned. The second article provides that in case any question arises in the future concerning sub- ject matters of the instrument, “‘ the Japanese Government will decide it in consultation with the Chinese Govern- ment.” Here is recognizable the hand which drafted the series of documents by which Japan’s suzerainty over Korea, amounting practically to annexation, was estab- lished. It can hardly be assumed that this departure from usual phraseology, specifically giving to Japan alone the right to decide upon the interpretation of the treaty, was accidental. But the working method of the treaty, in so far as it THE BALKANS OF THE EAST 13 determined upon details, is embraced in the supple- mentary articles. It was announced at the time the treaty was promulgated that its chief object was to es- tablish a definite basis for Japan’s position in Manchuria, and to provide a way to work out the details of the in- terval of military occupation. That many important matters not specifically referred to either in the treaty or supplement would require subsequent adjustment was rec- ognized, and these were left to be considered by a future convention, or by regular diplomatic representatives of the two nations. As to the actual operation of the supple- mentary articles, this may be best illustrated by a descrip- tion of conditions in Manchuria since the war, which will bring out, in a practical way, all the propositions in- volved. For a short time after hostilities terminated, both bel- ligerents maintained the then existing status quo, while their military commissioners consulted about details for withdrawal of the armies. Marshal Oyama left Mouk- den in November, 1905, and returned to Japan. His departure may be said to fix the beginning of the evac- uation movement, and the turning point into what may be termed the occupation interval. Marshal Oyama was succeeded by General Oshima, who assumed com- mand of all Japanese elements in Manchuria, under the title of Viceroy. He established headquarters at Liao- yang, and divided the country into districts, each under a military administrator. Soon after Oshima’s arrival the movement of troops to Japan was commenced, and con- tinued with reasonable rapidity until by the beginning of summer, 1906, the greater part of the vast army was withdrawn. Just how many were left was not easy to ascertain. While in Manchuria in the summer of 1906, I asked a Japanese officer how many troops Japan then had 174 THE FAR EASTERN QUESTION there, and he replied: ‘‘ We have no troops; only police and railway guards.” It is amusing how Japanese ofh- cials, even in casual conversation, persist in adhering to the phraseology of these mild diplomatic fictions. The ‘police’ and ‘ guards”? were then regular soldiers of the Japanese army. But technically, conforming to the language of the treaties, Japan and Russia are not now expected to have troops in Manchuria, so their soldiers are given a different name. Both powers had until March, 1907, to complete the withdrawal of troops; but Japan chose for some time before that date to represent that she had completed the military evacuation, and that such troops as remained were not there in a military capacity. Under the limitation by the peace treaty to fifteen guards per kilometer of line, Japan has the right to keep not more than fifteen thousand such guards in Manchuria. This estimate, however, includes only the former Russian lines, and the proposed line between Antung and Mouk- den, with a liberal allowance for spurs and side-tracks. But the Japanese authorities early displayed a disposition to stretch this limit by means of an unexpected complica- tion. During the war, for the uses of the army, a num- ber of what were then regarded as temporary railway lines were laid. ‘These usually were of toy-like dimen- sions, often too frail for steam locomotion, the cars be- ing pushed by coolies or drawn by animals. Portions of the country were gridironed by these little roads, and after the army was withdrawn many of them continued to be operated, and still are to some extent. Japa- nese were inclined to include the mileage of these roads in their estimate of the proper number of guards. It is true that prior to the expiration of the occupation inter- val the presence of a few thousands of Japanese troops, THE BALKANS OF THE EAST 178 more or less, was of minor importance; but it is interest- ing to note the care then taken to create precedents for quibbles when the time for final adjustment comes. Perhaps the most significant part of the last treaty be- tween China and Japan is embraced in those supple- mentary articles which deal with the restoration of Chi- nese political autonomy in Manchuria. It will be noted (Article 3) that Japan agreed, tentatively, to not wait upon final evacuation to begin this restoration; but to make the process gradual, as troops were withdrawn from various localities. A calculated effort, through Japanese news agencies, was made to show that this assurance was carried out, and that even prior to March, 1907, the greater part of Manchuria was administered by China. There is some foundation for this contention, but the in- formation so widely disseminated gives a very imperfect idea of actual conditions and the circumstances which at- tended them. CHAPTER XIV THE EVACUATION PERIOD Drirt oF JAPAN’s PoLicy IN MANCHURIA — SIGNIFICANCE oF INTERNAL DISSENSIONS IN JAPA FacTIONS — CONSIDERATIONS INVOLVED — DIFFERENT OPIN- ions, One Desire— Tue First ‘“Openinc” or Man- CHURIA — GENERAL OsuHima’s ATTITUDE— Marquis Sal- onj’s Visir—SuHirT oF JAPANESE HEADQUARTERS — REAL SiruaTION aT MoUKDEN— THE VICEROY’s PosiITIoN — His EXCELLENCY PRACTICALLY A PRISONER — VISIT OF A FOREIGN OrFIcIAL TO MouUKDEN — SITUATION OF CHINESE INHABIT- ANTS — THE SECOND “ OpENING”’ OF MANCHURIA — Opposli- TION IN JAPAN— TEMPORARY RETIREMENT OF VISCOUNT HayasHI— PartiaL RESTORATION OF ee s AUTONOMY — FuRTHER NEGOTIATIONS. To get the drift of Japan’s political policy in Man- churia since the war ended, it is necessary to take a pass- ing glance at some incidents of internal politics in Japan. Owing to paucity of news from Japan, and the fact that a considerable part of news from there which is dissem- inated abroad originates with the Government or corres- pondents subsidized by it, the western world does not always understand the issues which animate political fac- tions there, or the significance of internal dissensions. When, therefore, soon after the war radical changes in the ministry occurred they caused but little international comment, and it is probable that thousands of well-in- formed persons have never heard of them. Yet they were a result of long-growing differences between the 176 THE EVACUATION PERIOD 177 military party in Japan and other elements in the na- tional life. These differences, which had been suspended, by common consent, during the continuation of hostili- ties, again sprang into prominence when victory was as- sured, and it became necessary to consider plans for the future. Under the circumstances it was natural that mil- itary and naval influence would be very strong, but op- position forces soon revived sufficiently to make them- selves felt. In respect to issues raised by the settle- ment of the war a wide, even fundamentally vital schism on a broad question of national policy soon developed. This schism is about Japan’s position in Manchuria. Many views are held by prominent statesmen, but, to at once strip the matter to the bone, the issue was drawn on the question of whether Manchuria shall be restored to China. It may be said that there was practically no divergence of desires in the matter; which means that almost all Jap- anese earnestly wish to keep the part of Manchuria now held by their Government, and perhaps hope in time to de- vise a way to do so. But opinions differed widely about the immediate course to pursue. The purely military party wanted flatly to declare, as in the case of Korea, Japan’s political and commercial paramountcy in southern Man- churia, trusting to Japan’s strong military position and the general unreadiness of most powers which might be disposed to dispute the issue to prevent any decisive oppo- sition. There is little doubt that such a coup might have been at least temporarily successful. This is exactly what was done in Korea, and the powers obligingly con- sented to forget Japan’s pre-bellum assurances regarding the independence of that kingdom. But wiser and more far-seeing Japanese statesmen saw serious difficulties in the way of this plan. The war 178 THE FAR EASTERN QUESTION had impaired the national finances, and an ability to fur- ther borrow in western countries was necessary to any so- lution of the grave fiscal problems confronting the Gov- ernment, and resuscitation of its depleted material re- sources. To throw at once openly international prom- ises to the winds would almost certainly have isolated Japan among the nations, so far as active sympathy is concerned, and seriously crippled her financial credit. Conservative leaders pointed out that a nation cannot progress by war alone, and that Japan had already, for the moment, gone about her limit on that line. This briefly summarizes the main differences in Japanese coun- cils during the year which followed the end of the war, and discussion was none the less active because the outside world heard scarcely anything of it at the time. To have permitted it to become public that the Government was in doubt whether to fulfill its obligations in Manchuria would have at once centered upon it keen international suspicion, which pacific assurances and a moderate course, even if subsequently adopted, would have great difficulty in counteracting. Evidences of the crisis were plentiful at the time in the columns of the Japanese vernacular press, although censorship made such references extremely guarded. These differences of opinion led, early in 1906, to reor- ganization of the ministry, and Marquis Saionji became premier. ‘The selection of Saionji seems to have been a compromise between the extreme military and anti-mili- tary wings. The extreme military party for the moment was checked, and a moderate course was adopted. Soon after his assumption of office, Marquis Saionji made a visit to Manchuria. Although no attempt was made to conceal the fact of his trip (which would have been im- possible), it was “‘ unofficial,” as Japanese put it, and no THE EVACUATION PERIOD 179 prominence was given it in foreign news dispatches. While the premier doubtless took occasion to inform him- self first-hand about conditions in Manchuria, there is good reason to think that his chief object was to talk per- sonally with some of the military administrators, particu- larly with Viceroy General Oshima, and to urge certain political and financial necessities of the Government upon them. At this time differences between the ministry and military administrators in Manchuria had almost reached a state of open dissension. The ministry was urging a hastening of the military evacuation, and an os- tensible restoration of Chinese autonomy. In fact, the first of a series of announcements of the “‘ opening” of Manchuria had already been circulated over the world by news services out of Tokyo. A disposition to become sceptically critical was beginning to appear in the West, induced by .complaints about conditions in the country. The military administrators in Manchuria, with the usual reluctance, as often exemplified by analagous conditions elsewhere, to relinquish their absolute rule, were strongly objecting to any modification of the situation. While he is not known to have expressed himself publicly, it was understood in well-informed circles that General Oshima was strongly opposed to even an appearance of giving up the country; and in this, as I have indicated, he had the support of a powerful faction at Tokyo. The army holds the view that if it gets out of Manchuria now it will be forever, and this it regards as partial and useless dissipa- tion of the fruits of its exertions and sacrifices. I pretend to no exact knowledge of what transpired between Saionji and Oshima, but it seems that a rupture narrowly was averted. It is said that when Saionji returned to Japan he carried with him Oshima’s resignation, to take effect unless his (Oshima’s) views were at least partly met. 180 THE FAR EASTERN QUESTION Some compromise evidently was reached, for Oshima re- tained command in Manchuria. Soon afterward, how- ever, he removed his headquarters from Liao-yang to Port Arthur, in Japanese leased territory. His title was changed from “ Viceroy” to ‘“ Governor-General,” and it was officially announced that he would thereafter ad- minister Manchuria under the direction of the Foreign Office. While this move was an outward defeat for the mil- itary party, its repulse was more apparent than real. The shifting of General Oshima’s headquarters did not alter the real situation, for administration of Southern Manchuria remained in the hands of his military sub- ordinates. Although the greater part of the army had returned to Japan, detachments were stationed in the prin- cipal cities and towns. Unadulterated military rule still prevailed. As the number of troops was reduced the lo- cal Chinese civil authorities were permitted partly to re- sume their customary functions, still, however, under the direct supervision of Japanese. Eager as China is to re- gain her territory, her position is very delicate and re- quires the exercise of tact. The Chinese Government was during this period content to accept what was permitted, and while occasionally a hint was thrown out that less de- liberation in restoring her autonomy would be entirely to China’s satisfaction, no disposition was shown to hustle or irritate Japan. The real situation well may be illustrated by relations which then existed between the Japanese administrator at Moukden and the Chinese Viceroy of Manchuria, whose seat of government is in the old Manchu capital. Soon after the Japanese occupied Moukden they removed the Tartar General who had held the position during the Rus- sian occupation, and for a time no successor was appointed THE EVACUATION PERIOD 181 by the Chinese Government. After an interval a new Viceroy was named, whose appointment, if it was not ab- solutely dictated by Japan, was subject to her veto. The new Tartar General entered Moukden with a cere- monial flourish, in which the Japanese military authori- ties participated. Once inside his palace, however, he became practically a figurehead. Indeed, it is not too much to say that he was for a time a prisoner, as was demonstrated by a number of incidents which came under the observation of foreigners. The difficulties which were thrown in the way of for- eigners who desired to enter Manchuria after the conclu- sion of peace will be hereafter described, but some few exceptions were made to the rule debarring them. In the spring of 1906 the consular representative of a western power, stationed at Newchwang, was ordered by his Gov- ernment to proceed to some interior points for the purpose of observing conditions and looking after property which belonged to its nationals. After considerable delay, per- mission for him to make the journey was granted by Japan. On reaching Moukden the foreign official pre- pared to call upon the Tartar General. This was en- tirely proper, and to have failed to do so would have been a discourtesy. On intimating his intention to Jap- anese officials who had him in charge, he was informed that the Chinese Viceroy was very ill and unable to re- ceive visitors. Not quite satisfied, the Consul-General quietly made some inquiry through Chinese sources, with a result that he received word that the Tartar General was quite well and very anxious to see him. He there- upon pressed his request upon the Japanese military admin- istrator, who finally gave an obviously reluctant consent, with the proviso that a Japanese officer should be present at the interview. Under these circumstances the Consul- 182 THE FAR EASTERN QUESTION General saw His Excellency, who greeted him with pleas- ure, and expressed a wish to have a private conversation with him. This proved difficult to manage, owing to the presence of a Japanese officer, but the Viceroy suc- ceeded in communicating an impression of his relations with the Japanese. Later on the same day, when the Tartar General attempted to return the call of the Consul-General, he was arrested by Japanese soldiers and compelled to remain in the Yamen. A short time after- ward a consular representative of another western power, on a similar visit to Moukden, was unable to see the Vice- roy, receiving word through the Japanese administrator that His Excellency was too ill to receive visitors. This foreign official privately expressed the opinion after leaving Moukden that Japanese officials prevented the Tartar General from receiving him. It should be re- membered that these incidents occurred something like eight months after the war had ended, and after it had been announced from Tokyo that Chinese local autonomy in Manchuria was substantially restored. If the Japanese authorities assumed this attitude in dealing with one of the highest officials in the Chinese Empire, in the chief city and capital of Manchuria, and when the circumstances could hardly escape the notice of foreigners, one well may wonder what may have been the situation of Chinese officials of lower degree, located in remoter towns and villages, where foreign observers had not penetrated since the Japanese occupied the country. Many and bitter were the complaints made by local Chi- nese magistrates about certain methods of Japanese mili- tary administration, but until recently slight official atten- tion was paid to them. Meanwhile, the Japanese and Chinese governments, and representatives of both nations in Manchuria, were continually fencing with each other, as IE EVACUATION PERIOD 183 conditions slowly shifted, in the effort to score points; the main object of China being to get the Japanese out of the country as soon as might be and on the best terms, while Japan endeavored to defer abandonment of her advan- tageous position, using it as a lever to reap all existing benefits and to force, if possible, a permanent continuance of them. While China was impatiently but somewhat passively waiting for Japan to notify her, in accordance with Ar- ticle 3 of the supplementary agreement, that the time had come for resumption of her autonomy in regions that had been evacuated, outside pressure to hasten the “ opening ” of the country began to be felt in Tokyo. I will not here discuss the reasons for and character of this pressure, which is fully treated elsewhere, but it had the effect of causing another apparent turn of the wheel. On June 1, 1906, a banquet was given at Moukden by the Japanese military administrator, and which was attended by the Tartar Gen- eral and his staff, when it was formerly announced, in an after-dinner speech, that the military evacuation was com- pleted and that immediate steps would be taken to restore administration of a large part of the country to Chinese officials, and that restrictions upon foreigners entering Manchuria would be removed. Again did the press of the world announce the glad tidings. But months passed and nothing was done, from anything that could be de- tected in Manchuria, toward carrying out this announce- ment. In fact, it seemed for a time that its fulfillment might be deferred indefinitely; for it at once plunged the Japanese ministry into the throes of another internal crisis. As long as the policy was merely to pretend to “ open” that part of Manchuria under the control of Japan, while leaving the actual conditions comparatively unaffected, the discontent of the military party was somewhat assuaged, 184 THE FAR EASTERN QUESTION and its leaders were persuaded to countenance outward concessions to international expediency. But really to turn over any part of the country to the Chinese was felt by the military administrators to give ground which might never be recovered. So they rallied their partisans at Tokyo and the fight raged afresh. Little was permitted to leak out of the council chamber, but the crisis had, nevertheless, some significant manifestations. When it was announced that Viscount Hayashi, Minister for For- eign Affairs, had taken a vacation from his official duties, some native newspapers commented upon the matter. One of the léading Japanese vernacular journals had this to say: ‘Various rumors are in circulation as to the actual cause of Viscount Hayashi’s temporary retirement, it be- ing widely believed that he has been forced to retire ow- ing to the situation in the cabinet. A Tokyo dispatch to this paper states that Viscount Hayashi’s indisposition is of so slight a nature that he cannot be said to be ill, nor is it at all necessary for him to absent himself from his of- ficial duties on that account. Viscount Hayashi is stated to have quoted his medical adviser’s opinion that he should relieve himself of all business and take care of his health; otherwise the consequences would be serious. ‘The large amount of important diplomatic business in the course of negotiation at the present time may account for Marquis Saionji assuming the control of foreign affairs; but certain circumstances suggest that the present leave of absence granted to Viscount Hayashi is merely the forerunner of his resignation. The strained relations between the civil and military parties in the cabinet — which led to the resignation of Mr. Kato, Viscount Hayashi’s predecessor — continue to cause friction, especially in reference to the “\ FETE IN THE JAPANESE SETTLEMENT, MOUKDEN. THE EVACUATION PERIOD 185 opening of Manchuria. Consequently, the settlement of every question —even though it concerns Great Britain or the United States — involves a disagreement between these conflicting parties, a state of affairs which has great- ly harassed Viscount Hayashi as Foreign Minister. Moreover, the diplomatic negotiations with China have not proceeded so swiftly or satisfactorily as could be de- sired, and finding the outlook hopeless in his embarrass- ing position Viscount Hayashi is said to have resolved to quit office on the plea of ill health.” To those who have regarded political Japan as a happy family, harmoniously bending its energy for the national good, this intimation of the internal disagreements com- mon to all governments may come as a surprise. From what I know of Japan, inside and outside, I am convinced that western knowledge of darkest Russia is as the noon- day sun to the moon compared to general western under- standing of internal forces which sway the policy of Nip- pon. The Russian official sphynx is garrulous in com- parison with his eastern neighbor and erstwhile foe. In no other country which pretends to broader civilization 1s news about national affairs which is sent out for publica- tion abroad so effectually controlled by the Government as in Japan. Whatever may be the whole truth about this crisis, the conservative party for the time held its position, and the policy of moderation and expediency was kept to the fore. On August 1, 1906, the Japanese military administrator at Moukden gave another banquet, to which principal Chinese officials were invited; when he announced that on that date Japanese military administration of Moukden would terminate. During the proceedings attention was called, in an address read in Chinese, to the alleged fact 186 THE FAR EASTERN QUESTION that while Japan was living up to her promises, had com- pletely evacuated the country and was now restoring Chi- nese autonomy, the Russians further north, although un- der similar obligations, had withdrawn only part of their forces; the obvious moral being that Japan was the real friend of China. What the Tartar General and his sub- ordinates who were present thought of these assurances is not known, but the function passed harmoniously. A few days afterward the Japanese military administrator departed from Moukden with his staff, and went to Port Arthur, after turning over to the Japanese Consul-Gen- eral at Moukden the care of Japanese subjects and inter- ests. The Japanese guards were withdrawn from the Yamen and the city gates, and were replaced by Chinese troops and police. Here, then, was tangible evidence of an intention to restore Chinese authority, and Chinese of- ficials were for a brief while greatly encouraged. But they soon discovered that in practice there was little real difference between Japanese military administra- tion and Japanese consular supervision, backed by the same military force. It developed that Chinese officials could do nothing of importance without ‘‘ consulting ” the Jap- anese Consul-General, who remained the real authority. Beside this, the so-called restoration was so narrow in its territorial application as to confer little more than per- sonal liberty to the Tartar General inside the city of Moukden. At the same time when Moukden was “ re- stored,” similar steps were taken at Liao-yang, Tieling and some other minor places in the interior, which gave a casual impression that the restoration was general through- out the country. But when the Tartar General prepared, in 1906, to make a trip for the purpose of ascertaining conditions and the situation of Chinese subjects, he was privately “advised” by the Japanese Consul-General to THE EVACUATION PERIOD 187 remain in Moukden, and did so. It is true that this was subsequently made to appear as the act of the Chinese Government, and it was announced at Peking that the Viceroy’s journey would be deferred; but there is no doubt that diplomatic pressure was brought to compel this an- nouncement, and meanwhile the Japanese kept the Tartar General cooped up in Moukden. The truth is that while not kept under quite as rigid surveillance as formerly, His Excellency was little more than an unwilling puppet in the hands of the Japanese. At intervals after the signing of the convention of 1905, which is obviously and admittedly incomplete, there were negotiations at Peking between Mr. Hayashi, the Japanese minister, and the Wai-Wu-Pu, with a view to adjusting the many matters left open by or entirely omit- ted from the existing agreement. Apparently almost no progress was made, although necessity for expedition grew as time for final and complete evacuation of Man- churia by the former belligerents drew near. Each nation blamed the other for the seeming deadlock, bringing contra-charges of dilatory methods; and probably the truth is that both were in a measure responsible. Both nations were feeling their way, realizing that they alone or to- gether cannot entirely settle all issues that may be raised. But there are many questions, however they may affect other interests, upon which some kind of an understanding must be reached between China and Japan before condi- tions in Manchuria can be established upon a stable basis. A majority of these questions grow out of purely local con- ditions, and are results of the war and some phases of the military occupation. Their equities may, therefore, best be got at by examination of some of the elements involved. CHAPTER XV PROPERTY RIGHTS IN MANCHURIA A PuzzLiInc QUESTION — JaPANESE RIGHTS INHERITED From Russta— THE SoutH MANCHURIAN RalLway — MuinEs AND OTHER CoNCESSIONS — ADDITIONAL REQUISITIONS BY THE JAPANESE — VALIDITY OF TITLES IN DispuTE — JaPa- NESE SETTLEMENTS — THE Casge oF ANTUNG— SEIZURE OF Lanp — MetHops EmpLtoyep— Monopoty oF FACcILITIES —Tue Case or Newcuwanc—Crivic IMPROVEMENTS — A SPECULATIVE PRoyECT — CONFISCATION OF RIGHTS — USE OF CHINESE REVENUES — ACQUISITION OF CHINESE PRIVATE PRopeRTY — JAPAN’S Morat SHirt— BEARING OF ‘THESE Propositions Upon Cuina’s SOVEREIGNTY — THE YALU TimBer INDUSTRY — A DEADLOCK. ONE of the complex and puzzling questions which grew out of Japanese and Russian occupation of Manchuria re- lates to property rights under the new status. These al- leged rights vary greatly in character, but a majority con- sist of real estate and other vested interests. For pur- pose of classification they may be discussed under two heads — Rights or interests which the Japanese claim to have inherited from the Russians, and rights and interests which they claim to have acquired since their occupation of the country. When rights which have been inherited from the Russians are mentioned one naturally thinks of the South Manchurian Railway (Chinese Eastern Rail- way), which is provided for in the treaty. But the rail- way and Kwang-tung lease by no means limit Japan’s 188 PROPERTY RIGHTS IN MANCHURIA 189 claims, and some of them present extremely interesting phases. Beside the railway, Japan claims that all concessions formerly held by Russia revert to her, and has established herself in possession of them. ‘They chiefly consist of mining and timber concessions, and while their value is not definitely known, it is believed to be considerable. Even before peace was declared mining experts in the em- ploy of the Japanese Government were set to work in southern Manchuria and along the upper Yalu, to make an examination of the mineral resources of the country. After hostilities ended this prospecting was continued on a wide scale. Not only are all mines formerly opened or prospected by the Russians in southern Manchuria now in the hands of Japanese, but also are many to which the Russians never made a claim. During Russian oc- cupation, beside land and buildings purchased from Chi- nese residents of the country, much real property was oc- cupied under circumstances which savored strongly of ap- propriation. Such actions of the Russians were strongly criticised by the Japanese press and Government, and the moral need for someone to intervene in behalf of the Chi- nese was pointed out. The Chinese people and author- ities also protested at these actions, and succeeded in a number of instances in compelling restitution, or securing payment for the owners. Much of such property fell into the hands of the Japanese when they expelled the Russians, and the former owners were for a while rejoic- ing at the prospect of getting their own back again. In many instances where Russians held title to property, val- idity of the deeds was disputed, it being alleged that when other means failed to induce an owner to sell coercion was resorted to. These charges against the Russians were widely published before the war, and while they 190 THE FAR EASTERN QUESTION usually were exaggerated they were by no means destitute of truth. Now the shoe is on another foot, and the Japanese Government shows a disposition to claim as a legitimate inheritance what it formerly objected to Russia taking. Japan’s argument seems to be that the robber’s spoils belong to the man who drives him off. And in re- gard to some former Russian concessions, Japan is in- clined to stretch them farther than the Russians them- selves ever attempted to do. Far from building any hopes of a general recovery, through Japanese occupation, of Chinese property appro- priated outright or under various subterfuges by the Rus- sians, the unfortunate residents of Manchuria now find themselves confronted by a similar and far greater acqui- sition of public and private property by the Japanese themselves. In matter I have formerly published about conditions in this country,! I thoroughly discussed the suf- fering and annoyance to which the Chinese population was subjected by the military authorities during the war, and need not review them here. Fortunately, the gener- al situation of native residents is much ameliorated since the establishment of peace, and the more tragic elements have almost disappeared. But reminders of that gloomy period remain, and one of these takes root in the manner by which titles to property now claimed by Japanese were acquired. It is not feasible here to give many examples of how this system has worked, and in selecting a few il- lustrations I take cases which directly involve the Japan- ese Government, through its administrators, and which may, by sometime becoming the subject of international arbitration, have attention concentrated upon them. As a case of this kind I select that of the Japanese set- tlement at Antung. This town, which is situated near the mouth of the Yalu river, was almost the first place in 1 The New Far East. PROPERTY RIGHTS IN MANCHURIA 191 Manchuria to be occupied by the Japanese army. For more than fifteen months before the war ended, it was un- der Japanese administration. Its commercial importance has long been recognized, and before the war the efforts of John Hay resulted in having it declared a treaty port by China, and an American consul was appointed to the post. Owing to the war, however, the position was unoc- cupied until 1908, leaving Japan for several years the only nation represented there. Soon after the Japanese army occupied Antung, early in 1904, steps were taken to create a Japanese settlement. A large plot of ground immediately adjacent to the Chinese city was laid out for a town and surrounded by a wall. When the war ended an apparently thriving settlement was already established, with shops and other activities that usually are to be found in Japan. Also it was found that practically all river front available for godowns and shipping purposes had been secured by Japanese. These things are not in them- selves objectionable, but there were some complaints by other foreign firms that had contemplated establishing themselves there; and Japan is open to the criticism of using her military control of the country to get everything worth having while her regulations kept competitors out. Nearly the whole of this property is now in dispute. The Japanese Government wants the Chinese Govern- ment now to perfect the titles, which was not practicable during the war, and the Chinese Government hesitates to do so on the ground that transfers of much of the land were, it is asserted, secured by coercion and fraud, and without co-operation of Chinese local officials. To this con- tention the Japanese reply that the land was regularly pur- chased from the proper owners, and paid for. This seems to be true in a prima facie sense; but many former owners now assert that they were forced to part with their prop- 192 THE FAR EASTERN QUESTION erty, and that they did not receive the money appropriated by the Japanese Government to pay them. Extraordinary as these assertions may seem to people who reside in highly civilized communities, and who have never had the misfor- tune to live in the path of war, there was much in the known conditions in Manchuria at the time most of this property was acquired to give plausibility to the evidence of former Chinese owners. An official of the American Government, who investigated the situation at Antung soon after the war, was informed by the Japanese authori- ties there that a fair price was paid for all land then held by them, or by Japanese subjects, and the prices quoted, while not representing ordinary values, might be con- sidered equitable remuneration at the time the property is alleged to have been bought. It is probable that many Chinese owners sold willingly; but there is strong evidence to show that some of them parted with their property with reluctance. The usual method seems to have been, with recalcitrant or reluctant owners, to employ an inter- mediary not connected with the Japanese military adminis- tration. Frequently these intermediaries were Chinese or Japanese who were attached to the Japanese administra- tion as spies and informers, and who exercised a sinister in- fluence among the people. Former owners now assert, since they have been able to learn the prices which Jap- anese claim to have paid, that in many cases intermedi- aries gave the owners but a tithe of the actual purchase price, pocketing the difference themselves or sharing it with petty Japanese officials, and if mulcted Chinese suspected that they were being robbed they dared not complain. The land thus in dispute at Antung embraces about five square miles, includes the railway station and yards, the Japanese settlement and the best of the river front. A similar case is at Newchwang, This treaty port, eu) pue uedef useajoqg ayndsip ur st “AVM asautdHf(-ossnyy ol} ddUIS [ING SBA YIYM “UMOZ sty} JO Ips oT ONQINY LV LNANAWIAG ASANVAVE NI LaaYLS PROPERTY RIGHTS IN MANCHURIA 193 which was the only one fully opened in Manchuria when war began, has, consequently, a somewhat peculiar po- sition. Although the city was occupied at times by the military of both belligerents, foreign consular represen- tatives remained at their posts through the war, as did the greater part of the small foreign population. A re- sult of these conditions was that both Russian and Jap- anese authorities were more careful of their actions than was true elsewhere in the country, for whatever they did was observed and reported to other governments, and there was no way of preventing news from going out. Moderate action was therefore the rule in Newchwang under both military regimes, and illustrations taken from there reduce probability of exaggeration to a minimum. When the Russian Government built a branch of the Chinese Eastern Railway from Tashihcha to Newchwang, the Newchwang terminus was placed on the river bank nearly three miles above the city, where a small village grew up around the station. When the Japanese occupied Newchwang, they established a large army base at the rail- way station. As the land previously occupied by the Rus- slans was not sufficient for Japanese purposes, large addi- tions were requisitioned by the army, and sheds and go- downs built upon them. When, as time passed, probabil- ity of Russian reoccupation vanished, the Japanese author- ities began extensive improvements. A macadamized road several miles long was built from the city to and beyond the railway station, with brick drains and curbing. At the time when construction of this road was commenced, it was spoken of as a military necessity and so regarded by foreigners in Newchwang, although its evidently perma- nent character caused comment. But when, after peace was declared, work on the road was continued and extended; and the whole of the large tract lying between 194 THE FAR EASTERN QUESTION the city and the station, by the river, was laid out in cross- streets along which a Japanese settlement began to spring up, the intent of the plan became clear. It then devel- oped that during the war Japanese had acquired almost all land about the station and lying between it and the city. Japanese officials contend that this property was secured by ordinary purchase. But, as at Antung, many former owners now claim that coercion was used to induce them to sell. It is not easy to get at the entire truth of this matter. Investigation of circumstances attending these transfers clearly shows, as at Antung and other places, that some property was seized by Japanese under military law, with- out consulting the wishes of owners; and after hostilities ended former owners practically were compelled to accept such remuneration as was offered, or run the risk of get- ting none at all. On the other hand, it seems that some Chinese owners sold their land willingly, and were satisfied with prices which they received. Before the war most of this land had small value, either actual or prospective, and usually was held at low prices. Taking values as they were when Japanese took over this property, the stated re- muneration seems reasonable, assuming that the real own- ers got the money, and that prices given are correct. But since the improvements inaugurated by Japanese author- ities have fully developed (these include — besides roads and streets — street lamps, and water-front facilities) property in the locality has greatly advanced, and some of it is quoted at ten to twenty times its former value. Some property for which Japanese state that they paid twenty-five taels (about $17.00) a mow (about 1-5 acre), has since been quoted at 1,000 taels a mow; and while these values seem inflated, some lots are said to have changed hands at this price. PROPERTY RIGHTS IN MANCHURIA 195 This whole movement is analogous to a common kind of real estate speculation in America, where likely prem- ises adjacent to cities are laid out in building lots, streets and other civic improvements made, and settlement in- vited. It now seems clear that this plan was contem- plated by Japanese administrators, if not from the be- ginning, from the time when it became evident that Japan was to remain in temporary possession of southern Manchuria. While some land owned by other foreign- ers was occupied by Japanese for military uses, no disposi- tion was shown not to reimburse such owners, and repair damages, although such reparation does not al- ways entirely satisfy owners. It also seems likely that some former Chinese owners, who may have sold their property willingly, now realize that they were worsted in a speculative sense, and in their discontent bring accu- sations against the Japanese authorities, out of spite, which cannot be substantiated. In the whole affair Jap- anese authorities have managed to preserve outward reg- ularity, though the circumstances, when investigated in detail, throw strong suspicion upon the methods em- ployed. The real issue of the controversy is whether Chinese owners were coerced into selling their property. In many cases, it now appears, where a group of Chinese objected to selling at the price offered, the matter was taken up between Japanese authorities and the local guilds, and adjusted by compromise. Conditions which surrounded relations of Japanese military administrators to the Chi- nese functionary bodies do not, however, justify any great assurance in the equity of this plan. It is known that some prominent guild leaders, then under serious charges or imprisonment by the military authorities, had such disabilities apparently removed after meeting the views of Japanese officials in this and other matters; and 196 THE FAR EASTERN QUESTION it is also known that some of these Chinese were open and silent partners in large contracts growing out of these improvements, and which were at the letting of Jap- anese authorities. And it is positively known that some higher Japanese officials were personally interested, in a financial way, in the speculation involved by the scheme as a whole. The visible improvements which are the result of all this will impress any visitor to Newchwang, and the press of the world, duly notified by the Tokyo news serv- ice, favorably commented upon the benefits of Japanese administration. The benefits are obvious enough, looked at only from the standpoint of what has been accom- plished. But action of the Chinese Government, in rais- ing this issue of property rights in connection with the negotiations with Japan, calls attention to a matter of considerable pertinence. It appears that the money used in making these improvements at Newchwang and else- where was largely derived from the customs revenue at Newchwang and local revenues there and elsewhere. To elucidate this phase of the question it is necessary to state that when Japanese military authorities took possession of the port, after its evacuation by the Russians, they also took general control of the custom house. Few changes were made in the personnel of the customs staff, which was at that time and for long after under Mr. Edward Gilchrist, an American, and who was succeeded by Mr. Clark, also an American. The Chinese customs, as is generally known, are pledged to satisfy foreign claims upon China’s revenue; and are administered by a foreign board of which Sir Robert Hart is the nominal head. So to have interfered materially with outward administration of the Newchwang custom house would have aroused in- ternational susceptibilities. PROPERTY RIGHTS IN MANCHURIA | 197 Collection of customs revenue at Newchwang went on as usual under Japanese administration, but there seems to have been a serious divergence from the usual method of disbursement. The Chinese Government asserts that many public improvements undertaken at Newchwang by Japanese were paid for out of customs and local revenue, and that this money also was used to purchase some of the land which now constitutes the new Japanese settlement. In negotiations pending, for the purpose of adjusting mat- ters at issue concerning Manchuria between Japan and China, Japan has announced that she expects to retain that part of customs and other revenues collected under her ad- ministration and which was spent for public purposes, such as roads and sanitation. As by far the greater proportion of such expenditure, so far as I was able to discover, was upon roads needed at the time for Japanese military use (although some now are convertible to public use), and upon improvement of actual or proposed Japanese settle- ments, which Japan now insists that China recognize as permanent and extra-territorial, it will be seen that Ja- pan’s diversion of local and national Chinese revenues was not entirely altruistic. China has protested that she can- not consent to retention by Japan of revenues pledged for general indemnity due to several nations, nor can she recognize the validity of expenditure by Japan of local revenues in the purchase of land at an arbitrary price for Japanese use and occupation. Conditions as illustrated by property disputes in An- tung and Newchwang are universal, in some degree, throughout all parts of Manchuria where Japanese mili- tary administration has been and is applied. Not only has the Japanese Government, through its regular officials, acquired, under equivocal circumstances, a large amount of what formerly was Chinese public and private prop- 198 THE FAR EASTERN QUESTION erty; but hundreds of instances are known where Japan- ese subjects have been supported by Japanese officials in acquiring Chinese property against protests of the owners. Indeed, some of the cases of this nature which were brought to my attention, through reliable sources, show a disregard of law and equity that constitutes a re- proach upon those officials who permitted such incidents to occur. In regard to Japan’s contention that she inherits all privileges, concessions and property formerly held by Rus- ria, China again takes issue with her; pointing out that many of Russia’s alleged privileges and property rights never were recognized as valid by China, but, on the con- trary, were strenuously disputed. In this category China places (the specific exceptions have not, so far as I know, been made public, but I am informed by a high Chinese official in close touch with the negotiations) all coal and other mines formerly operated and claimed by Russia, and much of the real estate included by and adjacent to former Russian settlements along the railway. It is somewhat amusing to see Japan, by her position in this matter, assume an attitude of championing the actions of Russia which she formerly complained of, and upon which she based her chief reasons for going to war. The im- portance of this question to China is far greater than the issue involved in the value of this property which lies south of the line of present division between Russian and Japanese spheres in Manchuria. It should be remem- bered, though I am now confining the discussion to rela- tions between Japan and China, that very similar issues must be adjusted with Russia regarding a far larger part of Manchuria. If China reaches an agreement with Ja- pan by which she concedes Japan’s right to inherit these desiderata of the former Russian regime, it will be diff- STREET IN JAPANESE SETTLEMENT, NEWCHWANG. re. PROPERTY RIGHTS IN MANCHURIA 199 cult, if not impossible logically to refuse to recognize Russia’s similar claims in regions farther north. In much advocacy that I have noticed in the western press, in favor of granting Japan a generous allowance in Man- churia to compensate her for sacrifices in the war, it seems to have been entirely forgotten that Russia still occupies two-thirds of the country, under precisely the same terms as Japan, and that such arguments, in effect, tend to support Russia in pressing the retention of the status quo respecting herself. Property disputes between Japanese subjects and Chi- nese residents of Manchuria, of which there is an enor- mous number, while presenting fewer elements of inter- national friction than similar controversies of their gov- ernments, possess considerable humanitarian interest. There is too much disposition in the West, it seems to me, to ignore, in discussing the recent war and its results, its effects upon Chinese inhabitants of this region. Rep- resenting the greatest human factor in the issues at stake, they apparently are regarded in many quarters almost as a negligible quantity, to be considered only after more important matters are disposed of. Of the innumerable cases where Chinese claim to have been forcibly and wrongfully deprived of their property, one of considerable importance refers to the timber in- dustry along the Yalu river. Those who followed the diplomatic recriminations which immediately preceded the late war may recall that alleged improper Russian aggressions in the Yalu timber region was made a ground of complaint by Japan. It was contended by Japan that Russian claims to timber concessions on both banks of the Yalu were, in effect, fraudulent, and constituted a direct and further aggression upon both Chinese and Korean ter- ritory which Japan could not tolerate. To some it may 200 THE FAR EASTERN QUESTION seem unnecessary to thus, in presenting cases for illustra- tion, so frequently revert to their political antecedents; but the astounding rapidity, particularly in regard to Japan, that pre-bellum attitude and assurances are being rele- gated to oblivion in favor of new and constantly shifting premises, seems to justify keeping the old arguments in mind in this discussion. Japan has not here, as in other places, absolutely demanded the timber concession in Manchuria formerly claimed by Russia; but she caused to be inserted into the supplementary agreement to the last convention with China! (Article 10) a clause providing for organization of a company to exploit forests on the right bank of the Yalu, the Korean side now being absolutely controlled by Japan. Long before this agree- ment was signed Japanese had taken possession of the properties in question, and have since been using them as their own, regardless of wishes of the Chinese; and the clause referred to seems designed to give a color of legality to Japan’s past and present actions. When the Japanese army occupied the Yalu country, the military authorities at once took possession of this industry. At that time there was a large quantity of cut logs lying in the river, and these were seized. Since then the business has been carried on by Japanese, it be- ing the chief source of supply for timber and lumber needed for constructing military railways, fortifications and other requirements during and since the war. It now appears that Chinese who owned these logs and lumber, and whose business arbitrarily was taken out of their hands, have not been able to secure a full settlement. They demand payment for lumber and timber used, and restoration of the property to their own management. During the four and a half years since Japanese seized 1 Appendix C. PROPERTY RIGHTS IN MANCHURIA 201 these properties, several serious disturbances growing out of the matter have occurred. On one occasion when Chi- nese refused to turn over a quantity of lumber and logs, a detachment of Japanese troops fired upon them, killed a number of the Chinese, and seized the property. On an- other somewhat similar occasion Japanese troops were sent to disperse recalcitrant Chinese, but no bloodshed re- sulted. Japanese authorities have claimed that Chinese demand too high a price for timber and lumber that was consumed, while Chinese claim that the Japanese offer too little. So a deadlock resulted, which must be settled in some way by the respective governments. Meanwhile Japanese retain complete supervision of the industry. Tentative attempts have been made to satisfy Chinese interested in the timber business in the Yalu region, by offering to include them in a corporation to be organized under the terms of the treaty; but the Chinese apparently do not want to be included in the proposed company, which they fear will be conducted by Japanese chiefly for their own profit. The commercial reputation of Japanese in the East is such that most people other than Japanese hesitate to become associated with them in enterprises except under conditions which insure equity and honest administration. When pressed to restore the timber business on the Yalu to its former status, now that the war is over, the Japanese state that they are awaiting organization of the company which is to have the conces- sion, under the terms of the treaty, and that refusal of Chi- nese to codperate alone prevents progress. CHAPTER XVI THE OPEN DOOR IN MANCHURIA CoMMERCIAL ASPECTS OF THE Muttrary REGIME — Russia Nor an AccRESSIVE Factor — JaPAN’s COMMERCIAL ACTIVITY — Part PLAyED BY JAPANESE IMMIGRANTS— ATTITUDE OF Japan — Tue Expoitation oF \lanCHURIA — JAPAN’S PRo- PRIETARY TONE — THE ‘“ Open Door ”— ELEMENTS INVOLVED —ConpiTions AFFECTING INCOMING COMMERCE — JAPAN’S CoNTROL OF TRANSPORTATION FacILiTIES —- USE OF JAPANESE SuippiInc Lines — ENCOURAGEMENTS TO JAPANESE TRADE — Japan’s ASSUMPTION OF SOVEREIGNTY — INTERNATIONAL IN- TERESTS AFFECTED — JAPAN’S DENIAL OF ALLEGED DIscrIm- INATIONS. ALTHOUGH political circumstances which attend the oc- cupation of Manchuria by Japan and Russia are of great international importance, and must in time determine the condition and status of all activities within the country, some commercial aspects of the military regime have extraordinary significance to trading nations interested in the future of the Far East. As Russia is not, at least just now, an aggressive commercial power, and her pres- ence in northern Manchuria involves no substantial difference from the situation during years which pre- ceded the late war, here again the chief interest lies in actions of Japan. And of unusual features presented by new commercial activities of Japan, at home and throughout the East, none is so immediately significant, particularly to America, as that illustrated by some phases 202 THE OPEN DOOR IN MANCHURIA 203 of what was done here during the period when Japan’s authority was absolute. The beginning of Japan’s direct commercial activity in Manchuria did not wait upon conclusion of the war. When before hostilities terminated it was pointed out that thousands of immigrants and commercial agents were tramping upon the heels of Japanese armies, it was asserted in some quarters that these persons, whose pres- ence it was said was only temporary, were connected with the military operations, and had nothing to do with a calculated commercial policy of the Japanese Govern- ment. If such assertions ever had any plausibility, it long ago vanished. ‘The year that followed the making of peace revealed this movement, beyond possibility of equiv- ocation, in its true light. There is no longer any attempt to conceal reasons for the presence of these immigrants, and the Japanese Government, by many official acts and utterances, has declared its purposes and intentions in terms so plain that they are clear even to casual inspection. In the effort by Japan to capitalize her victory over Russia, and make it a means of starting the nation upon a career of industrial and commercial prosperity, an im- portant place was assigned to Manchuria. Optimistic propaganda concerning the future of the Empire that was wide-published in Japan and throughout the world prom- inently represented Manchuria among the new assets. Care was taken in most of this comment to refrain from openly asserting proprietary interest, but many Japanese journals and some semi-official utterances have, in dis- cussing imperial possibilities, treated China’s provinces as already being, in practical effect, an adjunct of Japan. It was taken for granted in such comment that it is for Japan to decide upon the future of southern Manchuria, and that no interference with her decision will be tol- 204 THE FAR EASTERN QUESTION erated. Within the last year, since attention of the western world has been more definitely attracted to con- ditions in Manchuria, the Japanese official press has quit its proprietary tone in speaking of the country; but at the time of which I am now writing that tone habitually was employed. Japan’s design commercially to exploit Manchuria is part of a general plan embracing Korea, the home domin- ions and other parts of the East, the scope of which has already been intimated; but it will here suffice specifically to mention only those methods, which are designed to apply specially in this locality. Among factors applicable to development of the for- eign commerce of any nation, beside purely internal ele- ments, are means for getting goods to a proposed mar- ket, and conditions under which they may enter that market; or, in other words, transportation and such regulations affecting trade as customs and other tariffs. It has often been pointed out, by students of Japan’s industrial and economic position, that her geographical location gives her great advantage over western nations in trade with China and Korea in the matter of trans- portation; and some have contended that this advantage will offset certain handicaps which she always must, ap- parently, unless she acquires extensive continental pos- sessions, labor under. Under these circumstances it was thought by many that Japan could afford to forego dis- criminations in her favor in entering the continent, and this alleged fact tended to diminish western commercial uneasiness in regard to portions of Asia falling tem- porarily or permanently under her control. Japanese commercial enterprises in Manchuria during and since the war throw light upon these questions, and perhaps afford a basis for some conclusions as to the real purport Timber RAFTs ON THE YALU River. ScENE IN CHIEN-TAO, A SECTION oF MaANCHURIA ADJOINING Korea, AND WHICH IS OccUPIED BY JAPANESE. THE OPEN DOOR IN MANCHURIA 205 of her policy. In examining matters which bear upon them, illustrated by their application to Manchuria, it may be better to take up the item of transportation first, as it is entirely controlled by the Japanese Government, and for a long time after the war ended was practically unaffected by outside influence or action. During the war with Russia the great Japanese ship- ping companies chiefly were employed in transporting troops and munitions of war to the scene of hostilities; and when hostilities ended the return of the armies to Japan provided business for a considerable time. But after the war, with the tide of transport setting, for the first time in eighteen months, almost entirely toward Ja- pan, the shipping companies found their boats returning to Manchuria with light cargoes or none at all. Special inducements, with direct encouragement and frequent as- sistance of the Government, were offered to Japanese desiring to emigrate to Manchuria. Rosy reports of prospects there were circulated in Japan, and this and the low rates offered had a material effect in swelling the tide of emigration. It is known that many of these emigrants of certain classes, particularly tradesmen, were given transport for themselves and belongings; the presumption being that where such persons were carried free the Government in some way compensated the shipping companies. Several special excursions were made, thousands of so-called students given a free trip to Manchuria, and opportunity to remain there if they wished. Although some effort was made to induce a good class of emigrants to take advantage of these offers, the average, judging from those to be seen in Man- churia, is very poor, falling under normal social level in Japan, and giving some ground to the charge that Japan has been making Manchuria and Korea a dumping 206 “‘IHE FAR EASTERN QUESTION ground for her undesirable elements. So strong at times were these complaints, that many Japanese were deported by the military authorities, and sent back to Ja- pan. But enough to make a distinct impression upon the commercial life of the country have remained. The chief use to which Japanese shipping companies were put was in bringing Japanese goods to Manchuria. These goods have been brought under various condi- tions, shifting as the country evolved from a war status. In the beginning it appears that Japanese traders, or some of them, were charged a low rate of freight on their merchandise; but when even with this help they failed to prosper as the Government wished, and showed signs of discouragement, steps were taken to give them further assistance, and firmly to establish Japanese commerce on a definite basis. The Government called some prominent financiers and merchants into consultation, and a some- what extraordinary programme was advanced. This pro- gramme was fully discussed by the Japanese press, and some of its details formulated into official gazettes. For purpose of directing, under the Government, an energetic campaign to monopolize the foreign trade of Manchuria (for no secret was made of the object of the scheme), what is known as the Manchuria Export Guild was formed in 1906. It included most of the greater commercial guilds in Japan, such as the Osaka Boseki, Miye Boseki, Kanakin Seishoku, Tenima Ormomo and the Okayama Boseki. It was announced that Mitsui & Company were to act as general agents for the guilds and the Government, through its branches in Manchuria; and the Yokohama Specie Bank, the Government’s fiscal agent in Manchuria, was to lend its codperation. ‘These details are significant, for the Imperial Household of Japan owns an interest in the Nippon Yusen Kaisha, largest of the big shipping THE OPEN DOOR IN MANCHURIA — 207 companies, and in the great Mitsui firm, which, in its various ramifications, is the greatest commercial power in the Empire; and the relations of the Yokohama Specie Bank to the currency in Manchuria, which I will hereafter discuss, will give an idea of its power under existing condi- tions. The purpose of the Government respecting trade in Manchuria, as printed in the newspapers, was summed in four articles, as follows: Article 1 — The Government to guarantee a loan of yen 6,000,000 at 4 per cent., to be advanced to Japanese merchants doing business in Manchuria, to assist them in establishing a trade for Japanese goods. Article 2— Japanese goods destined for Manchuria to be delivered upon credit under certain limitations. Article 3 The Chinese Eastern Railway (South Manchurian Railway) to carry such goods free, or at one- half the usual rate, for one year. Article 4— Maritime freightage in Japanese ships carrying Japanese goods to Manchuria to be free, or at one-half the usual rate, for one year. There were a number of supplementary provisions re- garding details for working out the plan as a whole. Firms taking advantage of the Government loan for this purpose, and which did a business aggregating a stated sum annually, were to have % per cent. of the interest charge refunded, as encouragement to extra effort. It may be admitted, I think, that when a Government lends money directly to private persons to engage in private business, at a rate of interest below normal; also guaran- tees them credit for a limited amount, and carries their merchandise free or at half rate to where it is to be sold, it is giving pretty substantial encouragement; and it is 208 THE FAR EASTERN QUESTION time for competitors to take notice. All that is in- volved, in respect to outside competition, does not appear on the surface of this plan, unusual and far-reaching as it is. To get at its full effects, and the extent of Japan’s efforts to push her trade in Manchuria, requires analysis of all factors to the proposition, in the light of actual conditions there during the occupation period. Few will deny, as an abstract proposition, that a gov- ernment legitimately may undertake to advance its na- tional commerce by such methods as are here outlined; for although merchants may be allowed a rate of interest below the market, the difference must be paid by some one, and to say that goods are carried free does not mean that it costs nothing to convey them. In this case it merely means that these ordinary expenses attendant upon the transaction of business temporarily are shifted from certain classes of the community to others; the presump- tion here being that the cost of the experiment will be merged into general taxation. Either this must be true, or there lurks in the project a design in some way to load the cost upon elements external to the nation. The Chinese Eastern Railway, mentioned in Article 3, is that part of the South Manchurian Railway ceded by Russia to Japan, and extends from a point in central Man- churia to Port Arthur, with branches to Dalny and New- chwang. Whether the railway from Antung to Mouk- den, which Japan is to continue to operate, is to be in- cluded in. the arrangement was not stated; but while prob- ability now indicates that this road will when rebuilt be conducted under a different name, there is no reason to doubt that it, as well as railways in Japan and Korea, also will be utilized wherever it is possible. Thus all of several routes of transportation between Japan and Man- churia, and penetrating into this country, are controlled THE OPEN DOOR IN MANCHURIA 209 over their entire length by the Japanese Government. By these lines goods from Japan can reach the interior of Manchuria over four different routes: By ship to New- chwang, and thence by rail to interior points on either of two railways; by ship to Port Arthur or Dalny, and thence by rail; by ship to Antung, and thence by rail; and by ship to Fusan, and thence by rail to Antung. It is probable that the rail route through Korea will rarely be used for this purpose, as water transportation usually is cheaper. Assuming that Japan is permitted to remain, as she now actually is, the absolute sovereign of Korea, it will not be feasible for foreign powers to object to regulations she may make regarding the operation of railways in Korea. If Japan wishes, in countries under her sovereignty, to carry Japanese goods free of charge, and to impose a heavy tariff on foreign goods, in order to encourage home industries, it might be considered unusual; but it is diffi- cult to see just how international objection logically can be made, since many governments resort to devices fully as unfair with the same general object, and the right of a nation to regulate its internal affairs is unquestioned. The Japanese Government owns the railways in Japan and Korea, and revenues drawn from them are only an item in the national income, to be raised or lowered as the Government sees fit. If Japan should adopt the policy of operating her railways at a loss, charging the deficit upon other revenues, it would be purely her own busi- ness, As Japan’s position in Manchuria is not, however, recognized as sovereign, but is assumed merely to be temporary and preliminary to complete restoration of the sovereignty of China, it is clear that Japan’s railway in- terests there are on a different basis from those in Japan 210 THE FAR EASTERN QUESTION and Korea. In Manchuria Japan’s governmental func- tions, after the period of occupation has ended (if it ever ends), do not, or should not apply. Here all nations have an interest in the way these railways are managed. All great trading nations have commercial treaties with China which entitle them to ‘‘ most favored nation” treatment; which means, reduced to practice, that a nation having such a treaty is entitled everywhere in the Chinese Empire to any commercial opportunities and advantages enjoyed by any other foreign nation, and must not be discriminated against in favor of any foreign nation. In all treaties granting to foreign governments or corpora- tions a right to build and operate railways in China, it is understood that railways must give equal facilities to all foreign nations. It is true that some railway conven- tions exacted from China at a time when she was particu- larly helpless and ignorant of such things, are ambiguous in this and other important matters, perhaps purposely so; but this tendency long ago was noted by the diplomacy of the world, and steps taken, by mutual exchange of views, to guarantee international equity in this. Most observers of the course of events in China during the last decade will recall John Hay’s successful effort to secure definite assurance from Germany that the Shantung Rail- way will not be operated so as to discriminate against goods of other nations, and the international understand- ing respecting the ‘“‘open door” that resulted from his action. Did not China and foreign nations trading within her borders recognize this principle we might, and probably would see a German railway in China favoring German products in its tariff rates; a French railway carrying French goods cheaper than British, German and Amer- ican; an English railway giving rebates to British ship- THE OPEN DOOR IN MANCHURIA © 211 pers while charging a straight rate to their competitors, and so on. Suppose in the United States the Pennsyl- vania system gave to German goods a lower rate than to British, French or Austrian; that the Gould system fa- vored the British; that the lines controlled by Mr. Hill were owned by the French Government, which permitted all goods from France to be carried for less than goods originating in England and Germany, or even America. Would not such a condition result in commercial chaos, to say nothing of possibilities for international fric- tion growing out of it? The manner by which rate dis- criminations have affected internal commerce in America gives an idea of some effects of this method, and conveys an impression of the part it may be made to play in furthering international trade rivalries in the Far East. John Hay saw what such a situation would mean, and tried to nip tendencies toward it in the bud. Nothing, then, can be clearer than that Japan’s position as a rail- way operator in Manchuria is as a corporation, not a Government; an as a corporation she is amenable, or should be, to the laws and treaties of China. Any other interpretation of foreign railway franchises here would be tantamount to destruction of China’s power to regu- late internal commerce within her domain. Japan may operate railways as a Government in Japan, and also may in Korea if the powers continue to be complaisant, but in China she should be required to conduct them as a corpora- tion. When, therefore, Japan announced an intention to per- mit the transport of Japanese products and goods shipped by Japanese merchants for consumption in Manchuria over a railway in Manchuria free of charges, while other foreign products and traders must pay, it looks like delib- erately setting at naught the Hay Agreement. It is true aie, JHE FAR EASTERN OUEST ION that, in published accounts of the proposals, these special privileges were to extend over a period only of one year. The policy was announced in the spring of 1906, and probably had in mind the fact that the extreme limit of the military occupation of Manchuria expired in the spring of 1907, or about one year from the time when these special privileges were to go into effect. It may be, as this seems to indicate, that Japan realized that for her to continue such a policy after the occupation period had expired would be difficult, and likely to cause international criticism; which throws into rather a strong light her intention to use temporary control of the country to ad- vance her national interests there. Since Japanese statesmen and the Japanese press have repeatedly denied, in the most specific terms, that the Government is disposed to take such advantage at the possible expense of other competitive nations, and that its actions in Manchuria have had such an effect, it is pertinent to examine some phases of Japanese adminis- tration there since the termination of hostilities. 1 Appendix A. CHAPTER XVII THE OPEN DOOR IN MANCHURIA — Continued JAPANESE CLOSURE OF THE CouNTRY — INJURY TO FOREIGN INTERESTS — PoLicy oF THE Mutirary ADMINISTRATION — Passports REFUSED TO FOREIGNERS — SucH RestricTIons UN- NECESSARY — VISIT OF FoREIGN MERCHANTS — THEIR REPORT AND RECOMMENDATIONS — EvASION OF CHINESE CUSTOMS — PRETENSE OF MiLirary NeEceEssiry — Prorests oF CHAMBERS OF COMMERCE — JAPANESE REFUSAL TO Pay Lixin — CHIN- ESE OFFiclaLs IGNoRED-—— UsuRPATION OF CHINESE PRIVATE PRroPERTY — CHARACTER OF JAPANESE IMMIGRANTS — A For- EIGN MissIoNARY’s VIEWS — JAPANESE IN NON-TREATY TOWNS — THE PRINCIPLE INVOLVED. THE success of Japanese during the war in keeping events in Manchuria, except such as they chose to make public, from general knowledge of the world has been so widely commented upon that it only needs to be referred to for most persons to recall it. Notwithstand- ing expectation to the contrary, this policy was continued after the treaty of peace had been ratified and dis- persal of the opposing armies had begun. As months passed it became evident that Manchuria was as closely locked, especially in the part occupied by Japan, as it was during the war. The chief commercial ingress to Man- churia always has been from the south, so while the same conditions prevailed to some extent in the Russian sphere, the closing of it was not so generally or immediately felt. No sooner was conclusion of peace announced, when 213 214 THE FAR EASTERN QUESTION Chinese and foreign commercial houses, whose trade in Manchuria had been interrupted by the war, and which had accumulated large stocks of goods ordinarily con- sumed there, made preparations to resume business, nat- urally anticipating a great demand. Other foreigners who had property and private interests there prepared to go to look after them, and discover how they had fared during the war. To their surprise, such persons found the doors to southern Manchuria shut. Obstacles were placed in the way of foreign goods entering the country, and no foreigner could travel without a passport granted by Japanese military authorities. As an inevitable effect of a prolonged war is to deplete the resources of a land which is the scene of it, and ex- haust commodities therein, it is usual in such cases to facilitate introduction of supplies of all kinds, and to deprecate as contrary to humanitarian spirit any disposi- tion to prolong the hardships of noncombatants in a war zone, and to make of their necessities a speculative oppor- tunity. It can hardly be pretended, with any show of reason, that military necessity for such restrictions ex- isted after hostilities ended. What, then, were the rea- sons for continuation of a strict military exclusion? It was not to be expected that trading firms in China, which already had suffered considerable detriment by the war, would permit an indefinite continuation of the mili- tary embargo upon trade in Manchuria without protest. Western chancelleries might for a time be satisfied by vague talk about a necessary interregnum, but practical business men felt that their interests were being injured, perhaps permanently. Merchants in Shanghai and Tien- tsin had purchased largely of goods usually sold in Man- churia, anticipating an end of the war, and when peace was declared godowns were filled with this merchandise THE OPEN DOOR IN MANCHURIA — 215 and a number of ships already loaded for the north. The Japanese closure brought about stagnation, and a conse- quent business depression, which was felt over the whole of middle and north China, and which is not yet ended. Some firms were threatened with bankruptcy, and a few weak concerns did collapse. ‘The situation became so serious that the Shanghai Chamber of Commerce, after getting no satisfaction from correspondence with the Jap- anese military authorities, resolved upon more decisive action. Application was made to the Japanese Consul- General at Shanghai for permission for a committee rep- resenting commercial interests in Shanghai to proceed to Manchuria and investigate conditions. This request was refused, with the usual excuses and regrets; whereupon the matter was taken to Peking and placed in the hands of the British and American ministers. This brought quick action by Japan, for the cabinet at Tokyo evidently did not want the question to be raised diplomatically at that time; so the Japanese Consul-General at Shanghai promptly changed front, and informed the merchants that permission would be given for a committee to visit Manchuria. In the spring of 1906 the visit was made. The com- mittee, which was composed of two British and two Amer- ican merchants, was cordially received at Newchwang by the Japanese military authorities, and taken, under their supervision, on a short visit to Moukden and some other interior points. I state on excellent authority that every endeavor was made, unobtrusively, by Japanese officials to prevent members of the committee from meeting persons likely to represent conditions unfavorably for the Japa- nese administration, and they particularly were kept away from prominent Chinese. But the committee was com- posed of shrewd business men, who might be trusted to 216 THE FAR EASTERN QUESTION notice a good deal, even with limited and adverse op- portunity. When the members returned to Shanghai a report was made to the body which they represented, portions of which were published. To read the news- papers in Japan and China, concerning this report, one might gather that it painted Japanese administration of Manchuria in glowing colors or that the Japanese ad- ministration was ruining the country and was deliberately bent upon driving all foreign business out of it. The view taken of the report depended upon the interest in which each newspaper was retained. News despatches sent abroad also reflected such considerations to a great extent; so, as Far Eastern press services are almost alto- gether handled in the British and Japanese interests, it is likely that western readers got the idea that this report was rather favorable than otherwise, and that it was a matter of minor importance anyway. The truth seems to be somewhere between these ex- tremes, although members of the committee were inclined to be reticent upon their return. An impression was dis- seminated, in a general way, that the report was confi- dential, and that while some grounds for dissatisfaction existed, the Japanese authorities had promised a speedy modification of offensive conditions. The key-note of the greater part of eastern press comment was a glossing over of the question, by reminders that conditions in Man- churia were only temporary, and that Japan could be re- lied upon to modify them as soon as was possible. That the report contained elements of great vitality is shown by the fact that it repeatedly came up in one form or an- other, notwithstanding strong disposition in powerful quar- ters finally to bury it. Several months after it was pre- sented, the Shanghai branch of the British China Associa- tion forwarded to the British minister at Peking some On THE SoutH MANcHURIAN RAILWay, Japan’s COMMERCIAL INVASION OF MANCHURIA. Two of these signs, which were erected while other foreigners were excluded from the country, advertise Japanese Government monop- olistic products. THE OPEN DOOR IN MANCHURIA — 217 recommendations based upon it. As these recommenda- tions introduced some matters of great importance, I re- produce the more pertinent published ones: 1— The Diplomatic Corps should take steps to have the Chinese customs established at Tairen (Dalny), with a view to preventing Japanese commodities from being imported to various places in Manchuria without the pay- ment of import duties and likin. 2— That necessary steps be taken to put a stop to the illegal trade conducted in Manchuria through the Korean frontier. 3 — That the Chinese Government be advised to take steps to remove the obstacles placed on the junk trade on the Liao river, on account of the railway bridge thrown across the river by the Japanese authorities. This leads to examination of conditions under which foreign commodities are presumed to enter Manchuria. - Being a part of China, the Chinese customs treaty ap- plies. Prior to the late war there was but one maritime custom house in Manchuria, Newchwang then being the only treaty port which actually had been opened. So dutiable goods entering the country, except those com- ing through the Siberian land frontier and those introduced by smugglers, passed through the custom house at New- chwang. When a concession was granted for Russia to build a railway through Manchuria, it was provided that custom houses should be established upon the Rus- sian frontier; but in the disorderly times that fol- lowed nothing was done toward carrying out this provi- sion, and it then remained to be adjusted. However, under conditions as they formerly existed, it was a matter of small practical importance, as trade across the Sibe- 218 THE FAR EASTERN QUESTION rian frontier was not of a character seriously to compete with foreign trade entering the country from the south. So, although the question periodically cropped up, there was no strong pressure from any source to compel action. With the advent of the Japanese the situation, in re- spect to southern Manchuria, entirely changed. All of Korea and some parts of Manchuria have been occupied by them for four years now, which is long enough to permit some reasonable conclusions to be drawn about Japan’s commercial policy. Basing my opinion on a study of conditions, and as diligent inquiry as I was able to make, I am convinced that almost from the moment a locality was occupied by Japanese armies it was the de- liberate and calculated effort of Japan to use her posses- sion of these territories to establish and advance her commercial interests. In order to do this she excluded as far as was possible all competitors both actual and prospective, while at the same time throwing open the country to her own nationals. She impeded by innumer- able petty devices, usually cloaked by a pretense of mil- itary necessity, the ingress and transport in Manchu- ria of foreign commodities which have long had a large sale there, and which were required for uses of the Chi- nese population; and while such foreign commodities as were permitted to enter passed through the Chinese cus- tom house, similar commodities from Japan were per- mitted to enter duty free through Dalny and Antung. As Japanese authorities in Manchuria and the Govern- ment at Tokyo deny that Japanese merchandise was brought into Manchuria free of tariff, it is, of course, not possible to obtain exact information of the extent of this evasion; but it positively is known to be considerable. When protests were made by foreigners who felt that this kind of competition is illegal and unfair, the Japa- THE OPEN DOOR IN MANCHURIA 219 nese authorities at first replied that importation of supplies through Port Arthur, Dalny and Antung was solely for military uses, and that they were not of a com- mercial character; then, when withdrawal of the greater part of the army has invalidated this excuse, the usual reply is a general denial. Early in 1906 the Foreign Chamber of Commerce of Newchwang addressed the foreign consular body there, protesting against a num- ber of handicaps upon internal trade in Manchuria alleged to have been imposed by the Japanese authorities; and also protested against the importation of Japanese goods duty free through Dalny and Korea. It is hardly to be presumed that these foreign business houses, which gen- erally had been sympathetic to Japan, and with long-es- tablished trade in the country and excellent sources of information, were making an outcry about nothing. Restrictions upon internal trade complained of by other foreign merchants, and also by Chinese officials, usually arise out of irregularities in connection with or evasion of the likin. From the time they occupied the country the Japanese paid no attention, either officially or pri- vately, to local tax regulations. It is interesting to examine some effects of this disposition, particularly upon Chinese commercial classes. The likin, which is uni- versal throughout China, is analogous to municipal, county and township taxes in America, or octroi in some European countries, in that it is for the purpose of rais- ing local revenues apart from those imposed by national and provincial administrations, although some part of it usually finds its way to higher quarters. The system is complex, wasteful and full of abuses; but fuller dis- cussion of it is not needed in this connection. Some of its methods, especially in larger municipalities, corre- spond to the licensing system so generally employed in 220 THE FAR EASTERN QUESTION Europe and America. Japanese traders who swarmed into Manchuria in the trail of the armies, and who have been greatly augmented since the war ended, consistently refused to pay likin from the beginning. At first, or as soon as something like order was restored after a local- ity had been swept by the battle zone, local Chinese offi- cials made attempts to collect taxes from Japanese trad- ers, and upon refusal made representations to the military authorities; who invariably either ignored the matter or sustained their own nationals. So the condition became established, and Chinese officials have since then usually contented themselves by making an occasional demand for form’s sake. But the Chinese trader still has to pay his taxes, which puts him at a disadvantage with his Japanese competitor. In every town and city in southern Manchuria can be seen Japanese shops doing business alongside Chinese stores, and selling practically the same commodities. To the extent that these articles are of foreign origin, the Jap- anese trader often has the advantage of offering a simi- lar article made in Japan, and which has been imported free of duty, and, perhaps also free of transport charges; and he is free from local taxation, which in this, as in most countries, is an appreciable burden upon commerce. It is no wonder that Chinese regard this new competitor with concern, which is not lessened by the fact that in some cases Japanese also are living rent free through having usurped the premises of Chinese. I know a case in Moukden where part of the house of a Chinese merchant was occupied by Japanese traders selling similar com- modities under the following circumstances: Just prior to the battle of Moukden the owner, desiring to get his family to a place of safety, took it to Tsinmintun and down into China proper, outside the area of hostilities. THE OPEN DOOR IN MANCHURIA 221 When he returned the city was taken by the Japanese army, and he found a portion of his property occupied by Japanese traders. He tried to get them to vacate, but failed, and his protests to the Japanese authorities were unavailing. So he effected a compromise with the Japanese traders by permitting them to remain in a part of his building frofting on the street, where they still were when I was last in Moukden. I could give many such instances, and worse, for in this case the Chinese managed to regain possession of most of his premises, while in many similar situations Chinese owners have lost their property altogether, and sometimes lost their lives trying to recover it. The Japanese immigration which poured into Man- churia during and immediately after the war also de- serves some notice, on account of its political and social phases. It was not, until quite recently, possible to ob- tain accurate figures bearing upon the extent of this im- migration of the civilian class, but fairly reliable esti- mates made in 1906 placed it from 40,000 to 60,000 in the region under Japan’s administration. The greater number of these immigrants settled in larger cities along the railway lines, but thousands penetrated the in- terior and became domiciled in remoter towns and vil- lages. These male settlers almost entirely are shopkeep- ers and artisans in so far as they have regular occupations; but a large proportion simply are adventurers, ne’er-do- wells at home, who came in the hope of quickly making a fortune in Manchuria, which has been represented in Japan as a country of marvelous wealth. In discussing some moral aspects of Japanese occupation with an English missionary of world-wide reputation, who has re- sided in Manchuria for many years and was there through the entire period embracing the Russian occupation and 222 THE FAR EASTERN QUESTION the war, I found him in a rather gloomy frame of mind. Among other things, he said: ‘““T am very much disappointed at some results of Japa- nese administration. Its general effect has been decid- edly to lower the moral standards of Chinese life. The conditions under which the people haye been compelled to exist, the necessity for constant evasion and lying to save their lives and property, the deteriorating commer- cial influence of Japanese traders who are supported in their pretensions by the military authorities, the uncer- tainty of obtaining justice from Japanese military courts, and the presence of thousands of Japanese men of low character and immoral Japanese women, who openly ply their avocation in the streets of the cities and towns, are corrupting influences new to the country, or only felt be- fore in a limited degree.” Since the moral betterments presumed to follow an ex- tension of Japanese influence and authority in Asia have been kept prominently to the fore in western discussion of probabilities, this opinion of an unprejudiced observer has considerable interest and significance. Delicate as this subject of Japanese women in Manchuria is, it is hard to omit it from any comprehensive and candid discus- sion of conditions. It confronts one at every turn, about the railway stations and in the streets. Next to the soldiery and the commercial advertisements with which they have plastered the country, it is the most obvious indication of Japanese occupation. Its extent may be ap- preciated when I say that, from the best information I could obtain, coupled with my own observation, probably one-fourth of the civilian Japanese population in Man- churia belongs to this class. ‘That this assertion may not lack support, I quote from a leading foreign newspaper THE OPEN DOOR IN MANCHURIA 223 in Japan, whose proprietor is married to a Japanese lady and has long lived happily with her: ‘“ We have at all times considered it our duty to defend Japanese women against the charges of immorality em- anating from globe-trotters and others who have sought immorality in Japan and who, of course, found it. The depths to which women can and do sink in the West . . . are, fortunately, still unknown in Japan. “But in spite of this we are not ourselves blind to the fact that the whole Far East swarms with Japanese prostitutes, so that the following paragraph from the China Gazette is only one of many of a similar character that have appeared in the press of the Far East: ‘““*’'There are over five thousand immoral Japanese women in and around Newchwang, mostly living among the Chinese and the Japanese soldiery. Other parts of ‘Manchuria are similarly and systematically worked by thousands of these enterprising bearers of the glorious banner of Dai Nippon in darkest but formerly moral Manchuria. The people of the country must be sorely puzzled to know what to make of this development of western civilization and enlightenment as taught by Ja- pan.’ ‘“This is a disgraceful condition of affairs for which the Japanese Government must accept the blame. We hear so much about ‘bushido’ (whatever it may be), Japanese loyalty, chivalry, Japanese sensitiveness to crit- icism, etc.; but here we have, at least with the tacit con- sent, if not with the actual connivance of the Japanese Government, whole provinces of a neighboring continent that have passed under Japanese control overrun by thou- sands of immoral Japanese women, who are inveigled, 224 THE FAR EASTERN QUESTION forced or sold into infamous slavery by Japanese men .; for it is safe to say that not one Japanese woman out of a thousand would of her own account go to a for- eign country . . ., and that not one of a thousand has the means to enter upon such a course of adventure. Nor would the dealers who carry on and control the trade in Japanese girls permit one to do so. Has the Japanese press nothing to say on the subject?” It should be stated that the China Gazette, a quota- tion from which is included in this criticism, is sympa- thetic to Russia, and quick to seize an opportunity to hurl a stone at Japan; and I think the number of women it mentions is greatly exaggerated, so far as applies to the stated locality. That the general condition so severely arraigned by the writer exists there can be no doubt; and when circumstances which have attended immigration into Manchuria during and since the war are considered, it is dificult for the Japanese Government to acquit itself of complicity in this matter. It is idle to say that it could not have prevented such immigration. While China, in fencing for diplomatic points, lays some stress upon this special condition, I think Chinese statesmen are more concerned about certain political as- pects of the Japanese immigration. The last agreement with Japan provides for opening a number of new ports where foreigners may reside, and it is fair to pre- sume that a majority of Japanese immigrants will settle in these places by choice. Many, however, already are established in other localities, where they show a dispo- sition to remain. China has insisted that, after the pe- riod of Japanese occupation expires, Japanese shall only be permitted to reside at treaty ports, as is the case with foreigners elsewhere in China; or if they do reside out- THE OPEN DOOR IN MANCHURIA 225 side such ports extra-territorial jurisdiction over them by Japan shall not locally apply. Japan seems to be re- luctant to concede this, and apparently desires to retain jurisdiction over all her nationals who may choose to live in Manchuria. Here is a matter that touches China’s vitals, not only in Manchuria, but in the whole Empire. This propensity of Japanese immigrants is worrying Chinese in connection with the opening of new treaty ports. There is delay in locating the foreign settlements, for which China chiefly has been blamed. It appears, however, that this is partly due to indisposition of Jap- anese to segregate themselves within specified limits, they preferring to remain where they first located, scat- tered here and there. No exact division of jurisdiction is possible without geographical limitation, and China fears that such a status will result in extension of foreign jurisprudence over the entire country, creating endless op- portunity for interference in local affairs. So China is disinclined to proceed with the opening of new foreign settlements until occupation has entirely ended, and has advanced various and usually immaterial excuses for de- lay. Here, again, it should be kept in mind that any ad- justment must, in reason, apply also to territory now under Russian control. CHAPTER XVIII THE OPEN DOOR IN MANCHURIA — Continued CoMMERCIAL EFFECTS OF JAPANESE ADMINISTRATION Upon THE CHINESE— GOVERNMENTAL AID TO JAPANESE IMMI- GRANTS — Petry JAPANESE TRapERS— THEIR REAL FuNc- TION — AUXILIARIES OF THE GREAT JAPANESE Firms — THE Mitsu1 Bussan KalsHa — EFFEcTS OF JAPANESE EVASION OF THE LIkIN—- CHINESE CoLLEcTORS EJECTED — CORNERING THE BEAN CAKE— DISCRIMINATION AGAINST FOREIGN Firms — Some PERTINENT EXAMPLES — EXPERIENCES OF AN AMERICAN Firm — JAPANESE COUNTERFEITS AND IMITATIONS — JapANESE MANIPULATION OF THE CURRENCY — THE YOKO- HAMA SPECIE BANK — JAPAN’S USE oF DALNY. To many readers of these comments the effects of Japanese evasions of internal commercial regulations upon other foreign interests in the country will, perhaps, out- weigh their effects upon Chinese. While many Japan- ese traders came to Manchuria on their own initiative and operate independently, a majority of those now there really are agents of large Japanese commercial firms, which are backed by the Government. As a rule, these small traders have not the means to emigrate, or to purchase and import stocks of merchandise. As I have shown, the Government often has provided them with means for getting to Manchuria, and with some capital and credit. But while this assistance of the Government is given the outward form of an endeavor to help Jap- anese of all classes to make a beginning in a new coun- 226 THE QPEN DOOR IN’ MANCHURIA, 22% try, it really is, when analyzed, a scheme to aid big Japan- ese corporations associated with the Government to ex- ploit Manchuria. In conditions surrounding the exten- sion of assistance by the Government, some minor regu- lations clearly indicate this fundamental intent; such as limitation of interest rebate to firms doing a minimum business of Yen 5,000,000 a year. Since none but great firms can hope to do as large a business, it is evident that the small merchant will not get the benefit of this provision. The Mitsui Bussan Kaisha, entrusted by the Government and guilds with supervision of the national exploitation scheme in Manchuria, had established itself there before the war; and almost immediately after the armies dis- lodged the Russians, it took steps to extend its relations. This company now covers southern Manchuria with a web of branch houses and minor agents, which work hand in glove with the Japanese authorities, and are abetted and supported by them on every possible occasion, and in every practical way. It is impossible, in any intelli- gent estimation of commercial forces at work there, to ig- nore or minimize the relation between the Japanese Goy- ernment and leading Japanese financial, industrial and commercial enterprises; which frequently are so close as al- most to make them identical. I gathered during my visit in 1906 so many pointed in- cidents bearing upon internal trade conditions in southern Manchuria during the Japanese military regime that it is not feasible specifically to refer to all of them; but a few may serve to illustrate some elements of the situation. There is a likin upon foreign commodities traversing the interior, and there are stations where /zkin is collected, as elsewhere in China. During Japanese occupation this likin has been enforced as usual upon foreign goods, except Japanese articles, which are exempted by reason 228 THE FAR EASTERN QUESTION of the same general policy that exempts Japanese subjects from ordinary processes of Chinese law. Until quite re- cently, since it was announced to the world that Chinese local autonomy is restored, and an attempt made to give some outward evidences of this change, Japanese commer- cial houses operating in Manchuria were open and bold in defying Chinese regulations. On some commodities produced in Manchuria there is an export likin, as bean cake and bean products. Japan is the largest consumer of these products, as it happens, and exportation of bean cake to Japan has in the past been handled by foreign and Chinese merchant and shipping firms. Chief among Jap- anese competitors for this business, in the mercantile and transportation fields, are the Mitsui Bussan Kaisha and two of the great Japanese shipping companies. During the war, owing to extraordinary conditions, there was difh- culty about marketing bean products, and so when peace came practically two crops had accumulated and were awaiting shipment. The movement of these bean prod- ucts has always been to the south, down the Liao river, or by cart in winter. Soon after the Japanese occupa- tion of Moukden and Tieling, which is a center for the bean trade, the Mitsui Bussan Kaisha sent agents through the country to buy bean cake, which was brought to Newchwang and shipped to Japan, it is alleged, without likin being paid. As this method gave the Mitsui com- pany an advantage over other exporting firms which had to pay the tax, it quickly attracted attention, and a de- mand was made upon Chinese officials that the likin on bean products be rescinded until normal conditions are restored, so as to place Chinese and other foreign ex- porters on equality with Japanese. When the Japanese authorities learned of this demand, they refused to per- mit any modification of the regulations, and denied that THE OPEN DOOR IN MANCHURIA 229 Japanese exporters were not paying likin. There seems to be little reason to doubt, however, that a large quan- tity of bean cake purchased by the Mitsui Company was moved without paying this tax, although after the complaint of the other exporters and shippers the viola- tion of Chinese regulations was not so open. While I was in Moukden in 1906, Chinese officials, in order, perhaps, to see how far their “‘ restored”? au- thority really extended, sent a likin collector to a Japa- nese store to demand payment of the tax upon certain foreign commodities in which it did a large business. This store, although ostensibly conducted as a private busi- ness, is a branch of the Mitsui Bussan Kaisha; and the col- lector was promptly ejected from the place. A complaint to the Japanese authorities had no practical result. Thus, while southern. Manchuria was overrun by small Japa- nese traders and agents, foreign firms were kept out of the country, and were not permitted to establish agencies un- til more than a year after the war had ended. ‘The rail- way stations swarmed with hawkers offering Japanese products, but hawkers of foreign commodities, especially those competing with any of the Japanese Government monopolies or articles for which the great Japanese com- mercial houses are agents, were not permitted to do busi- ness. Since August 1, 1906, when the ban upon foreign- ers entering the country was removed, and responsible for- eign agents could establish themselves and closely watch conditions, protests to the Japanese authorities have led to modification of many of these petty impediments; for complaint by a foreigner, on the ground and fully in possession of the facts, is a different matter from one by a Chinese, and the military authorities were compelled to notice them. The persistence and unanimity with which the military 230 THE FAR EASTERN QUESTION authorities have protected Japanese traders and supported them in their evasions and conflicts with local Chinese reg- ulations is understandable only when it is realized that the little trader is part of a system having behind it the Jap- anese Government, and the greater industrial and com- mercial interests of the Empire. In selecting a few more examples of objectionable methods employed to advance Japanese trade in Manchuria I will confine them to matters directly involving the Government, so there can be no question as to responsibility for the relation between cer- tain causes and effects. [Early in 1906, finding some en- couragement in growing manifestations among foreigners of discontent with Japanese administration, the Chinese Government, through its officials, began a series of moves to regain its autonomy, particularly in respect to collection of revenues. This movement assumed various forms, but one significant tendency was to increase likin upon foreign commodities sold in the country. The question of likin on foreign goods in China has long been an inter- national sore-spot, and many unsuccessful efforts have been made to have it removed; but as long as the condi- tion exists the action of Chinese officials in Manchuria in trying to produce more revenue by this means must be rec- ognized as legitimate, and foreign firms doing business there did not at first protest. It soon developed that the new likin was having results invidiously detrimental to some foreign interests in contradistinction to others. In May, 1906, the Chinese began to levy an increased likin upon tobacco products sold in Manchuria. The tax was raised from two to five per cent. ad valorem, or more than doubled. The tobacco business in Manchuria was, before the war, largely controlled by the British-Ameri- can Tobacco Company. As a war revenue measure, and what has proved’ to be the forerunner of a national in- THE OPEN DOOR IN MANCHURIA 231 dustrial ownership policy, the Japanese Government com- pelled the British-American Company to sell to the Goy- ernment its factories in Japan, which then supplied a considerable part of the Far Eastern demand. ‘Thus de- prived of a large output, the British-American Company began erection of factories in China, and is now again ready to meet the requirements of its trade in eastern Asia. But it has a competitor in the Japanese Govern- ment Tobacco Nlonopoly, which is making an energetic campaign in China, and particularly in Manchuria. Dur- ing the year which followed the making of peace, the British-American Company made efforts to resuscitate its business there, but found that it encountered obstacles on every hand. Except a foreign superintendent in New- chwang, the trade always had been supplied through Chi- nese agents distributed over the country, who put prod- ucts in the hands of retail merchants. In China to- bacco products consumed by the lower classes, which con- stitutes a great proportion of the business, usually are sold by peddlers, or hawkers, who are to be seen every- where. All persons who have visited China must have noticed how important this peddling system is in the in- ternal commerce of the Empire, and how closely it touches the life of the people. The coolie buys his food from a peddler, his occasional beverage from another, his bit of sweetmeat from another, his cigarettes from still another, all in the course of a single day, and when the money and desire happen to be possessed at the same time. Hawk- ers are supplied by retail merchants, who issue goods to them in small quantities from day to day. Japanese military administration of southern Manchu- ria had not continued for long when complaints began to reach managers of the British-American Tobacco Company in Shanghai that their Chinese agents in Man- 232 THE FAR EASTERN QUESTION churia were having trouble. Hawkers of their products were not permitted about railway stations or other places occupied and directly controlled by Japanese, and many hawkers were maltreated and threatened by Japanese roughs. It became evident that a campaign of intimida- tion against native vendors of British-American brands was systematically being carried out; and it even was ex- tended to the shopkeepers. Meanwhile products of the Japanese Government Tobacco Monopoly were being energetically pushed, usually by Japanese traders, but in many cases by Chinese merchants who were induced to ac- cept agencies. Native agents of the British-American Company quickly felt the effects of this movement, and soon found themselves seriously handicapped. When rep- resentations were made to the Japanese authorities, they denied that such conditions existed, and at first refused to allow a foreign representative of the British-American firm to travel in the country to investigate and look after its interests. It will be noted that this case is peculiarly significant in several ways. The foreign business firm affected is joint- ly composed of persons of the two nationalities which might above all others be presumed to receive favorable treatment from Japanese if such treatment was accorded to any, and is in a position to exert a powerful influ- ence in its behalf; and the competitive concern is not only of Japanese nationality, but is the Japanese Government. Finally, after a lapse of months during which these meth- ods steadily were employed, permission was granted to a foreign agent of the British-American Company to travel in Manchuria; who made a report to his organization fully confirming the charges of unfair discrimination. This agent was born in Newchwang, speaks Chinese fluently, and probably no living white man is in closer touch with 76 116 124 Lake R jC TED vase ye Quest 2 EF ; $, Poteet Stretvinsk o i RY. g Chita, sib o een ee RAILWAY ame = { atka, C3S0d04d ¢ te. > ‘ N a \, = eo oS cI Cc} 5 og © Vo Lidell tre ep al J ; ussiNaen SS ) “yok § fee + M O "ee, ; sf Meese ) G Os Le 2 & ee . 3 ee m Si W eno eeTe nba SENET ate: X a ARABE, Ors eileen, e R A 4 nam, &Y S unos" leper iantsa PROJ* ° i 62 CHIN ' Sing ane BELG 98 a’ I eae eres eagy oy, £0] ROJECT Kowlegy . Wn | Langs 4 SCALE OF MILES Ss % 0 50 100 200 300 400 500 KILOMETERS §cd1b0 250 380 460 600 do 760 800 LUZON W.S.) 2 Gg x Mekon, PRENOINW MAL BE A

‘ a = % * Bes oa TypicAL MunicipAL BUILDING IN THE PROVINCES. VALUE -OF THE PHLLIPPINES 455 the Philippines would have imported in 1906 from the United States about $157,000,000.00 worth of merchan- dise, as against $4,477,886.00 which was consumed. The area, soil, climate and population of the Philippines war- rant assumption that the islands might in time produce, with its other tropical possessions, practically all tropical and semi-tropical products which the United States will require. This would mean corresponding increase in the purchasing power of the Filipino people. Having politi- cal control of the islands means that the United States can regulate circumstances under which merchandise may be imported, and easily can establish conditions favorable to American products in comparison with competing products originating in other manufacturing nations. Viewed as a step toward establishment of substantial economic independence, by creating under a central gov- ernment an almost complete productive cycle, ‘such a scheme might well engage the attention of American states- men. As a business proposition, is not an annual trade of from $600,000,000.00 to $800,000,000.00 with the Philippines worth considering? Such possibilities are in- cluded in the future of the islands. Why, then, does the United States pursue a fiscal policy toward the Philippines which lends small active encouragement to development, and which in some matters positively hinders it? The answer is that certain influences have been exerted to obstruct progress toward improvement of the economic situation of the islands. These influences are various and somewhat complex; but they fall into groups which makes it possible to identify and analyze them. Of these groups, undoubtedly the more active and potent is composed of protected interests in the United States, which pro- fess to see danger to some industries in America if the tariff wall be opened to admit Philippine products. The 456 THE FAR EASTERN QUESTION economic basis for arguments presented by this group is so slight that it hardly could have prevented action by Congress had not it been able to obscure real issues by in- jecting into the discussion a lot of confusing and more or less irrelevant matters. To this end a campaign of mis- representation was waged. ‘The islands have been repre- sented as a tremendous financial burden upon the nation; difficulties of the political situation were grossly exagger- ated; and all the incongruous elements which, for many and diverse reasons, oppose our policy there, were rallied into a common army of obstruction, which so far has been able to prevent remedial legislation by Congress. Those first entrusted with the administration of these is- lands quickly realized that their acquisition by the United States Government must affect Philippine commerce and industry, through alteration of international relations and consequent modification of conditions which apply to for- eign trade. It was the policy of Spain to exploit the is- lands, as far as was possible, for advantage of the mother country; certain industries and production were stimulated, others discouraged, with a view to benefit Spain rather than the islands. It was evident that alteration of the system, by depriving Philippine products of advantageous markets in some quarters, would compel them to seek markets elsewhere. This caused, in the beginning, no uneasiness; for what mattered the loss of a narrow and restricted market if entry into the immeasurably greater one of the United States was gained thereby? When the need for some relief was urged upon Con- gress, a bone was thrown to the islands by conceding a reduction of 25 per cent. of the Dingley schedules to Phil- ippine products entering the United States. It soon be- came evident, however, that this concession was of slight benefit; and when W. H. Taft became Secretary of War VALUE OF THE PHILIPPINES 457 he urged Congress to grant free trade between the Phil- ippines and the States, as was done with Hawaii and Porto Rico. A bill was introduced, granting further re- duction of 50 per cent. of the Dingley tariff until 1909, when free trade should become operative. This measure passed the House of Representatives by a large majority, but antagonistic interests succeeded in having it killed in the Senate. Free admission of sugar was the real stumbling block, and the character of opposition is indi- cated by its attitude in this matter. The sugar interests professed to be willing to admit Philippine sugar free if annual importation be limited to 400,000 tons. As the entire output of the islands cannot reach this figure for probably twenty years, even under favorable conditions, it is evident that alleged peril to American industry from this source is more imaginary than real. Although effective opposition to legislation to benefit the Philippines centers in the United States, it receives considerable indirect support from elements in the islands. This support springs from two sources — political and economic. Political opposition comes from those ad- vocates of Philippine independence who fear that if the islands ever become too closely attached to the United States, by ties of commercial and industrial reciprocity, hope for a Philippine Republic will vanish. There is ex- cellent ground for this anticipation. Increased prosperity, closer relations with America, introduction of capital, and forces brought into play by such conditions undoubtedly will be destructive to sentiment for severance by altering circumstances which now give such arguments plausi- bility in both countries. The Filipino politician who would prefer a poor and feeble Philippine Republic to a secure and prosperous dependency of the United States is ubiquitous in the islands, just as Americans who oppose 458 THE FAR EASTERN: QUESTION broader national interests for personal gain are plentiful at home. Nor do such men, some of whom are sincere and patri- otic, lack present arguments. About two-thirds of insular revenue is now secured through the custom house. It is pointed out that with free trade with the United States the islands will lose revenue on articles now imported from America, and admission of American products free also will tend to displace other foreign products in the islands, and thus cause further loss of revenue. It is estimated that free trade with the United States may cause a loss of customs revenue to the Philippine Gov- ernment of three-fourths of present customs receipts. If this should prove true, the deficit must be met by creation of other revenues, and this idea frightens Filipino politi- cians, and causes uneasiness to the Commission. Human experience has demonstrated that while indirect taxation is wasteful, it is the easiest way to get money out of peo- ple. A serious loss of revenue from the customs might, so many persons in the islands fear, compel the Insular Government to resort to direct taxation; which some pre- dict cannot be done in the present state of the islands without exciting internal disorder. While these views are not without reason, a study of the insular budget, and the situation of the islands, causes apprehension to recede. When the present internal reve- nue law was put into effect it was freely predicted, espe- cially by prominent Filipinos, that it would cause disaster to Philippine industries, and probably incite resistance among the people. ‘These anticipations were not realized. There were slight disorders, due to mistaken agitation; but these have entirely passed, while industries which ob- jected to the law have felt no ill effects. It is reasonably certain that insular revenue can be materially increased VALUE OF THE PHILIPPINES 459 from other sources should customs receipts fall off. In respect to this question, there is almost an exact parallel in the case of Porto Rico. In establishing free trade be- tween the United States and that island, practically the same situation was encountered. The result has been that while trade between the island and America has greatly increased, and American products now nearly monopolize the Porto Rican market, the customs receipts are now 70 per cent. of what they were before the change was made, and are steadily increasing. The reason for this is quite clear. Mlany articles brought from Europe and other countries are liked and desired by the people on account of their quality and character, and with in- creasing prosperity they have continued to buy such arti- cles for their gratification, while at the same time buying American products which formerly they had not used at all. There is reason to think that such a result would follow free trade with the Philippines. An argument. one hears in the islands is that free importation of American products like, let us say, agricul- tural machinery needed to develop natural resources of the country, will not have the effect of cheapening such articles to Philippine consumers, and may add to cost of production. Some important articles of American origin now consumed in the islands, or for which a demand may be created, are known at home as “trust” products, and have protection by the present tariff, which enables them to get a higher price in the home market than can be ob- tained in other countries. It is commercial custom in the Philippines, as in many countries, for American manufac- turers of these products to grant rebates to their agents equal to the insular tariff they must pay. Commercial firms which import such American products believe that if the present insular tariff on these goods is removed, manu- 460 THE FAR EASTERN QUESTION facturers, having then a “ home market” in the Philip- pines, will no longer grant rebates; with result that in- stead of getting goods cheaper, the Filipino consumer will pay even more than he now does, beside losing reve- nue. Some effects of free trade with America thus might be detrimental to the islands. In the multiplicity of interests involved, and the widely divergent angles from which the subject is viewed, is ample ground for difference of opinion; and it is not strange that advocates of ‘‘ justice for the Philippines ” should ke somewhat divided in their councils, which op- erates to the advantage of obstructionists by obscuring the vital issues involved. ‘The situation really presents no extraordinary complexities when the major elements are considered. And these stand out above turmoil created by the clash of petty interests and narrow views. The geographical location of these islands, their soil, climate and natural resources definitely indicate that de- velopment must fundamentally be based upon agriculture. Regarding natural advantages found in the islands for the production of tropical and sub-tropical crops, one finds it necessary to exercise repression in describing them for fear of being suspected of exaggeration. Here, indeed, nature has lavished her favors. No complete computa- tion of agricultural statistics has been made, but experts estimate that 80 per cent. of the total area of the islands can be made productive. The greater part of this beau- tiful region has not been touched. It requires only the intelligently directed effort of man to contribute its quota to the sum of human wealth. Under modern conditions, two main factors are essential to such effort: capital and labor. The state of labor in the islands is a matter which deserves notice; and it may be said that the present supply is ample for a considerable development. Conditions VALUE OF THE PHILIPPINES 461 which deter the introduction of capital are the chief pres- ent economic handicap to the islands. While many minor conditions contribute their influence to discourage capital from entering the Philippines, there is a central cause for its present timidity. ‘This is un- certainty about the present and future political status of the islands. Mr. Taft's definite declaration, in October, 1907, that the Washington administration has no idea of letting go of the islands helps to set at rest one cause for uneasiness; but much remains to be done before capital will find there an inviting field for investment. People who, recognizing the remarkable natural opportunities af- forded, would like to invest in agricultural or other pro- duction in the Philippines want first to be assured of sta- bility of the general conditions which will affect their investments. If they desire to open hemp plantations, or to invest in rubber land, they want to feel reasonable as- surance of the political stability of the country, and also that economic conditions surrounding production and mar- keting of their products will not suddenly be changed. In other words, capital is willing to enter the Philippines on the merits of natural advantages offered; but in esti- mating chances of profit or loss it wants to know where the islands stand, at least for a definite period; whether they are in or out of the United States; whether the same general conditions which attend development in America also may be expected to apply there, or, if not, what con- ditions will apply. Given this assurance, there is no doubt that ample capital for development of the islands can be secured. Nor will capital be so hard to satisfy in this respect as some seem to anticipate. Several factors bear upon the proposition: the attitude of the Insular Government and the policy of Congress being essential ones. In the end, 462 THE FAR EASTERN QUESTION the policy of the Insular administration must follow direc- tion of the President and Congress, but it always will greatly influence the course of events, and this gives im- portance to its attitude toward capital which seeks in- vestment in the islands. Our nation is committed to a policy which substantially will conserve the interests of the inhabitants, and protect them against external efforts to exploit them for advantage of foreigners, which frequently is a result of similar relations between a great power and weak, alien peoples and possessions. This has caused re- jection by the Commission of some ambitious projects de- signed to attract capital on the ground that they involved a sacrifice of interests of the natives. The spirit which prompts this policy is excellent, and the policy is a good one; but if the islands are to be developed, which will in- crease general prosperity, the idea of protecting interests of the natives should not be permitted to operate to ex- clude legitimate enterprises. To draw foreign capital to the islands it is necessary to make investments there more attractive than now can be found elsewhere. This may be done through any or all of the circumstances which affect investments: political stability, security, and the profits promised. Where risk is believed to be greater, capital demands greater prospec- tive profits. In the beginning, it probably will be neces- sary to make the Philippines attractive to capital by offer- ing greater opportunity for profit in comparison to coun- tries of similar natural advantages; for, even with favor- able action by Congress, all doubts concerning the stability of other factors will not immediately vanish. Here is a chance for exercise of wisdom and discretion by men who administer Insular affairs. One is glad to note that pres- ent prospects are, on the whole, distinctly favorable. Whether these islands shall progress, stand still or drift VALUE OF THE PHILIPPINES 463 backward depends upon Congress. A reduced tariff bill, with amendments designed to meet views of the more rea- sonable opposition, should be passed. Such a measure, while not to be regarded as a panacea, promises substan- tial benefit, and will go far to clarify the economic status of the islands. It also would be wise for Congress to amend the law permitting the establishment of an agricul- tural bank so as to make the proposition more attractive to capital. It has been pretty conclusively demonstrated that American capital will not take up the project in its present shape, and the islands are suffering for the relief which such an institution will afford. ‘The land laws, which limit the area that can be acquired by a single entity, dis- courage enterprises which require large tracts of land, without preventing innumerable petty evasions of its let- ter and spirit, and should be amended. So we find that action by Congress on a few matters will give substantial relief to the Philippines, and set in motion forces which will in time, perhaps quite soon, place the islands firmly in the path to prosperity. If this hap- pens, Americans will hear less about their being a “ bur- den” and “problem.” These words have been sadly overworked in this connection. Observation of conditions there has convinced me that when one finds a person who always refers to the Philippines as a “burden” or ‘“ problem,” one only has to probe a little to discover in that person one who is laboring, directly or indirectly, to make the islands deserve these appellations. Let Con- gress act intelligently and fairly, and in the future we will hear little about the Philippines being either a burden or a problem. CHAPTER XXXIII VALUE OF THE PHILIPPINES — Continued STATE OF LABOR IN THE ISLANDS — FALLACIES REGARDING FILipInos — SHALLow CoNncLusions — EARLY AMERICAN Ex: PERIENCES — EXPECTATION AND FULFILLMENT — FALSE STANDARDS — ERRONEOUS IDEAS — FILIPINO PECULIARITIES — Kinp oF Lasor NEEDED — EXPERIENCE OF LARGE AMERICAN Firms — BENDING AMERICAN METHODS TO THE FILIPINO — Resutts Versus MeETHODS— THE PHILIPPINE RAILWAYS — EXPERIENCE IN THE VISAYAS — ORGANIZATION AND MeETHop — NaTIvE PREJUDICES RESPECTED —- Economic RE- SULTS OF THIS PoLIcy-—GRADUAL IMPROVEMENT — MeE- CHANICAL APTITUDE OF THE NaTIvES— WAGES IN THE IsLaNDS — FILIPINOS AMENABLE TO ENVIRONMENT. SPEAKING of some effects of American policy in the Philippines, Senor Antonio Regidor, who returned from exile to be present at the opening of the Assembly in 1907, said: “Teach our people the dignity of labor. Teach them how to work.” That the venerable Filipino patriot touched a funda- mental factor in progress in the islands cannot reasonably be disputed. ‘‘ The trouble with the Philippines is that the natives won’t work,” has been repeated so often that it almost has hardened into a proverb; and probably none of detrimental reports which have been circulated about these islands has had more effect in hampering their develop- ment, by discouraging investment of capital. But is it 464 VALUE OF THE PHILIPPINES 465 true that satisfactory labor cannot be had in the Philip- pines? The answer to this question turns upon several matters, and invites examination of conditions in which this idea originated, and elements which apply to it. Many Amer- icans who reside in the islands believe the theory thus advanced. Inquiry reveals, however, that much of such comment is based upon superficial knowledge of the facts, and slight consideration of them. One frequently hears American and foreign residents of the islands, especially in Manila, inveigh against the ignorance and carelessness of native servants and employes, as examples of general Filipino incompetency. But one hears similar animadver- sions anent the servant problem in the United States; yet no one familiar with our country would think of conclud- ing therefrom that Americans are destitute of industrial capacity. So to estimate the industrial capability of Filipinos it is necessary to inquire of persons who have employed them on a large scale, through a considerable period of time, and who are able, from previous experience with similar labor in other countries, to compare results. These results turn upon various elements; but judgments derived from them depend upon comparative efficiency, and the economic measure of efficiency is the equation between work accomplished and its cost. It may be conceded that early experience with native labor in the Philippines was attended by unsatisfactory results to American employers. Satisfaction in such cases is measured by what an employer gets in comparison with what he expects, and disproportion may be caused by variation of either or both factors. An employe may give too little, and an employer may expect too much. In early days of American occupation, the American employer 466 THE FAR EASTERN QUESTION of Filipino labor unconsciously measured it by American standards of quality, as expressed in the output of human units, not then having become familiar enough with indus- trial environment of the East to reckon the real worth of labor as expressed in cost of production. Moreover, the average American employer, imbued with a sense of superiority which was a result of political conditions, was intolerant of native methods, and usually insisted on having things done as is customary in the United States. Thus forced along unfamiliar channels, Filipino labor was not able to meet expectations. Its efficiency was measured by a false standard, and, moreover, suffered actual depre- ciation from being badly directed. Thus, in the begin- ning, most Americans not only expected too much of Filipino labor, but actually helped to diminish its cus- tomary efficiency by imposing upon it unfamiliar methods and implements, and by not understanding or refusing to consider its sociological peculiarities. Several matters contributed to start American manage- ment of Filipino labor off wrongly. One was our idea that we can hustle the East. In the beginning Amer- ican theory for rapid development of the islands was quickly to introduce American methods. This theory is excellent in itself, but it was destined to suffer reverses in the process of practical application. Industrial meth- ods anywhere are interdependable, and are rendered efh- cient or inefficient by conditions and circumstances which circumscribe them. ‘This economic rule applies in the Philippines as elsewhere; but in introducing American in- dustrial methods there it was common, one may say usual to fail to consider the whole combination of collateral con- ditions which must affect their net result. Americans continually made mistakes of this character, by failing to consider some important element of cost, by introducing VALUE OF THE PHILIPPINES 467 expensive machinery which could not economically be used; and then blamed their failures upon Filipinos, and upon the native laborer in particular, when they often were due to lack of foresight and judgment in themselves. It cannot reasonably be denied that Filipinos, as work- ers, have peculiarities which are excessively irritating to the average American employer, especially to one just from the United States. Their indolence, their disposition to ‘‘ lay off,” their fondness for fiestas, and their slight physique have become familiar to people in the United States through constant iteration. Nature plays a part in shaping this disposition. The picture of a Filipino sleep- ing under a tree surrounded by edibles, which he only has to pluck to satisfy his needs, has come to represent to many the native conception of work. This picture is com- posed of partial truths, and the idea that the average Filipino cannot be induced to work has been refuted dur- ing the last few years. In considering the question of labor in the Philippines as an economic factor, the kind of labor needed to de- velop resources of the islands must be kept in mind. While there now are incidental manufacturing enterprises, and others will grow as concomitants of increasing pro- duction, agriculture always will be the chief industry of the islands; and agriculture requires a large proportion of unskilled labor. Indeed, it seems that now and in the future progress of the islands requires a large amount of dependable unskilled labor rather than skilled labor; and in this connection some results already secured with un- skilled lzbor under American management are interesting and significant. The more extensive experience with native unskilled la- bor in the islands has been that of large contracting com- panies which operate there. There are several of these; 468 THE FAR EASTERN QUESTION and the more important are J. G. White & Company, and the Atlantic, Gulf & Pacific Company. Both these firms have undertaken large construction works in the Philip- pines; the former the Manila Street Railways, the Philip- pine Railways, the Cebu harbor improvements and other contracts; the latter the Manila port improvements, the Luneta extension and other things. All these works have been carried on with native labor under American supervi- sion, involving the simultaneous employment of many thousands of Filipinos; and the estimate which their man- agers have formed of the Filipino as a worker is based upon actual experience with him under a variety of con- ditions, and extending over a period of several years. This experience has not been free from disagreeable incidents. Notwithstanding that these companies have at their command the best professional talent, and came to these islands fortified with ample experience in large un- dertakings elsewhere, they found it necessary gradually to re-shape their methods to suit conditions here. This de- cision was reached only after the men on the job had tried to introduce innovations, with unsatisfactory results. Their experience has been a process of experiments in try- ing to get the best results from native labor, a succession of compromises between so-called American methods and conditions peculiar to this country and people. With re- sults rather than methods always in mind, they are evolv- ing a system which imposes upon Filipinos as much of American method as they can assimilate and employ to ad- vantage, while permitting them to follow their natural bent in others. In short, it has been found easier in many matters to adapt the method to Filipino laborers than to bend them to it. Construction of the Philippine Railways probably pro- vides the best available illustration of what may be done VALUE OF THE PHILIPPINES 469 with native labor. These railways lie entirely in the Visayas. In respect to such undertakings at Manila, which is the industrial center of the islands, and where such industrial capability as the people possess has reached its highest state of development, it is contended that results obtained there are above the average, and that experiments in other places would be less favorable. In the Visayas constructors of the Philippine Railways are compelled to draw their labor almost exclusively from the agricultural element of the community, and results ob- tained there may fairly be assumed to represent an aver- age capable of being sustained throughout the islands. In beginning railway construction in the Visayas, J. G. White & Company had the advantage of its experience in Luzon. Conditions in Cebu, Panay, and Negros gen- erally represent the state of labor throughout the islands. These islands are almost exclusively agricultural, and la- bor for construction work had to be drawn from planta- tion hands and small farmers. Most of these are in- dependent in the sense that they can exist without reg- ular employment and, consequently, have been in the habit of working only when they feel like it. Many per- sons familiar with conditions predicted that J. G. White & Company would not be able to get enough labor to carry on the work satisfactorily. Certain difficulties could be definitely foreseen. The work involved use of unfa- miliar tools, and could only be carried on by organization such as the natives had no previous experience with. One evil attendant upon employment of labor in the Philippines is the existence of a counterpart of the padrone system in the capitas. A capitas is petty boss of a gang of fifteen to twenty men, who manages it, ar- ranges about wages and is responsible for its work. When American contracting firms first came to the islands 470 THE FAR EASTERN QUESTION they tried to eliminate the capitas, but results were so un- satisfactory that the effort was abandoned, and reform limited to curtailing the worse evils of the system. J. G. White & Company’s construction work in the Visayas is organized in camps, each under the supervision of a for- eign foreman. The camps are divided into divisions of from forty to sixty men, each under a foreign sub-fore- man; and divisions are composed of several gangs each under its own capitas. By this system more than 4,000 natives have worked simultaneously and without delay or friction in Cebu, where railway construction is further ad- vanced. In thus creating an efficient working force out of abso- lutely raw material, the construction managers laid the foundation for success upon these propositions: fair wages, and protection of the laborer from being “‘ squeezed” out of part of his pay; good and sufficient food; non-interfer- ence with native customs and habits except when absolutely unavoidable, and then with tact and discretion; using only native bosses in directing common laborers while at work; endeavor to make the men understand that the company is concerned about their welfare and is interested in im- proving their condition. The economic results of this policy, so far as they have developed, are extremely interesting. A principal factor in railway construction is the moving of great quantities of dirt, involving the use of excavating tools and means of transport. At first baskets were used to carry dirt in the Visayas; then it was decided to introduce the wheelbarrow, an implement practically unknown to Filipinos before the advent of Americans. At first it was found that men were unable to carry more than half a load. This was partly due to awkwardness and partly to lack of strength in the arms and shoulders. But the managers Bui_vinc RAILWAYS IN CEBU. VALUE OF THE PHILIPPINES 471 persisted, gradually increasing the loads, until now the men haul full loads without difficulty. A disposition to get tired easily and loaf in their work, which for- merly was such an aggravating habit of common Filipino laborers, also is being counteracted. Better nourishment is partly responsible for this improvement, due to good food and sanitation, and supervision has had an influ- ence. No foreign foreman is permitted to give an order to or hustle a native during working hours. Neces- sary orders are transmitted to the men through the native capitas, and if a foreman notices that a workman loafs habitually, the capitas quietly is instructed to re- place him with another man. In this way frictions be- tween foreign overseers and natives, which formerly were so numerous and often were the cause of serious labor troubles, are now almost entirely prevented. An Ameri- can labor overseer who believes in the rough methods of maintaining discipline which are often used at home is use- less in the Philippines, and is not wanted. Large em- ployers of labor in the islands will now discharge a foreign superintendent or foreman who shows a disposition to be arrogant and truculent with natives. To strike a native workman means instant discharge. Men who direct this work have come to realize that patience and consideration will go much further in handling native labor than rough displays of authority, and a foreign foreman or superin- tendent who cannot adapt his conduct to this theory is use- less. This policy does not accord with some so-called American ideas of dealing with Filipinos, but it is pro- ducing good economic results. Under this treatment the native laborer is undergoing an evolution. A man who formerly would work an aver- age of perhaps three days in a week, now will work five or six days. Where he used to knock off on every little feast 472 THE FAR EASTERN QUESTION day, he now lets many of them pass, and sticks to his job. This change of disposition is significant, for it is an indica- tion that habits which have in the past been detrimental to industrial progress are not so deeply encrusted as was thought, but will yield to tactful application of the same forces that elsewhere stimulate humanity to new efforts. In early days of American experiments with Filipino com- mon labor, if a workman quit in the middle of the week part of his pay was withheld, and he was refused employ- ment when he applied again. This system is feasible where it is understood, but Filipinos do not under- stand it, and its application caused such dissatisfaction that it was necessary to modify it. In railway work the men are paid by the day, and are paid in full whether they work six days or one day in a week. If Pedro wants to attend a fiesta or go fishing he does so, and when he again reports he is put to work without comment if there is a vacancy, and his desertion is not scored against him so far as he can tell. But José is Pedro’s neighbor, and José is of a more industrious habit. He works regularly. In time José’s wife has a better gown than Pedro's wife; his children wear shoes and stockings, and have some other little luxuries which Pedro’s wife and children cannot afford. Some day when Pedro re- turns to work after a brief vacation without leave, he finds his place on the gang taken by a new man. Is he discharged? He would have been five years ago; but now he is not. He is told to come around, and when there is a vacancy he will be put to work again. This occurs a few times; Pedro’s wife begins to remark upon her posi- tion as compared to that of the wife of José, who always works. Pedro does not find loafing so satisfactory as it used to be; he begins to regard his job as a good thing, and thinks twice before he runs the risk of being crowded VALUE, OF THE: PHILIPPINES 473 out of it. The influence of these adapted American methods is being strongly felt wherever they have been introduced in the Philippines, and they are planting the seed which may, aided by other educational forces, grow into tangible realization of Senor Regidor’s exhortation. From the standpoint of the employer, results have been equally satisfactory. Notwithstanding that to secure labor some American firms were compelled to pay higher wages than was usual, amounting to an average increase of 50 per cent., many kinds of work are now done much more cheaply than is possible in the United States, and very much more cheaply than white labor can do the work in the Philippines. In railway construction, for instance, a white laborer in America will move half as much more dirt in a day than a Filipino does, and he is paid four to five times as much to do it. The Filipino as a workman has serious defects, but most of them readily yield to tact- ful pressure, and the stimulating influence of environ- ment. The Manila & Dagupan Railway, a British cor- poration, and the Manila street car system conclusively have demonstrated that natives make fairly competent operators. They have great imitative mechanical in- genuity, but seem to lack industrial initiative. In the field of skilled labor, they show good progress in many branches. An old-time Spanish Friar once said that the brains of Filipinos are in their fingers. An idea of what can be accomplished by native skilled labor may be had by a visit to the printing plant of the Insular Government in Manila, where all kinds of advanced print- ing and engraving is done by Filipinos under American direction. Several hundred Filipino youths now attend the School of Arts and Trades in Manila, and industrial work, already an important branch in the insular school system, is being extended. 474 THE FAR EASTERN QUESTION I regard it as an encouraging sign that of the many Americans who employ Filipinos on a large scale whom I questioned about their capacity, not one gave a pessi- mistic account of them. On the contrary, men who from actual experience should know most about the propo- sition believe that a fair degree of industrial efficiency and reliability in Filipinos can be developed by in- telligent and painstaking effort. Richard Laffan, E. J. Beard, John Leech, and their associates in pioneer con- struction and mechanical operating work in the islands, may in time be credited with having laid the foundation for reorganization of the industrial system of the islands. It is interesting to note some incidental effects of Amer- ican industrial activity in the islands. One hears com- plaint among Filipino planters about the scarcity of labor. When analyzed, however, it appears that what is called scarcity really means that labor is becoming disinclined to accept the terms offered. In the past the tao groaned under the oppressions of caciqueism, by which he was mulcted of any surplus proceeds of his labor, and thus deprived of incentive to work. When the Philippine Rail- ways, in order to induce natives to undertake unfamiliar and wearisome work, advanced wages in the Visayas from 50 to 75 centavos a day, it caused a strong protest by the planters, who still are disgruntled, notwithstanding experience has demonstrated that double result is secured by this policy at an increase of 50 per cent. in pay. The truth seems to be that a large segment of old-time planters do not want the native laborer to progress, for this will mean his emancipation from the industrial semi-slavery under which he previously existed. If the planter pays higher wages, he himself will have to work harder to get value out of his labor; and the average planter in the Philippines has become so accustomed to the old order VALUE OF THE PHILIPPINES 475 of things that he regards any change with apprehension and disfavor. But careless, slipshod ways are doomed. They will in time, as the fao learns his rights under the law and, shaking himself free from the shackles of cacique- ism, acquires industrial energy and efficiency under stim- ulation of increasing desires and greater rewards, be re- placed by better methods. There is little reason to doubt that Filipinos will respond to such a stimulus; indeed they already are beginning to look to Americans to provide opportunity for material improvement. Should the United States pursue an eco- nomic policy toward the islands which will encourage their development, there is small chance that the question, “Will the Filipino work?” will permanently be answered in the negative. CHAPTER XXXIV VALUE OF THE PHILIPPINES — Concluded ADVERSE CONDITIONS — PERNICIOUS AGITATION — MORAL AND MATERIAL VIEWPOINTS — CosT OF THE ISLANDS TO THE Unitep StatTEsS—CoNnFuUSsION OF Issu—ES—-AN Economic Parapox — INADEQUACY OF PROPOSED AIEASURES — PRESENT STATE OF THE IsLANDS— Cost oF MAINTENANCE — QUES- TION OF THEIR SecuRITY — THE Extra Expense —A PHILIP- PINE Native ARMY — EXCELLENCE OF MATERIAL — ISLANDS ARE SELF-SUPPORTING — THEIR FiscaAL SITUATION — FALLACY or Some Economic OBJECTIONS — PROPOSED SALE OF THE IsLanps — PossinLE Economic Errects— Morau_ Consip- ERATIONS INvoLvep — No Basis For “Ger Rip oF THEM” ARGUMENT — THE “‘ PROBLEM”? EXAGGERATED. OF conditions which have retarded progress in the Philippines, agitation which tends to create uncertainty about theit political stability and status, such as sugges- tions to sell or trade the islands, are among the more detrimental. While such suggestions hardly will be taken seriously in diplomatic circles, they nevertheless are per- sistently thrust upon public attention by persons in Amer- ica and elsewhere, who either are grossly mistaken about conditions and circumstances which apply to the proposi- tion, or who take this means to gain political advantage or personal notoriety. It is highly important to the future of the islands, and to wider interests of the United States, that such impractical ideas be set at rest; which may, perhaps, be done by plainly presenting some pertinent issues involved. 476 VALUE OF THE PHILIPPINES 477 Broadly, arguments which apply to this question have two viewpoints moral and material. In prevailing discussion of the position of the United States in the Philippines both of these lines of attack have been used to attempt to show that it should relinquish sovereignty there; but material arguments apparently have produced greater effect. In any event, they have been more per- sistently urged, and with greater plausibility; so it may be well to give them precedence here. It is probable that none of material arguments against retention of the islands by the United States has had greater weight with the American people than statements carefully compiled to show that they already have cost the Government an enormous sum. The Philippines have cost the United States a great deal of money; although many financial balances prepared by opponents of the Gov- ernment’s policy can be discredited by candid auditing. But admitting that a large sum has been spent because our nation acquired these islands from Spain, it neverthe- less is true that to drag this question of cost into discus- sion of our future relations to the islands involves a fal- lacy. This money, or the greater part of it, was spent in suppressing an insurrection and in re-establishing civil order; or in the exercise of extraordinary police power. If a serious riot occurs anywhere, resulting in destruction of property, and requiring troops to suppress it, the extra cost is reckoned as a legitimate charge upon the main- tenance of government. Such incidents are deplored and regretted, but no reasonable citizen objects to paying the bill, although he well knows the loss never can be recov- ered, nor replaced except by fresh increment of wealth. The American civil war cost taxpayers of the nation an enormous sum; but sensible men realize that the loss can never be recovered, although it may be restored, and 478 THE FAR EASTERN QUESTION has been many times over. Such extraordinary govern- mental expenses are analogous to losses by fire. So in proposing to sell or give away the Philippines, it is clear that by doing so our nation will not thereby recover what these islands already have cost it, unless it should get an equivalent sum in exchange for them, or adequate compensation in another form. The injec- tion of this matter of past cost into the discussion involves some economic paradoxes, which indicate a confusion of ideas among those who advocate this disposal of the islands. Mflany who want to sell them on the ground of what the islands have and will cost the United States, profess to believe that we will be able to make a profitable sale of this expensive dependency, and thereby recoup. This idea seems to be based on a vague notion that another nation can make the islands profitable, and will be glad to take them off our hands. Here is a paradox; for if the islands are destined to be a burden to the nation which governs them, it is evident that the United States will find it difficult to sell or give them away; while if they can be made a source of profit, why should it, after having borne the brunt of a political and economic cata- clysm, not reap this profit for itself? Recognizing that to get rid of the islands now will not necessarily reimburse the nation for what they already have cost, a reasonable estimation of material elements involved must depend upon present and future contingencies. Cost of maintaining American sovereignty in the Philippines has two aspects: expense attached to administration of civil government in the islands, and expenses necessary to pro- vide for their security. As the islands cannot now, and probably never can defend themselves against the aggres- sion of a powerful nation, their defense will in some meas- ure devolve upon the United States, and this means ex- VALUE OF THE PHILIPPINES 479 pense. Many take for granted that it means additional expense to the United States. For security the islands ultimately must depend upon the United States army and navy, particularly the navy. The United States will main- tain an army and navy in any case; so presumption that retention of the Philippines will entail extra expense im- plies that their possession will require a larger military and naval force than otherwise would be needed to safe- guard our national interests throughout the world. This is a debatable question, and involves vast consider- ations. Projected on this hypothesis, the discussion at once assumes proportions so great that the item of the Philippines becomes insignificant by comparison. I have given considerable thought to this subject, and proposi- tions which it includes, and I believe, leaving the Philip- pines entirely out of consideration as part of our national domain, that we will be unable to reduce our army from its present status, and will find it necessary to increase our navy in order to afford adequate protection to our national interests in the Far East. If our broader in- terests demand such a naval programme in any event, its application to the security of the Philippines becomes largely incidental. I think it can be demonstrated that the permanent existence of a friendly and intimate relation between the Philippines and the United States, which is the object of and the likely result of our present policy, will strengthen America’s military and naval position in the Pacific, and eventually will reduce expense attached to its maintenance; and in this I ignore material compen- sations from other sources, confining the statement purely to the single element. At present 12,000 to 15,000 United States troops are kept in the islands, and there is little probability that it will be practicable to reduce this number for several years. 480 THE FAR EASTERN QUESTION The extra expense attached to maintenance of these troops in the Philippines is difference between the cost of their keep there and the cost of keeping them at home. At present it does cost more to have these troops in the is- lands than if they served only in the United States. They, of course, get the same pay and allowances in both places, and there is little difference in their upkeep in time of peace. The chief additional expense is the factor of transportation to and from the United States. The present tour of duty in the Philippines is two years, which means that troops frequently are moved great distances at considerable actual expense for transportation, and loss of time from active service while in transport. While it never will be practicable entirely to eliminate this additional expense, there is no doubt that it can be materially reduced. Many army officers favor an increase of the insular duty tour to three or five years. The two year tour was fixed during the disturbed period which attended the in- surrection and early days of civil government, when troops were subjected to arduous service, and before our officers had learned how to manage men in the tropics. Service in the Philippines is not now more strenuous than in the United States, and largely consists of routine duty in well situated and sanitary barracks. There is no sound reason why troops should not retain their health during an extended period of service in the islands. As we be- come more familiar with conditions which surround life in the tropics, it will be possible to introduce eco- nomies in the military budget. That it always will cost to maintain a military and naval outpost in the Far East may be granted, for it costs to keep such establishments anywhere. Americans should, however, learn mentally to separate the question of the security of our position in the Pacific from the local issue of administration of the Philip- VALUE OF TOE: PHILIPPINES 481 pine Islands. The United States, it is safe to predict, will in the future maintain a naval and military post in Asiatic waters whether the Philippines are retained or not. As time passes, with continuation of tranquillity in the islands, such United States troops as are stationed there probably will be concentrated in two or three large posts, the main one being near where the major naval base is established. Artillery and infantry will be the arms chiefly required, since the troops will not be expected to take the field in force. For policing the islands native troops may almost exclusively be employed. There al- ready are several thousands of native troops, denom- inated Scouts and Constabulary. The Scouts are recruited as part of the United States army, and chiefly are officered by Americans. The Constabulary is attached to the Insular Government, and is paid by it; and also is chiefly oficered by Americans, some of whom are detailed from the regular army. These troops have demonstrated that they are capable of developing first-class efficiency, and experts think that native troops can, when properly oficered and equipped, be depended upon to hold their own against any Asiatic soldiery. The raw material is excellent. Plans to recruit and maintain a native army sufficient to police the islands, and upon occasion provide reinforce- ment to the United States for defense of the Philippines, or other operations in the East, are seriously being con- sidered by the Government. While the Scouts and Con- stabulary now are separate organizations, time probably will witness their consolidation, as they perform prac- tically the same duties. When they were organized it was not thought wise to burden the budding Insular Government with the whole expense. In establishing the native troops upon a stable basis, it will be possible to 482 THE FAR EASTERN QUESTION profit by experience gained, and to guard against errors. It will be an excellent plan to officer this force entirely by graduates of West Point, a proportion of whom well may be Filipinos. This will entail increase of classes at the Military Academy, but this must soon be done anyway, as our army is under-oficered. The advantages of such a plan are clear. A native army will neither expect nor desire to get away from the country, it can be main- tained much more cheaply than a similar body of Amer- ican troops, and on the whole will be more adaptable to requirements of the situation. We may now see our way clearly enough in this matter to proceed, and steps to establish such a permanent force should receive early attention. Twenty thousand men should suffice for any contingency which reasonably may be anticipated. From some comment on the topic which one hears and sees in print, it is evident that many persons think that all or part of the cost of civil government in the Philippines is borne by the United States Government. This impression is erroneous, and its existence only can be explained by attributing it to persistent misrepresenta- tion. Since civil government was established, in 1901, expenses attached to its administration, with some un- important exceptions, have been met out of the insular revenues. Notwithstanding unfair treatment in legisla- tion by the home Government, a succession of devastat- ing natural visitations, and detrimental results of years of war and unsettled conditions, the islands are self-sup- porting. Revenues from all sources for the fiscal year 1906—7 were $13,754,046.00; while expenditures, includ- ing allowance for various sinking funds, were $12,691,- 378.00; leaving a reserve of over a million dollars. This has been accomplished in the face of unusual conditions, which required suspension of nearly all taxes upon land, ih ti: a TPHtuipreing CONSTABULARY, VALUE OF THE PHILIPPINES — 483 suspension of other taxes in some provinces, and frequent appropriations for relief of the people. During this pe- riod the Government has successfully undertaken a grad- ual shift of methods of taxation, which in the Spanish re- gime bore heavily upon the poorer classes. In this connection, some comparisons are interesting. The Philippine Islands are 3,141 in number, have a total area of 127,853 square miles, and a population of 7,635,- 426. The revenue now exacted amounts to $1.52 per capita. Cuba has an area of 44,000 square miles, and a population of 1,572,845; and her per capita taxation is $13.33. Porto Rico, with an area less than that of the island of Panay, exacts taxation of about $3.70 per capita. Japanese pay a per capita annual tax of $8.00. These figures indicate that with increasing prosperity it will be comparatively easy to increase insular revenues with- out their being burdensome to the people. If the islands are treated fairly by Congress, and given opportunity to develop their resources, there need be no fear that they will be a burden upon the national treasury. On the contrary, they can extend their school system, undertake internal improvements and meet all legitimate demands upon the insular treasury; and they will be able to main- tain at their own expense such military force as I have suggested, and this will be their contribution to the scheme of broad national security. Material profit which will accrue to the United States through industrial and commercial development of the islands is among compensatory benefits to be estimated in this connection, and which J already have reviewed. Another phase of this matter may, however, be mentioned. Much opposition in America to retention of these islands may be traced to allied corporations, which allege that certain American industrial and agricultural interests will 484 THE FAR EASTERN QUESTION be adversely affected if Philippine products are given free entry into the United States. It is significant that the in- terests which present this argument are sympathetic to pro- posals to sell or exchange the islands. The matter of a sale of the Philippines presents some interesting economic suggestions. Only one probable purchaser has so far beén suggested — Japan. What would be the effect upon American industry if the Philippines should fall into the hands of Japan? Staple exports from the Philippines are hemp, sugar and tobacco, in the order named. Hemp is a Philippine monopoly, and at present there is an export duty on it. More than half of the hemp produced in the world is consumed in the United States, and if industrial ex- periments now under way prove successful, the United States may consume all the hemp these islands can pro- duce. Under the existing tariff arrangement between the United States and the Philippines, export duty on hemp which goes to the United States is refunded, and accrues to the benefit of the purchaser; thus giving Amer- ican manufacturers who use hemp this advantage over competitors in other countries. At present the islands lose revenue of nearly half a million by this law. If the islands should be sold to Japan, or are otherwise acquired by her, she could at once make the hemp industry a government monopoly, and increase the export duty to as high a point as would be possible without curtailing consumption. ‘This could produce increased revenue which would be ample to take care of interest and sinking fund of a bond issue to purchase the islands, and eventually might lead to the extinguishment of certain industries in the United States, and usurpation of their markets by hemp products manufactured in Japan. VALUE OF THE PHILIPPINES 485 Everyone recognizes that it benefits American industry to. be able to secure hemp without a duty being added to its price, and there is no opposition to its free entry into the United States; in fact, it enters free now. Opposition in America to free trade with the Philippines seems to center in the beet sugar industry. An attempt is made to have it appear that this opposition is in the interest of beet sugar growers, but sugar refiners are the real movers in the matter. It is admitted that the Philippines do not produce enough sugar materially to affect the market in America even if it should all go there (very little does now); and it is contended that if offered a free market in the United States there would be great development of the sugar industry in these islands, which might in time adversely affect American beet sugar grow- ers. What might happen, in respect to sugar, if Japan should take the Philippines? Is it not reasonable to sup- pose that Japanese labor would be imported to till the plantations, and that the sugar refineries of Japan, which already enjoy the protection of government monopoly, would get a further advantage over the American sugar industry in competing in the world’s market? If this should prove true, the sale of the Philippines to Japan might bring about the result which sugar manufacturers of America pretend to fear. In giving precedence to material aspects of this situa- tion, I have not felt that its moral aspects are unimportant or of secondary interest. [he moral propositions in- volved stand out so clearly that it is hardly possible for casuistry to obscure them. ‘Think of proposing, after having in an altruistic impulse undertaken to govern a country, to sell it, and of course its inhabitants also, be- cause we do not see our way clear to make money out of it 486 THE FAR EASTERN QUESTION and them, and to be rid of some trouble and responsibility ; to be rid of what is called a “ problem,” when human affairs present a perpetual problem! In a time now not far distant the American people will understand that the so-called Philippine problem is a Bogey. In the future we will be ashamed of fears which attended our early efforts to administer these islands; for as years pass, and we grow more familiar by contact with this ‘“‘ problem,” and as its difficulties recede into correct perspective in comparison with our combined na- tional activities, we will know it for what it really is; an undertaking not above the capacity of a third-rate Euro- pean nation. There is one moral factor attached to a sale of the islands which many persons apparently have overlooked; the ethical difficulty involved in turning over a Christian people to be governed by a pagan power; which probably will be the fate of these islands should the United States ever, for any reason, entirely cast them loose. When re- cently a segment of the American press was seriously dis- cussing a sale of these islands to Japan, an American clergyman in Manila thundered from his pulpit: “We will ot be sold into Paganism.” There appears, so far as I am able to estimate condi- tions in the Philippines and circumstances which now determine and must in the future decide what their rela- tions to the United States will be, no sound basis for a “get rid of them at any cost” agitation. Such dis- cussion is based upon misconception of the facts, and its chief practical effects are to hamper material progress in the islands, increase the difficulties of administration, and defer the time when Filipinos will be prosperous and contented. ‘Taking into consideration their geographical location, and the indisputable tendency for greater nations TRANSPORTATION IN THE PHILIPPINES VALUE OF THE PHILIPPINES 487 to absorb lesser ones, I cannot believe it will ever be pos- sible for the Philippines permanently to exist as an in- dependent political entity. Left to themselves they inevi- tably will fall under the dominion of some superior power, and for the United States to abandon its position there will be to cast them, like a rich prize, to be struggled for by other nations; a fate to which, in my opinion, the Amer- ican people never will consign them. CHAPTER XXXV THE MORO PROVINCE Tue OrTHer PHILIPPINES — History oF THE Moros — EarLty SETTLEMENTS — Piratic Excursions — THE SPANISH REGIME — TRANSFER TO THE UNITED STaTES—— THE AmMErI- cAN Poticy — Errorts aT ReForM— PoweER OF THE Datus — TrousLes WITH THE Moros— SuPPRESSION OF THE IN- SURRECTION — ESTABLISHMENT OF CIVIL GOVERNMENT — ITS SEMI-MILITARY CHARACTER— THE ADMINISTRATIVE PROCESS — PopuLaTION AND ReEsouRCES — FISCAL SITUATION — THE ScHoots — Moro Cuaracreristics — MInpANAo — THE SuLtu ARCHIPELAGO — THE IsLETs — JoLo — JURAMENTADAS — Moros anp Fitipinos —A VALUABLE POSSESSION. THERE are two Philippines. One is the Philippines of Manila, Iloilo and Cebu: which has representation be- fore Congress, on the Commission, on the Insular Supreme Court; which elects its own governors and Assembly, and talks about independence. The other Philippines contains people of a different race, who practice a different religion, have different manners and customs; who live under a different form of government, and who never have thought of independence in the accepted political meaning of the term. This is that part of the archipelago officially denominated Moro Province. The Moros are supposed to be of Arabic origin, but their ethnology now has only incidental interest. The immediate ancestors of Philippine Moros seem to have been the dyaks of Borneo, who many hundreds of years ago began to make forays and excursions to the chain 488 THE MORO PROVINCE 489 of small islands now known as the Sulu group. Thence they extended to Mindanao, where a salubrious climate and fertile soil induced them to form settlements. When two princes of Borneo quarrelled, one of them removed to Jolo, where he established his Court. Moros occu- pied those islands without trouble, except numerous civil wars, until long after Spanish sovereignty was established in the Philippines. As civilization progressed and wealth accumulated in the Visayas and northern islands, the spoil which they offered tempted Moros to make depreda- tions upon them. At intervals fleets of Moro vintas in- vaded the north, ravaged and plundered the Visayas, and once even threatened Manila. At every coast settlement in the Visayas the remains of watch towers and stone forts can be seen to-day, evidences of former Moro activity. Spain was compelled to make effort to protect her colonies, and after several campaigns succeeded, with great difficulty, and partly by diplomacy, in bringing the Moro country under her nominal rule. While Moros, through acquiescence of their leaders, thus were induced to recognize Spanish sovereignty, it was a yoke which they felt very slightly and which Spain dared not press too strongly upon them. ‘The Spanish were content if the Moros would remain quiet, and hardly made an at- tempt to govern them locally. This complaisant policy was destined afterward to react upon Americans. While the Spaniards established garrisons in some coast towns, and thus managed pretty well to control the trade of the southern islands, inhabitants of the interior scarcely were conscious of Spanish rule, and pursued their ancestral ways practically unmolested. ‘There was, in recent times, a recognized Moro sovereign, the Sultan of Sulu, whose seat of government was and still is at Jolo. The Sultan for many years drew an annuity from Spain, but he had 490 THE FAR EASTERN QUESTION little real authority outside the island on which he lived. The people were ruled by datus, or local chiefs. The position of a datu depended upon personality, and his ability to secure and hold a following. More powerful datus would receive the allegiance of lesser ones, and datus ranked according to the number of fighting men who obeyed them. They fought among themselves. When petty civil wars between neighboring datus oc- curred, as they frequently did, the Spanish Government and the Sultan usually left them to fight it out provided they did not injure Spanish property or subjects, or unless the strife threatened to embroil the entire country. On such occasions the Spaniards usually would end the war by taking the side which for various reasons seemed to be more politic, and aiding its leader to crush his enemy. Thus the Spanish regime, far from trying to develop po- litical homogeneity among Moros, rather strove to keep the greater datus asunder, and to employ their mutual jeal- ousies and animosities to preserve the balance of Spanish authority. In early days of the Spanish regime, the friars made some attempts to proselyte among the Moros, who are Mahometans; but these efforts were followed by such disagreeable consequences that they were abandoned. This passing glance at Moro history may serve to give an idea of the situation in the southern islands when the United States took control of the Philippines. Hardly had the Spanish-American war begun when Moros started an insurrection which the Spaniards, being en- gaged elsewhere, could but feebly oppose. In a short time the Spanish governor and garrison were besieged in Zamboanga, and so they remained until rescued from their dilemma by American troops. It thus happened that in the Moro country, as elsewhere in the islands, the United States took over an insurrection. This one, how- THE MORO PROVINCE 491 ever, had no disturbing political idea behind it, having as its genesis a religious and racial antipathy coupled with irritation caused by petty commercial oppressions; and, consequently, was not so hard to deal with. Amer- ican military officials succeeded in convincing leading datus of their friendly intent, and in a short time peace was restored. The Spaniards sailed away, and Americans ruled in their stead. Regarded one way, troubles of Americans with the Moros since then are due to ourselves and our ways. Having here a fine new possession, it was natural that the United States Government should look it over and begin to take stock. This stocktaking revealed some peculiar conditions, and the attempts to alter some of these con- ditions subsequently caused collisions. Placed in an unfamiliar environment, and occupied by the Filipino insurrection in the north, the American author- ities in Moroland at first devoted themselves merely to establishing their authority in the principal towns, where garrisons were stationed; and in opening friendly relations with the Sultan and more influential datus. No especial obstacle was encountered in these preliminary moves. The Sultan was cajoled into recognition of United States sov- ereignty by continuation of the pension which he formerly had drawn from Spain. In Mindanao the greater datus, such as Piang and Ali, likewise were conciliated, and out- wardly accepted American authority. As time passed, and Americans gradually came to learn something of the country and conditions in the interior, a state of affairs was revealed which rightly was judged to be inconsistent with the policy of the United States Government. The mass of the people practically were under the domination of datus, who exercised al- most absolute power in localities which they governed, 492 THE FAR EASTERN QUESTION and who frequently used this power to defraud and op- press their subjects. The laws were crude, and their administration barbaric. There was no definite land tenure, nearly all domain being held by datus and their favorites. Slavery and polygamy existed. Except for a few Jesuit schools in garrisoned towns, which taught children of Filipino and Chinese residents, the people were being left in ignorance. The Spaniards had made no effort to educate the people, after early attempts of the church provoked such bitter opposition, for with Spain school and church were synonymous, and instruction never moved except under the wing of religion. To improve this condition was a problem which con- fronted the Americans and, true to inherited training, they set about it with confidence. In 1902 civil government, after a fashion, was extended to Moro Province, and with its establishment attempts at reformation began. The rapid change from a condition of comparative peace to one of insurrection which followed is attributed by many to replacement of military by civil government. This view has some plausibility, but argument in favor of indefinite continuation of military rule which is based upon it is, when scrutinized, revealed to be founded upon miscon- ception. ‘The military government succeeded in maintain- ing order, it is true, and might have continued to do so for years by a show of military force and by not interfer- ing with local affairs of the people. But this would have meant comparative stagnation, and continuation of con- ditions which detained the people in barbarity and pre- vented development and prosperity of the country. Reformation meant interference with the authority of datus and curtailment of their power; the abolition of slavery and suppression of slave trade; establishment of courts, and compelling popular recognition of authority THE MORO PROVINCE 493 of the law; providing a sound foundation for commercial and industrial development by creating a legal basis for land titles; establishment of a school system; and, in general, extension of the functions of the central govern- ment into all parts of the country. None of these things had ever been accomplished, hardly attempted by Spain; so here was a field for pioneer work. To have accomplished such an evolution with- out serious friction would be difficult under the most favorable conditions. In the Moros the Americans tackled a fierce, warlike, ignorant and intractable people, who rarely had been defeated and never conquered; a combination of qualities almost destitute of pliancy, and which made resistance a practical certainty. As was an- ticipated by many, the attempt to apply American policy to the Moros aroused opposition among them. Petty datus in remote districts refused to accede to admin- istrative processes of the Government, and when a show of force was made to compel them, offered armed resist- ance. Thus began disorders, which in a short time involved the entire Moro Province, and which were sup- pressed only after arduous campaigning and some severe fighting. Fortunately, internecine jealousies of datus prevented them from combining against the Americans, and this made it possible to defeat them in detail. The campaign in the Lake Lanao country is typical of this weakness in Moro method. The cottas of perhaps fifty petty datus adjoin the lake, and these fell one by one under attacks of American troops. Fighting men of one cotta would witness the reduction of a neighboring cotta with indifference, often with satisfaction, apparently unable to realize that their turn would come next. American authorities soon adopted the Spanish expedient of playing hostile datus against each other, and with considerable 494 THE FAR EASTERN QUESTION success; for in this way they were prevented from com- bining their forces. While the Lanao and Cotobato districts presented greater difficulties, the fighting in Jolo probably had more decisive effect. Here occurred the Bud Dajo fight, the so-called battle of the crater, sanguinary details of which caused so much criticism in the United States. So severe was the defeat inflicted upon hostile Moros in this fight that further resistance was abandoned, and peace was re- stored. During the entire period of insurrection Gen- eral Leonard Wood was governor of Moro Province and commander of troops engaged in the operations, and to his able administration much of their success is due. The United States army did splendid work in this little war. Moro constabulary took an effective part in the campaign, and fought their own people with as much energy as they used to display in attacking Filipinos. Upon suppression of the insurrection civil Govern- ment, which perforce had restrained development of its policy during hostilities, resumed its efforts, and in time the now existing administrative system of the province was organized and put into execution. ‘There is a gov- ernor, who also is commander of the military department of Mindanao; a treasurer, an attorney general and an auditor. These four officials constitute the Provincial Legislative Council, which legislates for the province, and whose acts may be vetoed by the Philippine Commis- sion. The province is divided into five districts, each with a governor, secretary and treasurer, who compose the District Board and are appointed by the Provincial Legislative Council, subject to approval of the Commis- sion. Districts are divided into tribal wards, each ad- ministered by a head man and a deputy. Local datus usually are appointed head men in their wards, as ex- THE MORO PROVINCE 495 perience has shown that the people are easier to control when their familiar chiefs thus are employed. District boards make laws for a district, subject to amendment or annulment by the Provincial Council. District governors act as justices of the tribal courts. Appeals from tribal courts go to the Court of First Instance for the province, which is presided over by an American judge, and consti- tutes the Fourteenth Judicial District of the Philippines. Spanish civil and penal codes chiefly are used, as elsewhere in the islands, but Moro laws, which have been crudely codified, sometimes are used in modified form. Christian elements of the community are under the same status as in other provinces. Under the law organizing the province, army officers may act as district governors and officials, and if they exercise these offices they receive a small addi- tion to their pay. At present several district governors are army ofhcers, from motives of convenience and econ- omy, as it is necessary to maintain a number of military posts in the province. It will be perceived that this Government, while called a civil government, is semi-military in character, in the sense that its authority still largely rests upon the presence of troops, and that it is chiefly administered by army officers. But the essence of civil government is here. The law of the land, not autocratic dictum, is the basis for administratien, and the people are being instructed in obedience to this law as interpreted by the central Government and the courts. Still, the work has only just begun. The central Government has comparatively little knowledge of what is going on in many tribal wards, its source of information being the local datus. Gradually the people are learning that they can appeal to higher authority than their datus against injustice and oppression, and the worse evils of datu caciqueism are being remedied. 496 THE FAR EASTERN QUESTION Slavery no longer exists, polygamy is diminishing, and a legal basis for personal and real property rights is being established. A plan has been adopted whereby it is hoped in a few years to have all land titles registered. Formerly datus claimed all unoccupied land, which is the greater part of provincial domain in the larger islands. The Government has refused to recognize these claims, how- ever, and will grant titles only upon proof of actual occu- pation and cultivation. This will remove a cloud from the title of public lands, and throw open the country to settlement and development. The Government is en- deavoring to discourage present migratory habits of the Moros, and to get them to settle upon land and establish titles; but without much success so far. The present population of Moro Province consists ap- proximately, for an exact census never has been made, of 450,000 Moros known as civilized, 60,000 Filipinos and Chinese, and about 50,000 uncivilized people who live in the mountains of eastern Mindanao, known as hill tribes. Of this population a great majority inhabit the large island of Mindanao, which has nearly half a million inhabitants, of whom nearly three-fourths are Moros. Filipinos chiefly live in northwestern Mindanao, where there is a small organized province attached to the regular Insular Government, and in the coast towns. Chinese are merchants and traders of the province, and have been established there for many years. ‘The prov- ince is self-supporting. The fiscal year 1907-8 showed a revenue of 750,000 pesos, and a surplus of 30,000 pesos. All customs and other revenues collected in the province inure to the provincial treasury. A provincial school system is maintained out of the revenues. Schools have been established throughout the province, but except THE MORO PROVINCE 497 in larger towns considerable difficulty is had in inducing Moro children to attend. The attendance is, however, slowly increasing, and the people are growing more friendly to the schools as they come to understand their purpose. Moro children are keen and apt to learn. [ was rather struck with a scene in the industrial branch of the Zamboanga school, where some three score of Moro, Filipino and Chinese boys were learning how to make wicker baskets, chairs and other articles, under the instruction of a Chinese teacher. It was somewhat difh- cult to realize that this was an American public school. It was the American policy in Moroland revealed at a glance. The schools of the province now contain 60,000 children, of whom a majority are Filipinos. Moro Province presents an administrative rather than a political problem, except as political considerations are externally thrust upon it. Moros have no idea of politics in the modern sense, and take no interest in such matters. They moreover as yet have practically no conception of responsibility and loyalty to a central government. Their civilization, such as it is, is based upon family and tribal relations, held together by a thin thread of religious imperialism, centering upon the Sultan. The people for- merly paid tribute to the datus, who in turn paid tribute to the Sultan, unless they felt able to resist his power, when they refused, and civil war usually resulted. The only political problem, to employ a seeming paradox, in- volved in the administration of Moro Province is a re- ligious one. M{ahometanism, ever poor soil for pros- elyting of other religions, has here lost none of its stub- bornness and fanaticism. Any interference with the re- ligion of Moros is certain to cause serious trouble. So the Government does not desire the presence there of other 498 THE FAR EASTERN QUESTION religious sects. The Jesuits already are established, but they long ago learned to leave Moros alone, and confine their attention to Filipinos. In time the Insular Government hopes to accomplish much for the Moros and their country. There are two customs, however, which even the military prefer not to interfere with, at least not now; concubinage and carrying of arms by the fighting men. With great difficulty the authorities have secured most of the rifles formerly pos- sessed by the warriors, but Moros still strut about with dangerous looking barongs thrust in their belts. They are splendid fighters, and if the Government ever needs an Oriental army it can raise it here. Moros differ in some respects from any Orientals I have seen at close range; their eyes meet yours without flinching, with the look of men who may at times have been defeated by su- perior force or skill, but who never have been subjugated, and who are ready to take up arms again at any moment. The Moro constabulary does excellent work, and is, de- pendable, so the officers believe. Some American army officers who have had contact with Moros think that, with equal equipment and training, they make better soldiers than Japanese. A cruise through the southern islands tempts one to rhapsody. The smaller islands are more picturesque, rising out of a sea of brilliant blue or purple, and usually with a bank of fleecy clouds clustering about the summits of the hills. Mindanao is the largest island in the Philip- pines, and probably the richest in natural resources. It is spoken of out there as a ‘‘ white man’s country ’’; mean- ing that the climate is salubrious for people who have been accustomed to reside in temperate zones; but I suppose that by now the slander about the Philippines being an unhealthy country is sufficiently refuted. The manner of THE MORO PROVINCE 499 life of most Americans there has been unhealthy, I grant. Mindanao impressed me as being best of the is- lands when climate is in mind. Zamboanga is, I think, the prettiest town in the islands. It is the provincial capital and principal port in the Moro group, and is sur- rounded by a beautiful country through which one may drive upon well kept roads. The streets are clean, the buildings neatly whitewashed, and the place has an air of prosperity and progress. It is the only place in the Philippines where jinrikishas are used. Mindanao indeed is a wonderful island, as yet prac- tically undeveloped. Great rivers flow through broad and fertile valleys, while the hills and mountain slopes, which in places rise to an altitude of 10,000 feet, are covered with a dense growth of timber, mostly valuable hardwoods. Hemp grows on the island in great pro- fusion and excellence. There now is a thriving colony of American hemp planters at Davao, and the industry is rapidly extending. The resources of Mindanao have not yet been scratched. Populated as densely as Porto Rico, the island will support 20,000,000 people. Hemp, rub- ber and rice are the chief staple products, but nearly all kinds of tropical and sub-tropical crops thrive in this soil and climate. Jolo perhaps is the most interesting of the chain of islands which form the Sulu Archipelago, because of its historical associations and on account of being the seat of the Sultan. In Jolo one suddenly steps into a warlike atmosphere. The order is that no soldier or foreigner shall ever be without arms, and so one sees men going about with pistols strapped on them. I met some soldiers returning from a plunge in the surf. They wore only bathing suits, and each man carried his revolver in his hand. While they were in the water they deposited their 500 THE FAR EASTERN QUESTION weapons on shore, guarded by two comrades. At a fixed hour every evening all Moros must leave the walled city of Jolo, when the gates are locked and guarded during the night. In the morning they are again opened, and sen- tries always are on duty, who scrutinize Moros who pass through. The reason for these extraordinary precautions in time of peace is the juramentada, a type of religious fanatic who occasionally takes into his crazy head to get out his barong and run amuck. He exists in all parts of the Moro country, but Jolo seems to be his favorite hab- itat. The desperate deeds of juramentadas could fill a volume. Once they go on the war path, which they always do without the slightest warning, they will cut and slash at every Christian within reach until they are them- selves killed. So wrought by frenzy do they become that sometimes it takes a score of bullets to bring one down. Quite recently a juramentada who ran amuck at Asturius, a suburb of Jolo, was shot twelve times before he fell. The Spanish Government also had juramentadas on its hands, and they reaped many sacrifices. There is a story, probably apocryphal, of how a Spanish governor of Jolo managed a juramentada incident. It has been printed be- fore, but always is interesting, and it points a moral. A peculiarly atrocious juramentada outrage was perpe- trated in the city, the victims being a Spanish family. The juramentada was killed, as is usual, for one always resigns himself to death and makes no attempt to escape. This juramentada was a follower of a neighboring datu, and the governor sent a protest to the datu, demanding that such men be kept under control. The datu replied that he was very sorry, but the man was juramentada and he could not control men so affected. A few days later a Spanish gunboat appeared before the cotta of this SVLNIA ONOJAL AO LAN TT THE MORO PROVINCE sol datu and shelled it, killing a number of people and de- stroying much property. The datu sent a hasty protest to the governor, who is said to have replied: ‘“T am very sorry; but my gunboat has gone juramen- tada, and I cannot control it.” Whatever method Spanish governors may have used, juramentadas were few in later days of the Spanish re- gime, and they revived soon after American occupation. Fortunately, they now seem to be diminishing; but they still are frequent enough to be a cause of apprehension to foreigners in Jolo. While they are but the fringe of the Philippines, its ragged edges so to speak, the islands of the Sulu group are well worth a visit. Here ply the pearl fishers, and snuggled in the maze of tiny islets are rendezvous of native and Chinese smugglers who use Borneo as a base. In order to check smuggling the Philippine Government maintains custom houses at several points. Siassi, Bangao and Sitanki are remote even from the Philippine world; yet we would hardly drop anchor in one of these little ports when the cutter would be surrounded with vintas filled with Moro boys, who would chatter at us in Eng- lish, and invite us to throw coins for them to dive after. Sometimes lads would stand in the vintas and perform the manual of arms with paddles, at the command of one of their number. ‘‘ Carry arms; port arms; shoulder arms; order arms;”’ and the orders would be executed with accuracy and precision. ‘They learn these tricks from the American soldiers. At Siassi a Moro boy who spoke very good English told us of a rich datu who always presents American visitors with a handsome pearl, but we did not test his hospitality. On Cagayan Sulu, the scene of Quiller-Couch’s mythical romance, are two white men living among 3,000 armed Moros. One of these, a 502 THE FAR EASTERN QUESTION United States customs officer, had, in 1908, been there for nearly two years, and never had any trouble with the natives. He was quite contented, and when asked if he was not afraid to live there without any troops or constabulary, he said: ‘If the Government ever sends any soldiers or police here I will resign at once; for that would mean certain trouble.” Notwithstanding difficulties which are encountered, the American policy is making progress even in Moro- land. Anomalous as is the relation of the civil to the military element in the Government, they are here work- ing together harmoniously. There is only one cloud, and that a small one, on the horizon of Moro Province. This is desire of the Philippine Assembly to get con- trol over its affairs, which tentatively cropped out during the first session of this body. Owing to the bitter racial and religious antipathy between Moros and Filipinos, it is not prudent to employ Filipinos in administration of the province, nor will it be for years. The Moro de- spises the Filipino, and the Filipino hates and fears the Moro. Filipino politicians seem to fear that Moroland will become separated from the other islands, and they want to retain control over it. Some Americans believe that if the islands, including Moro Province, were now given independence, the Moros would conquer the north- ern islands in a few years. Fortunately, there is slight probability of any fundamental alteration of the status of the province for a long time to come, which gives assurance of continuation there (with, perhaps, some pass- ing interruptions) of a condition of peace and progress. CHAPTER XXXVI AMERICA’S POSITION IN THE PACIFIC Issurs INVOLVED— AMERICAN INTERESTS IN THE East — QUESTION OF THEIR SECURITY —COMMAND OF THE SEA— NavaL Bases— THEIR Usk anp REQUIREMENTS — THE QUESTION PRACTICALLY ESTIMATED— PROSPECTIVE OPppon- ENTS — AMERICA AND JAPAN — THE SITUATION ELUCIDATED —Its PossIBILITIES AND PROBABILITIES — ELEMENTS OF THE PRoBLEM — THE GEOGRAPHICAL Factor — THE DEFENSE OF Hawau—A PossistE JAPANESE ATTACK — THE Factor oF ‘TRANSPORTATION — PRELIMINARY Moves — MosiLizaTION AND DispatcH — LocicaL CONCLUSION OF THE PROPOSITION. As appreciation of commercial possibilities of the Orient and their relation to industrial prosperity of the United States grows among Americans it will, inevitably, cause consideration of the security of our position in the Pacific Ocean, which body of water now is recognized by many as the probable future center of the world’s greater activities. When interests of the United States in the East are mentioned, many persons in America think at once of the Philippines as the beginning and end of them. While the relation of those islands to the question is important, they really are a minor factor in comparison with broader issues at stake. So when it is proposed to secure our interests in the Far East by creating facilities for protecting them from possible aggression or assault, the average American, having only the Philippines in mind, is apt to say: ‘‘ Oh, 503 504 THE FAR EASTERN QUESTION are they worth the trouble and expense?” It is possible, I think, justly to answer this question in the affirmative. But the real question is: ‘‘ Will it pay to establish a con- dition giving force and effect to America’s voice in the solution of the problem involved in the evolution of the East, and making it possible to safeguard our material in- terests by other means than concessions which, by limiting our national opportunity in those regions, will re-act upon our prosperity at home?” It may be said that security of American interests in the Pacific depends upon command of the sea in compari- son with any probable antagonist; and command of the sea in turn depends, in addition to marine armaments, upon coaling stations and naval bases. Naval arma- ments are practically useless in any locality without facili- ties for supply and repair. To provide such facilities two things are necessary: harbors and landing places, and the necessary depots and mechanical adjuncts. The United States already is supplied with ample natural facilities in the Pacific. It remains, therefore, to provide only the artificial element. The equipments required are dry docks for ships of all sizes; coal and coaling machinery; shops provided with machinery and material needed to make ‘repairs to both ships and armament; and depots contain- ing reserves of all needed supplies. Where natural condi- tions are favorable, to provide all these things requires only time and money. Since the establishment of such bases contemplates, as does the maintenance of armies and navies, the possibility of war, it is necessary to consider the probability of their being attacked; and in selecting sites their defensibility is a fundamental consideration. A naval base may be at- tacked both by land and sea, so this matter has two aspects. Should a superior hostile fleet be able to bring its guns AMERICA’S POSITION 505 to bear upon the anchorage and mechanical facilities of a base its value will be destroyed, and such ships as had sought refuge there may be lost. The harbor should, therefore, be so situated that it cannot be entered or ap- proached by a hostile fleet except at grave peril or almost certain danger of destruction. Recent wars conclusively have demonstrated that ships cannot successfully combat with land batteries of anything like equal strength, while if the entrance to a harbor is narrow it also may be pro- tected by mines. Given a well located harbor, to defend it from naval attack is comparatively easy, and involves only the mounting of batteries and planting of mines. The problem of defense from attack by land is not, however, always so simple. Where circumstances make it possible that a base can be blockaded by sea and at the same time beleaguered by land, its defensibility de- pends upon ability to withstand assault and to sustain a prolonged siege. It is not necessary to worry about the land defensibility of naval bases situated in the United States, for they easily and quickly can be supported by the entire military strength of the nation. But the prob- lem of defending bases situated over sea from their sources of supply and reinforcement is different. In such cases protection of a base ultimately depends upon supply and reinforcement, which can be accomplished only by securing and retaining command of the sea. Unless, therefore, the United States adopts a policy of perma- nently maintaining a naval force in Pacific waters superior to that which can quickly be assembled by any prospective opponent, it must be prepared to defend its naval bases there from attack by land and sea until a fleet capable of disputing command of the sea with the enemy can reach the scene. The value of naval bases in Pacific waters may be said 506 THE FAR EASTERN QUESTION to apply chiefly to war between the United States and an Asiatic power; for while some European nations might conduct large naval operations in that part of the world, the crux of any conflict between America and another west- ern power would not be there, and no naval force alone ever can wrest any of our major Pacific possessions from us. Only armies can do this, and it is not now feas- ible for any European power, excepting Russia, to assem- ble a formidable army in the Far East in the face of seri- ous opposition. Of Asiatic nations which conceivably may come into collision with the United States there are only two — China and Japan; so the proposition of defense of American interests and possessions in this locality need seriously consider only these two possibilities. The inter- nal situation and military unpreparedness of China pre- vents apprehension from that source for many years to come; so present estimation of the problem may be predi- cated upon the comparative situation of the United States and Japan. While there is some disposition to deprecate discussion in time of peace of possibilities of war between nations as tending to cause such collisions, it is evident that candid comparison of resources and elements involved also may have deterrent effects. Whatever view of this question one may hold, there is no doubt that governments perpet- ually are occupied with the problems which international strife presents, and that they possess perennial human in- terest. Nor do these considerations necessarily imply bel- ligerent design or intent, and if popular discussion of them usually is limited to occasions when diplomatic embroil- ments seem to presage a disagreement, it is equally true that only under such circumstances is the popular mind in most countries receptive of information to which national security and legitimate ambitions demand attention. AMERICA’S POSITION 507 That results of the war against Spain and subsequent events in lands bordering the Pacific Ocean would provide new problems for American naval and military depart- ments was inevitable; and that Japan would take a promi- nent place in such considerations was a foregone conclu- sion, definitely established by her geographical location and rapid development. In early days of American occu- pation of the Philippines, and during the insurrection, spe- cific evidences of adverse Japanese political activity there were obtained by officials of the United States Govern- ment, and while these quietly were relegated to archives in Washington without publicity, from that time our army and navy have regarded the Japanese as opponents against whom they eventually may be called upon to try their mettle. Since then Japan’s naval and military efficiency has been practically demonstrated. Her national ambi- tions and activities have greatly widened, and new forces set in motion by them already have produced friction be- tween American and Japanese interests in both Asia and America. As yet the more serious instances remain in comparative obscurity, known only to a directly interested few, and nursed in diplomatic cabinets, while those which so far have been widely discussed belong properly in the pin-prick class. But these have served to attract the atten- tion of the world, giving rise to much speculation on the possibility of war between Japan and the United States, until to-day many Americans seriously are asking: ‘‘ What can Japan really do to us?”’ And while it probably will suffer periodical lapses, this question will grow more in- sistent as the years pass, and may one day demand a prac- tical answer of the nation. The problem contains various elements; those of time, place and contingent physical conditions. In respect to place, the scene of such a conflict seems inexorably to be 508 THE FAR EASTERN QUESTION limited, except minor manifestations, to the Pacific Ocean and countries contiguous to it. Thus the one fixed ele- ment is geographical, and this may be considered first. Japan and the United States are still remote from each other, even under modern conditions. Ten days is now required for the fastest ship plying the Pacific to steam from Yokohama to San Francisco, while the shortest mail schedule now operating is twelve or thirteen days for a shorter run to Vancouver. Mail lines between Yoko- hama and San Francisco, via Honolulu, require sixteen days for the passage; ten from Yokohama to Honolulu, one day lie-over, and five days for the remainder of the distance. But America has possessions much nearer to Japan; the Philippines, Guam, Midway Island, Hawaii and Alaska. Remoteness in war is advantageous or dis- advantageous, according to whether a nation is acting on the defensive or offensive. In war the offensive or de- fensive often is determined by circumstances over which neither belligerent has, in the beginning, any control. It is probable that initiatory offensive or defensive in a war between Japan and the United States will be deter- mined by geography. Manila is nearly three times as far from San Francisco as from Nagasaki, and Guam is two and one-half times farther from the United States than from Japan. Honolulu is 2089 nautical miles from San Francisco, and 3445 miles from Yokohama. These places represent pieces in any naval and military game between Japan and the United States, and it is perhaps not neces- sary now to carry the purely geographical demonstration further. Turning to other elements, it is clear that the time when such a war may be fought has an important bearing. We cannot penetrate the future to any distance, and so speculation, to have practical value, must be confined to a AMERICA’S POSITION 509 period when conditions may be foreseen with tolerable ac- curacy, which in this case does not exceed twenty years. Beyond this, modification of material conditions, through territorial acquisition or relinquishment by both or either nation, or evolution in transportation and implements of war, renders conjecture futile. In fact, ten years may be set as a reasonable limit for prognostication, for experts hold the view that if Japan decides to court an extreme is- sue with the United States she will do so before the comple- tion of the Panama canal. So here a certain limitation of time applies; and this period may be again divided into two periods of five years each, defined by practical consid- erations which I will demonstrate later. The remaining element of physical conditions affords a more interesting field for speculation, because these are so numerous and variable, and I first will predicate the discussion upon conditions as they approximately will ex- ist during the next five years. A vital factor is the naval strength of the two nations. So many statements of pres- ent and prospective navies of Japan and the United States recently have been published that it is unnecessary to pre- sent one here, it being perhaps enough to say that there is a considerable aggregate preponderance in our favor, and that probable and possible ratios of increase accrue to the further advantage of America. The armies of the two nations need not be compared, since they cannot im- mediately be brought into collision, and must in the end, especially in case of America, first be recruited and organ- ized. Both nations easily can raise and equip armies as large as ever can be employed. A Japanese invasion of the United States or an American invasion of Japan do not require detailed consideration in this connection, and may be dismissed as being practically impossible under present conditions. 510 THE FAR EASTERN QUESTION Should war begin, then, within five years, the United States would, if its major naval force should then be in the Atlantic ocean, be placed by circumstances on the defensive, and be confronted by the problem of protecting its posses- sions in the Pacific. Japan’s chief effort probably would be directed against the Philippines: but the order of pro- cedure might be varied. Some experts hold that Japan would, immediately on the outbreak of war, dispatch an expedition to take Manila and seize the islands, confining her effort for the time to these operations. Others think that she would first endeavor to cut our line of communi- cations with the Philippines, by seizing Guam and Hawaii, thus making the task of defending the Philippines harder, and vastly increasing the difficulty of retaking them should they succumb early in the struggle. We need accept, at present, neither of these views; but as much the same propositions are involved in both undertakings, and a solu- tion of one applies directly to the other, I will first discuss the probabilities involved in a Japanese attempt to take Hawaii. In its relation to the general defense of our possessions in the Pacific, Hawaii is important only as a stepping stone on the way across. As long as we retain a foothold there, we have a base whence further operations can penetrate, and which dominates the whole area of the central Pacific. With Hawaii in Japan’s possession, we would be tre- mendously handicapped in attempting to defend the Phil- ippines, and the American coast would be open to Japa- nese naval incursions. Notwithstanding that this has been understood at Washington for years, the establish- ment of a defendable naval and military base in Hawaii has progressed very slowly. Pearl Harbor, near Hono- lulu, has been selected for a naval base, and preparations for its protection and defense begun. Should war begin AMERICA’S POSITION 511 before its defenses are completed, the defense of this es- sential outpost would depend upon hastily constructed for- tifications, and such military force as could quickly be as- sembled there. As the importance of striking the first effective blow in war is appreciated by governments, diplomatic nego- tiations which immediately precede a rupture usually are conducted with a view to the military and naval situa- tion when hostilities begin, each of the prospective bellig- erents endeavoring to secure advantage. AA striking exam- ple of success of this nature was given by Japan at the be- ginning of war against Russia, when the Russian fleet at Port Arthur was surprised and seriously damaged by the Japanese fleet, and Russian ships at Chemulpo, Korea, were destroyed. ‘This was accomplished through the circumstances (although Russian stupidity played a part) which gave Japan control of telegraphic connection with Korea, enabling her to cut off the Russian minister in Seoul from communication with his Government for several days before hostilities were begun. Such practices are not countenanced by diplomatic canons, but history af- fords many instances where such advantage has been taken, and in dealing with Japan in the future any government will have such possibilities in mind. While there is no international rule exactly defining the matter, hostile collisions between nations nowadays usu- ally are preceded by a period of negotiation, in which the causes for complaint are mutually exchanged and a pre- sumed effort amicably to compromise them made. I use the word presumed because in many cases the preliminary negotiation is purely perfunctory, war having been fully decided upon by one or both nations before the exchange of the first diplomatic parler. \Vhen war comes from such conditions, the nation taking initiative (usually 12 THE FAR EASTERN QUESTION attended by a depreciatory attitude and disclaimer of hos- tile intent) certainly will have been actively preparing for months, even for years, and the larger national interests will have been warned to shape their affairs for the ap- proaching conflict. The necessity for doing this, and the practical impossibility of long keeping such moves secret, provides, as a rule, ample notice to those with eyes to see, and makes it dificult for a wide-awake government to be completely surprised. In respect to Japan and the United States it reasonably may be assumed that no crucial diplomatic issue between them will be raised unless one nation is resolved upon war provided satisfaction is not obtained. This does not take into account, of course, peccadillos advanced from time to time on account of requirement of internal politics, or by way of general diplomatic offsets. Assuming an intention to bring on war, or expectation that war may result from a diplomatic contretemps (for no government will commit itself without first estimating the cost), it is probable that at least two months will elapse between the first preliminary note and a rupture. It is fair to pre- sume that this interim will be used by both governments to make such preparations as they can without taking action which would immediately precipitate hostilities. Actions which, under such conditions, may be construed as actual acts of hostility, are not specifically defined, and always must be judged in conjunction with all the sur- rounding circumstances; but some are fully recognized, as a movement of large bodies of troops to a contiguous frontier, or the concentration of a naval force where it may threaten an important possession of the prospective enemy. Steps of a government to protect its exposed pos- sessions by strengthening their defenses, where such addi- tion of force does not at the same time threaten some pos-' AMERICA’S POSITION 513 session of the prospective enemy, cannot legitimately be considered acts of overt hostility, although wars often have been commenced on such pretexts. Thus, in the event of a serious issue between Japan and the United States, and while negotiations are pending, for the United States to accelerate work on fortifications at Manila and Honolulu, and increase the garrisons there could not justly be criticized. It safely may be assumed that under circumstances like this the United States Government would recognize the ex- posed position of its possessions in the Pacific and consider ways and means to protect them. Leaving for the time the Philippines out of consideration, let us see what is involved in a defense of Hawaii under conditions as they now exist and will approximately obtain for several years. Should the Government neglect, with a number of trans- ports lying idle in Pacific coast ports, to reinforce the garri- son at Honolulu until it became evident that a rupture was inevitable, there still would be time to dispatch an ade- quate force provided prompt action was taken. By char- tering a few additional ships, it would be possible to land a force of 25,000 men at Honolulu within ten days after the movement was commenced. With such a force would go supplies of all kinds, including artillery, and guns for fortification and coast defense, even if such had not already been dispatched. As the defense of Hawaii turns on security of a naval base there, the officers entrusted with this duty would not concern themselves with the other islands, but would confine their efforts to holding Pearl Harbor and Honolulu from Japanese attack. Thou- sands of men would be set to work upon fortifications, and while nothing comparable to Port Arthur or Sebastopol could quickly be created, a few weeks would be quite enough to establish a system of defensive works which 514 THE FAR EASTERN QUESTION could not be taken by assault of any except a land force of greatly superior numbers. It hardly is necessary to say that any naval force which could be assembled by Japan at Hawaii could not, unaided by troops, occupy Pearl harbor or Honolulu in the face of serious opposition from troops on land. But these questions arise: What might Japan do to prevent the reinforcement of Hawaii by a force large enough to hold a base for some time, and failing to do this, what force could she bring to attack and capture it! First to be considered is whether Japan would be able to prevent the landing in Hawaii of reinforcements from America, for should she succeed in this it would greatly modify the difficulties in the way of her occupation of the islands, since her navy, supplemented by compara- tively few troops, would suffice for the undertaking. It is clear that reinforcement from America only could be pre- vented by intercepting our transports with ships of the Japanese navy, and this leads to examination of the conditions involved, and the probable distribution of the two navies when the breach came. By withdrawing all battleships from the Asiatic naval station the United States Government inaugurated a new policy, which may be pur- sued for several years. ‘This policy is based on the theory that our only prospective naval opponent in Asiatic waters is Japan, and that unless we are prepared to maintain a bat- tleship fleet there capable of meeting the Japanese battle- ship fleet with a fair chance to defeat or cripple it, it is worse than useless to have any there at all, for it would be isolated and might be fruitlessly sacrificed. So our Asiatic fleet now consists of small cruisers and gunboats, and a small torpedo flotilla. Should war with Japan come while this condition exists, the cruisers and perhaps some smaller boats would be withdrawn at least to Honolulu before the AMERICA’S POSITION 515 break came, and probably to San Francisco, where they would unite with the cruisers and battleships of the Pacific fleet, forming quite a formidable force; not, under the pres- ent tactical distribution of the American navy, one capable of successfully encountering the major Japanese fleet, but potent enough to compel Japanese naval officers to reckon with its existence. Between Manila and the United States is a telegraph cable, touching at Guam, Midway and Hon- olulu, which will be controlled in war by the Govern- ment. Fast cruisers, equipped with wireless apparatus, undoubtedly would be stationed at Guam and Midway pending and immediately following the outbreak of hos- tilities. Such ships could cruise about the sea routes between Japan and America, and report should a Japanese fleet be sighted. In this way Honolulu and the Govern- ment at Washington could receive warning should any Japanese fleet take the seas. Even assuming that a Jap- anese fleet should take time by the forelock, and leave its base in Japan before diplomatic negotiations were broken off, as was done at the beginning of war against Russia, but little time could be gained, for such a move would soon be detected, and the Japanese Government would hardly risk sending a fleet to sea and losing communication with it until a rupture was only a matter of hours, or a day at most. A Japanese fleet capable of defeating the combined Asiatic and Pacific American fleets at their normal strength must include battleships and armored cruisers, and should, to be effective, be confined to ships of wide steaming radius. As things now are, once a Japanese fleet sailing eastward left Japan it would have no place to coal, except at sea, until it secured a foothold on American territory, or returned to Japan. No Japanese battleship, and but few of the larger cruisers, can carry enough coal to cross the 516 THE FAR EASTERN QUESTION sailing route between Honolulu and San Francisco, cruise there for a time, and return to Japan without exer- cising great economy: and this would make the outbound voyage somewhat slow. It is not probable, therefore, that a Japanese fleet of any magnitude could intercept com- merce between America and Hawaii until ten days after hostilities commenced, which is the time I have al- lowed for our Government to send reinforcements. It should be remembered, in this connection, that by fast steaming (for coal economy is no object here) a transport can get from San Francisco to Honolulu in six days, and some of the Pacific Mail liners can make it in less time. It seems, then, that only gross negligence and sloth on the part of American authorities could prevent the assembly in Hawaii of a force of 25,000 troops, with supplies for several months, before a Japanese naval force could inter- rupt its transport. Should this reinforcement be accomplished, the problem takes another aspect. Any Japanese attack directed against Hawaii must now be prepared to encounter this American force, which we will assume to be isolated by withdrawal of the American naval force, except pos- sibly some sub-marines, to the Pacific coast, there to await reinforcement from the Atlantic fleet. For the work of reducing and occupying fortified positions held by 25,000 American troops, perhaps aided by a few thousand Ha- waiian volunteers, a Japanese army of at least 50,000 would be required. This large army must be brought from Japan under convoy, for it would be quite possible for fast American cruisers to intercept the transport fleet, which would necessarily be large and unwieldy, and per- haps inflict serious loss. Two chief factors are involved in this undertaking — the means employed and the time required. The means AMERICA’S POSITION 517 for transport must be the Japanese merchant marine, and to convey a large army and its impedimenta many ships are needed. In time of peace the Japanese merchant marine is somewhat widely distributed. Japanese ship- ping lines using ships of considerable tonnage are chiefly those which ply to Europe, America and Australia, requiring long voyages. Of the 400,000 aggregate ton- nage of the Japanese steam merchant marine, three-fourths is in vessels of less than 3,000 tons, usually engaged in Far Eastern coastwise trade, and thus easily mobilized. Without giving further details which apply to this proposi- tion, it safely may be stated that it is not possible quickly to find marine transport in Japan for 50,000 troops, or half that number, without employing many of these little ships. Such vessels primarily are built with a view to econ- omy in operation, and as they are not designed for long voyages, as a rule, their coal carrying capacity is small and their speed slow. The average Japanese coaster has a speed of about nine knots, often even less, on an econom- ical basis. As the test of the strength of a chain is its weakest link, so the speed of a fleet is that of its slowest vessel. Since to land a Japanese force in Hawaii piece- meal would be to invite defeat in detachment, it would be necessary to transport a large army simultaneously. The problem is very different from that presented in Korea and Manchuria, where the marine transport resem- bled a ferry. It is probable that the average speed of any transport fleet conveying a Japanese army to Hawaii would not be more than eight knots an hour. From one of the ports in Japan which would be the rendezvous for such a fleet to the island of Oahu, on which Honolulu is situated, is about 4,000 nautical miles; which means that it would take a Japanese army twenty days to reach Hawaii from the time it actually sailed from Japan. So 518 THE FAR EASTERN QUESTION if we assume that the Japanese army had been loaded into transports before war was declared (of which America would have ample notice, through mobilization of troops and ships, and other sources), three weeks would elapse before a Japanese soldier could land in Hawaii; three weeks for fortification and preparation. Those who may recall the feats in fortification sometimes accomplished by both armies in the American civil war within twenty- four hours or less, will realize that a good deal may be ac- complished in three weeks. Arriving at Oahu, the difficulties of landing would be presented. The island is small, and Honolulu and Pearl Harbor are the only good landing places. Leaving oppo- sition out of consideration, if such an army and its im- pedimenta was landed in two weeks it would be a good job. Then it would have to settle down to take the American positions. It is not unreasonable to think that this task might occupy many weeks, even months. So it is a fair presumption that Honolulu and Pearl Harbor might hold out for three months after war was declared. Assuming this, another element enters the proposition. This is the American navy. When the battleship fleet made its famous trip around the Horn it provided an object lesson. What was then accomplished can be done again if necessary, and before three months from a decla- ration of war between the United States and Japan had passed a fleet of American battleships could reach San Francisco, and effect a junction with the fleet already there. This would establish the numerical superiority of the American navy in Pacific waters, and there would be noth- ing to prevent it from proceeding to Hawaii and there of- fering battle to the Japanese fleet. Should the Japanese fleet be defeated, it could hardly escape annihilation, for it would be 4,000 miles from a base where repairs could be AMERICA’S POSITION 519 made or whence reinforcement could come. And with the Japanese fleet annihilated, or even forced to relinquish con- trol of Hawaiian waters, the Japanese army in Hawaii would be at America’s mercy. The considerations thus briefly enumerated lead me to believe that if there should be a war between Japan and the United States within five years Japan will make no serious attempt to occupy Hawaii, but will confine her en- deavors to an attack upon the Philippines. And the task of defending the Philippines is different from that of de- fending Hawaii. CHAPTER XXXVII AMERICA’S POSITION IN THE PACIFIC — Concluded POSITION OF THE PHILIPPINES — PRESENT INSECURITY — AMERICAN TROOPS IN THE ISLANDS— PROBLEM OF THEIR REINFORCEMENT — POossIBILITY OF A PROLONGED War — Non- MILITARY FacTors — COMPARATIVE INCREASE OF NAVAL ARMA- MENTS — NAvAL CONSTRUCTION IN THE UNITED STATES — FINANCE AND Economics — EUROPEAN SYMPATHY — THE AT- TITUDE OF ENGLAND — JAPAN’s DISADVANTAGES — THE SEC- OND Pseriop — A BREATHING SPELL — PREPAREDNESS AN AsS- SURANCE OF PEaceE— DeEapLock ABOUT AN EASTERN NAVAL Basrt — Reasons For THis—A QUESTION OF SITES — PRO- CRASTINATION DANGEROUS — ECONOMIES OF THE PROPOSITION —A New American Nava. Poticy — AMERICA’S RESPONSI- BILITY. THE elements involved in a Japanese attack upon the Philippines are the same as would be employed against Hawaii, with exception of the geographical factor. Ma- nila is about 1800 miles from Japan’s military and naval bases, and is more than 5,000 miles from San Francisco. So no possible celerity of reinforcement, unless it was be- gun long before a breach occurred, could get American troops to the Philippines before a Japanese army could be landed there, and with Japan in command of Asiatic waters reinforcements could not be dispatched after war had com- menced. There are now about 12,000 American troops in the Philippines, but these are widely distributed, and cannot now entirely be withdrawn for mobilization at any 520 A STREET IN ZAMBOANGA. Moro CHILDREN. AMERICA’S POSITION Sar point without permitting civil order in some localities to crumble. For the same reason the greater part of native scouts and constabulary cannot quickly be mobilized. While plans for a naval base at Olongapo or Cavite have been discussed for years, and some work on them has been accomplished, it is not now feasible to defend either place for more than a few weeks against a serious attack by land. Thus if war with Japan should come within the next few years, and its beginning find the greater part of the Ameri- can navy in the Atlantic ocean, it will hardly be possible to prevent Japanese from occupying the Philippines, and Guam and Midway as well. The United States would therefore be confronted from the beginning of such a war with the necessity of holding Hawaii, and then preparing to retake the Philippines. This would mean a prolonged and expensive conflict, for it need not be presumed that if the American people would ever enter upon such a war they would permit their Gov- ernment to abandon it until victory was secured or the fu- tility of further effort absolutely established. The prob- lems which would face the naval and military authorities of the United States would be: first, to wrest naval control of Asiatic waters from Japan; second, to use this control, when secured, to blockade the coast of Japan as effectively as possible, so as to cripple her trade and industry, and prevent reinforcement and supply of any Japanese force in the Philippines; third, to dispatch enough troops to the Philippines to defeat the Japanese armies there and re- cover possession of the islands. While to accomplish this is by no means impossible, it would be a difficult under- taking, and probably would require two or three years to complete. So prolonged a war would call into play factors not purely military, which are of vital consequence. Increase 522 THE FAR EASTERN QUESTION of naval armament is one of these progressive factors. The comparative slowness of naval construction in Amer- ica frequently has been pointed out as a weakness, but much of such criticism does not fully consider the circumstances. The United States Government does not give bonuses for quick construction as a rule, and where war ships are built by private companies it frequently happens that workmen will be taken off naval vessels and set to work upon ships for other uses, the reason being that Government work usually is not taken by shipwrights because it is profitable, but because it enables them to keep their workmen em- ployed in dull times. Many who have studied the situa- tion of ship-building in America hold the opinion that in emergency battleships can be built there as rapidly as any- where except in England, and more rapidly than in Japan. Should the United States become involved in a war which turns upon naval supremacy, there is no doubt that every ship yard in America would become busy with Government work, stimulated to extraordinary celerity by bonuses. An estimate of comparative naval construction facilities of Ja- pan and the United States which I recently saw calculates that during a war which may begin now or soon the Amer- ican navy can be augmented twice as rapidly as can the Japanese navy. This matter has another bearing. Practi- cally everything which enters into a modern fighting ship, and is involved in the manufacture of military equipment, can be supplied in any quantity in the United States. This is not the case in Japan. While Japanese are proud of the fact that Japan has constructed her new Dreadnaughts at home, much of the material needed to build them was imported. It will be some time before Japan is fully prepared to build a navy from keel to topmast for herself. In war such materials are contraband, and their importa- tion might be limited, and perhaps stopped altogether. AMERICA’S POSITION 523 But probably the more important factor in a prolonged war between these nations would be that of finance and in- ternal economies. It is difficult to see how Japan can now sustain the financial and industrial strain of another great war, which might subject her domestic economies to a se- vere depression by cutting off raw materials necessary for her industries, depriving her products of markets abroad, and maybe even curtailing the food supply of her people. There are persons who pretend to believe, taking the idea, perhaps, from the disposition of European military and naval experts to predict disaster to American arms should we ever engage a formidable power, that European nations will sympathize with Japan in a conflict with us, from jealousy of our progress, and that this might enable Japan to finance a war. I accept no such view. Let anyone who does travel about the East and sound the sentiment of British and Europeans toward Japanese and Japan’s Far Eastern policy. No! Europe may have her little jeal- ousies and fears concerning us, but they are as nothing to sentiment involved in the question whether the white or yellow race shall dominate the future of civilization, which would be an issue of such a conflict, and the importance of maintaining friendly intercourse with America because of interdependent commercial and industrial affiliations. In such a war public sentiment and statesmanship in Europe would, I believe, be almost solidly arrayed with the United States. Some commentators point to the fact that the Anglo- Japanese alliance requires England to support her ally should she be attacked, and argue that England would side against America. It is true that, viewed from a cer- tain angle, the alliance seems to demand such action, and should England be arrayed against the United States in conjunction with Japan the whole problem would be al- 524 THE FAR EASTERN QUESTION tered. We would lose the Philippines, but we would gain Canada, and be pleased with the exchange. Let none think that England will become Japan’s cat’s-paw in this matter. It is not conceivable that the United States ever will come into collision with Japan, or another nation in the East, except in defense of American interests in Asia which, by contravening existing international covenants, may be trampled upon by any of them, or because of dis- position by any nation to dispute America’s right to regu- late her internal affairs. For instance, no reasonable in- terpretation of the Anglo-Japanese alliance can stretch it to invoke England’s interference in the immigration issue between Japan and America, or in an issue which might arise between these nations concerning the “ open door” in China. It is doubtful, when present disposition of Britishers toward it is considered, if the Anglo-Japanese alliance now has any real vitality. A feeling that Great Britain entered into this agreement without correctly es- timating its possibilities is now noticeable in England, while the once popular pact is execrated by Britishers in the East, and frowned upon in the Antipodes. Apart from the alli- ance’s loss of sentimental vitality, we may be assured that so long as Great Britain holds Canada and desires to retain that noble dominion she will remain neutral in any war be- tween Japan and the United States, even if our alleged cousinship should prove a chimera. So in estimating probabilities of a war with Japan, it appears that Japan’s fiscal and economic situation, coupled with comparative naval weakness, gives reasonable assur- ance that she will not provoke a breach with the United States before several years have passed; and this brings us to the second period. The problem which will be pre- sented in a war between Japan and the United States after five years depends almost entirely upon the course pur- AMERICA’S POSITION 52s sued by our Government meanwhile. Unless the Wash- ington administration and Congress fail in their plain duty, five years will find our navy substantially increased and on a more efficient status, military and naval bases in the Philippines, Hawaii and Guam fully equipped, and a practical scheme for defense of our possessions in the Pa- cific Ocean arranged. Such a condition will materially alter the situation, and will enable us to meet Japan or any other nation at so much greater vantage than we can do now that its very existence will be a substantial guarantee of peace. A base in the Philippines which can, if occasion demands, withstand a land attack for six months is needed. The problem of defending a naval base in the Philip- pines turns upon several factors: the strength of the force which might be brought against it, the time which must elapse between the declaration of war and the investment, and difficulties which conditions and artifice may inter- pose between the enemy and his object. The time re- quired to bring an army to attack a base in the Philip- pines is dependable upon its numbers, for a small force can more quickly be transported than a large one; while the obstacles will be modified by the same consid- erations and by the size and preparedness of the defend- ing force. It is quite profitless in discussing these ques- tions to assume, as many commentators do, that we will not upon the outbreak of a possible war be prepared to defend any base in these islands. ‘To estimate and weigh probabilities it is necessary to assume that a base has been created, and that adequate provisions for its defense have been made. Unless this is assumed, it is useless to discuss advantages or disadvantages of this or that proposed site, for these must be estimated not so much for what they now are as by what can be made of them. So I will assume that should the United States after five 526 THE FAR EASTERN QUESTION years become involved in a war with an Asiatic power it will have a naval base in the Philippines, and have made intelligent preparations for its defense. Assuming this, it would be necessary for an enemy to make preparations accordingly, and in estimating fac- tors applicable to the proposition we have the advantage of being able to turn to similar operations recently con- ducted by our only theoretically prospective opponent — Japan. It cannot reasonably be assumed that Japan will for many years be able to begin a war so well prepared as she was when war against Russia started. It is now known that she had mobilized troops and loaded them upon transports before negotiations were terminated; in- deed, some actually were dispatched upon a hostile mis- sion before diplomatic relations were severed. As an example of preparedness and celerity this hardly can be surpassed. The chief immediate object was to capture the Russian naval base and fortress at Port Arthur, which lies less than sixty hours away from Japan. With this fortunate proximity, together with the fact that land operations on the Kwang-tung peninsula present no ex- traordinary natural difficulties, and that a good landing place at Dalny was speedily acquired, the actual in- vestment of Port Arthur did not begin until several months after hostilities commenced. By actual investment I mean when the Japanese army in force was in direct con- tact with outer defenses of the fortress. The loss of the Nanshan isthmus, and consequent cutting of railway com- munication with the north had, of course, practically iso- lated Port Arthur before this time; but the pressure upon its defenses had not begun. Ten months after war was declared the place was surrendered. It might have re- sisted for months longer; but when Japanese reached po- sitions from where the fire of large guns could reach the AMERICA’S POSITION 527 harbor, the value of the port as a naval base was destroyed. It cannot reasonably be assumed that in a war with the United States Japan can now land a large army in the Philippines more quickly than she landed one on the Kwang-tung peninsula, or in Manchuria and Korea; in fact, the presumption is that more time will be required. The landing of such an army being made possible by the absence of a considerable American naval force from Asiatic waters, the length of time required to reduce a fortress will depend upon natural and artificial obsta- cles. That the United States needs a fully equipped and well fortified naval base in the Far East has been recognized for years by those who have studied the situation, and that the present finds us without one is due to an interest- ing and rather extraordinary state of affairs. Naturally, such a base will be located in the Philippines, since these islands comprise our only territorial possessions in Asiatic waters, and afford many fairly satisfactory sites. When the islands were acquired from Spain we secured two so- called naval bases—those at Cavite and Olongapo. These yards were hardly worthy of the name in a modern sense, the facilities being limited to shops where minor repairs can be made. ‘There was no dry dock at either place, although at Cavite small craft might be shored upon ways. Since then the important improvements have been erection of a coaling plant at Cavite, a similar plant at Olongapo, and placing of the floating dock Dewey at Olongapo. There have been additional quarters erected at Olongapo for the accommodation of officers and marines. On the whole, however, the work of improving these yards has stagnated, notwithstanding that with each passing year the need for proper facilities has become more pressing and important. 528 THE FAR EASTERN QUESTION There are several reasons for this condition. The failure of Congress to make appropriations is one; but the real cause is failure of the War and Navy depart- ments to agree upon a site. In 1902 a naval board was ordered to examine and report upon sites in the Philippines. Several were examined, but none except Cavite and Olon- gapo was seriously considered. ‘The navy decided that Subig Bay, where Olongapo is situated, fulfils to a remark- able degree the natural requirements demanded. In time plans for an elaborate base at Olongapo were prepared, and have been waiting upon Congressional authoriza- tion. While Congress has been somewhat slow, perhaps reluctant to act in this matter, owing to uncertainty about our policy in the Philippines and failure to comprehend the importance of such a base, it is probable that the question of a site would have been decided before now and work definitely begun had not military and naval experts dis- agreed about it. Two factions sprang into existence; one favoring Olongapo, and the other Cavite. While each faction finds supporters in both the army and navy, it is generally true that the navy prefers Olongapo, while the army insists upon Cavite. It is of greatest importance to the United States that the deadlock about the site be broken, and work on a naval base in the Philippines be begun without fur- ther delay. This controversy somewhat resembles that which for so many years retarded progress upon an isth- mian canal. Experts agreed that both the Panama _ and Nicaragua routes are practicable, but they disagreed as to their comparative merits, with a result that for many years nothing was done. I do not wish to appear in the role of alarmist, but the situation in the East is such that to procrastinate in this matter is little short of criminal neglect of the nation’s interests. The day may come, and AMERICA’S POSITION 529 soon, when such a base will be worth ten Dreadnaughts to America; not necessarily in war, but as make-weight for peace. A chain of coaling stations stretching across the Pacific and linking America with a great fortress in the Far East may be likened to a strong arm extended with the fist at the western extremity, and presenting an obstacle which any enemy approaching America from that quarter must first overcome. The economics of an American naval base in the Far East also should be considered. Armies and navies are, in modern times, international police, and police cannot perform their functions without equipment and stations. If our navy is to police our interests in the East it must have a station there. A proper station will cost millions, to be sure, but it should pay for itself within ten years in actual saving of dollars and cents. Before the drydock Dewey was brought to Olongapo it was necessary to send our naval vessels and army transports in eastern service to Hongkong or Nagasaki to be docked and overhauled. It has been estimated that already the Dewey has earned in the economy which her presence in the East makes pos- sible more than half the cost of her construction and de- livery there. At present vessels must be sent to the Atlan- tic or Pacific coast for serious repairs, thus increasing cost of maintenance. ‘The recent discovery of a fairly good quality of steaming coal in the Philippines will result in another economy in maintenance of an American fleet in the East, and the Government is preparing to open mines. With a naval base and cheap coal, for which it does not have to depend upon foreign assistance not available in war, America’s naval position in Asiatic waters will be such as to make our eastern possessions secure, and will give our navy an offensive potency in that part of the world which will make wishes of the nation respected there. 530 THE FAR EASTERN QUESTION I think the United States Government should fundamen- tally alter its naval strategic policy. There seems small reason to doubt that until the Far Eastern situation passes the forthcoming crisis, and definitely settles upon a stable base, America’s naval policy should be a Pacific Ocean pol- icy. This probably is recognized at Washington, but there seems to be a disposition to wait for the change until the Panama canal is opened. Why wait? I think, and I know that some American naval experts have the same opinion, that the United States should keep its major battleship fleet on the Pacific coast until the canal is open, its strength to be increased in proportion to increase of the Japanese navy. This will assure security of Hawaii and the Philip- pines until naval bases there can be built and adequately fortified. Until it has defendable and properly equipped bases, to keep a large fleet in Asiatic waters is useless, even foolish. And to defend American interests in the East, our naval force should be able to take the aggressive if oc- casion demands. Many Americans will, doubtless, be disposed to ask: “Why go to this trouble to defend possessions which we do not need? Why not solve the difficulty by giving them up?” This question often has been heard in America in the past, and will be heard again in the future, but with dimin- ishing frequency and less insistence. I have attempted to present some reasons involving broader interests of the nation, and its future economic progress, which will com- pel our attention to the course of events in the Pacific. The military answer to such questions is that it seems probable that eastern possessions, or at least a military foothold there, will be required for national security. In our possession they may serve as out-posts for our army and navy, where any attack coming from a wakened ard AMERICA’S POSITION 531 efficient Orient may be met and held. In Oriental pos- session they would make a path by which our own coast more easily can be reached. To those who are of- fended by all consideration of armaments, and who ob- ject on principle to expenditure of national revenue for such purposes, it may be said that as society has not yet reached that condition when it can dispense with police, so have not nations attained a comity when international police are unnecessary. Some oppose our retaining a bat- tleship fleet in the Pacific on the ground that its presence there may embroil the United States with an Oriental nation or may provoke a war. This is like assuming that the presence of a policeman is likely to foment dis- order, for I presume no one thinks that an American fleet will be wantonly aggressive anywhere. In my judg- ment, within the next five years to strip the Pacific of adequate naval force is like giving the police or fire- men of a city a holiday and hoping there will be no need for their services. A strong American policy in the Pacific should have the effect of giving steadiness and stability to the Eastern situation, thus supplying a powerful influence for peace. I cannot agree with those who seem to assume that care and effort of the Unitca States to assure to American in- terests an equitable and advantageous share in develop- ment of the East is unbecoming, and involves an oftense against either the inhabitants of those regions or the broad interests of humanity. The purposes and dealings of our nation and people are as just and_ beneficial as others likely to be applied to these propositions, and aspiration on our part to take a position in the world to which our progress and ideals entitle us is legitimate. Whether we wish it or not, we cannot escape increasing contact with Oriental nations and peoples, and it should 53g AMERICA’S POSITION not be assumed that our closer relations with them will be to their disadvantage. On the contrary, American activ- ity, enterprise and influence, when representative of our in- stitutions, are, if applied to Oriental countries, likely to be as beneficial to Governments and natives of those coun- tries, and to all persons who reside there, as similar ac- tivities of other nations. While Americans pretend no altruistic motive in extending their national interests in the East, beyond the fact that they are pressed in a spirit of friendly reciprocity, I believe that the East will ben- efit more by extensive relations with us than we will through relations with it. The great wealth of the United States, and the energy and intelligence of our peo- ple, combine to give our Government enormous power in promoting its national interests throughout the world, and should it fail to accomplish what reasonably may be expected of it, the American people sternly will hold it to account. Of wider problems which confront our na- tion, the question of its present and future position in the Pacific Ocean, and its security, is second to none. APPENDIX The text of appended treaties, agreements and conventions is as given in W. W. Rockhill’s compilation of treaties with or con- cerning China and Korea (1894-1904), and in supplements to that volume officially published by the United States Government (1908). Appendix L is an unofficial copy, obtained, however, from semi-official sources. APPENDIX A. TREATY OF PEACE BETWEEN JAPAN AND RUSSIA. Signed at Portsmouth (New Hampshire), September 5 [Rus- sian calender], 1905. Ratifications exchanged at Washington, November 25, 1905. His Majesty the Emperor of Japan on the one part, and His Majesty the Emperor of all the Russias on the other part, ani- mated by the desire to restore the blessings of peace to Their countries and peoples, have resolved to conclude a Treaty of Peace, and have, for this purpose, named Their Plenipotentiaries, that is to say; His Majesty the Emperor of Japan: His Excellency Baron Komura Jutaro, Jusammi, Grand Cor- don of the Imperial Order of the Rising Sun, His Minister for Foreign Affairs, and His Excellency M. Takahira Kogoro, Jusammi, Grand Cordon of the Imperial Order of the Sacred Treasure, His Envoy Extra- ordinary and Minister Plenipotentiary to the United States of America; and His Majesty the Emperor of all the Russias: son) 534 APPENDIX His Excellency M. Serge Witte, His Secretary of State and President of the Committee of Ministers of the Empire of Rus- sia, and His Excellency Baron Roman Rosen, Master of the Imperial Court of Russia and His Ambassador Extraordinary and Plenipo- tentiary to the United States of America; Who, after having exchanged their full powers which were found to be in good and due form, have concluded the following Articles: ARTICLE I. There shall henceforth be peace and amity between Their Maj- esties the Emperor of Japan and the Emperor of all the Russias and between Their respective States and subjects. ARTICLE II. The Imperial Russian Government, acknowledging that Japan possesses in Korea paramount political, military and economical interests, engage neither to obstruct nor interfere with the meas- ures of guidance, protection and control which the Imperial Gov- ernment of Japan may find it necessary to take in Korea. It is understood that Russian subjects in Korea shall be treated exactly in the same manner as the subjects or citizens of other foreign Powers, that is to say, they shall be placed on the same footing as the subjects or citizens of the most favoured nation. It is also agreed that, in order to avoid all cause of misunder- standing, the two High Contracting Parties will abstain, on the Russo-Korean frontier, from taking any military measure which may menace the security of Russian or Korean territory. ArTICLE IIT. Japan and Russian mutually engage: 1. To evacuate completely and simultaneously Manchuria except the territory affected by the lease of the Liao-tung Penin- sula, in conformity with the provisions of additional Article I. annexed to this Treaty; and 2. To restore entirely and completely to the exclusive adminis- APPENDIX 535 tration of China all portions of Manchuria now in the occupa- tion or under the control of the Japanese or Russian troops, with the exception of the territory above mentioned. The Imperial Government of Russia declare that they have not in Manchuria any territorial advantages or preferential or ex- clusive concessions in impairment of Chinese sovereignty or in- consistent with the principle of equal opportunity. ARTICLE IV. Japan and Russia reciprocally engage not to obstruct any gen- eral measures common to all countries, which China may take for the development of the commerce and industry of Manchuria. ARTICLE V. The Imperial Russian Government transfer and assign to the Imperial Government of Japan, with the consent of the Govern- ment of China, the lease of Port Arthur, Talien and adjacent territory and territorial waters and all rights, privileges and con- cessions connected with or forming part of such lease, and they also transfer and assign to the Imperial Government of Japan all public works and properties in the territory affected by the above mentioned lease. The two High Contracting Parties mutually engage to obtain the consent of the Chinese Government mentioned in the forego- ing stipulation. The Imperial Government of Japan on their part undertake that the proprietary rights of Russian subjects in the territory above referred to shall be perfectly respected. ARTICLE VI. The Imperial Russian Government engage to transfer and as- sign to the Imperial Government of Japan, without compensation and with the consent of the Chinese Government, the railway between Chang-chun (Kuan-cheng-tze) and Port Arthur and all its branches, together with all rights, privileges and properties ap- pertaining thereto in that region, as well as coal mines in the said region belonging to or worked for the benefit of the railway. 536 APPENDIX The two High Contracting Parties mutually engage to obtain the consent of the Government of China mentioned in the fore- going stipulation, Artic.Le VII. Japan and Russia engage to exploit their respective railways in Manchuria exclusively for commercial and industrial purposes and in no wise for stategic purposes. It is understood that that restriction does not apply to the rail- way in the territory affected by the lease of the Liao-tung Penin- sula. ARTICLE VIII. The Imperial Governments of Japan and Russia, with a view to promote and facilitate intercourse and traffic, will, as soon as possible, conclude a separate convention for the regulation of their connecting railway service in Manchuria. ARTICLE IX. The Imperial Russian Government cede to the Imperial Gov- ernment of Japan in perpetuity and full sovereignty, the southern portion of the Island of Saghalien and all islands adjacent thereto, and all public works and properties thereon. The fiftieth degree of north latitude is adopted as the northern boundary of the ceded , territory. The exact alignment of such territory shall be de- termined in accordance with the provisions of additional Article II. annexed to this Treaty. Japan and Russia mutually agree not to construct in their re- spective possessions on the Island of Saghalien or the adjacent islands, any fortifications or other similar military works. They also respectively engage not to take any military measures which may impede the free navigation of the Straits of La Perouse and Tartary. ARTICLE X. It is reserved to the Russian subjects inhabitants of the territory ceded to Japan, to sell their real property and retire to their coun- APPENDIX 537 try; but, if they prefer to remain in the ceded territory, they will be maintained and protected in the full exercise of their industries and rights of property, on condition of submitting to Japanese laws and jurisdiction. Japan shall have full liberty to withdraw the right of residence in, or to deport from, such territory, any inhabitants who labour under political or administrative disability. She engages, however, that the proprietary rights of such inhabi- tants shall be fully respected. ArTICLE XI. Russia engages to arrange with Japan for granting to Japanese subjects rights of fishery along the coasts of the Russian possessions in the Japan, Okhotsk and Behring Seas. It is agreed that the foregoing engagement shall not affect rights already belonging to Russian or foreign subjects in those regions. ARTICLE X1Y. The Treaty of Commerce and Navigation between Japan and Russia having been annulled by the war, the Imperial Governments of Japan and Russia engage to adopt as the basis of their com- mercial relations, pending the conclusion of a new treaty of com- merce and navigation on the basis of the Treaty which was in force previous to the present war, the system of reciprocal treat- ment on the footing of the most favoured nation, in which are included import and export duties, customs formalities, transit and tonnage dues, and the admission and treatment of the agents, sub- jects and vessels of one country in the territories of the other. ArTIcLe XIII. As soon as possible after the present Treaty comes into force, all prisoners of war shall be reciprocally restored. “The Imperial Gov- ernments of Japan and Russia shall each appoint a special Com- missioner to take charge of prisoners. All prisoners in the hands of one Government shall be delivered to and received by the Com- missioner of the other Government or by his duly authorized representative, in such convenient numbers and at such convenient 538 APPENDIX ports of the delivering State as such delivering State shall notify in advance to the Commissioner of the receiving State. The Governments of Japan and Russia shall present to each other, as soon as possible after the delivery of prisoners has been completed, a statement of the direct expenditures respectively in- curred by them for the care and maintenance of prisoners from date of capture or surrender up to the time of death or delivery. Russia engages to repay to Japan, as soon as possible after the exchange of the statements as above provided, the difference be- tween the actual amount so expended by Japan and the actual amount similarly disbursed by Russia. ArTICLE XIV. The present Treaty shall be ratified by Their Majesties the Emperor of Japan and the Emperor of all the Russias. Such ratification shall, with as little delay as possible and in any case not later than fifty days from the date of the signature of the Treaty, be announced to the Imperial Governments of Japan and Russia respectively through the French Minister in Tokyo and the Ambassador of the United States in Saint-Petersburg and from the date of the later of such announcements this Treaty shall in all its parts come into full force. The formal exchange of the ratification shall take place at Washington as soon as possible. ARTICLE XV. The present Treaty shall be signed in duplicate in both the English and French languages. The texts are in absolute con- formity, but in case of discrepancy in interpretation, the French text shall prevail. In witness whereof the respective Plenipotentiaries have signed and affixed their seals to the present Treaty of Peace. Done at Portsmouth (New Hampshire) this fifth day of the ninth month of the thirty-eighth year of A/eiji, corresponding to the twenty-third day of August (fifth September) one thousand nine hundred and five. (Signed) SERcE WITTE, [L.s. ] APPENDIX 539 (Signed) Rosen. [x.s. ] (Signed) Juraro Komura. [L.s.] (Signed) K. Takauira. [Ls.] In conformity with the provisions of Articles III and 1X of the Treaty of Peace between Japan and Russia of this date, the under- signed Plenipotentiaries have concluded the following additional Article: I. To Articte III. The Imperial Governments of Japan and Russia mutually en- gage to commence the withdrawal of their military forces from the territory of Manchuria simultaneously and immediately after the Treaty of Peace comes into operation, and within a period of eighteen months from that date, the Armies of the two countries shall be completely withdrawn from Manchuria except from the leased territory of the Liao-tung Peninsula. The forces of the two countries occupying the front positions shall be first withdrawn. The High Contracting Parties reserve to themselves the right to maintain guards to protect their respective railway lines in Manchuria. The number of such guards shall not exceed fifteen per kilometre and within that maximum number, the Commanders of the Japanese and Russian Armies shall, by common accord, fix the number of such guards to be employed, as small as possible having in view the actual requirements. The Commanders of the Japanese and Russian forces in Man- churia shall agree upon the details of the evacuation in conformity with the above principles, and shall take by common accord the measures necessary to carry out the evacuation as soon as possible and in any case not later than the period of eighteen months. II. To Articre IX. As soon as possible after the present Treaty comes into force, a Commission of Delimitation, composed of an equal number of members to be appointed respectively by the two High Contract- ing Parties, shall on the spot, mark in a permanent manner the exact boundary between the Japanese and Russian possessions on 540 APPENDIX the Island of Saghalien. The Commission shall be bound, so far as topographical considerations permit, to follow the fiftieth parallel of north latitude as the boundary line, and in case any deflections from that line at any points are found to be necessary, compensation will be made by correlative deflections at other points. It shall also be the duty of the said Commission to prepare a list and description of the adjacent islands included in the cession and finally the Commission shall prepare and sign maps showing the boundaries of the ceded territory. The work of the Commission shall be subject to the approval of the High Contracting Parties. The foregoing additional Articles are to be considered as ratified with the ratification of the Treaty of Peace to which they are an- nexed. Portsmouth, the 5th day, 9th month, 38th year of Meiji, corre- ; 23rd August, sponding to the sth September | 1905, (Signed) SERGE WITTE. (Signed) J. Komura. (Signed) Rosen. (Signed) K. Takanira. APPENDIX B. CONVENTION BETWEEN JAPAN AND RUSSIA. SIGNED JULY 30, 1907. The Government of his Majesty the Emperor of Japan and the Government of his Majesty the Emperor of All the Russias, de- siring to consolidate the relations of peace and good neighbour- hood which have happily been re-established between Japan and Russia, and wishing to remove for the future every cause of mis- understanding in the relations of the two Empires, have agreed to the following arrangements: — Art. I— Each of the High Contracting Parties engages to re- spect the actual territorial integrity of the other, and all the rights accruing to one and the other Party from treaties, conventions and contracts in force between them and China; copies of which have APPENDIX 541 been exchanged between the Contracting Parties (in so far as these rights are not incompatible with the principle of equal opportunity ) of the Treaty signed at Portsmouth on the 5th day of September (23rd of August) 1905, as well as the special conventions con- cluded between Japan and Russia. Art. Il.— The two High Contracting Parties recognise the in- dependence and the territorial integrity of the Empire of China and the principle of equal opportunity in whatever concerns the commerce and industry of all nations in that empire, and engage to sustain and defend the maintenance of the status guo and respect for this principle by all the pacific means within their reach. In witness whereof, the undersigned, duly authorized by their respective Governments, have signed this Convention and have afhxed their seals. Done at St. Petersburg, the 30th day of the 7th month of the 4oth year of Meiji, corresponding to the 30th (17th) of July 1907. (Signed ) I. Morono. (Signed) IswoLsky. APPENDIX C. TREATY AND ADDITIONAL AGREEMENT BE- TWEEN JAPAN AND CHINA RELATING TO MANCHURIA. SIGNED AT PEKING, DECEMBER 22, 1905. RATIFICATIONS EXCHANGED AT PEKING, JANUARY 23, 1906. ° [ Translation. ] His Majesty the Emperor of Japan and His Majesty the Em- peror of China, desiring to adjust certain matters of common concern growing out of the Treaty of Peace between Japan and Russia of September 5th, 1905, have resolved to conclude a Treaty with that object in view and have for that purpose named Their Plenipotentiaries, that is to say: His Majesty the Emperor of Japan: 542 APPENDIX Baron Komura Jutaro, Jusammi, Grand Cordon of the Im- perial Order of the Rising Sun, Minister for Foreign Affairs and Special Ambassador of His Majesty, and Uchida Yasuya, Jushii, Second Class of the Imperial Order of the Rising Sun, His Majesty’s Envoy Extraordinary and Minister Plenipotentiary ; and His Majesty the Emperor of China: Prince Ching, Presiding Minister for Foreign Affairs, Coun- cillor of State and Plenipotentiary of His Majesty, Chu Hung-chi Minister for Foreign Affairs, Councillor of State and Plenipotentiary of His Majesty, and Yuan Shih-Kai, Viceroy of the Province of Chihli, Junior Guar- dian of the Heir-Apparent, Minister Superintendent of Trade for the Northern Ports and Plenipotentiary of His Majesty; Who, after having exchanged their full powers which were found to be in good and due form, have agreed upon and concluded the following Articles: ArTICLE I. The Imperial Chinese Government consent to all the transfers and assignments made by Russia to Japan by Artices V and VI of the Treaty of Peace above mentioned. ArTICLE IT. The Imperial Japanese Government engage that in regard to the leased territory as well as in the matter of railway construc- tion and exploitation, they will, so far as circumstances permit, conform to the original agreements concluded between China and Russia. In case any question arises in the future on these sub- jects, the Japanese Government will decide it in consultation with the Chinese Government. Articie III. The present Treaty shall come into full force from the date of signature. It shall be ratified by Their Majesties the Emperor of Japan and the Emperor of China and the ratifications shall be ex- APPENDIX 543 changed at Peking as soon as possible, and not later than two months from the present date. In witness whereof, the respective Plenipotentiaries have signed this Treaty in duplicate in the Japanese and Chinese languages and have thereto affixed vheir seals. Done at Peking, this twenty-second day of the twelfth month of the thirty-eighth year of Meiji, corresponding to the twenty-sixth day of the eleventh moon of the thirty-first year of Kuang Hsi. (Signed ) Baron Komura JuTaro, [L.S.] Jusammi, Grand Cordon of the Imperial Order of the Rising Sun, Alinister for Foreign df- fairs and Special Ambassador of His Majesty the Emperor of Japan. (Signed ) Ucuipa Yasuya, [ws.] Jushii, Second Class of the Imperial Order of the Rising Sun, Envoy Extraordinary and Min- ister Plenipotentiary of His Alajesty the Em- peror of Japan. (Signed ) Prince CHING, [LS.] Presiding Minister for Foreign Affairs, Coun- cillor of State and Plenipotentiary of His Maj- esty the Emperor of China. (Signed ) Cuu Hune-cu, [Ls.] Minister for Foreign Affairs, Councillor of State and Plenipotentiary of His Majesty the Em- peror of China. (Signed) Yuan SHIH-KAI, [LS.] Viceroy of the Province of Chihli, Junior Guar- dian of the Heir-Apparent, Minister Superin- tendent of Trade for the Northern Ports and Plenipotentiary of His Majesty the Emperor of China. The Governments of Japan and China, with a view to regulate, for their guidance, certain questions in which they are both inter- ested in Manchuria, in addition to those provided for in the Treaty signed this day, have agreed as follows: 544 APPENDIX ARTICLE I. The Imperial Chinese Government agree that as soon as pos- sible after the evacuation of MIanchuria by the Japanese and Russian forces, the following cities and towns in Manchuria will be opened by China herself as places of international residence and trade: In the Province of Shingking: Fengwangcheng; Liaoyang; Hsinmintum; Tieling; Tung- kiangtzu and Fakumen. In the Province of Kirin: Changchun (Kuanchengtze); Kirin; Harbin; Ninguta; Hunchun and Sanhsing. In the Province of Heilungkiang: Tsitsihar; Hailar, Aihun and Manchuli. ArTICLE II. In view of the earnest desire expressed by the Imperial Chinese Government to have the Japanese and Russian troops and railway guards in Manchuria withdrawn as soon as possible, and in order to meet this desire, the Imperial Japanese Government, in the event of Russia agreeing to the withdrawal of her railway guards, or in case other proper measures are agreed to between China and Russia, consent to take similar steps accordingly. When tranquillity shall have been reestablished in Manchuria and China shall have become herself capable of affording full protection to the lives and property of foreigners, Japan will withdraw her railway guards simultane- ously with Russia. ARTICLE III. The Imperial Japanese Government, immediately upon the with- drawal of their troops from any regions in Manchuria, shall notify the Imperial Chinese Government of the regions thus evacuated, and even within the period stipulated for the withdrawal of troops in the Additional Articles of the Treaty of Peace between Japan and Russia, the Chinese Government may send necessary troops to the evacuated regions of which they have been already notified as APPENDIX 545 above mentioned, for the purpose of maintaining order and tran- quillity in those regions. If, in the regions from which Japanese troops have not yet been withdrawn, any villages are disturbed or damaged by native bandits, the Chinese local authorities may also dispatch a suitable military force for the purpose of capturing or dispersing those bandits. Such troops, however, shall not proceed within twenty Chinese li from the boundary of the territory where Japanese troops are stationed. ArRTICLE IV. The Imperial Government of Japan engage that Chinese public and private property in Manchuria, which they have occupied or expropriated on account of military necessity, shall be restored at the time the Japanese troops are withdrawn from Manchuria and that such property as is no longer required for military purposes shall be restored even before such withdrawal. ARTICLE V. The Imperial Chinese Government engage to take all necessary measures to protect fully and completely the grounds in Man- churia in which the tombs and monuments of the Japanese officers and soldiers who were killed in war are located. ARTICLE VI. The Imperial Chinese Government agree that Japan has the right to maintain and work the military railway line constructed between Antung and Moukden and to improve the said line so as to make it fit for the conveyance of commercial and industrial goods of all nations. The term for which such right is conceded is fifteen years from the date of the completion of the improvements above provided for. The work of such improvements is to be completed within two years, exclusive of a period of twelve months during which it will have to be delayed owing to the necessity of using the existing line for the withdrawal of troops. The term of the con- cession above mentioned is therefore to expire in the 49th year of Kuang Hsii. At the expiration of that term, the said railway shall be sold to China at a price to be determined by appraisement of all 546 APPENDIX its properties by a foreign expert who will be selected by both parties. The conveyance by the railway of the troops and muni- tions of war of the Chinese Government prior to such sale shall be dealt with in accordance with the regulations of the Eastern Chinese Railway. Regarding the manner in which the improve- ments of the railway are to be effected, it is agreed that the person undertaking the work on behalf of Japan shall consult with the Commissioner dispatched for the purpose by China. ‘The Chinese Government will also appoint a Commissioner to look after the business relating to the railway as is provided in the Agreement relating to the Eastern Chinese Railway. It is further agreed that detailed regulations shall be concluded regarding the tariffs for the carriage by the railway of the public and private goods of China. ArTICLE VII. The Governments of Japan and China, with a view to promote and facilitate intercourse and traffic, will conclude, as soon as pos- sible, a separate convention for the regulation of connecting services between the railway lines in South Manchuria and all the other railway lines in China. ArTIcLe VIII. The Imperial Chinese Government engage that all materials re- quired for the railways in South Manchuria shall be exempt from all duties, taxes and likin. ARTICLE IX. The methods of laying out the Japanese Settlement at Yingkou in the Province of Shingking, which has already been opened to trade, and at Antung and Moukden in the same Province, which are still unopen although stipulated to be opened, shall be separately arranged and determined by officials of Japan and China. ARTICLE X. ‘The Imperial Chinese Government agree that a joint-stock com- pany of forestry composed of Japanese and Chinese capitalists shall APPENDIX 547 be organized for the exploitation of the forests in the regions on the right bank of the River Yalu and that a detailed agreement shall be concluded in which the area and term of the concession as well as the organization of the company and all regulations concerning the joint work of exploitation shall be provided for. The Japanese and Chinese shareholders shall share equally in the profits of the undertaking. ARTICLE XI. The Governments of Japan and China engage that in all that re- lates to frontier trade between Manchuria and Corea most favoured nation treatment shall be reciprocally extended. ARTICLE XII. The Governments of Japan and China engage that in all matters dealt with in the Treaty signed this day or in the present Agree- ment the most favourable treatment shall be reciprocally extended. The present Agreement shall take effect from the date of signa- ture. When the Treaty signed this day is ratified, this Agreement shall also be considered as approved. In witness whereof, the Undersigned, duly authorized by their respective Governments, have signed the present Agreement in duplicate in the Japanese and Chinese languages and have thereto affixed their seals. Done at Peking, this 22nd day of the 12th month of the 38th year of Meiji, corresponding to the 26th day of the 11th moon of the 31st year of Kuang Hsi. (Signed) Baron Komura Jutaro, [L.s.] Jusammi, Grand Cordon of the Imperial Order of the Rising Sun, Minister for Foreign Affairs and Special dm- bassador of His Majesty the Emperor of Japan. (Signed) Ucuipa Yasuya, [LsS.] Jushii, Second Class of the Imperial Order of the Rising Sun, Envoy Extraordinary and Minister Plenipotentiary of His Majesty the Emperor of Japan. 548 APPENDIX (Signed ) Prince CuHInG, [LS.] Presiding Minister for Foreign Affairs, Councillor of State and Plenipotentiary of His Majesty the Emperor of China. (Signed ) Cuu Hune-cul, [1.s.] Minister for Foreign dffairs, Councillor of State and Plenipotentiary of His Majesty the Emperor of China. (Signed) Yuan Suiu-Kal,_ [L.s.] Viceroy of the Province of Chihli, Junior Guardian of the Heir-Apparent, Minister Superintendent of Trade for the Northern Ports and Plenipotentiary of His Maj- esty the Emperor of China. APPENDIX D. SUMMARY OF SECRET PROTOCOLS TO PEKING TREATY OF DECEMBER 22D, 1905. The following was communicated by the Japanese Minister for Foreign Affairs to Mr. Wilson, Chargé d’Affaires of the United States at Tokyo, and by him transmitted to the Department of State under date February 16, 1906, as a summary of certain pro- tocols to the Peking Agreement signed by the plenipotentiaries of Japan and China: Whereas the protocols of the Conference recently held between the Plenipotentiaries of Japan and China with regard to Manchuria are to be kept strictly secret in deference to the desire of the Chinese Government, only such portions of those Protocols as pos- sess the character of executory agreements are given in the following summary: 1. The railway between Changchun and Kirin will be con- structed by China with capital to be raised by herself. She, how- ever, agrees to borrow from Japan the insufficient amount of capital, which amount being about one-half of the total sum re- quired. The contract concerning the loan shall, in due time, be concluded, following, mutatis mutandis, the loan contract entered into between the board of the Imperial Railways of North China APPENDIX 549 and the Anglo-Chinese Syndicate. ‘The term of the loan shall be twenty-five years, redeemable in yearly installments. 2. The military railway constructed by Japan between Mouk- den and Hsinmintun shall be sold to China at a price to be fairly determined in consultation by Commissioners appointed for the pur- pose by the two Governments. China engages to reconstruct the line, making it her own railway, and to borrow from a Japanese corporation or corporations one-half of the capital required for the portion of the line east of Liao-ho for a term of eighteen years re- payable in yearly installments, and a contract shall be concluded, for the purpose following, mutatis mutandis, the loan contract en- tered into between the Board of the Imperial Railways of North China and the Anglo-Chinese Syndicate. All the other military railways in different localities shall be re- moved with the evacuation of the regions. 3. The Chinese Government engage, for the purpose of protect- ing the interests of the South Manchurian Railway, not to con- struct, prior to the recovery by them of the said railway, any main line in the neighborhood of and parallel to that railway, or any branch line which might be prejudicial to the interest of the above- mentioned railway. 4. China declares that she will adopt sufficient measures for securing Russia’s faithful observance of the Russo-Chinese treaties with regard to the railways which Russia continues to possess in the northern part of Manchuria, and that it is her intention, in case Russia acts in contravention of such treaty stipulations, to approach her strongly with a view to have such action fully rectified. 5. When in the future, negotiations are to be opened between Japan and Russia for regulation of the connecting railway services (Article VIII of the Treaty of Peace between Japan and Russia), Japan shall give China previous notice. China shall communicate to Russia her desire to take part in the negotiations through com- missioners to be despatched by her on the occasion, and Russia consenting shall participate in such negotiations. 6. With regard to the mines in the Province of Feng-tien, ap- pertaining to the railway, whether already worked or not, fair and detailed arrangements shall be agreed upon for mutual observance. 550 APPENDIX 7. The affairs relating to the connecting services as well as those of common concern in respect of the telegraph lines in the Province of Feng-tien and the cables between Port Arthur and Yen-tai shall be arranged from time to time as necessity may arise in consultation between the two countries. 8. The regulations respecting the places to be opened in Man- churia, shall be made by China herself, but the Japanese Minister at Peking must be previously consulted regarding the matter. g. If no objection be offered on the part of Russia respecting to the navigation of the Sungari (by Japanese vessels), China shall consent to such navigation after negotiations. 10. The Chinese Plenipotentiaries declare that immediately after the withdrawal of the Japanese and Russian troops from Manchuria, China will proceed to take, in virtue of her sovereign right, full administrative measures to guarantee peace in that region and endeavor, by the same right, to promote good and remove evil as well as steadily to restore order, so that the residents of that region, natives and foreigners, may equally enjoy the security of life and occupation under the perfect protection of the Chinese Govern- ment. As to the means of restoring order, the Chinese Govern- ment are to take by themselves all adequate measures. 11. While relations of intimate friendship subsisted as at the present time between China and Japan, Japan and Russia had un- fortunately engaged in war and fought in the territory of China. But peace has now been reéstablished and hostilities in Manchuria have ceased. And while it is undeniable that Japanese troops, be- fore their withdrawal, have the power of exercising the rights ac- cruing from military occupation, the Chinese Government declare that certain Japanese subjects in Manchuria have recently been ob- served to sometimes interfere with the local Chinese administration and to inflict damage to public and private property of China. The Japanese Plenipotentiaries, considering that, should such in- terference and infliction of damage have been carried beyond mili- tary necessity, they are not proper acts, declare that they will communicate the purport of the above declaration of the Chinese Government to the Government of Japan, so that proper steps may be taken for controlling Japanese subjects in the Province of Feng- APPENDIX 551 tien and promote the friendly relations between the two nations, and also for preventing them in future, from interfering with the Chinese administration or inflicting damage to public or private property without military necessity. 12. In regard to any public or private property of China which may have been purposely destroyed or used by Japanese subjects without any military necessity, the Governments of the two countries shall respectively make investigations and cause fair rep- aration to be made. 13. When the Chinese local authorities intend to despatch troops for the purpose of subduing native bandits in the regions not yet completely evacuated by Japanese troops, they shall not fail to previously consult with the Commander of the Japanese troops stationed in those regions so that all misunderstandings may be avotded. 14. The Japanese Plenipotentiaries declare that the Railway Guards stationed between Chang-chun and the boundary line of the leased territory of Port Arthur and Talien [Dalny], shall not be allowed, before their withdrawal, to unreasonably interfere with the local administration of China or to proceed without per- mission beyond the limits of the railway. 15. Chinese local authorities, who are to reside at Inkou, shall be allowed, even before the withdrawal of the Japanese troops, to proceed to that place and transact their official business. ‘The date of their departure is to be determined, as soon as possible after the definite conclusion of this Treaty, by the Japanese Minister to China in consultation with the Waiwupu. As there is still in that place a considerable number of Japanese troops, quarantine regula- tions as well as regulations for the prevenion of contagious diseases shall be established by the authorities of the two countries in con- sultation with each other so that epidemics may be avoided. 16. The revenue of the Maritime Customs at Yin Kou [New- chwang] shall be deposited with the Yokohama Specie Bank and delivered to the Chinese local authorities at the time of evacu- ation. As to the revenue of the native Customs at that place and the taxes and imposts at all other places, which are to be appro- priated for local expenditures, a statement of receipts and expendi- S52 APPENDIX tures shall be delivered to the Chinese local authorities at the time of evacuation. Nore. In regard to the foregoing, see No. 1-B (?), Information Series, Far East, being a memorandum of a conversation of January 28, 1908, in the course of which Tang Shao-yi, Governor of the Prov- ince of Fengtien, who signed the Peking Agreement, categorically denied the existence of any clause debarring China from paralleling the South Manchurian Railroad. ‘Tang Shao-yi further gave dis- tinct assurance that there was no secret agreement between Japan and China and that all the Legations had been apprised of this fact upon the conclusion of the Komura negotiations. “Tang-shao-yi in- timated that an agreement that China should not parallel the Japanese railroad had been sought and discussed, but not made, and implied that such discussion appeared in the signed minutes of the conference, the inference being that there was absolutely no agree- ment but simply evidence of a discussion of this subject. APPENDIX E. REORGANIZATION OF THE MANCHURIAN PROV- INCES. Imperial Edict of April 20, 1907. [ Translation. ] The government of the Three Eastern Provinces (Manchuria) has become antiquated, and the condition of the people is one of poverty. It becomes urgently necessary therefore to conscientiously undertake a thorough reorganization of these provinces to get rid of long-standing abuses, and to define the responsibilities of officials. The Tartar Generalship of Shengking is hereby changed to the Viceroyship of the Three Manchurian Provinces, and to this post are added the functions of the Tartar Generals of these three prov- inces. ‘The incumbent of the post will have an office in each of the three provinces and reside in each of them in turn. APPENDIX rk The post of Governor is created in each of these three provinces; Feng-tien (Moukden), Kirin, and Hei-lung-chiang, to assist in the administration of the government. Hsu Shih-ch’ang is hereby appointed to the post of Viceroy of the Three Manchurian Provinces with the added powers of ‘Tartar General of the three provinces, and is also made a High Commis- sioner of the Imperial Government. Tong Shao-yi is appointed Governor of Feng-tien (i. e. Mouk- den), Chu Chia-pao Acting Governor of Kirin, and Tuan Chih- kuei is given the rank of a Provincial Treasurer, and made Acting Governor of Hei-lung-chiang (Amur). The said Viceroys and Governors, having thus been placed in charge of these important provinces, ought to exercise great care in all their planning and in the exercise of their functions, disregard- ing the importunities of friends and unmindful of enmities and hardships, giving thorough consideration to all their duties and taking them up in orderly succession, so that thus they may fulfill the trust confided to them. As to the additional offices which may need to be created, let the aforesaid Viceroy and Governors take the matter into consideration and report to US. APPENDIX F. ANGLO-JAPANESE AGREEMENT. SicNED AT Lonpon, AUGUST 12, 1905. The following “Despatch to His Majesty’s Ambassador at St. Petersburgh, forwarding a copy of the Agreement between the United Kingdom and Japan, signed at London, August 12, 1905,” was issued yesterday as a Parliamentary paper [Cd.2690] :-— THE MARQUESS OF LANSDOWNE TO SIR C. HARDINGE. ForeIGn OFFIce, September 6, 1905. Sir,— I inclose, for your Excellency’s information, a copy of a new Agreement concluded between His Majesty’s Government and 554 APPENDIX that of Japan in substitution for that of the 30th January, 1902. You will take an early opportunity of communicating the new Agreement to the Russian Government. It was signed on the 12th August, and you will explain that it would have been immediately made public but for the fact that negotiations had at that time already commenced between Russia and Japan, and that the publication of such a document whilst those negotiations were still in progress would obviously have been im- proper and inopportune. The Russian Government will, I trust, recognize that the new Agreement is an international instrument to which no exception can be taken by any of the Powers interested in the affairs of the Far East. You should call special attention to the objects men- tioned in the preamble as those by which the policy of the Con- tracting Parties is inspired. His Majesty’s Government believe that they may count upon the good will and support of all the Powers in endeavouring to maintain peace in Eastern Asia, and in seeking to uphold the integrity and independence of the Chinese Empire and the principle of equal opportunities for the commerce and industry of all nations in that country. On the other hand, the special interests of the Contracting Parties are of « kind upon which they are fully entitled to insist, and the announcement that those interests must be safeguarded is one which can creat? no surprise, and need give rise to no mis- givings. I call your special attention to the wording of Article II., which lays down distinctly that it is only in the case of an unprovoked attack made on one of the Contracting Parties by another Power or Powers, and when that Party is defending its territorial rights and special interests from aggressive action, that the other Party is bound to come to its assistance. Article III, dealing with the question of Korea, is deserving of especial attention. It recognizes in the clearest terms the para- mount position which Japan at this moment occupies and must henceforth occupy in Korea, and her right to take any measures which she may find necessary for the protection of her political, military, and economic interests in that country. It is, however, APPENDIX 555 expressly provided that such measures must not be contrary to the principle of equal opportunities for the commerce and industry of other nations. “The new Treaty no doubt differs at this point con- spicuously from that of 1902. It has, however, become evident that Korea, owing to its close proximity to the Japanese Empire and its inability to stand alone, must fall under the control and tutelage of Japan. His Majesty’s Government observe with satisfaction that this point was readily conceded by Russia in the Treaty of Peace re- cently concluded with Japan, and they have every reason to believe that similar views are held by other Powers with regard to the relations which should subsist between Japan and Korea. His Majesty’s Government venture to anticipate that the alliance thus concluded, designed as it is with objects which are purely peaceful and for the protection of rights and interests the validity of which cannot be contested, will be regarded with approval by the Government to which you are accredited. “They are justified in believing that its conclusion may not have been without effect in facilitating the settlement by which the war has been so happily brought to an end, and they earnestly trust that it may, for many years to come, be instrumental in securing the peace of the world in those regions which come within its scope. I am, &c., (Signed ) LANSDOWNE. INCLOSURE. AGREEMENT BETWEEN THE UNITED KINGDOM AND JAPAN, SIGNED AT LONDON, AUGUST I2, 1905. PREAMBLE. The Governments of Great Britain and Japan, being desirous of replacing the Agreement concluded between them on the 3oth January, 1902, by fresh stipulations, have agreed upon the follow- ing Articles, which have for their object :— (a) The consolidation and maintenance of the general peace in the regions of Eastern Asia and of India; (b) The preservation of the common interest of all Powers in 556 APPENDIX China by insuring the independence and integrity of the Chinese Empire and the principle of equal opportunities for the commerce and industry of all nations in China; (c) The maintenance of the territorial rights of the High Con- tracting Parties in the regions of Eastern Asia and of India, and the defence of their special interests in the said regions :— ARTICLE I. It is agreed that whenever, in the opinion of either Great Britain or Japan, any of the rights and interests referred to in the preamble of this Agreement are in jeopardy, the two Governments will com- municate with one another fully and frankly, and will consider in common the measures which should be taken to safeguard those menaced rights or interests. ARTICLE II. If by reason of unprovoked attack or aggressive action, wherever arising, on the part of any other Power or Powers either Contract- ing Party should be involved in war in defence of its territorial rights or special interests mentioned in the preamble of this Agree- ment, the other Contracting Party will at once come to the assistance of its ally, and will conduct the war in common, and make peace in mutual agreement with it. : Articve III. Japan possessing paramount political, military, and economic in- terests in Korea, Great Britain recognizes the right of Japan to take such measures of guidance, control, and protection in Korea as she may deem proper and necessary to safeguard and advance those interests, provided always that such measures are not contrary to the principle of equal opportunities for the commerce and industry of all nations. ArTICLE IV. Great Britain having a special interest in all that concerns the security of the Indian frontier, Japan recognizes her right to APPENDIX Ty: take such measures in the proximity of that frontier as she may find necessary for safeguarding her Indian possessions. ARTICLE V. The High Contracting Parties agree that neither of them will, without consulting the other, enter into separate arrangements with another Power to the prejudice of the objects described in the pre- amble of this Agreement. ARTICLE VI. As regards the present war between Japan and Russia, Great Britain will continue to maintain strict neutrality unless some other Power or Powers should join in hostilities against Japan, in which case Great Britain will come to the assistance of Japan, and will conduct the war in common, and make peace in mutual agreement with Japan. ArTIcLe VII. The conditions under which armed assistance shall be afforded by either Power to the other in the circumstances mentioned in the present Agreement, and the means by which such assistance is to be made available, will be arranged by the Naval and Military author- ities of the Contracting Parties, who will from time to time consult one another fully and freely upon all questions of mutual interest. ARTICLE VIII. The present Agreement shall, subject to the provisions of Article VI., come into effect immediately after the date of its signature, and remain in force for ten years from that date. In case neither of the High Contracting Parties should have noti- fied twelve months before the expiration of the said ten years the intention of terminating it, it shall remain binding until the expi- ration of one year from the day on which either of the High Con- tracting Parties shall have denounced it. But if, when the date fixed for its expiration arrives, either ally is actually engaged in war, the alliance shall, ipso facto, continue until peace is concluded. In faith whereof the Undersigned, duly authorized by their re- 558 APPENDIX spective Governments, have signed this Agreement and have affixed thereto their Seals. Done in duplicate at London, the rath day of August, 1905. (L.S.) LANSDOWNE, His Britannic Majesty's Principal Secretary of State for Foreign Affairs. (L.S.) Tapasu HayaAsuHl, Envoy Extraordinary and Minister Plenipotentiary of His Majesty the Emperor of Japan at the Court of St. James. APPENDIX G. FRANCO-JAPANESE ARRANGEMENT. SIGNED AT Paris, JUNE 10, 1907. ARRANGEMENT. The Government of His Majesty the Emperor of Japan and the Government of the French Republic, animated by the desire to strengthen the relations of amity existing between them, and to remove from those relations all cause of misunderstanding for the future, have decided to conclude the following Arrangement: “The Governments of Japan and France, being agreed to respect the independence and integrity of China, as well as the principle of equal treatment in that country for the commerce and subjects or citizens of all nations, and having a special interest to have the order and pacific state of things preserved especially in the regions of the Chinese Empire adjacent to the territories where they have the rights of sovereignty, protection or occupation, engage to sup- port each other for assuring the peace and security in those regions, with a view to maintain the respective situation and the territorial rights of the two High Contracting Parties in the Continent of Asia.” In witness whereof, the Undersigned: His Excellency Monsieur Kurino, Ambassador Extraordinary and Plenipotentiary of His Majesty the Emperor of Japan to the President of the French Re- APPENDIX 559 public, and His Excellency Monsieur Stephen Pichon, Senator, Minister for Foreign Affairs, authorized by their respective Gov- ernments, have signed this Arrangement and have affixed thereto their seals. Done at Paris, the roth of June 1907. (L. 8.) S. Kurino. (L. 5.) 5. Picoon. DECLARATION. The two Governments of Japan and France, while reserving the negotiations for the conclusion of a Convention of Commerce in re- gard to the relations between Japan and French Indo-China, agree as follows: The treatment of the most favoured nation shall be accorded to the officers and subjects of Japan in French Indo-China in all that concerns their persons and the protection of their property, and the same treatment shall be applied to the subjects and protégés of French Indo-China in the Empire of Japan, until the expiration of the Treaty of Commerce and Navigation signed between Japan and France on the 4th of August, 1896. Paris, the roth of June, 1907. Che Se) S. Kurino. (aS) 5. PicHon. APPENDIX H. CONVENTION BETWEEN THE UNITED KINGDOM AND RUSSIA RELATING TO PERSIA, AF- GHANISTAN AND THIBET. SIGNED AT St. PETERSBURG, AUGUST 31, 1907. RATIFICATIONS EXCHANGED AT ST. PETERSBURG, SEPTEMBER 23, 1907. CONVENTION. [ Translation. ] His Majesty the King of the United Kingdom of Great Britain and Ireland and of the British Dominions beyond the Seas, Em- 560 APPENDIX. peror of India, and His Majesty the Emperor of All the Russias, animated by the sincere desire to settle by mutual agreement dif- ferent questions concerning the interests of their States on the Continent of Asia, have determined to conclude Agreements des- tined to prevent all cause of misunderstanding between Great Britain and Russia in regard to the questions referred to, and have nominated for this purpose their respective Plenipotentiaries, to-wit: His Majesty the King of the United Kingdom of Great Britain and Ireland and of the British Dominions beyond the Seas, Em- peror of India, the Right Honourable Sir Arthur Nicolson, His Majesty’s Ambassador Extraordinary and Plenipotentiary to His Majesty the Emperor of All the Russias; His Majesty the Emperor of All the Russias, the Master of his Court Alexander Iswolsky, Minister for Foreign Affairs; Who, having communicated to each other their full powers, found in good and due form, have agreed on the following: — AGREEMENT CONCERNING PERSIA. The Governments of Great Britain and Russia having mutu- ally engaged to respect the integrity and independence of Persia, and sincerely desiring the preservation of order throughout that country and its peaceful development, as well as the permanent establishment of equal advantages for the trade and industry of all other nations; Considering that each of them has, for geographical and eco- nomic reasons, a special interest in the maintenance of peace and order in certain provinces of Persia adjoining, or in the neighbor- hood of, the Russian frontier on the one hand, and the frontiers of Afghanistan and Baluchistan on the other hand; and being desirous of avoiding all cause of conflict between their respective interests in the above-mentioned provinces of Persia; Have agreed on the following terms: — I, Great Britain engages not to seek for herself, and not to sup- port in favour of British subjects, or in favour of the subjects of APPENDIX 561 third Powers, any Concessions of a political or commercial nature —such as Concessions for railways, banks, telegraphs, roads, transport, insurance, etc.— beyond a line starting from Kasr-i- Shirin, passing through Isfahan, Yezd, Kakhk, and ending at a point on the Persian frontier at the intersection of the Russian and Afghan frontiers, and not to oppose, directly or indirectly, de- mands for similar Concessions in this region which are supported by the Russian Government. It is understood that the above- mentioned places are included in the region in which Great Britain engages not to seek the Concessions referred to. II. Russia, on her part, engages not to seek for herself and not to support, in favour of Russian subjects, or in favour of the subjects of third Powers, any Concessions of a political or commercial nature— such as Concessions for railways, banks, telegraphs, roads, transport, insurance, etc.— beyond a line going from the Afghan frontier by way of Gazik, Birjand, Kerman, and ending at Bunder Abbas, and not to oppose, directly or indirectly, de- mands for similar Concessions in this region which are supported by the British Government. It is understood that the above- mentioned places are included in the region in which Russia en- gages,not to seek the Concessions referred to. ITI. Russia, on her part, engages not to oppose, without previous arrangement with Great Britain, the grant of any concessions whatever to British subjects in the regions of Persia situated be- tween the lines mentioned in Articles I and II. Great Britain undertakes a similar engagement as regards the grant of Concessions to Russian subjects in the same regions of Persia. All Concessions existing at present in the regions indicated in Articles I and II are maintained. IV. It is understood that the revenues of all the Persian customs, 562 APPENDIX with the exception of those of Farsistan and of the Persian Gulf, revenues guaranteeing the amortization and the interest of the loans concluded by the Government of the Shah with the “ Banque d’Escompte et des Préts de Perse”’ up to the date of the signature of the present Agreement, shall be devoted to the same purpose as in the past. It is equally understood that the revenues of the Persian cus- toms of Farsistan and of the Persian Gulf, as well as those of the fisheries on the Persian shore of the Caspian Sea and those on the Posts and Telegraphs, shall be devoted, as in the past, to the service of the loans concluded by the Government of the Shah with the Imperial Bank of Persia up to the date of the signature of the present Agreement. _ V. In the event of irregularities occurring in the amortization or the payment of the interest of the Persian loans concluded with the ‘‘ Banque d’Escompte et des Préts de Perse” and with the Imperial Bank of Persia up to the date of the signature of the present Agreement, and in the event of the necessity arising for Russia to establish control over the sources of revenue guaran- teeing the regular service of the loans concluded with the first- named bank, and situated in the region mentioned in Article II of the present Agreement, or for Great Britain to establish con- trol over the sources of revenue guaranteeing the regular service of the loans concluded with the second-named bank, and situated in the region mentioned in Article I of the present Agreement, the British and Russian Governments undertake to enter beforehand into a friendly exchange of ideas with a view to determine, in agreement with each other, the measures of control in question and to avoid all interference which would not be in conformity with the principles governing the present Agreement. CONVENTION CONCERNING AFGHANISTAN. The High Contracting Parties, in order to ensure perfect se- curity on their respective frontiers in Central Asia and to main- APPENDIX 563 tain in these regions a solid and lasting peace, have concluded the following Convention :— ARTICLE I. His Britannic Majesty’s Government declare that they have no intention of changing the political status of Afghanistan. His Britannic Majesty’s Government further engage to exer- cise their influence in Afghanistan only in a pacific sense, and they will not themselves take, nor encourage Afghanistan to take, any measures threatening Russia. The Russian Government, on their part, declare that they rec- ognize Afghanistan as outside the sphere of Russian influence, and they engage that all their political relations with Afghanistan shall be conducted through the intermediary of His Britannic Majesty’s Government; they further engage not to send any Agents into Afghanistan. , ArTICLe II. The Government of His Britannic Majesty having declared in the Treaty signed at Kabul on the 21st March, 1905, that they recognize the Agreement and the engagements concluded with the late Ameer Abdur Rahman, and that they have no intention of interfering in the internal government of Afghan territory, Great Britain engages neither to annex nor to occupy in contravention of that Treaty any portion of Afghanistan or to interfere in the internal administration of the country, provided that the Ameer fulfils the engagements already contracted by him towards His Britannic Majesty’s Government under the above-mentioned Treaty. ArTICLE III. The Russian and Afghan authorities, specially designated for the purpose on the frontier or in the frontier provinces, may es- tablish direct relations with each other for the settlement of local questions of a non-political character. 564 APPENDIX ArtIce IV. His Britannic Majesty’s Government and the Russian Govern- ment affirm their adherence to the principle of equality of com- mercial opportunity in Afghanistan, and they agree that any fa- cilities which may have been, or shall be hereafter, obtained for British and British-Indian trade and traders, shall be equally en- joyed by Russian trade and traders. Should the progress of trade establish the necessity for Commercial Agents, the two Govern- ments will agree as to what measures shall be taken, due regard, of course, being had to the Ameer’s sovereign rights. ARTICLE V. The present arrangements will only come into force when His Britannic Majesty's Government shall have notified to the Rus- sian Government the consent of the Ameer to the terms stipu- lated above. AGREEMENT CONCERNING THIBET. The Governments of Great Britain and Russia recognizing the suzerain rights of China in Thibet, and considering the fact that Great Britain, by reason of her geographical position, has a spe- cial interest in the maintenance of the status quo in the external relations of Thibet, have made the following Agreement :— ARTICLE I. The two High Contracting Parties engage to respect the terri- torial integrity of Thibet and to abstain from all interference in its internal administration. ArTIcLe II. In conformity with the admitted principle of the suzerainty of China over Thibet, Great Britain and Russia engage not to en- ter into negotiations with Thibet except through the intermedi- ary of the Chinese Government. ‘This engagement does not ex- clude the direct relations between British Commercial Agents and the Thibetan authorities provided for in Article V of the Con- APPENDIX 565 vention between Great Britain and Thibet of the 7th Septem- ber, 1904, and confirmed by the Convention between Great Brit- ain and China of the 27th April, 1906; nor does it modify the engagements entered into by Great Britain and China in Article I of the said Convention of 1906. It is clearly understood that Buddhists, subjects of Great Brit- ain or of Russia, may enter into direct relations on strictly re- ligious matters with the Dalai Lama and the other representatives of Buddhism in Thibet; the Governments of Great Britain and Russia engage, so far as they are concerned, not to allow those relations to infringe the stipulations of the present Agreement. ArtIcLe III. The British and Russian Governments respectively engage not to send Representatives to Lhassa. ArTICLE IV. The two High Contracting Parties engage neither to seek nor to obtain, whether for themselves or their subjects, any Conces- sions for railways, roads, telegraphs, and mines, or other rights in Thibet. ARTICLE V. The two Governments agree that no part of the revenues of ‘Thibet, whether in kind or in cash, shall be pledged or assigned to Great Britain or Russia or to any of their subjects. ANNEX TO THE AGREEMENT BETWEEN GREAT BRITAIN AND RUS- SIA CONCERNING THIBET. Great Britain reaffirms the Declaration, signed by his Excel- lency the Viceroy and Governor-General of India and appended to the ratification of the Convention of the 7th September, 1904, to the effect that the occupation of the Chumbi Valley by British forces shall cease after the payment of three annual installments of the indemnity of 2,500,000 rupees, provided that the trade marts mentioned in Article II of that Convention have been ef- 566 APPENDIX fectively opened for three years, and that in the meantime the Thibetan authorities have faithfully complied in all respects with the terms of the said Convention of 1904. It is clearly under- stood that if the occupation of the Chumbi Valley by the British forces has, for any reason, not been terminated at the time antici- pated in the above Declaration, the British and Russian Govern- ments will enter upon a friendly exchange of views on this sub- ject. The present Convention shall be ratified, and the ratifications exchanged at St. Petersburgh as soon as possible. In witness whereof the respective Plenipotentiaries have signed the present Convention and affixed thereto their seals. Done in duplicate at St. Petersburgh, the 18th (31st) August, 1907. (L. S.) A. NIco.son. (L. 8.) Iswo.sky. APPENDIX I. CONVENTION PROVIDING FOR CONTROL OF KO- REAN FOREIGN RELATIONS BY JAPAN. SIGNED NOVEMBER 17, 1905. The Governments of Japan and Korea, desiring to strengthen the principle of solidarity which unites the two Empires, have with that object in view agreed upon and concluded the following stipulations to serve until the moment arrives when it is recog- nized that Korea has attained national strength :— ARTICLE I. The Government of Japan, through the Department of For- eign Affairs at Tokyo, will hereafter have control and direction of the external relations and affairs of Korea, and the diplomatic and consular representatives of Japan will have the charge of the subjects and interests of Korea in foreign countries. APPENDIX 567 ARTICLE II. The Government of Japan undertake to see to the execution of the treaties actually existing between Korea and the other Powers, and the Government of Korea engage not to conclude hereafter any act or engagement having an international character, except through the medium of the Government of Japan. ArtTIcce III. The Government of Japan shall be represented at the Court of His Majesty the Emperor of Korea by a Resident General, who shall reside at Seoul, primarily for the purpose of taking charge of and directing matters relating to diplomatic affairs. He shall have the right of private and personal audience of His Majesty the Emperor of Korea. The Japanese Government shall also have the right to station Residents at the several open ports and such other places in Korea as they may deem necessary. Such Residents shall, under the direction of the Resident General, ex- ercise the powers and functions hitherto appertaining to Japanese Consuls in Korea and shall perform such duties as may be nec- essary in order to carry into full effect the provisions of this agreement. ARTICLE IV. The stipulations of all treaties and agreements existing between Japan and Korea not inconsistent with the provisions of this Agreement shall continue in force. ARTICLE V. The Government of Japan undertake to maintain the welfare and dignity of the Imperial House of Korea. In faith whereof, the Undersigned duly authorized by their Governments have signed this Agreement and affixed their seals. Signed HayasHt GONSUKE, [SEAL ] Envoy Extraordinary and Minister Plenipotentiary. The 17th day of the 11th month of the 35th year of Meiji. Signed. Pak CHE Soon, [SEAL] Minister for Foreign Affairs. The 17th day of the 11th month of the Qth year of Kwang-Mu. 568 APPENDIX APPENDIX J. CONVENTION CONCERNING THE ADMINISTRA- TION OF KOREA. SIGNED AT SEOUL, JULY 24, 1907. (Official English text issued from Tokyo Foreign Office.) The Governments of Japan and of Korea, desiring to speedily promote the wealth and strength of Korea and with the object of promoting the prosperity of the Korean nation, have agreed to the following terms: 1. In all matters relating to the reform of the Korean Admin- istration the Korean Government shall receive instruction and guidance from the Resident-General. 2. In all matters relating to the enactment of laws and ordi- nances and in all important matters of administration, the Ko- rean Government must obtain the preliminary approval of the Resident-General. 3. There shall be clear differentiation of the Korean Executive and the Korean Judiciary. 4. In all appointments and removals of high officials the Ko- rean Government must obtain the consent of the Resident-General. 5. The Korean Government shall appoint to be officials of Ko- rea any Japanese subjects recommended by the Resident-General. 6. The Korean Government shall not appoint any foreigners to be officials of Korea without consulting the Resident-General. 7. The First Article of the Agreement signed on August 22nd, 1904, shall be rescinded. In witness of the above the undersigned Plenipotentiaries, duly accredited by their respective Governments, have signed the pres- ent Convention :— Done at Seoul, the 25th day of the 7th month of the goth year of Meiji, corresponding to the 24th day of the 7th month of the 11th year of Kwangmu. (Signed. ) Ito Hirospumi, Marquis; Yr Wan Yona, Resident-General. Prime Minister of Korea. APPENDIX 569 Note.— The convention was actually signed at 1.0 A. M. on Thursday 25th July, 1907, at the Residency General at Seoul. The Japanese date, as given in the text is correct, the Korean incorrect ; some other versions of this convention give the date of signature as the 24th. APPENDIX K. Agreement between the Chinese Government and the Russo- Chinese Bank for the construction and management of the Chi- nese Eastern Railway. Imperial sanction received by the Chinese Envoy to Russia, Hsu, dated 29th August, 1896. Agreement signed 8th September, 1896. (Translation from Chinese text.) 1. China and Russia establish a Company, to be called the Chinese Eastern Railway Company, to construct and manage this railway. The seal to be used by the Company will be issued by the Chinese Government. The regulations of the Company will be in conformity with those of Russian railway companies. Shares may only be bought by Chinese and Russians. The Di- rector of the Company will be appointed by China. His remu- neration will be provided by the Company. He may live in Pe- king. His duty will be to supervise the task delegated to the Company by China, and to ascertain whether its obligations are faithfully performed. All business between the Company and the Chinese Government or any Chinese officials, either in Peking or the provinces, will also be managed by the Director. The Director will also investigate from time to time the accounts of the Company with the Chinese Government. An agent must be stationed at Peking for convenience of consultation. 2. For the purpose of surveying the course of the railway, the Chinese Director will depute an officer to act in conjunction with the Company’s engineer and the local officials along the line of route, who will arrange matters satisfactorily. Measures must 570 APPENDIX be taken to pass round all houses, graves, villages and towns in the course of the railway. 3. Within twelve months of the issue of an Imperial Edict sanctioning this agreement the Company must have commenced work on the railway; and within six years from the date of the completion of the survey for the line and the handing over to the Company of the necessary land the whole line must be completed. The gauge of the line must be that of the Russian railway, i.e. 5 Russian feet, equivalent to 42 1-3 Chinese inches. 4. The Chinese Government will order all local officials con- cerned to do their utmost to assist the Company in regard to all material required for the construction of the railway, in engag- ing laborers and boats, carts, men, and horses for transport pur- poses, and in the purchase of grain and fodder. All these must be paid for by the Company at market rates. The Chinese Gov- ernment will also afford facilities for transport. 5. The Chinese Government will take measures for the pro- tection of the line and of the men employed thereon. ‘The staff, Chinese and foreign, necessary for the line will, be engaged as re- quired by the Company. All crimes and lawsuits arising on the land of the company will be dealt with by the local officials in accordance with treaty. 7 6. As regards the land required by the Company for construct- ing, managing, and protecting the line and adjacent land, for procuring sand, earth, stones, and lime, if the land be Govern- ment land it will be given the Company without payment. If privately owned, the Company will provide funds for payment to the proprietors at market rates, either in one payment or as yearly rent. All the Company’s land will be exempted from land tax. As soon as the land comes under the management of the Company they may erect thereon any buildings and carry on all kinds of work, and they may establish a telegraph line thereon worked by the Company for the Company’s use. With the exception of mines, for which special arrangements must be made, all receipts of the Company for transport of passengers and freight, tele- grams, etc., will be exempt from all taxation. APPENDIX sri 7. All materials required by the Company for the construction and repair of the line will be exempt from taxation. 8. All Russian troops, naval or military, and munitions of war, moved by the Russian Government by this railway, must be conveyed by the Company directly across the border. Apart from slight detentions en route, incidental to transfers, no other delays will be permitted for any cause. g. Any foreign passengers by this line who may proceed into the interior away from the railway must be provided with Chinese pass- ports authorizing them to proceed. Any person unprovided with such passports must be forbidden by the Company to proceed into the interior. 10. All goods and baggage coming from Russian territory, and again entering Russian territory by this line, will be exempt from taxation, but such goods and baggage, with the exception of per- sonal luggage of passengers, must be carried by the Company in special vans, and sealed by the customs officers on entering Chi- nese territory, and on leaving Chinese territory they must be ex- amined by the customs officers to ascertain that the seals are in- tact, in which case they will be allowed to pass. If it be found that the seals have been opened en route the goods will be con- fiscated. As to goods conveyed by this line from Russia to China or from China to Russia, they will pay duty according to the treaty tariff, i.e. an import or export duty, as the case may be, but subject to a reduction of 1-3 of the tariff rate. If such goods be conveyed to the interior they must pay transit duty in addition, i.e. half the amount of the duty already paid. Transit duty being paid, they are not to be taxed again on passing customs stations or likin barriers. But if transit duty be not paid they must pay duty at stations and likin barriers. China must establish customs sta- tions at the two points where the line crosses the frontier. 11. Fares for passengers, freight for goods, and charges for loading and unloading will be fixed by the Company. Chinese Government despatches and letters must be carried by the Com- pany free of cost. Chinese troops and munitions of war will be carried at half rates. 572 APPENDIX 12. From the day of completion of the railway and the com- mencement of trafic, for a period of eighty years, all profit made by the line shall belong to the Company solely. Any loss must likewise be borne by it; the Chinese Government cannot be re- sponsible. After eighty years the line and all its property are to revert to the Chinese Government without payment. Thirty-six years after commencement of trafic China may take over the line on payment of the following and all capital and all moneys owed on account of the line and interest. As to profits made by the Company, should there be any not distributed to shareholders, these must be taken to be capital returned and be deducted from the price paid for the line. China must actually pay over the amount of purchase to Russia before receiving pos- session of the line. On the day the line is completed and traffic commenced the Company will pay the Chinese Government five million treasury taels. APPENDIX L. LAW CONCERNING MIXED RESIDENCE IN JAPAN. We, by the advice of our Privy Council, hereby give our sanc- tion to matters relating to the residence and occupation, etc., of foreigners who either by virtue of Treaty or of custom have no freedom of residence and order the same to be promulgated. (Imperial Seal and Sign-Manual.) July 27th, 1899. Marquis Yamagata Aritomo, Minister President. Marquis Saigo Yorimichi, Minister for Home Affairs. Viscount Aoki Shuzo, Minister for Foreign Affairs. Kiyoura Keigo, Minister for Justice. APPENDIX 593 IMPERIAL ORDINANCE NO. 352. Art. 1. Foreigners who either by virtue of Treaty or of cus- tom have not freedom may hereafter reside, remove, carry on trade and do other acts outside the former Settlements and mixed residential districts. Provided that in the case of laborers they cannot reside or carry on their business outside the former Set- tlements or mixed residential districts unless under the special permission of the administrative authorities. The classes of such laborers (referred to in the preceding clause) and details for the operation of this Ordinance shall be determined by the Minister for Home Affairs. Art. 2. Persons infringing the proviso of clause 1 of the fore- going article shall be sentenced to a fine not exceeding Y. 100. SUPPLEMENTARY RULES. Art. 3. This law shall be put into operation on and after Au- gust 4th, 1899. Art. 4. Imperial Ordinance No. 137, of 1894, shall be re- scinded after the date on which this Law comes into force. HOME OFFICE NOTIFICATION NO. 42. Details relating to the operation of Imperial Ordinance No. 352, 1899, concerning the residence and occupation of foreigners who have no freedom of residence either by virtue of Treaty or of custom are decided as follows:— July 28th, 1899. Marquis Saigo Yorimichi, Minister for Home Affairs. Art. 1. The administrative authorities mentioned in Art. I of Imperial Ordinance No. 352, 1899, shall be the head of each prefecture and of Hokkaido. rt. 2. The laborers mentioned in Art. I of the same Law shah be men engaged in labor in agricultural, fishing, mining, civil engineering work, architectural, manufacturing, transporting, carting, stevedoring, and other miscellaneous work. Provided that this rule is not applicable to those who are employed in house- hold services such as cooking and waiting. 574 APPENDIX Art. 3. Permission given to laborers (to reside in the interior) may be cancelled by a local Governor when he deems it necessary to do so for the public welfare. APPENDIX M. NOTES EXCHANGED BETWEEN THE UNITED STATES AND JAPAN, NOVEMBER 30, 1908, DECLARING THEIR POLICY IN THE FAR EAST. IMPERIAL JAPANESE EMBASSY, WASHINGTON. NovEMBER 30, 1908. Sir: The exchange of views between us, which has taken place at the several interviews which I have recently had the honor of holding with you, has shown that Japan and the United States holding important outlying insular possessions in the region of the Pacific Ocean, the Governments of the two countries are animated by a common aim, policy, and intention in that region. Believing that a frank avowal of that aim, policy, and inten- tion would not only tend to strengthen the relations of friendship and good neighborhood, which have immemorially existed be- tween Japan and the United States, but would materially con- tribute to the preservation of the general peace, the Imperial Gov- ernment have authorized me to present to you an outline of their understanding of that common aim, policy, and intention: 1. It is the wish of the two Governments to encourage. the free and peaceful development of their commerce on the Pacific Ocean. 2. The policy of both Governments, uninfluenced by any ag- gressive tendencies, is directed to the maintenance of the existing status quo in the region above mentioned and to the defense of the principle of equal opportunity for commerce and industry in China. 3. They are accordingly firmly resolved reciprocally to respect APPENDIX 575 the territorial possessions belonging to each other in said region. 4. They are also determined to preserve the common interest of all powers in China by supporting by all pacific means at their disposal the independence and integrity of China and the prin- ciple of equal opportunity for commerce and industry of all na- tions in that Empire. 5. Should any event occur threatening the status quo as above described or the principle of equal opportunity as above defined, it remains for the two Governments to communicate with each other in order to arrive at an understanding as to what measures they may consider it useful to take. If the foregoing outline accords with the view of the Govern- ment of the United States, I shall be gratified to receive your con- firmation. I take this opportunity to renew to Your Excellency the assur- ance of my highest consideration. K. TakaHira Honorable Ettnvu Root, Secretary of State. DEPARTMENT OF STATE, Washington, November 30, 1908. EXcELLENCY: I have the honor to acknowledge the receipt of your note of to- day setting forth the result of the exchange of views between us in our recent interviews defining the understanding of the two Governments in regard to their policy in the region of the Pa- cific Ocean. It is a pleasure to inform you that this expression of mutual understanding is welcome to the Government of the United States as appropriate to the happy relations of the two countries and as the occasion for a concise mutual affirmation of that accordant policy respecting the Far East which the two Governments have so frequently declared in the past. I am happy to be able to confirm to Your Excellency, on behalf of the United States, the declaration of the two Governments em- bodied in the following words: 576 AP PEN DLS 1. It is the wish of the two Governments to encourage the free and peaceful development of their commerce on the Pacific Ocean. 2. The policy of both Governments, uninfluenced by any ag- gressive tendencies, is directed to the maintenance of the existing status quo in the region above mentioned, and to the defense of the principle of equal opportunity for commerce and industry in China. 3. They are accordingly firmly resolved reciprocally to respect the territorial possessions belonging to each other in said region. 4. They are also determined to preserve the common interests of all powers in China by supporting by all pacific means at their disposal the independence and integrity of China and the prin- ciple of equal opportunity for commerce and industry of all na- tions in that Empire. 5. Should any event occur threatening the status quo as above described or the principle of equal opportunity as above defined, it remains for the two Governments to communicate with each other in order to arrive at an understanding as to what measures they may consider it useful to take. Accept, Excellency, the renewed assurance of my highest con- sideration. Euinvu Root. His Excellency Baron Kocoro TAKAHIRA, Japanese Ambassador. THE END y We ae f pola (Hii y nar) LE FA) NO lS Ye Yai the (F Vi Doe Me PO watt Ay} "Ae ve ce ah 7M i “i Khotan (fichi) ! ‘ ' / uf \ al Anas aT ‘ay X heli , ao -~---’ ) KaraB ILI SU atl ST ee IN Me ta Kanigals hii She 1 ull Ww s oo aly A 84° 88° o2° 96° 100° 104° 108° 2° Vey ESOT s « y ro é NINN «F ee \ M ‘i o 8 haskal- S So wld \h aM HAN S Zi, sy gh NT Liar stLEL ie" Hic Nl ky DL Les, WY AN Ges] wunucber, . aN Mung un) lc ‘ ORR ca NAR TRN , ZL. N LH Sart hamish Kyttokemetdal——s 1 Inchikee / Tse ary a Si ns yoke 7 NV ON Tigi Al ZAM WW SF com & NWA ANS ANS Shap cE il/ Su My UNM! a ido Ny aque y Mung 1 MY WHI 9 Ts chan 3 clans yong Pe 136° ay (144 148° 152° 4.0° Mora - f Peter the Great INV 7 Victoria B.} La sin Bs: G 28° ares Bho ae 24° YjtchiL « G Ea Feu, Gin, Sari-lamish Kudtolernet 5 \ M Ney Baba-tal Inchike Pe ; is \ > Sha: oe or ny) - f es Pp: <= <1 PY 3 > Vs ew Abt wor PY, - eB CEs Wasim He SN if ae ene ” Po OT ies = él - WW Jak S77 ; A Kear gals hig CAM = . es Wa WP ly ‘aris DA) hiv D7, iapaas y 3 BR ] Wi bie Pilleailoboy Wai y (A ke bata. :Gangri ni Bes AINA teeny Re EAS MOO Aso \(L)) Lange 0 fit tak oy an hen ferent rete iar appame neuen Papert ree pore een detects if A Peete ahha tee’ -Aiorecopndt ae aalaar ie Soe ta ae Roars iy ire i erg reine he ee , Mirada tigate a ba ii yh eater tN ea dtr td pee ee rat fi sid fa saat Wide h le trun ties i) ist Pua Ra Mra Seis! Raacnaercn abit reat = oe ear: Shae rei Saas 1 Secon es te % Prins ER Sa ee Saunt = ahhh alt SSS etches ‘Delp no oe MT alan