The New York herald., 1921-11-20

Special Correspondent to the JiU Shinpo,
Toxic.
Special Despatch to THE New York HERALD.
New York Herald Bureau,
Washington, ID. c., Nov. ID.
1t is all very well for us to hitch our
wagon to the star, but we must see to it
that the wagon is sound.
In examining the Chinese memoran-
dunn now before the conference. one feels
that China has hitched her wagon to the
star. The inevitable question is: rs
China sound?"
Critics certainly are not lacking who
think China not only unsound. but rot
ten, and rotten to the core. Critical
observers like j. o. p. Bland are dead
sure about It.
Such extreme views cannot be shared
by sympathetic critics We think that
China, in spite OF many deadly symp-
toms, is not hopelessly sick. With the
sympathetic assistance of friendly ma
tions, of which America must be the
leader China may turn a new leaf and
become a united orderly and organized
nation.
China herself must admit that foreign
assistance is absolutely necessary for her
| regeneration. Her memorandum in
savors OF foreign interference. But she
must know that foreign supervision in
| some of her administrative branches has
| conferred a great material benefit upon
her.
One of the most difficult problems for
| China Is the readjustment of her fl
4 nances It is matter of common
knowledge that the Government at Pc
| kin has for years been upon the verge
| of bankruptcy.
| To-day the monthly deficit OF the
| Chinese Government amounts to S9O00,-
000. It's foreign debt, making due allow
| ance for the recent fall in foreign eX-
change, exceeds s200o000. 900.
4 With deficit of 80 900 900 every month
how does the Chinese Government man.
age to continue its existence? In the
| past is has existed mainly, almost en-
trely, by borrowing foreign cash in the
most reckless manner. 1t has been
ready to offer almost any concession
for ready cash, for that has been the
only means by which the Government
could eke out an existence. Foreign
money lenders. including Japanese, have
We'd with one another in taking advan-
tage of this condition and offered money
| for railway and mining concessions.
| Fortunately or unfortunately for China,
the advent Of the new international
consortium has put an end to reckless
money borrowing on the part OF the
Chinese Government. The Interested
| Powers have agreed not TO compete with
one another in advancing loans to
| China The international bankers think
1t uiiwse under the present chaotic
conditions in China, to make loans to
/ Pekin. The result is that the Chinese
Government is at it's wits end. / have
before me the China year book FOR 1921
%. 1t says:
"The reorganization or the whole
financial system of China. admitted by
common consent to be a pressing neces-
sity, still meets with the insuperable
difficulties, of which the unsettled con-
dition of the country is not the least.
Ever since the Chang Hsun coup in
1917, the authority OF the central Gov
ernment has been merely nominal even
in those provinces which still recognize
their allegiance to Pekin. Little or no
revenue, other than that under foreign
control, ever finds it's way from the
provinces to Pel<in. on the contrary.
the Government is constantly black
mailed by Tuchuns and -ilitarists for
funds with which to pacify their huge
standing armies, the pay of which is
always in arrears"
That is the financial condition which
OF the Interested nations sit at the con-
ference table at Washington and listen
TO the high aspirations voiced by Chinas
delegates. How are the friendly Powers
going to meet that condition? II must
be met somehow IL their professed de-
sire to help China means anything.
One thing the nations may do for
China Mt this conference is the cancella-
tion of the balance q. the Boxer indem-
nifty That win rell~ 4. China OF a yearly
payment or some ss.s77,00o.
Another. thing the conference may do
Is TO raise the customs tariff. Chlna's
annual receipts from import duties
amount to some s22,50O.0o0. II the pres
ent tariff, which was fixed more than
twenty years ago. is revised equitably,
that revenue will increase at least to
s5o00o,0oo;