China continues to be the high point of interest in the Asiatic world, but a point still enwrapped in China clouds. Arthur Ransome, who is writing the sanest articles from that country just at present, as he frequently has from Russia in the past, says that the radical Nationalist group at Hankow is held together mainly by the English language a curious paradox in that centre of anti-British propaganda. 'For all they that take the sword shall perish with the sword' is strikingly confirmed by the last two years' history in China. Britain's misfortunes there for she has lost more in pounds sterling and prestige than any other nation - date from Shanghai's 'Boston Massacre' two years ago, and the bombardment of Wanhsien last September. On the other hand, the Kuomintang's successful progress northward has been checked and its forces have been demoralized by the atrocities committed by its soldiers at Nanking last March. After falling out with Chiang Kai-shek, the Hankow Junta is said to have invited the Christian General, Feng Yu-hsiang, to come down from the Northwest to head its forces. But if that was ever contemplated, the decision was quickly revoked, and General Feng's emissaries at Hankow have been arrested. Some predict that the larger shaping-up of forces in the Orient is toward a union of France, Japan, and possibly Russia, against the Anglo-Saxon Powers. Certainly France has made noticeable advances toward Japan of late, and the two countries are pursuing somewhat parallel courses in China. How Russia could close the triangle is hard to see. Japan has just doubled her garrison in Manchuria - supposedly to strengthen her position there against Soviet penetration; and though Japanese press opinion upon the whole condemned Chang Tso-lin's raid upon the Russian

propaganda quarters in Peking, Baron Tanaka, the new Premier and Foreign Minister, hastened to announce that his country could not remain indifferent to Communist activity in China. Our own refusal to join the other Powers in coercing Hankow to make reparations for the Nanking outrages, while condemned by most Americans in that country, is approved by a section of the British press. The Nation and Athenæum deplores the 'melancholy fact that the United States appears for the moment to be the only Power which is disinclined to renew threats that should never have been made.' Documents seized at the Russian offices in Peking are said to show that Moscow has spent about ten million dollars since a year ago last January to stir up trouble in China. Moscow is apparently dissatisfied with its returns from these expenditures. Bukharin writes in Izvestia, the official organ of the Communist Government, that his country's representatives merely pretended to cooperate with Chiang Kai-shek because that guileless general served its purposes temporarily, and that it was about to throw him over anyway 'when he dealt us a treacherous blow before we were ready.' Treachery is obviously a one-sided affair in Russia.

Among many evidences of the New Youth movement in China is the revolt of General Chiang Kai-shek's eighteen-year-old Communist son against ancestral authority. When he learned that his father had broken with the Hankow Junta he promptly declared: 'My father was heretofore my friend and comrade in revolution. Now that he has passed into the camp of the enemy, he is my foe.' Hankow is not entirely deserted by foreigners, for it was not until late in April that two of the three English-language papers in that city ceased publication.

One of these, the Herald, was owned and edited by Americans, the other, the Central China Post, by Britishers. Both were forced to suspend by a walkout of their Chinese mechanical staffs. Apparently the unions acted at the instigation of the Government, for both papers had signalized themselves by bitter attacks upon the Nationalists. The People's Tribune, which still continues, is a pro-Nationalist organ, edited by an American.

A new word has recently been added to our growing international political vocabulary. It is 'Ucsaya,' Latin and stands for Unión Cen


tro-Sur-Americana y Antillana, an organization founded in Mexico, and already having branches throughout the New World and Spain, to boycott our merchandise, our merchants, and our money. The headquarters of this society are in Mexico City, and its executive committee includes representatives from fourteen Latin American countries. El Universal welcomed with cold courtesy the news

that a party of Washington senators was on its way to Mexico to investigate her condition. It says such junkets, which began with the dispatch of confidential agents to that country by President Wilson, are all right as pleasure excursions, but intimates that their alleged official character implies a spirit of patronage not altogether complimentary to the nation. 'Mexico cannot consent to receive official commissions of inquiry appointed by a foreign government.' The editor also doubts if the senators are qualified for the task they profess to have in hand. "These studious gentlemen are for the most part utterly ignorant of Spanish. They cannot express themselves, or understand others, except in their own mother tongue. They are about as competent for their mission as deaf mutes would be. As a rule they know equally little of our traditions and character. We are an exotic country for them, and all they will take home with them will be a memory of certain "Mexican curiosities.""

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WITHIN the last few weeks there has been a singular Anglo-American incident. Mr. Mellon, the American Secretary of the Treasury, began it by some serious misstatements of the British position in regard to Reparations, Allied war debts, and our payments to America. Mr. Churchill, in his Budget speech, suavely and indirectly corrected him. The American statesman's fable had the start, and has kept it. The British statesman's reply has altogether failed to arrest its flight. Only the other day the Bishop of Gibraltar, who knows Europe thoroughly, drew public attention to the harm that was being done to the British name by Mr. Mellon's distortion of the easily ascertainable facts, and by our failure to answer him effectively and on the spot. It seems desirable, therefore, in the interests of both countries, that the subject should be reopened and probed a little more deeply.

What Mr. Mellon said was that we in Great Britain are already receiving from Germany more than enough to pay our debts to the United States. He even went on to calculate and to announce the extent of this surplus. This year, apparently, it will amount to £400,000; next year to £3,000,000; and in 1928-29 to a swingeing £14,000,000. It was true, he added, that for the past two years we had collected from Germany, France, and Italy some £20,000,000 less than we had remitted to the United States. But from the 1 From the Sunday Times (London weekly), April 24

present year onward the position would be reversed; our receipts from German Reparations and our Allied debtors would leave us with a substantial sum in hand over and above our disbursements to America. It follows, therefore, in the case of Great Britain that 'her American payments will not constitute a drain upon her own economic resources.' They are to be discharged for us, it seems, by Germany, France, Italy, Belgium, Portugal, Rumania, and Greece, and we shall be left with a handsome profit on the whole transaction.

There are many reasons why a more damaging insinuation could hardly have been made against us. Have we not publicly and repeatedly stated that our policy in the matter of Reparations and Allied war debts was to ask from these sources just enough, and no more, to enable us to meet our American payments. With that object in view, we have scaled down the debts owing to us with a generosity that Mr. Mellon doubtless considers foolish and almost immoral. But just when everything had been arranged on a more or less satisfactory basis, and the first puny installments were beginning to reach the Treasury, puny, I mean, in comparison with what Washington would have insisted upon,- along comes the American Secretary of the Treasury and assures our debtors, officially, that they are being 'had,' that we are coining money out of them, and that our pretense of generosity is really a cloak for a shrewd stroke of business.

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Naturally he has been believed. In politics men will believe anything. The authority of Mr. Mellon's office and the startling character of his statement assured for it a world-wide circulation and a ready acceptance. Moreover, it chimed in too neatly with some popular Continental misconceptions of ourselves and our position, and of what we have made out of the war, not to find a greedy credence. The peoples and the papers of Italy and France, and indeed of all Europe, took it for granted that the nation of shopkeepers was up to its old huckstering tricks again. The governments, of course, know how far the picture departs from the truth, but the peoples do not; it has revived and deepened the least flattering impression they ever had of wily, wealthy, bargaining Britain.

What have we done to correct it? Nothing. That is where our meekness, our long-suffering tolerance, come in, and also our genial indifference to what is being said and thought of us abroad. We listened to Mr. Mellon with polite wonder, but even among ourselves hardly took the trouble to contradict him; while as for chasing and exposing his legend up and down the byways of Europe, such a notion never entered either the popular or the official mind. There was a question or two in the House, and then the matter dropped. Mr. Churchill, in his Budget speech, set out the facts briefly and simply, and alluded distantly to 'the misconceptions which appear to prevail in some high quarters.' Otherwise no attempt of any sort has been made to scotch and kill a lie that, as the Bishop of Gibraltar has testified, is working on the popular mind of Europe with poisonous effect.

It seems to me a real gap in our governmental equipment that we have no machinery for dealing with emergencies of this nature. Admirably Admirably

armed and served in every other way, and beyond comparison the best informed and most efficient institution of its kind in the world, our Foreign Office has rarely been keen about propaganda. Even during the war it was slow to realize, and did not prove very competent to wield, the tremendous weapon of publicity. It laid it down with relief when peace came, and it has scarcely ever played with it since. Overtaking calumnies it does not consider to be part of its business. So long as foreign governments and officials are aware of the facts, the Foreign Office is appar ently content. It does not feel called upon, or does not think it worth while, to hunt down the hundred and one half-truths, misrepresentations, libels, and thumping falsehoods that may be circulated about Britain and British policy abroad.

I admit the task would not be an easy one, but I still think it should be attempted. These fantastic legends that we allow to grow up - not troubling to fight them, just because they are so fantastic-leave behind them a sediment of suspicion or misunderstanding; they affect opinion; they give a bias to sentiment. And sentiment and opinion play a bigger part in determining international relationships than the Foreign Office appears always to recognize. It makes an enormous difference, when two governments are negotiating a difficult issue, whether there is or is not an atmosphere of good will between the peoples they represent. It is this atmosphere of good will that misstatements disturb, and it seems more prudent to counteract them on the spot than to hope they will die harmlessly of their own stupidity or

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intelligible, and conclusive, and if only facts really 'spoke for themselves' and did not have to be shouted through a megaphone seventy and seven times before they can hope to be accepted as facts at all, there would be no trouble in the matter whatever. Mr. Mellon was inaccurate for a man in his position culpably inaccurate in his figures, and consequently in his deductions from them. He said that this year we shall be paying America £400,000 less than we shall be receiving from Germany and the Allies. We shall, as a matter of fact, be paying some £8,000,000 more. Against our annual remittance to the United States of £33,000,000, we received from Germany and the Allies together during 1925 £8,500,000; during 1926, £17,500,000; and during the current financial year we may, with luck, receive £25,000,000.

Up to date the gap between payments to America and receipts from Germany and the Allies represents a deficiency of £110,000,000, all of which has fallen, and continues to fall, on the British taxpayer. Moreover, even if the account ever balances, and in some future year we actually collect from Reparations and our debtors enough to cover the remittances to America, we shall still be shouldering not only all our own war expenses but the full charge of the loans advanced by us to our allies. allies. In In 1918 these these loans amounted to £1,500,000,000, and there is Mr. Churchill's word for it that 'in no circumstances can we expect to receive any contribution to this burden.'

So that when Mr. Mellon talks airily as though we were making a very good thing out of our payments to America, as though our debt and its punctual discharge were really proving a sort of nest egg for ourselves, as though our liabilities were being liquidated not by the toiling British taxpayer but by

Germany and the Allies, who, in addition, were presenting us with a nice round sum every year for the privilege of settling our bills when the American Secretary of the Treasury makes himself officially responsible for such curious misrepresentations as these, even the meek and careless Briton is moved to a mirthless wonder. It is all very well for America to hold us to the repayment of what we borrowed, that is perfectly fair, and no complaint under that head is to be thought of for a moment, but it is rather rubbing it in, when we are taxing ourselves white to meet our obligations, to come along and tell us that there is 'no drain on our economic resources.'

I sincerely hope there are Americans who understand our position better than their Secretary of the Treasury. If there are, they will hardly need to be told that the financial recovery which Great Britain has made since the war is the fruit of her own sacrifices and her own efforts, and that both the sacrifices and the efforts have been on the titanic scale. We have not reverted to the gold standard, we have not restored the pound to parity with the dollar, we are not meeting the interest on all our debts punctually on the dates when it falls due, we are not carrying a Budget of over £800,000,000 a year, without every single person in these islands being taxed and worked to the very uttermost. Now at last we seem to be reaping part of the long-delayed reward for the squareness and good sense with which we have faced our financial problem. In spite of prolonged and dislocating industrial stoppages, we are paying our way, our credit never stood higher, it has even been found possible to reduce the Bank rate. Sensible Americans will know that such achievements are not wrought by miracle or chance, but by hard work and sound policy.

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