It cannot be doubted that in China the withdrawal of the United States from the Consortium was interpreted as an act of friendship by all groups with the exception of that which was in control of the Government at the time, which would have preferred to have the United States at the council table of the Consortium Powers. Those opposed to the Government were particularly strong in their commendation of our refusal to join in an agreement which to them seemed far from beneficial to China. But all parties without exception drew the conclusion that the friendly action of the United States, which had now rejected the method of international coöperation, would continue independently of the others. In view of the power and resources of the United States, it was hoped that there would be a greater participation by the United States in Chinese industrial and commercial affairs, as well as in administrative loans, than had hitherto existed.

It is apparent from all this that the American position in China was not free from difficulties. The covert antagonism of the five Consortium Powers was continuous. We were isolated, and would be judged by what we could do by ourselves. Should it turn out that we had nothing to offer but sage advice, the strictures of our rivals might in time come to carry a certain amount of conviction.

So far as the Americans themselves were concerned, they were thoroughly discouraged, and everywhere talked as if it were all up with American enterprise in China. When I said: "No, it is only just beginning," polite incredulity was the best I could expect. It is very probable that the Americans who were so downcast saw in the appointment of a literary and university man as minister to China an additional indication that there was to be no special encouragement given to American economic enterprise. Having long been familiar with the underlying facts of the Far Eastern situation, I had entirely made up my mind on the primary importance of American participation in the industrial and economic development of China. No one could have appreciated more highly than I did the important work done by American missionaries, teachers, and medical men, in bringing to China a conception of Western learning and life. But if China should have to rely entirely on other nations for active support in the modern development of her industries and resources, then our position in the eyes of the Chinese nation could never come up to the opportunities which Nature had given us through our geographic position and our industrial strength.

I had long discarded any narrow interpretation of diplomacy, but even if I had adhered to the principle that the diplomat must busy himself only with political matters, I should have had to admit that in China political matters included commerce, finance, and industry. I did not, of course, intend that the Legation should enter into a scramble for concessions, but it was my purpose that it should maintain sympathetic contact with Americans active in the economic life of China, and should see to it that the desire of the Chinese to give them fair treatment should not be defeated from any other source.

When I thought of American enterprise in China I had less in mind the making of government contracts, than the gaining of the confidence of the Chinese people in the various provincial centres of enterprise by extensive business undertakings, resting on a sound and broad foundation. In China the people are vastly more important than the Government, so that it is necessary to make up one's mind from the start not to regard Peking as the end-all and be-all of one's activity, but to interest one's self deeply in what is going on in all of those important interior centres where the real power of government over the people is exercised, and where the active organizations of the people are located.

The universal knowledge that America has no political aims in China, of itself gives Americans the confidence of the Chinese and predisposes the latter to favour intimate coöperation. Our policy is known to be constructive and not to imply insidious dangers to their national life. It would be discouraging to the Chinese, should Americans fail to take a prominent part in the development of Chinese resources. To Americans the idea of securing preëminence or predominance is foreign, but from the very nature of their purely economic interest they have to resist any attempt on the part of others to get exclusive rights or a position of predominance, which could be utilized to restrict, or entirely to extinguish, American opportunities.

I was therefore resolved to give every legitimate encouragement to constructive enterprise, whether it were in education, finance, commerce, or industry.[1] Fully a year before going to China I had expressed my view of the nature of American policy there, saying that a united China, master of its own land, developing its resources, open to all nations of the world equally for commercial and industrial activity, should be the chief desideratum.

Among the specific American interests already existing in China, that of missionary and educational work had at this time to be given the first rank. There are two factors which have made it possible for this work to achieve a really notable influence. The one is that it is plainly the result of individual impulse on the part of a great many people animated by friendly motives, and not the result of a concerted plan of propaganda. The second factor is the spirit of helpfulness and coöperation which permeates this work. There is no trace of a desire to establish a permanent tutelage. An institution like the Y.M.C.A. acts with the sole thought of helping the Chinese to a better organization of their own social and educational life. The sooner they are able to manage for themselves, the better it seems to please the American teachers, who may remain for a while as friendly counsellors, but who make no effort to set up a permanent hierarchy of supervision. The Chinese have an intense respect for their educators, and it has been the good fortune of many Americans—men like Dr. W.A.P. Martin and Dr. Chas. D. Tenney—to win the devoted loyalty of innumerable Chinese through their activity as teachers.

Among commercial enterprises the Standard Oil Company was carrying petroleum to all parts of China. It had introduced the use of the petroleum lamp, had extended the length of the day to the hundreds of millions of Chinese, and even its emptied tin cans had become ubiquitous in town and country, because of the manifold uses to which these receptacles could be put. For efficiency and close contact with the people, the Chinese organization of this great company was indeed admirable.