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Asia at the crossroads

Edward Alexander Powell · 1922 · Scanned text · Free in the US

90,228 words · about 6 h 19 min to read

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

Author
Edward Alexander Powell
Language
English
Published
1922
Length
90,228 words · about 6 h 19 min
Sections
13 reader sections
Text
Scanned text, read from page scans by OCR; may contain errors
Rights
Public domain in the United States

 

Contents (13)
  1. Front matter about 1 min
  2. Foreword about 6 min
  3. Contents about 2 min
  4. Part I Japan about 5 min
  5. II about 23 min
  6. IV about 22 min
  7. VI about 13 min
  8. VII about 5 min
  9. VIII about 5 min
  10. IX about 26 min
  11. Part II Korea about 1 h 20 min
  12. Part III China about 1 h 33 min
  13. Part IV The Philippine Islands about 1 h 37 min

Continue:

Front matter

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Foreword

Most writers on Far Eastern politics make the mistake of crediting their readers with a profounder knowledge of the subject than they in fact possess. They take too much for granted. They talk in terms of algebra instead of arithmetic. On the assumption that those who read their books already understand the meaning of such phrases as "spheres of influence," "extraterritoriality," the Shogunate, the Genro, the tuchuns, the Anfu Club, the Consortium, the Gentlemen's Agreement, the Twenty-one Demands, they make repeated use of them without pausing long enough to explain precisely what they mean. As a result, the casual reader, who usually has only a vague idea of the subject to start with, either becomes bewildered and gives up in despair, frankly admitting that he does not understand what it is all about, or he forms conclusions which, being based on misconceptions, do not agree with the facts.

So, though the shelves of the public libraries sag beneath the volumes that have been written on various phases of Oriental politics, it seems to me that there is still a place for a clear, concise, simply written, unprejudiced explanation of the various problems, political, economic, and financial, which, taken together,

vii viii FOREWORD

form what is commonly referred to as the Far Eastern Question. Therefore, even at the risk of covering ground with which some of my readers are doubtless already familiar, I have endeavored to sketch in outline, using simple, every-day language, the conditions and events which have combined to produce the present complex situation. Those who have the patience to follow me to the end will have gained, I hope, a sound, if rudimentary, understanding of one of the most perplexing subjects in the whole field of international politics.

I am perfectly aware that, so far as the chapters dealing with Japan and China are concerned, this book does not cover much new ground historically, nor is it marked by any special originality of presentation. I am also aware that much of the material has been used repeatedly in recent years by other writers on Japanese and Chinese questions. But, in spite of this, the book has, I believe, the merits of being clear, comprehensive, accurate, and up-to-theminute. It was written, in the main, while the Washington Conference was still in session — an advantage in that it enabled me to discuss the mooted questions with the very men best qualified to discuss them; a disadvantage, perhaps, in that certain of the conditions which I have described, particularly in China, will necessarily be modified by the conferees' decisions.

FOREWORD ix

A certain number of errors inevitably creep into the pages of any book of this nature, no matter how carefully it may be written and edited, but, in order to keep the errors to a minimum, the proof-sheets of the various chapters were submitted for correction to gentlemen who are universally recognized as among the highest authorities on the subjects treated in them. The proofs of the chapters on Japan and Korea were read and corrected by His Highness Prince Tokugawa, President of the Japanese House of Peers, and by His Excellency Baron Shidehara, Japanese Ambassador to the United States, both members of the Japanese Delegation to the Washington Conference, and by the Honorable Roland S. Morris, formerly American Ambassador to Japan. The chapters on China were revised by Dr. J. C. Ferguson, Adviser to the President of the Chinese Republic, a distinguished educator and probably the leading foreign authority on Chinese affairs. The chapters on the Philippines were corrected by the Honorable William H. Taft, Chief Justice of the United States and formerly Governor- General of the Philippine Islands ; by the Honorable Cameron Forbes, also a former governor-general and a member of the Wood-Forbes Mission, and by Major-General Frank Mclntyre, Chief of the Bureau of Insular Affairs. It should be clearly understood, however, that the opinions expressed in the following pages do not necessarily

X FOREWORD

reflect the views, nor in all cases meet with the approval, of the gentlemen in question. The opinions expressed in this book are my own.

Some of the things which I have written will probably give offense to those governments and individuals from whom I received many courtesies. Those who are privileged to speak for governments are fond of asserting that their governments have nothing to conceal and that they welcome honest criticism, but long experience has taught me that when they are told unpalatable truths governments are usually as sensitive and resentful as friends. Yet, were I to attempt to retain the good-will of the governments and officials of the countries under discussion by refraining from unfavorable comment, this book would be little more than propaganda. Perhaps it is too much to expect, but I would like those who showed me so many kindnesses in Japan, China, Korea, and the Philippines to believe that I have leaned backward in an effort to keep these pages free from bias and injustice, that I have tried to tell the truth as I understand it and because I believe that it is to the best interests of all the peoples concerned that the unvarnished truth should be told. If those of my country people who honor me by reading this book obtain from it a clearer understanding of the problems and perplexities which confront our trans-Pacific neighbors, if it teaches them to regard the short-

FOREWORD xi

comings of the peoples of Eastern Asia a little more leniently and their national aspirations a little more sympathetically, then I shall feel that my purpose in writing it has been accomplished.

E. Alexander Powell.

Washington, January, 1922.

AN ACKNOWLEDGMENT

I welcome this opportunity of expressing my appreciation of the innumerable courtesies extended to me by the governments of Japan, Korea, China, and the Philippine Islands, and of the many personal kindnesses shown me by individuals in those countries.

My studies in the Japanese Empire were greatly facilitated by the hearty cooperation of the late Premier Hara, whose tragic death at the hands of an assassin in November, 1921, was a profound shock to all who knew him. For the assistance and hospitality which I received everywhere in Japan and Korea I am also grateful to His Excellency Baron Shidehara, Japanese Ambassador to the United States; to His Highness Prince Tokugawa, President of the House of Peers; to His Excellency Masanao Hanihara, Vice-Minister of Foreign Affairs; to Major-General G. Tanaka, formerly Minister of War ; to His Excellency Admiral Baron Saito, Governor-General of Korea, and to Dr. Kentaro Midzuno, the Vice-Governor-General; to Viscount Kaneko; to Dallas McGrew, Esq., and Frederick Moore, Esq., of the Japanese Foreign Office ; to Dr. T. lyenaga, of New York City; to the Hon. Ransford Miller, American Consul-General at Seoul; and in particular to the

xiii xiv AN ACKNOWLEDGMENT

Hon. Roland S. Morris, formerly American Ambassador to Japan.

Of the many persons who assisted me in China my thanks are due to Dr. J. C. Ferguson, Adviser to the President of the Chinese Republic ; to the Hon. Paul R. Reinsch, formerly American Minister to China; to Ray Atherton, Esq., Secretary of the American Legation at Peking; to I. Tokugawa, Esq., Secretary of the Japanese Legation at Peking; to P. Loureiro, Esq., Assistant Financial Secretary of the Salt Revenue Administration; and to Bertram Lennox-Simpson, Esq. ("Putnam Weale").

For the great trouble to which they put themselves in rendering my visit to the Philippines instructive and enjoyable I am very grateful to the Hon. Francis Burton Harrison, formerly Governor-General of the Philippine Islands; to the Hon. Manuel Quezon, President of the Philippine Senate; to the Hon. Sergio Osmena, Speaker of the House; to the Hon. Frank C. Carpenter, Governor of the Department of Mindanao and Sulu; to the Hon. P. W. Rogers, formerly Governor of Jolo; to Colonel Ralph W. Jones of the Philippine Constabulary; to Major Edwin C. Bopp, Chief of Police of Manila, and to army, scout, and constabulary officers all the way from northern Luzon to Zamboanga.

This also affords me an opportunity to acknowledge my indebtedness for many suggestions and much

AN ACKNOWLEDGMENT xv

valuable material which I have derived from the following sources : "Modern Japan," by A. S. Hershey ; "What Shall I Think of Japan?" by George Gleason; "The Japanese Empire," by Philip Terry; "The Far East Unveiled," by Frederick Coleman; "The New Far East," by T. J. Millard; "The Mastery of the Far East," by Arthur Judson Brown; "China, Japan and Korea," by J. O. P. Bland; "These from the Land of Sinim," by Sir Robert Hart; "China in Transformation," by A. B. Colquhoun; "Peking Dust," by Ellen La Motte; "Modern China," by S. G. Cheng; "Korea," by Angus Hamilton; "In Korea with the Marquis Ito," by George T. Ladd ; "Korea's Fight for Freedom," by F. A. McKenzie; "The Passing of Korea," by H. B. Hm'lbert; "The Truth About Korea," by C. W. Kendall; "The Rebirth of Korea," by Hugh H. Cynn; "The Case for the Filipinos," by Maximo M. Kalaw; "The Philippine Islands and Their People" and "The Philippines, Past and Present," by Dean C. Worcester, and particularly the extremely able despatches of the New York Tribune's Far Eastern correspondent, Mr. Nathaniel Peffer.

E. Alexander Powell.

Contents

PART PAGH

I Japan 3

II Korea 101

Part I Japan

IT is too early by many years to assess at their true value the achievements and failures of the Washington Conference for the Limitation of Armaments. We are standing too near the picture to estimate with accuracy its merits and its faults. But, when history has lent it the justice of perspective, the assembly of nations which convened on the banks of the Potomac in November, 1921, will assuredly be recognized as one of the most remarkable episodes of our time. No matter what else it accomplished, or failed to accomplish, it provided the world with a striking object-lesson in the efficacy, as applied to international relations, of the policy of let's-sit-downand-talk-it-over.

It would be idle to deny that, when the Conference was called by President Harding, Japan was regarded as a potential enemy by a majority of

Americans. I, for one, am convinced that, had the mutual suspicions and misunderstandings of the two peoples been permitted to continue, had their respective governments clung to the policies which they were then pursuing, the situation would have ended in war. Yet their mutual suspicions were so largely allayed, their misunderstandings so successfully composed by the frank discussions which characterized the Conference, that, when it ended, the sentiment of most thoughtful persons, Americans and Japanese, was expressed by Prince Tokugawa, President of the House of Peers, when he said upon his departure from our shores: "The United States has learned that Japan entertains no aggressive designs in the Pacific and Japan has learned that she has nothing to expect from this side of the Pacific except friendly cooperation."

The near-hostility which until recently embittered the relations of the United States and Japan, and which threatened at one time to break into an open sore, was due, I am convinced, not to any inherent ill-will on the part of either people for the other, but to a mutual lack of knowledge and sympathetic understanding. In other words, both Americans and Japanese had shovni themselves unable, or unwilling, to think the other's mind. It was not enough for groups of more or less representative Americans and Japanese to gather about banquet tables and indulge in sonorous protestations of mutual friendship and international good-will, or to cable each other hands-across-the-sea greetings couched in terms of fulsome praise. The possibihties of a cordial relationship and a harmonious cooperation between the two nations are so tremendous, the interests at stake are so vast and far-reaching, the consequences of an armed conflict would be so catastrophic and overwhelming, that it is unthinkable that the two peoples should ever again permit themselves to drift into the frame of mind which existed in both countries prior to the Conference at Washington.

Yet, if such a perilous situation is not again to arise, each people miist make an earnest endeavor to gain a better understanding of the temperament, traditions, ambitions, limitations, and problems of the other, and to make corresponding allowances for them — in short, to cultivate a more tolerant and sympathetic state of mind. Japan is, and probably always will be, one of the most important countries, if not the most important, on our political horizon. Summoned from obscurity by an American commodore, adopting with avidity the devices of Western civilization, advancing as in seven-league boots to her present position as one of the five greatest mihtary and naval powers in the world, our closest competitor in the race for the trade of Eastern Asia, one of our most profitable customers, the key that can lock the Open Door — it is imperative for every American to learn more about this great Ocean Empire on the other side of the Pacific and to obtain a clearer understanding of what has taken place in those nineand-sixty amazing years — less than the span of life which the Scriptures allot to man — since the anchors of Perry's frigates rumbled down in the Bay of Yedo.

The Japanese Question is an extremely complicated one. Its ramifications extend into the realms of politics, industry, commerce, and finance. It stretches across one hundred and fifty degrees of longitude. It affects the lives and destinies of six hundred millions of people. Its roots are to be found as far apart as a Japanese military outpost in Siberia and the headquarters of a labor union in Sacramento, as a Korean village and a Californian farm, as an obscure harbor on the coast of Mexico and a cablestation on a lonely rock in the Pacific, as the offices of a firm of international bankers in Wall Street and the palace of the President of China in the Forbidden City.

To understand algebra, you must have a knowledge of arithmetic. To understand the Japanese Question, you must have at least a rudimentary knowledge of the various factors which have combined to produce it. It grew to its present dimensions so silently, so stealthily, that the average well-informed American has only a vague and frequently erroneous idea of what it is all about. He has read in the newspapers of the anti-Japanese agitation in California, of the Gentlemen's Agreement, of picture-brides.

of mysterious Japanese troop-movements in Siberia, of Japan's "special interests" in Manchuria, of Japanese oppression in Korea, of the Shantung controversy, of the dispute over Yap ; but to him these isolated episodes usually had about as much significance as so many fragments of a complicated jig-saw puzzle. Moreover, the avalanche of information, nearinformation, and misinformation about Japan which filled the columns of the daily papers prior to and during the Washington Conference bewildered rather than enlightened him. Therefore, even at the risk of repeating some facts with which you are doubtless already familiar, I will endeavor to piece the puzzle together, so that you may view the picture in its entirety mid in the light of the Conference's decisions. But, before I proceed, let me make it amply clear that I hold no brief for Japan. I am an American and, because I wish to see my country morally in the right, I deplore the unjust, intolerant, and provocative attitude toward the Japanese adopted by certain elements of our population. I believe that the politician or publicist who deliberately inflames public opinion against a nation with which we are at peace, and with which we wish to remain at peace, is an enemy to the best interests of his country and should be treated as such by all decent citizens. It is to the great mass of reasoning and fair-minded people in both countries, who, I am convinced, wish to learn the unvarnished truth, no matter how unflattering m it may be to their national pride, how disillusionizing, that I address myself. In order that they may have the clearest possible understanding of a situation which vitally concerns the future well-being of both the United States and Japan, I propose, in the following pages, to discard all euphemism and diplomatic subterfuge and to tell as much as possible of "nothing but the truth."

II

Some fruths, more half-truths, many untruths have been said and written in each country about the other. The clear waters of our old-time friendship have been roiled by prejudice and propaganda. Much of our appalling ignorance of Japanese character, aims, and ideals is traceable to our national propensity for generalization — always an inexact and dangerous method of estimating another people, and doubly dangerous in the case of a people as complex as the Japanese. Let us not forget that we were accustomed to think of the French as a volatile, excitable, easy-going, pleasure-obsessed, decadent people until the Mame and Verdun taught us the truth. Such a misconception was deplorable in the case of a people from whom we had nothing to fear ; it is inexcusable, and might well prove disastrous, in the case of the Japanese. I have heard Americans who pride themselves on being well-informed, men whose opinions are listened to with respect, betray ignorance of Japan and of Japanese institutions which would be ludicrous under other conditions.

And the ignorance of many intelligent Japanese in regard to ourselves is no less disheartening. Their way of thinking is not our way of thinking; many of their institutions and ideas and ideals are diametrically different from ours. Believe it or not, as you choose, the great majority of intelligent Japanese are unable to understand our thinly veiled distrust and dislike of them. That many of our people do distrust and dislike the Japanese there can be no gainsaying. Yet the average American usually finds some difficulty in giving for his attitude toward the Japanese a definite and cogent reason. This unreasoning antipathy was illustrated by an educated and charming American woman, who had been traveling in Japan, whom I met on a homeward bound liner.

"How did you like the Japanese?" I asked her.

"I did n't like them," she replied.

"Were you ill-treated in Japan? Did you meet with any discourtesy or injustice?"

"No," she admitted, with some embarrassment. "I have no complaints whatever to make of the treatment I received. I found them universally courteous."

"Then why did n't you hke them?" I persisted.

"Well," she explained, "I just made up my mind before I went to Japan that I was n't going to like the Japanese, and I did n't."

That is an extreme case, I admit, but if you will take the trouble to go into the matter you will find that that is about as cogent a reason as many Americans can offer for their dislike of the people of Nippon.

Underlying all the misunderstandings between the two nations is race prejudice. Our racial antipathy for the Japanese is instinctive. It has its source in the white race's attitude of arrogant superiority toward all non-white peoples. We inherited it, along with our Caucasian blood, from our Aryan ancestors. It is as old as the breed. The Japanese do not realize that they are meeting in this an old, old problem; that the American attitude is not dictated by a wish to place a stigma of inferiority on them, but is merely the application to them of the Caucasian's historic attitude toward all peoples with tinted skins. If the Japanese question this, let them observe the attitude of the Americans resident in the Philippines toward the Filipinos, that of the English toward the natives of India and Egypt, that of the French toward their brown-skinned subjects in Indo-China. But this racial prejudice is by no means one-sided. The Japanese consider themselves as superior to us as we consider ourselves superior to them. Make no mistake about that. The Japanese are by no means free from that racial dislike for Occidentals which lies near to the hearts of all Orientals ; but they have the good sense, good manners, and tact to repress their feelings. That is where they differ from Americans.

Another reason for American dislike of the Japanese is the latter's assertion of equality. We don't call it that, of course. We call it conceit — cockiness. The reason that we get along with another yellow race, the Chinese, is because they, by their abject abasement and submissiveness, flatter our sense of racial superiority. Our pride thus catered to, we give them a condescending pat of approval, such as we would give a negro who always "knows his place," holds his hat in his hand when he addresses a white person, says "sir" and "ma'am," and shows no sign of resenting ill- justice or mistreatment. The Japanese, on the contrary, stands up for his rights; he is not at all humble or submissive or in the least awed by threats, and if an irate American attempts to "put him in his place," as he is accustomed to do with a Chinese or a Fihpino or a negro, he is more likely than not to find himself on the way to jail in the grasp of a small but extremely efficient and unsympathetic policeman.

I asked an American whom I met in Yokohama if he had enjoyed his stay in Japan.

"Not particularly," he answered. "I don't care for the Japs ; give me the Chinese every time."

"Why?" I queried.

He pondered my question for a moment.

"I'll sum it up for you like this," he replied. "The Chinese treat you as a superior; the Japanese treat you as an equal."

Until Commodore Perry opened Japan to western civilization and commerce, we held all Mongolians in contempt, being pleased to consider them as inferior peoples. But in the case of the Japanese this contempt changed in a few years to a patronizing condescension, such as a grown person might have for a precocious and amusing child. We congratulated ourselves on having discovered in the Japanese a sort of infant prodigy ; we took in them a proprietary interest. We watched their rapid rise in the world with almost paternal gratification. And the Japanese flattered our self-esteem by their open admiration and imitation of our methods.

I think that our national antipathy for the Japanese had its beginnings in their victory over the Russians. Up to that time we had looked on the Japanese as a brilliant and ambitious little people whom we had brought to the notice of the world and for whose amazing progress we were largely responsible. But when Japan administered a trouncing to the Russians, who are, after all, fellow-Caucasians, American sentiment performed a volte-face almost overnight. We were as pro-Russian at Portsmouth as we had been pro-Japanese at Port Arthur. This sudden change in our attitude toward them has always mystified the

Japanese. Yet there is really nothing mystifying about it. We were merely answering the call of the blood. As long as we believed Japan to be the under dog, we were for her ; but when she became the upper dog, the old racial prejudice flamed up anew. A yellow people had humbled and humiliated a Caucasian people, and we, as Caucasians, resented it. It was a blow to our pride of race. (A somewhat similar manifestation of racial prejudice was observable throughout the United States when the negro pugilist. Jack Johnson, defeated Jim Jeffries. ) That a yellow race could defeat a white race had never occurred to us, and we were correspondingly startled and alarmed. We abruptly ceased to think of the Japanese as a third-rate nation of polite, well-meaning, and harmless little men, drinkers of tea and wearers of kimonos. They became the Yellow Peril. Though the Japanese are of Asia, they cannot be treated as we are accustomed to treat other Asiatics. To attempt to belittle or patronize a nation that can put into the field three million fighting men and send to sea a battle fleet not greatly inferior to our own, would be as ridiculous as it would be short-sighted. Japan is a striking example to other Oriental races of the power of the Big Stick. She has never been subjugated by the foreigner. In spite of, rather than by the aid of, the white man, she has become one of the Great Powers, and at Versailles helped to shape the destinies of millions of Europeans. Yet when she claims racial equality we deny and resent it. Our refusal to treat the Japanese as equals, while at the same time showing a wholesome respect for the armed might that is behind them, reminds me of an American reserve heutenant, a Southerner, on duty at a cantonment where there was a division of colored troops, who refused to salute a negro captain. He was called before the commanding officer, who gave him his choice between saluting the negro or being tried by court-martial.

"I suppose I '11 have to salute the uniform," he muttered rebelliously, "but damned if I '11 salute the nigger inside it."

HI

I have already said that racial prejudice is at the bottom, the very bottom, of the friction between the two countries. Immediately overlying it is our fear of Japanese economic competition. For, if you will look into it, you will find that there has hardly ever been a conflict between nations into which some economic question has not entered as the final and essential factor. Never was this truer than in the American-Japanese situation. In considering the question of Japanese economic competition, it would seem that Americans fail to realize the extent to which Japanese business is aided,, controlled, and directed by the Japanese Government.

The Japanese business man does not have to fight unaided for foreign trade, as does the American. He has his government solidly behind him. Government-subsidized steamship lines and government-owned railways give him every possible advantage. The government's ambassadors, ministers, consuls, and commercial agents lend him encouragement and assistance. Allied industries support him. Virtually all of the industries of the empire belong to trade guilds, which, like their European prototypes of the Middle Ages, are licensed by the government and are granted special privileges and immunities. In short, the Japanese business man is really a part of a gigantic trust, which differs from our American trusts only in that it is a government instead of a corporation.

The Japanese long since realized that their material resources were greatly inferior to those of other first-class powers, and that the realization of their national ambitions required great wealth as much as a great mihtary establishment. They could not obtain this wealth by agriculture, for not only is Japan a comparatively small country territorially, but not more than fifteen per cent, of its area is capable of profitable cultivation. Moreover, there are already three hundred and fifty inhabitants to the square mile, and the birth-rate, hke the cost of Hving, is steadily rising.

In Japan, as in the United States, to quote the words of a popular song: "The rich get richer and the poor get children." Now the Japanese were fully conscious of the handicap under which they were struggling in their race for wealth and power. So they set about overcoming it by embarking upon a carefully planned campaign of industrial development and commercial expansion which, in its intensity and thoroughness, has no parallel save that which was waged by Germany prior to August, 1914. Perceiving that they could never hope to overtake their Western rivals by wading cautiously into the sea of commercial competition, they resolved to risk everything by plunging boldly into deep water. They risked everything — and they won. By utilizing to the utmost what they already possessed, by taxing themselves until they staggered under the burden, by borrowing from the Occidental nations until their credit was stretched to the breaking-point, by speeding up the industrial machine until it was running twenty-four hours a day and three hundred and sixty-five days a year, by hard work, rigid economy, and self-denial, they succeeded in raising the huge sums which they required for mills, factories, and powerplants, for railway and steamship hues, for docking and terminal facilities, for postal and telegraph systems. To-day, as a result of their courage and amazing energy, the Japanese are running neck-and-neck with the United States and England in the race for the commerce of the world. They are making matches at a price that has virtually closed the Asiatic markets to their Western competitors. They can deliver sashes, doors, blinds, and woodenware in North and South America at so low a rate that our manufacturers would be driven out of business were it not for the protection afforded by our tariif wall. Though the Japanese do not themselves grow large quantities of cotton, they purchase the poorer and cheaper grades of the raw material in India and Egypt, transport it by their government-subsidized steamers and government-owned railways to their government-assisted factories, where, as the result of low wages and long hours, it is spun into piece goods which are sold to the cotton-clad millions of the East at prices with which American and British manufacturers are finding profitable competition almost out of the question.

In competing with Western nations for the trade of the Orient, Japan possesses several important advantages. Government control of transportation lines by land and sea, government subsidies and bounties, and, in the trade with Asia, short hauls, are vital factors. The Japanese are so near to the great, rich markets of the Asian mainland that they can fill orders from Eastern Siberia, Korea, Manchuria, and Eastern China before the American manufacturer could get his shipment aboard a vessel at San Francisco or Seattle. Furthermore, it is a cardinal principle of Japanese commercial policy to constantly keep in touch with the changing tastes and fashions of their Asiatic customers and to give them exactly what they want, which American manufacturers, all too frequently, do not. It must also be kept in mind that the Japanese Government and the Japanese manufacturers work hand in hand in furthering their commercial ambitions. Several of the greatest industrial enterprises in Japan, as I shall show further on, are controlled directly or indirectly by the government, large blocks of stock being held by members of the imperial family and by high officials. Struggling enterprises are frequently assisted by government bounties, and money at low rates of interest is often loaned for the same purpose. The principal Japanese steamship lines are so liberally subsidized by the government, and pay their seamen such low wages, that it is impossible for American-owned vessels, with highly-paid white crews and no government subsidies, to compete with them. As a result, the carrying trade of the Pacific is in Japanese hands. Thus it will be seen that, in their struggle for the trade of the Orient, American firms are not merely competing against Japanese firms. In effect, they are competing against the Japanese Government.

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