New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1916-08-05

recently brought to light. As matter
Of fact. the political situation in emma
is much better than il was when the
first negotiations for the loan were
started.
Certain incidents have happened dur
ing the last few weeks which make
it unsafe for bankers to enter the fie!d
Of China, unless the Administration IS
able to support them In vigorous
manner. The most serious obstacle
is the newly concluded Russo-Japanese
treaty. II Is notorious that Russia and
Japan once before came together in
1910 just to balk American enterprise
in China. When Secretary of State
Knox brought out his scheme for the
naturalization Of railways in China,
Japan and Russia entered into an en-
tente "for the protection Of mutual
rights In Manchuria"; such an entente
led to the withdrawal Of several rail-
way schemes which America wanted to
20 into in the northern province.
A year ago Baron Shibusawa told
American fnanciers that the best plan
would be for them to give the money
to Japan, and let her do the work of
regenerating China. OF course, it did
not appeal to American business men.
Now, when there was every prospect
of America helping to regenerate China
while incidentally helping herself
we find that the entente between Rus
STA and Japan has been cemented into
a treaty. On the previous occasion the
entente stopped further American ac-
tivities in China, until American bank
ers found no other way open but that
Of Joining an international group. Now
such a course is not practicable. The
five-power group, which was formed IN
1919, still exists, but the Allies act
as if Germany was never member OF
the group. The five-power group has
bound China hand and foot, and has
the first mortgage on all Chinas re-
sources. II the American bankers
Join the group to-day it would mean
simplv that the United States would
furnish all the money, while the otner
members Of the group would benetit,
especially as the latter have a very
strong grip on the trade, finances and
economics OF China. From the politi-
cal point Of view it is also not prac-
ticable. because Germany is being ig-
nored the United States cannot fol-
low the Allies, as this country is on
friendly terms with Germany.
Priority Of Others.
An incident has happened recently
in China which has made the United
States pause before entering that heid'
Under the terms of the reorganization
loan of 1918 the surplus from the
Salt Gabelle, after meeting all inter
est and amortization charges, should be
handed over to China. Previous to the
conclusion of that loan, salt was very
important source OF revenue, which
helped to defray the expenses of in
ternal government. The Chinese
placed it under foreign control, be-
cause they believed that the compact
would be lived up to. The revenue IS
collected and deposited in the banks
of the fve-power group until 1t is dis
posed of. Recently Japan refused to
hand over the surplus for 1915 for no
valid reason, while the other Allies
were doubtful as to what course to
take. France refused to pay China
the sums deposited with her for equal
" valid reasons. England and Russia,
instead Of prevailing upon japan ana
France to do the right thing, simply
kept back their shares, because the
others had not paid. In the mean
while, the government in China has
been suffering actually from want OF
funds to carry on the daily routine OF
administration.