A similar result had been obtained by the British-American Tobacco Company, which, although organized in England under British law, is American by majority ownership, business methods, and personnel. The cigarette had been made of universal use, and had been adapted to the taste and purchasing ability of the masses. Though there were several American commission firms of good standing, none had the extensive trade and financial importance of the great British houses. Several American firm names established in China early in the nineteenth century, like that of Frazar & Company, had become British in ownership. The only American bank was the International Banking Corporation, which at this time confined itself to exchange business and did not differ in its policy or operations from the common run of treaty port banks.
If national standing in China were to be determined by the holding of government concessions, America was at this time, indeed, poorly equipped. The Bethlehem Steel Corporation had in 1910 concluded a contract with the Imperial Government for the construction of vessels to the value of $20,000,000. When I came to China, a vice-president of the corporation, Mr. Archibald Johnston, was in Peking, ready to arrange with the republican government for a continuance of the contract. The American banking group was a partner in the Hukuang Railways, in which it shared with the British, French, and German groups. An American engineer was employed at the time in making a survey of a portion of the proposed line along the Yangtse River. The American group also held the concession for the Chinchow-Aigun Railway in Manchuria, the execution of which had been blocked by Russia and Japan. The group further participated with the three other groups above mentioned in the option for a currency loan. The only activity going on at this time in connection with these various contracts, on the part of America, was the survey of the Hukuang railway line west of Ichang.
For some time the practice had grown up, on the part of European powers, to urge the Chinese to employ, as advisers, men reputed to have expert knowledge in certain fields. The most noted adviser at this time was Dr. George Morrison, who had gained a reputation in interpreting Far Eastern affairs as Peking correspondent for the London Times during and after the critical period of 1900. A fresh group of advisers had just been added under the terms of the Reorganization Loan. Each power therein represented had insisted that the Chinese appoint at least one of its nationals as an adviser. The American Government had never urged China to make such an appointment. But when President Eliot visited China in 1913, Chinese officials expressed to him the wish that a prominent American should be retained as adviser to the Chinese Government. President Eliot suggested that the Carnegie Endowment might propose certain experts from whom the Chinese Government could then make a selection. This method was actually followed, and as a result Prof. F.J. Goodnow of Columbia University, a recognized authority on constitutional law, had been retained by the Chinese Government and was at this time already in residence at Peking. The Ministry of Communications on its part had sought a man familiar with railway accounting, and had called upon the late Prof. Henry C. Adams, the noted economist and railway expert of Michigan University.
The important administrative positions of Inspector General of Customs and of Foreign Inspector of the Salt Revenue were held by two British officials. The salt administration had come within the purview of international supervision through the Reorganization Loan agreement; and, as America was not a party to that loan, the appointment of Americans to any positions in this service was frowned upon by several of the partners. The Inspector, Sir Richard Dane, an official of long experience in India, however, adopted the policy of not confining the appointments to subjects of the Consortium Powers. He had retained several Americans, in whom he seemed to place great confidence. In the Customs Service, Americans did not hold the number of positions to which they were relatively entitled. This was undoubtedly due to the fact that very few people in the United States knew that such positions in China are open to Americans; moreover, many of those Americans who were actually appointed had become impatient with the relatively slow advancement in this service and had been attracted by other opportunities. There were, however, a number of highly reputed and efficient American officials in the Customs Service.
FOOTNOTES:
[1] The leading British paper of China had this to say concerning the modern functions of diplomacy: "It is characteristic of Doctor Reinsch and his outlook upon China that he should mark a point of progress in the fact that the legations are ceasing to be merely political centres, and that, instead of politics being the one and only object of their existence, they are now establishing relations of all kinds of mutual helpfulness in vital phases of national reorganization. In this connection, we may see an increase in the number of experts who will come, unofficially for the most part, to study conditions and gather data which may be available as a sure foundation for progress." I may say in passing that the British papers in China, throughout the period of my work there, were almost uniformly fair and friendly, and gave credit for honest efforts to improve conditions.