New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-11-26
Plans to Obtain Complete
Control of Military
Organization
Arms Alliance
Deal Under Way
Pro.Japanese Government
Aiding in Outwitting
Other Powers
By Nathaniel Pfefer

America over the ISM pronouncemehI
Of Japanese Monroe Doctrine for
China rings sardonically academic.
For VIC have seen in the last six
months Japan slowly and steadily clos
ing a grip on China far more secure
than any tenuous political doctrine
could give it.
That grip will soon be wellnigh
closed. There is being concluded now
loan which gives Japan the heart of
the Twenty-one Demands Of 1915, the
substance of Group V. which the pub
lie opinion of the world forced it TO
relinquish then-the control of China's
military organization.
The whole story Of the politics and
diplomacy of the Far East in the last
six months is summed up in the word
loans. Since China entered the war
events of political Importance have
centred around the effort of Japan to
break through the Bank Consortium,
which consists of the financial interests
OF Great Britain, France, Russia and
itself, Germany now being out. BY the
agreement entered into by the Con-
sortium banks, the bank of none of the
powers involved can make loans to
China for political purposes except
through the Consortium. In their eff
fort to break through that agreement
the japanese have failed, with conse-
quent bitterness that has not been
realized in Europe or America.
But they have opened up another
avenue, that of the industrial loan.
There is nothing in the Consortium
agreement that forbids the making of
loans by the banks of any one power
FOR industrial purposes. And the ia
panese have discovered that with a
compliant government in Picking the
word industrial can cover a multitude
of purposes. And industrial loans,
strategically placed and guaranteed by
the borrowing government, can give
dominance as effectually as political
loans or political doctrines.
Ministers Openly PrO-Japanese
The government in Picking has been
more than compliant. When it first
came into power last July it was
charged that it was made up Of pro-
japanese elements. That charge has
since been substantiated. 1t is a mat
ter of general recognition in China
now. There are in the present Cabinet
two dominant personalities.
They are Tsao Ju-lin, Minister of
Communication and head of the pow
erful party known as the Chiaotung
cliqure, and LANG Chi-chiao, Minister
Of Finance and head of the party known
as the Chiuputang. Both are openly,
deliberately and thoroughly pro-Ja-
panese, Tsao being even Japanese-con-
trolled. And those two men not only
dominate the government, through an
indolent and politically ignorant Pre-
mier. but actually direct the two de-
partments through which nearly all i'm
portant loans are placed.
There has been as a result shower
of loans granted to Japan, and that
Notwithstanding the fact that with the
present exchange between gold and sill
yer China loses from % to 40 per cent
Of the face value of each loan.
One of the largest of the Chinese
banks, the Bank of Communications,
and one of the strategic railways in
Manchuria, the Kirin-Changchun line,
have been pawned on usurious terms
that virtually assure their ultimate re-
version to Japan, the government be-
ing compelled to act as guarantor.
supposedly joint project for a steel
mill to be located in Japan-China to
supply the raw material at half the
market price -- practically completes
Japanese control of the Han Yeh Ping
Iron and Coal Company, the largest
of its kind in China. Another project
is under way for "joint" exchange
bank to be located in China.
Gaining Control of hrsenals
The most sinister, however, is the
so-called Arms Alliance loan, negotia-
tons for which are now nearing con-
clusion. One of the salient articles In
Group V of the demands Of 1915 was
that China should purchase from Japan
at least so per cent of its munitions
of war: that a Chinese-Japanese joint
" worked arsenal be established in
China. and that Japanese experts and
Japanese material be used in all
Chinese arsenals.
The import Of that was obvious. To-
cether with the employment of Japan
csc military advisers and the estab
lishment of Japanese police stations
throughout the country, il would have
nut China a. the mercy Of the Toxic
War Office. And because il was SO
obvious Japan was forced TO withdraw
all the demands in Group V.
But Toxic is now working in a sub
tier way to achieve that end. The ex-
act terms Of the arms loan now being
negotiated are not known. Ostensibly
il is an arms unification measure. That
il China is to borrow certain sum
-s15,O 900 900 is the first amount, il is
reported which to purchase mu-
nitions from what is known as the
Tai ping Company, a Japanese corpora
ton In order that there should be
uniform equipment throughout the
Chinese army and navy. more money
will be borrowed from time to time to
eouin all Of China's military force. And
in return China shall supply Japan
with all the raw materials for the
manufacture OF munitions.
To Reorganize Chinese Army
But the plan goes further. The Jap
anese press, including those papers
that are known TO be government or
cans. is running over with significant
ioroscopes. II is interesting, incident
aIIv that most Of the news of the loan
is coming out in the japanese papers.
The Tokio "Asahi" in an official inter
view natlv says that the complete re-
organization Of ChIna's army is con
iemplated. A model army is to be
formed modern in every sense. IL
will have modern equipment, supplied
from Japan; it Is TO have modern