Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-08-18

siStence upon the limitation of Russia's ma
val armament in the far eastern waters
but this had not been concluded when the
conference was adjourned for the day.
Two official bulletins furnish some in
sight into the deliberations, and they are
given herewith. The reader should keep
in mind that article TX is the indemnity
proposal. article X the matter of interned
ships and article XI the proposed limita-
ton of naval strength Article XII, which
will be discussed today. relates to the
Japanese demand for fishing rights off the
Siberian coast.
The Saghalin Problem.
There are some who may find cause for
hope in the fact that the Japanese demand
for the formal cession of Saghalin Island,
which they claimed by right of conquest,
has been practically adjusted. According
to the understanding obtained today the
Russians have virtually consented to Japan
csc limited possession of Saghalin, but under
the condition that 1t shall not be fortified
or used as base of naval operations.
However, there is practically no absolute
compromise yet arranged and the Sagha-
lin demand, which is article V of the jap
anese conditions, will be taken up again
when the ENJOYS come to consider in con-
solidated and correlated form the points
upon which there was divergence of views.
The Importance of the virtual under
standing as to the disposition of the terri
torial conquest of the Japanese cannot be
oEeitSllnldteu unUcI present COHulilOHS.
From the first the Russians have maintained
that they would never surrender an inch of
territory TO their enemy, and when the
subject of Saghalin was reached in the
exchanges there We're many who believed.
and honestly believed, that the good ship OF
peace had gone on the rocks.
Eastern Chinese Railway.
The japanese demand for the possession
of the Eastern Chinese railway, that Man
ri ian for of ,inH, I,pl
more to do. perhaps. than anything else In
bringing about the present disastrous war.
was also regarded one of the worst
stumbling blocks in the pathway of sue
cesSful negotiation.
The ENJOYS, to the surprise Of all those
ol the outside, managed to reach an agree
ment that the portion of this railway run
ming from Vladivostok to a point ten miles
from Hardin should be under Russian con-
troll and the portion from the point men
toned to Port Arthur should be under Jap
arese control, subject to future arrange
ment of details.
1t became known yesterday that this flu
ture arrangement related to the rights of
persons who had subscribed for bond issues
to build the railway line which means a
substantial concession from the Japanese
side The road was financed by the Russo
Chinese Bank, which issued bonds to raise
the money necessary for construction and
equipment. These bonds were sold in Rus
STA and In other countries. and while the
dStudi Work was OON6 Dy the
Russian government the rights of the bond
holders were not affected.
Indemnity Crucial Point
The worst feature of the situation is the
deadlock upon the question of indemnity.
NJ. Witte apparently believes that there is
no hope of compromise. His instructions
from St. Petersburg are all in line with the
original Russian program that not a penny
must be paid to Japan to secure immunity
from further hostile operations on the part
OF the victorious army of Oyama.
The Russian ENJOYS think they have al
ready gone far enough to satisfy the most
exacting enemy who had won many battles
but had not conquered. They believe that
japan will not be satisfied with less than
the payment of several hundred million dol
lars by Russia, and they vow and declare
that not a cent of this shall be paid.
AS for the Japanese IL Is contended that
they are equally determined to go on with
the war If Russia does not consent to re-
munerate them for what they have spent in
prosecuting the conflict Japan must have
money. 1t Is held. and her only way to Sc
cure 1t is at the expense Of her opponent.
Fears Of Failure.
If the Russians are as firm as they say
they are In their decision not to pay in
den.nity, and the Japanese as firm as they
are represented to be In their decision to
adhere to their demand for payment, the
Jig is up, and there will be no peace.
Mr.. Witte said last night that there would