CHAPTER XXX THE RAILROAD BLOCKS THE WAY Washington, December 17, 1921: In spite of roseate official statements emanating from the Japanese and Chinese delegations, there is reason to believe that the Shantung "conversations" permit of no hasty optimism. It is yet possible that the parley may come to an impasse. In deference to the good offices of the American Government which have made these conversations possible, both delegations will make the utmost efforts to arrive at an agreement, but there exists a serious disagreement on the most vital aspect of the Shantung Railway question. The Chinese delegation has conducted the negotiations with remarkable skill and tact, and has won almost every point, including the disposition of public properties in Kiaochow and the future status of the Maritime Customs at Tsingtao. Throughout the parley, good nature has prevailed on both sides. But on the railway question the two delegations have struck a reef. The disagreement between China and Japan on this question is fundamental. It is not a matter of dollars and cents, but a question of efficient and honest management essential to a railway as a public carrier. Because the question involves the integrity and efficiency of the future management of the Shantung line, it is almost impossible for the Japanese delegates to discuss it without reserve. The reappearance at the Confer ence of Ambassador Baron Shidehara, who has just recovered from a protracted illness, may help to cut the Gordian knot, but the situation appears extremely embarrassing for the Japanese. To all familiar with the railways in China, the unsatisfactory administrative condition of the Chinese-managed lines is well known. True, official reports of the Chinese railway administration show a fair margin of profit from the railways. But this profit is made possible by neglecting sorely needed repair and replenish ment as to both the roads and the equipment. Apart from occasional arbitrary seizure of trains by military governors, their essential function as public highways is often made difficult of fulfillment by reason of universal miscarriage of administration. That this apprehension is well founded is fully proven by the following statement made in a New York magazine by an American businessman who has lived in China for thirty years, several of which have been spent in Shantung: "The real difficulty in the whole scheme is that the Chinese officials haven't the administrative honesty to preserve their own interests. Take their own railways, like the Tientsin-Pukow Railway, which runs through this same Shantung Province from north to south. What happens? The likin, the interprovincial duties and squeezes, the military usurpations of cars and materials, the want of honest administration, makes this road of practically little value in the transfer of merchandise. This road traverses excellent coal fields, and has connections in the north with Tientsin and in the south with Shanghai. An excellent coal mine, which was operated for local uses before the railway was built, finds it impossible to market its coal either in Shanghai or Tientsin because of the inefficient management of the Tientsin-Pukow Railway. There is a mine of excellent coal within thirty miles of Tsinan, and within two miles of the track of the Tientsin-Pukow Railway, and sixty miles nearer to Tsinanfu by the Tientsin-Pukow Railway than the Japanese mines on the Tsinanfu-Tsingtao Railway, and yet Tsinanfu is supplied by the Japanese mines! The reason why the Chefoo-Tsinanfu Railway is not built is that all concerned know that it would be ridden by a horde of greedy parasites which would sap the life of it and make it of no effect." No one will deny that the Shantung Railway has, under the Japanese management, attained a degree of efficiency unequalled by any Chinese-managed line. Even a casual traveler cannot fail to notice a refreshing change when he leaves a Chinese train and takes a Japanese train in Shantung or in Manchuria. I have on my desk a recent issue of the Central China Post, an English newspaper published by a Britisher, containing an editorial objecting for obvious reasons to the transfer of the Shantung Railway to the Chinese management. The Shantung Railway, though its main line is only 250 miles long, is one of the principal arteries of trade. The prosperity and even existence of the city of Tsingtao is dependent upon its efficient management. This commercial metropolis of Shantung has, under the Japanese regime, made a phenomenal progress. Under German administration it had 60,000 inhabitants. Today this population has increased to 108,000, of which about 80,000 are Chinese and 20,000 Japanese. The Japanese administration has expended $15,000,000 for public improvements, while some $70,000,000 has been invested by Japanese firms in factories and other business enterprises. Should the Shantung Railway be managed haphazard, or ever be liable to arbi trary seizure by military chiefs, the city of Tsintao must suffer incalculable damage. The value of the railway is estimated at 53,000,000 gold marks by the reparations committee. To this must be added some $10,400,000 gold, which has been expended by the Japanese for improvement. There are a group of iron mines and two groups of coal fields along and appurtenant to the railway. On those mines considerable Japanese capital has been invested. Whether or not these mines are turned over to China, their output will unquestionably be purchased by Japanese concerns. If the railways are ridden with mismanagement, the transportation of the mineral products is bound to encounter hindrance. All these circumstances are responsible for the Japanese desire to have a voice in the management of the railway. Japan is willing to confer upon China the absolute ownership of the line, but she thinks it not only to her interest but to the interest of all the public, the most important of which is Chinese, that she should be placed in a position to insure its efficient management. CHAPTER XXXI WHO MANAGE RAILWAYS FOR CHINA? Washington, December 24, 1921: As I predicted a week ago the Shantung "conversations" have reached an impasse on the railway question. The Japanese delegation is convinced that it has made every possible concession to China, going even beyond the authority allowed by the home government. Its position is made more difficult by the uncompromising attitude assumed by the public at home, which believes that Japan's terms of settlement, sent China on September 7, were the irreducible minimum. The Japanese delegates are receiving cablegrams reporting newspaper editorials vigorously protesting against making any further concessions to China. Some newspapers think that it would have been better for Japan to decline the good offices of Secretary Hughes and Mr. Balfour, and insist upon the terms presented to China in September. Others assert that those terms are most generous, and should be accepted by the Chinese delegation without modification. All agree that Japan has given up in favor of China everything except a half share in the Shantung Railway and the mines appurtenant thereto, and that this last vestige of Japanese interest should be maintained by all means. Now the Japanese delegates have, against the popular will at home, offered to waive even a half share in the line, and transfer absolute ownership to China. All that they ask is the usual privilege of supervision ac |