"Then," he replied, "we have bought of Japan 40,000 rifles, 160 machine guns, and 80 field guns. There will be no incidental commitments. I can rely implicitly on my military associates [General Hsu Shu-cheng, the Vice-Minister of War; Ching Yun-peng, Acting Chief of Staff; and Fu Liang-tso, Tuchun of Hunan]. They would not sanction such a thing."
But the next day I got positive evidence that they had. The negotiations were in full blast for Japanese military advisorships, control of the Nanking Arsenal, and rights to specific iron deposits. I saw General Hsu, telling him everything before giving him a chance to answer. I was not then solely concerned about the encroachment on Chinese independence. American and European interests had been told: "Hands off the national iron ore reserve; all remaining iron deposits are to be held for the nation." Respecting this decision, we had told our people that concessions for iron ores could not be obtained. We could not in justice to them now consent to a change of policy, without protecting our interests. Japan had already one half of China's iron ore deposits. Was she to get the rest? Also, were Chinese armaments to be standardized without consulting the experts of the Allied Governments, so that the arms might be used in the present war?
"We have been hard pressed," General Hsu explained. "The Japanese wished us to do something for them and we need the arms. They will be of the larger calibre, such as China's armament now has. The Japanese did demand the assignment of new ore deposits; they needed security for the contract. They compromised by reducing the amount of ore we are to furnish. But we must supply it under a contract of 1916, between the Japanese and a company formed by Chow Tsu-chi, whereby a million dollars was paid in advance on iron ores from deposits near Nanking. This is the best we can do. They demanded at first the grant of new ore deposits."
"I should like to visit you more often," General Hsu remarked later; "but my movements are closely watched." I stated I hoped he entertained no fear that would keep him from seeing the minister of a friendly power at any time he wished.
The real trouble lay in the rivalries between the north and south. The Premier and General Hsu were willing to barter the nation's birthright in the form of concessions in order to impose an internal unity of their own making. For China was torn. The situation in October, 1917—how different from that of April and May, 1915, when the twenty-one demands came to their climax! Then the Chinese people and Government were united as one man. The sentiment of the nation was now the same; nearly all the members of the Government were unchanged, yet a small pro-Japanese minority were in the saddle. The men who had Japanese funds under their control had the advantage over the mass of officials. They succeeded in muzzling the Chinese press. By Japanese insistence, aided in this case by the French minister—some of the Chinese papers had criticized his attitude—news of diplomatic negotiations had been absolutely suppressed. Without information, the public was disturbed and confused. The editor of the Japanese Kokumin, Mr. Tokutomi, in an interview in Peking, advocated still more stringent press control. Japan was using the war to displace the influence of her associates in China and to make her own power predominant.
Bad as the situation was it might have been saved by an adequate loan from America. Liang's first proposal was for a reorganization loan of $200,000,000, which was vetoed by Europe; this shrivelled to the mess of pottage of 10,000,000 yen offered by the Yokohama Specie Bank. General Hsu had unfolded to me in September a comprehensive scheme of equipping 500,000 soldiers, and providing for the immediate transport of at least 500,000 to Europe, further detachments were to go as fast as ships could be had. Later came more specific plans for 1,000,000 men, out of which the best contingents were to be sent to France. It was planned ultimately to send the whole million, if needed. Then came a modified proposal for outfitting 500,000 men and the completion of the industrial plants needed for war materials and ships. The European ministers were all anxious to secure China's active participation; the French Legation, through its military attaché, was coöperating with special energy in planning for the eventual use of Chinese forces. From my conversations with the President, the Premier, and his most active assistant, there was no doubt that the Chinese were in earnest. Now it was all simmering down to a few millions of Japanese money, supplied for politics and internal dissension, with Japan seeking special advantages.
Work was to be done. The United States could still bring relief and a strong call for united action into this troubled situation without giving just cause for complaint or for taking offence. The French were especially desirous of bringing the Chinese actually into the war. The Belgians wished the mobilization of Chinese material resources, particularly foodstuffs. The British were in general accord, though they doubted whether Chinese troops could be soon transported to the theatre of war. Dr. George Morrison who had just gone over the whole situation with the President and cabinet, came to me saying: "The Chinese will apply to you for advice. You have a freer hand than the British minister."
But an event of profound significance was impending, and it interrupted my efforts along these constructive lines. It was at this time that the results of Japan's efforts to reach an agreement with the State Department in Washington became known to China.