The Daily Missoulian., 1913-01-21

CARELESS OF the nebulOuS form of its
government, they had been asked tc
lay bond selling proposition before
the world. In the first place, while
prepared to advance sums from their
own strongboxes, under certain con-
| ditions they deemed it very unwise
| to even attempt to sell new Chinese
bonds at that time. They would have
been sold so low that other Chinese
bonds already on the market would
have slumped.
If the group undertook to advance
a large amount of money Immediately
they would have to discount treasury
bills. These they would have been
forced to keep, or try to sell to such
few clients as would take them. AS
to the salt gabelle the bankers held
that it would be safe security only
when administered by foreigners. The
annual returns from this salt tax are
estimated at $30,OOO00O per annua,,
whereas under foreign control it could
amount to at least twice as much.
After the relief of Peking in 1898 a
provisional government of foreigners
was organized to direct the affairs of
the city of Tientsin until order should
! be restored. The French consul gem
eral was chairman of this civil COM
mission and the secretary was Mr.
| DENLY, the American consul general
| Under this foreign administration one
station turned in as much from the
| salt tax in six months as the whole
district did in a year when the Chi
nese were in control. A similar ex-
| pertinent was tried at Tsingtao, and
the receipts were six times as much as
they had been before in the same
length of time. Consequently, the six
power group decided that the huge
loan Tang Shao requested could be
given only on the following terms:
| First, that the group should have
the right to satisfy as to the pur-
| poses for which funds We're required.
Second, that China should itself Gre
ate system of audit in which for
eigners should be employed with
powers not merely advisory, but also
executive so as to ensure the effective
expenditure of funds borrowed for the
purposes specified.
! Third, that the salt taxes to be hy-
| pothecated for the service of this loan
should be administered either by the
existing maritime customs organiza-
ton or by a separate Chinese service
like the customs, however, under for
eign direction, thus safeguarding the
proper administration of the security
despite the possible continuation or
recurrence of unsettled conditions in
China.
Fourth, that the group should take
the. first series of the loan of $780,
100000 at fixed price, and should
be assured an option on the subse-
quent series at a price to be based on
the market quotation of the first issue,
thus giving China the benefit of any
| Improvement in her credit.
Fifth, that to protect the quotation
of bonds issued and to assue sue
cessful marketing of subsequent series
China should not borrow through other
| groups until after the entire loan Of
$500, 900 had been issued.
Sixth, that for a period of five
years China should appoint the group,
it's financial agents to assist in the ad-
ministration in it's work of reorgani-
! zation.
On July these terms We're rejected
on the ground that they were unrea-
sonable from the Chinese point of
view. But the crying need for cash
did not abate, and two weeks later. or
thereabouts, the group was approached
IN regard to the issuing Of a small
$50,o00,000 loan, with immediate ad-
vances. Deeming this sum entirely in
adequate for the amelioration of
China, the bankers refused. In the
meantime disaffected and unpaid
troops continued to desert, riot. burn
and loot in various parts of the coun-
try
Probably the majority of the high
officials in the capital city of Pekinc
honestly believed the demands of the
SIX power group to be excessive. One
member of the cabinet said Il would
rather have my country die by slow
starvation than to be quickly
strangled'
This view was also held by the ma
Jority Of the members Of the national
assembly, really the provisional con-
gress. They felt that the terms of the
group We're tantamount to dire finan-
clal bondage and were deeply insultcd
over the stipulation that the salt ga
belle be controlled by foreigners and
that European and American auditors
and inspectors be picketed to watch
and direct the expenditure of the,
money that the six power group would
advance from time to time This in
ference of incompetence and inexperi-
ence, even possible dishonesty, wound
ed the pride Of the enthusiastic, pa
triotic and in many instances extreme
iy capable young men who found
themselves in power by virtue of the
successful revolution. The feeling
spread throughout the provinces. and
the native press, now a great factor
IN Chinese affairs, lined up soidly be-
hind the cabinet and the national as
sembly. On the other hand, the for
eign press in China was almost as
unanimously in favor of the modus
operandi suggested by the six power
group. Not a few influential Chinese.
especially those who had had business
and financial experience favored the
plan of the international bankers but
discretion made for silence in the