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The fight for the republic in China

B. L. Putnam Weale · 1917 · Scanned text · Free in the US

153,982 words · about 10 h 47 min to read

Period artwork: Interior of the Bodleian Library, 1845
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About this book

Author
B. L. Putnam Weale
Language
English
Published
1917
Length
153,982 words · about 10 h 47 min
Sections
37 reader sections
Text
Scanned text, read from page scans by OCR; may contain errors
Rights
Public domain in the United States

 

Contents (37)
  1. Front matter under 1 min
  2. Preface about 2 min
  3. Contents about 4 min
  4. Chapter I General Introduction about 25 min
  5. Chapter II The Enigma Of Yuan Shih-kai about 21 min
  6. Chapter III The Dream Eepublic about 23 min
  7. Chapter IV The Dictatoe At Work about 15 min
  8. Chapter V The Factoe Of Japan about 21 min
  9. Chapter VI The Twenty-one Demands about 45 min
  10. Chapter VII The Origin Of The Twenty-one Demands about 3 min
  11. Part I. The Eukopean War And The Chinese Question about 28 min
  12. Chapter VIII The Monarchist Plot about 41 min
  13. Chapter IX The Monaechy Plot about 25 min
  14. Chapter X The Monaechy Movement Is Opposed about 40 min
  15. Chapter XI The Dream Empire about 27 min
  16. CHAPTER XII "the third revolution" about 17 min
  17. CHAPTER XIII "the third revolution" (Continued) about 31 min
  18. Chapter XIV The New Regime, — From 1916 To 1917 about 25 min
  19. Chapter XV about 21 min
  20. Chapter XVI China And The War about 1 h 19 min
  21. Chapter XVII about 33 min
  22. II about 6 min
  23. Appendix about 1 min
  24. Chapter I. General Provisions about 2 min
  25. Chapter III. The National Council about 4 min
  26. Chapter V. Members Op The Cabinet under 1 min
  27. Chapter VI. The Judiciary about 4 min
  28. CHAPTER I. THE NATION ,; w' -*'•'"*'' about 2 min
  29. Chapter III. The President about 4 min
  30. Chapter V. The Administration about 1 min
  31. Chapter VI. The Judiciary about 1 min
  32. Chapter VII. The Tsan Cheng Yuan about 2 min
  33. Chapter IX. Procedure Of Constitution Making about 1 min
  34. Chapter X. Appendix about 37 min
  35. Chapter II. National Territory about 2 min
  36. Chapter. IV. The National Assembly about 4 min
  37. CHAPTER VI. THE PRESmENT about 52 min

Continue:

Front matter

aass_nSJI15_ y

THE FIGHT FOR THE REPUBLIC IN CHINA

BOOKS BY B. L. PUTNAM WEALE

Preface

This volume tells everything that the student or the casual reader needs to know about the Chinese Question. It is sufficiently exhaustive to show very clearly the new forces at work, and to bring some realisation of the great gulf which separates the thinking classes of to-day from the men of a few years ago; whilst, at the same time, it is sufficiently condensed not to overwhelm the reader with too great a multitude of facts.

Particular attention may be devoted to an unique feature — namely, the Chinese and Japanese documentation which affords a sharp contrast between varying types of Eastern brains. Thus, in the Memorandum of the Black Dragon Society (Chapter VII) we have a very clear and illuminating revelation of the Japanese political mind which has been trained to consider problems in the modern Western way, but which remains saturated with theocratic ideals in the sharpest conflict with the Twentieth Century, In the pamphlet of Yang Tu (Chapter VIII) which launched the ill-fated Monarchy Scheme and contributed so largely to the dramatic death of Yuan Shih-kai, we have an essentially Chinese mentality of the reactionary or corrupt type which expresses itself both on home and foreign issues in a naively dishonest way, helpful to future diplomacy. In the Letter of Protest (Chapter X) against the revival of Imperialism written by Liang Ch'i-chao — the most brilvi PREFACE

liant scholar living — we have a Chinese of the New or Liberal China, who in spite of a complete ignorance of foreign languages shows a marvellous grasp of poHtical absolutes, and is a harbinger of the great days which must come again to Cathay. In other chapters dealing with the monarchist plot we see the official mind at work, the telegraphic despatches exchanged between Peking and the provinces being of the highest diplomatic interest. These documents prove conclusively that although the Japanese is more practical than the Chinese — and more concise — there can be no question as to which brain is the more fruitful.

Coupled with this discussion there is much matter giving an insight into the extraordinary and calamitous foreign ignorance about present-day China, an ignorance which is just as marked among those resident in the country as among those who have never visited it. The whole of the material grouped in this novel fashion should not fail to bring conviction that the Far East, with its 500 millions of people, is destined to play an important role in posthellum history because of the new type of modern spirit which is being there evolved. The influence of the Chinese Republic, in the opinion of the writer, cannot fail to be ultimately world-wide in view of the practically unlimited resources in man-power which it disposes of.

In the Appendices will be found every document of importance for the period of under examination, — 1911 to 1917. The writer desires to record his indebtedness to the columns of The Peking Gazette, a newspaper which under the briUiant editorship of Eugene Ch'en — a pure Chinese born and educated under the British flag — has fought consistently and victoriously for Lib-

PREFACE vu eralism and Justice and has made the RepubHc a reality to countless thousands who otherwise would have refused to believe in it.

Putnam Weale.

Peking, June, 1917.

Contents

CHAPTER y^jjj.

L, I General Introduction ......... 1

m The Enigma of Yuan Shih-kai . . ... . . gi

Chapter I General Introduction

The revolution which broke out in China on the 10th October, 1911, and which was completed with the abdication of the Manchu Dynasty on the 12th February, 1912, though acclaimed as highly successful, was in its practical aspects something very different. With the proclamation of the Republic, the fiction of autocratic rule had truly enough vanished; yet the tradition survived and with it sufficient of the essential machinery of Imperialism to defeat the nominal victors until the death of Yuan Shih-kai.

The movement to expel the Manchus, who had seized the Dragon Throne in 1644 from the expiring Ming Dynasty, was an old one. Historians are silent on the subject of the various secret plots which were always being hatched to achieve that end, their silence being due to a lack of proper records and to the difficulty of establishing the simple truth in a country where rumour reigns supreme. But there is little doubt that the famous Ko-lao-hui, a Secret Society with its headquarters in the remote province of Szechuan, owed its origin to the last of the Ming adherents, who after waging a desperate guerilla warfare from the date of their expulsion from Peking, finally fell to the low level of inciting assassinations and general unrest in the vain hope that they might some day regain their heritage. At least, we know one thing definitely: that the attempt on the life of the Emperor Chia Ching in the Peking streets at the beginning of the Nineteenth Century was a Secret Society plot, and brought to an abrupt end the pleasant habit of travelling among their subjects which the great Manchu Emperors K'anghsi and Ch'ien Lung had inaugurated and always pursued and which had so largely encouraged the growth of personal loyalty to a foreign House.

From that day onwards for over a century no Emperor ventured out from behind the frowning Walls of the Forbidden City save for brief annual ceremonies such as the Worship of Heaven on the occasion of the Winter Solstice, and during the two "flights" — first, in 1860 when Peking was occupied by an Anglo-French expedition and the Court incontinently sought sanctuary in the mountain Palaces of Jehol ; and, again, in 1900, when with the pricking of the Boxer bubble and the arrival of the International relief armies, the Imperial Household was forced along the stony road to faroff Hsianfu.

The effect of this immurement was soon visible; the Manchu rule, which was emphatically a rule of the sword, was rapidly so weakened that the emperors became no more than rots faineants at the mercy of their

ministers.^ The history of the Nineteenth Century is

1 As there is a good deal of misunderstanding on the subject of the Manchus an explanatory note is useful.

The Manchu people, who belong to the Mongol or Turanian Group, number at the maximum five million souls. Their distribution at the time of the revolution of 1911 was roughly as follows: In and around Peking say two millions; in posts through China say one-half million, — or possibly thus logically enough the history of successive collapses. Not only did overseas foreigners openly thunder at the gateways of the empire and force an ingress, but native rebellions were constant and common. Leaving minor disturbances out of account, there were during this period two huge Mahommedan rebellions, besides the cataclysmic Taiping rising which lasted ten years and is supposed to have destroyed the unbelievable total of one hundred million persons. The empire, torn by internecine warfare, surrendered many of its essential prerogatives to foreigners, and by accepting the principle of extraterritoriahty prepared the road to ultimate collapse.

How in such circumstances was it possible to keep alive absolutism? The answer is so curious that we must be explicit and exhaustive.

The simple truth is that save during the period of vigour immediately following each foreign conquest I (such as the Mongol conquest in the Thirteenth Century and the Manchu in the Seventeenth) not only has there never been any absolutism properly so-called in China, but that apart from the most meagre and inefficient taxcollecting and some rough-and-ready policing in and around the cities there has never been any true govern-

three-quarters of a million; in Manchuria Proper — ^the home of the race — say two or two and a half millions. The fighting force was composed in this fashion: When Peking fell into their hands in 1644 as a result of a stratagem combined with dissensions among the Chinese themselves, the entire armed strength was re-organized in Eight Banners or Army Corps, each corps being composed of three racial divisions, (1) pure Manchus, (9) Mongols who had assisted in the conquest and (3) Northern Chinese who had gone over to the conquerors. These Eight Banners, each commanded by an "iron-capped" Prince, represented the authority of the Throne and had their headquarters in Peking with small garrisons throughout the provinces at various strategic centres. These garrisons had entirely ceased to have any value before the 18th Century had closed and were therefore purely ceremonial and symbolic, all the fighting being done by special Chinese corps which were raised as necessity arose.

ing at all save what the people did for themselves or what they demanded of the officials as a protection against one another. Any one who doubts these statements has no inkling of those facts which are the crown as well as the foundation of the Chinese group-system, and which must be patiently studied in the village-life of the country to be fitly appreciated. To be quite frank, absolutism is a myth coming down from the days of Kublai Khan when he so proudly built his Khanhaligh (the Cambaluc of Marco Polo and the forebear of modern Peking) and filled it with his troops who so soon vanished like the snows of winter. An elaborate pretence, a deliberate pohcy of make-believe, ever since those days invested Imperial Edicts with a majesty which they have never really possessed, the effacement of the sovereign during the Nineteenth Century contributing to the legend that there existed in the capital a Grand and Fearful Panjandi'um for whom no miracle was too great and to whom people and officials owed trembling obedience.

In reality, the office of emperor was never more than a politico-religious concept, translated for the benefit of the masses into socio-economic ordinances. These pronouncements, cast in the form of periodic homilies called Edicts, were the ritual of government ; their purpose was instructional rather than mandatoiy; they were designed to teach and keep alive the State-theory that the Emperor was the High Priest of the Nation and that obedience to the morality of the Golden Age, which had been inculcated by all the philosophers since Confucius and Mencius flourished twenty-five centuries ago, would not only secure universal happiness but contribute to national greatness.

The office of Emperor was thus heavenly rather than terrestrial, and suasion, not arms, was the most potent argument used in everyday life. The amazing reply (i. e., amazing to foreigners) made by the great Emperor K'ang-hsi in the tremendous Eighteenth Century controversy between the Jesuit and the Dominican missionaries, which ruined the prospects of China's ever becoming Roman Cathohc and which the Pope refused to accept — that the custom of ancestor-worship was political and not religious — ^was absolutely correct, politics in China under the Empire being only a system of national control eocercised by inculcating obedience to forebears. The great efforts which the Manchus made from the end of the Sixteenth Century (when they were still a small Manchurian Principality striving for the succession to the Dragon Throne and launching desperate attacks on the Great Wall of China) to receive from the Dalai Lama, as well as from the lesser Pontiffs of Tibet and Mongolia, high-sounding religious titles, prove conclusively that dignities other than mere possession of the Throne were held necessary to give solidity to a reign which began in militarism and which would collapse as the Mongol rule had collapsed by a mere Palace revolution unless an effective moral title were somehow won.

Nor was the Manchu military Conquest, even after they had entered Peking, so complete as has been represented by historians. The Manchus were too small a handful, even with their Mongol and Chinese auxiliaries, to do more than defeat the Ming armies and obtain the submission of the chief cities of China. It is well-known to students of their administrative methods, that whilst they reigned over China they ruled only in company with the Chinese, the system in force being a dual control which, beginning on the Grand Council and in the various great Boards and Departments in the capital, proceeded as far as the provincial chief cities, but stopped short there so completely and absolutely that the huge chains of villages and burgs had their historic autonomy virtually untouched and lived on as they had always lived. The elaborate system of examinations, with the splendid official honours reserved for successful students which was adopted by the Dynasty, not only conciliated Chinese society but provided a vast body of men whose interest lay in maintaining the new conquest; and thus Literature, which had always been the door to preferment, became not only one of the instruments of government, but actually the advocate of an alien rule. With their persons and properties safe, and their women-folk protected by an elaborate set of capitulations from being requisitioned for the harems of the invaders, small wonder if the mass of Chinese welcomed a firm administration after the frightful disorders which had torn the country during the last days of the Mings.*

It was the foreigner, arriving in force in China after the capture of Peking and the ratification of the Tientsin Treaties in 1860, who so greatly contributed to making the false idea of Manchu absolutism current throughout the world ; and in this work it was the foreign diplomat, coming to the capital saturated with the tradition of European absolutism, who played a not unimportant

iThis most interesting point — the immunity of Chinese women from forced marriage with Manchus — has been far too little noticed by historians though it throws a flood of light on the sociological aspects of the Manchu conquest. Had that conquest been absolute it would have been impossible for the Chinese people to have protected their womenfolk in such a significant way.

part. Investing the Emperors with an authority with which they were never really clothed save for ceremonial purposes (principally perhaps because the Court was entirely withdi'awn from view and very insolent in its foreign intercourse) a conception of High Mightiness was spread abroad reminiscent of the awe in which Eighteenth Century nabobs spoke of the Great Mogul of India. Chinese officials, quickly discovering that their easiest means of defence against an irresistible pressure was to take refuge behind the august name of the sovereign, played their role so successfully that until 1900 it was generally believed by Europeans that no other form of government than a despotism sans phrase could be dreamed of. Finding that on the surface an Imperial Decree enjoyed the majesty of an Ukaze of the Czar, Europeans were ready enough to interpret as best suited their enterprises something which they entirely failed to construe in terms expressive of the negative nature of Chinese civilization ; and so it happened that though the government of China had become no government at all from the moment that extraterritoriality destroyed the theory of Imperial inviolability and infallibility, the miracle of turning state negativism into an active governing element continued to work after a fashion because of the disguise which the immense distances afforded.

Adequately to explain the philosophy of distance in China, and what it has meant historically, would require a whole volume to itself; but it is sufficient for our purpose to indicate here certain prime essentials. The old Chinese were so entrenched in their vastnesses that without the play of forces which were supernatural to them, i. e., the steam-engine, the telegraph, the armoured warvessel, etc., their daily lives could not be affected. Left to themselves, and assisted by their own methods, they knew that blows struck across the immense roadless spaces were so diminished in strength, by the time they reached the spot aimed at, that they became a mere mockery of force; and, just because they were so valueless, paved the way to effective compromises. Being adepts in the art which modern surgeons have adopted, of leaving wounds as far as possible to heal themselves, they trusted to time and to nature to solve political differences which western countries boldly attacked on very different principles. Nor were they wrong in their view. From the capital to the Yangtsze Valley ( which is the heart of the country), is 800 miles, that is far more than the mileage between Paris and Berlin. From Peking to Canton is 1,400 miles along a hard and difficult route; the journey to Yunnan by the Yangtsze river is upwards of 2,000 miles, a distance greater than the greatest march ever undertaken by Napoleon. And when one speaks of the Outer Dominions — Mongolia, Tibet, Turkestan — for these hundreds of miles it is necessary to substitute thousands, and add there to difficulties of terrain which would have disheartened even Roman Generals.

Now the old Chinese, accepting distance as the supreme thing, had made it the starting-point as well as the end of their government. In the perfected viceregal system which grew up under the Ming Dynasty, and which was taken over by the Manchus as a sound and admirable governing principle, though they superimposed their own military system of Tartar Generals, we have the plan that nullified the great obstacle. Authority of every kind was delegated by the Throne to various distant governing centuries in a most complete and sweeping manner, each group of provinces, united under a viceroy, being in everything but name so many independent linked commonwealths, called upon for matricular contributions in money and grain but otherwise left severely alone.^ The chain which bound provincial China to the metropolitan government was therefore in the last analysis finance and nothing but finance; and if the system broke down in 1911 it was because financial reform — to discount the new forces of which the steam engine was the symbol — had been attempted, like military reform, both too late and in the wrong way, and instead of strengthening, had vastly weakened the authority of the Throne. ; In pursuance of the reform-plan which became popular after the Boxer Settlement had allowed the court to return to Peking from Hsianfu, the viceroys found their most essential prerogative, which was the control of the provincial purse, largely taken from them and handed over to Financial Commissioners who were directly responsible to the Peking Ministry of Finance, a Department which was attempting to replace the

1 A very interesting proof — and one that has never been properly exposed — 'Of the astoundingly rationalistic principles on which the Chinese polity is founded is to be seen in the position of priesthoods in China. Unlike every other civilization in the world, at no stage of the development of the State has it been necessary for religion in China to intervene between the rulers and the ruled, saving the people from oppression. In Europe without the supernatural barrier of the Church, the position of the common people in the Middle Ages would have been intolerable, and life, and virtue totally unprotected. Buckle, in his "History of Civilization," like other extreme radicals, has failed to understand that established religions have paradoxically been most valuable because of their vast secular powers, exercised under the mask of spiritual authority. Without this ghostly restraint rulers would have been so oppressive as to have destroyed their peoples. The two greatest monuments to Chinese civilization, then consist of these twin facts; first, that the Chinese have never had the need for such supernatural restraints exercised by a privileged body, and secondly, that they are absolutely without any feeling of class or caste — prince and pauper meeting on terms of frank and humorous equality — the race thus being the only pure and untinctured democracy the world has ever known.

loose system of matricular contributions by the European system of a directly controlled taxation every penny of which would be shown in an annual Budget j No doubt had time been vouchsafed, and had European help been enlisted on a large scale, this change could ultimately have been made successful. But it was precisely time which was lacking; and^the Manchus consequently paid the penalty which is always paid by those who delay until it is too late. The old theories having been openly abandoned, it needed only the promise of a Parliament completely to destroy the dignity of the Son of Heaven, and to leave the viceroys as mere hostages in the hands of rebels. A few short weeks of rebellion was sufficient in 1911 to cause the provinces to revert to their condition of the earlier centuries when they had been vast unfettered agricultural communities. And once they had tasted the joys of this new independence, it was impossible to conceive of their becoming "obedient" again.

Here another word of explanation is necessary to show clearly the precise meaning of regionahsm in China.

What had originally created each province was the chief city in each region, such cities necessarily being the walled repositories of all increment. Greedy of territory to enhance their wealth, and jealous of their power, these provincial capitals throughout the ages had left no stone unturned to extend their influence in every possible direction and bring under their economic control as much land as possible, a fact which is abundantly proved by the highly diversified system of weights and measures throughout the land deliberately drawn-up to serve as economic barriers. River-courses, mountain-ranges, climate and soil, no doubt assisted in governing this expansion, but commercial and financial greed was the principal force. Of this we have an exceedingly interesting and conclusive illustration in the struggle still proceeding between the three Manchurian provinces, Fengtien, Kirin and Heilungchiang, to seize the lion's share of the virgin land of Eastern Inner Mongolia which has an "open frontier" of rolling prairies. Having the strongest provincial capital — Moukden — it has been Fengtien province which has encroached on the Mongolian grasslands to such an extent that its jurisdiction to-day envelops the entire western flank of Kirin province (as can be seen in the latest Chinese maps) in the form of a salamander, effectively preventing the latter province from controlling territory that geographically belongs to it. In the same way in the land-settlement which is still going on the Mongolian plateau immediately above Peking, much of what should be Shansi territory has been added to the metropolitan province of Chihli. Though adjustments of provincial boundaries have been summarily made in times past, in the main the considerations we have indicated have been the dominant factors in determining the area of each unit.

Now in many provinces where settlement is age-oid, the regionalism which results from great distances and bad communications has been greatly increased by raceadmixture. Canton province, which was largely settled by Chinese adventurers sailing down the coast from the Yangtsze and intermarrying with Annamese and the older autochthonous races, has a population-mass possessing very distinct characteristics, which sharply conflict with Northern traits. Fuhkien province is not only as diversified but speaks a dialect which is virtually a foreign language. And so on North and West of the Yangtsze it is the same story, temperamental differences of the highest political importance being everywhere in evidence and leading to perpetual bickerings and jealousies. For although Chinese civilization resembles in one great particular the Mahommedan religion, in that it accepts without question all adherents irrespective of racial origin, politically the effect of this regionalism has been such that up to very recent times the Central Government has been almost as much a foreign government in the eyes of many provinces as the government of Japan. Money alone formed the bond of union; so long as questions of taxation were not involved, Peking was as far removed from daily life as the planet Mars. As we are now able to see very clearly, fifty years ago — that is at the time of the Taiping Rebellion — the old power and spell of the National Capital as a military centre had really vanished. Though in ancient days horsemen armed with bows and lances could sweep like a tornado over the land, levelling everything save the walled cities, in the Nineteenth Century such methods had become impossible. Mongoha and Manchuria had also ceased to be inexhaustible reservoirs of warlike men; the more adjacent portions had become commercialized; whilst the outer regions had sunk to depopulated graziers' lands. The Government, after the collapse of the Rebellion, being greatly impoverished, had openly fallen to balancing province against province and personality against personality, hoping that by some means it would be able to regain its prestige and a portion of its former wealth. Taking down the ledgers containing the lists of provincial contributions, the mandarins of

Peking completely revised every schedule, redistributed every weight, and saw to it that the matricular levies should fall in such a way as to be crushing. The new taxation, likin, which, like the income-tax in England, is in origin purely a war-tax, by gripping inter-provincial commerce by the throat and rudely controlling it by the barrier-system, was suddenly disclosed as a new and excellent way of making felt the menaced sovereignty of the Manchus; and though the system was plainly a two-edged weapon, the first edge to cut was the Imperial edge; that is largely why for several decades after the Taipings China was relatively quiet.

Time was also giving birth to another important development — important in the sense that it was to prove finally decisive. It would have been impossible for Peking, unless men of outstanding genius had been living, to have foreseen that not only had the real bases of government now become entirely economic control, but that the very moment that control faltered the central government of China would openly and absolutely cease to be any government at all. Modern commercialism, already invading China at many points through the medium of the treaty-ports, was a force which in the long run could not be denied. Every year that passed tended to emphasize the fact that modern conditions were cutting Peking more and more adrift from the real centres of power — the economic centres which, with the single exception of Tientsin, lie from 800 to 1,500 miles away. It was these centres that were developing revolutionaiy ideas — i. e., ideas at variance with the Socio-economic principles on which the old Chinese commonwealth had been slowly built up, and which foreign dynasties such as the Mongol and the Manchu had never touched.^ The Government of the post-Taiping period still imagined that by making their hands lie more heavily than ever on the people and by tightening the taxation control — not by true creative work — they could rehabilitate themselves.

It would take too long, and would weary the indulgence of the reader to establish in a conclusive manner this thesis which had long been a subject of inquiry on the part of political students. Chinese society, being essentially a society organized on a credit-co-operative system, so nicely adjusted that money, either coined or fiduciary, was not wanted save for the petty daily purchases of the people, any system which boldly clutched at the financial establishments undertaking the movement of sycee (silver) from province to province for the settlement of trade-balances, was bound to be effective so long as those financial establishments remained unshaken.

The best known establishments, united in the great group known as the Shansi Bankers, being the government bankers, undertook not only all the remittances of surpluses to Peking, but controlled by an intricate passbook system the perquisites of almost every officeholder in the empire. No sooner did an official, under the system which had grown up, receive a provincial appointment than there hastened to him a confidential clerk of one of these accommodating houses, who in the name of his employers advanced all the sums necessary for the payment of the official's post, and then proceeded with him to his province so that moiety by moiety, as taxation flowed in, advances could be paid off and the equilibrium re-established. A very intimate and far-reaching connection thus existed between provincial money-interests and the official classes. The practical work of governing China was the balancing of tax-books and native bankers' accounts. Even the "meltinghouses," where sycee was "standardized" for provincial use, were the joint enterprises of officials and merchants; bargaining governing every transaction ; and only when a violent break occurred in the machinery, owing to famine or rebellion, did any other force than money intervene.

There was nothing exceptional in these practices, in the use of which the old Chinese empire was merely following the precedent of the Roman Empire. The vast polity that was formed before the time of Christ by the military and commercial expansion of Rome in the Mediterranean Basin, and among the wild tribes of IsTorthern Europe, depended very largely on the genius of Italian financiers and tax-collectors to whom the revenues were either directly "farmed," or who "assisted" precisely after the Chinese method in financing officials and local administrations, and in replenishing a central treasury which no wealth could satisfy. The Chinese phenomenon was therefore in no sense new; the dearth of coined money and the variety of local standards made the methods used economic necessities. The system was not in itself a bad system : its fatal quality lay in its woodenness, its lack of adaptability, and in its growing w^eakness in the face of foreign competition which it could never understand. Foreign competition — that was the enemy destined to achieve an overwhelming triumph and dash to ruins a hoary survival.

War with Japan sounded the first trumpet-blast which should have been heeded. In the year 1894, being faced with the necessity of finding immediately a large sum of specie for purpose of war, the native bankers proclaimed their total inability to do so, and the first great foreign loan contract was signed/ Little attention was attracted to what is a turning-point in Chinese history. There cannot be the slightest doubt that in 1894 the Manchus wrote the first sentences of an abdication which was only formally pronounced in 1912 : they had inaugurated the financial thraldom under which China still languishes. Within a period of forty months, in order to settle the disastrous Japanese war, foreign loans amounting to nearly fifty-five million pounds were completed. This indebtedness, amounting to nearly three times the "visible" annual revenues of the country — that is, the revenues actually accounted for to Peking — was unparalleled in Chinese history. It was a gold indebtedness subject to all sorts of manipulations which no Chinese properly understood. It had special political meaning and special political consequences because the loans were virtually guaranteed by the Powers. It was a long-drawn coup d'etat of a nature that all foreigners understood because it forged external chains.

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