Powers Still Hope To Persuade China.

New York Times 100 years ago today, September 26, 1912:
Success of Independent Syndicate Has Not Stopped Efforts in Regard to a Large Loan.
REALLY FOR CHINA'S GOOD
Powers in Position of Philanthropists Trying to Save Empire from Peril of Intervention.
Special to The New York Times.
    WASHINGTON, Sept. 25.— The action of the New York banking houses interested in the Six-Power loan to China in withdrawing from the negotiations does not, in the view of the State department, affect in any degree the attitude of the various Governments or the prospects of the ultimate success of the nationals of those Governments. The withdrawal of banks that have been included in the efforts to arrange the loan is taken to mean that the conditions imposed have been such as would be prompted by ordinary financial caution and good judgment.
    The bankers and the diplomats have not allowed themselves to be deceived by the situation in China, which is anomalous. The Peking Government, it is said here, is not a Government of China, but corresponds to the provisional Government of France following the Franco-Prussian War, when from Versailles a council of defense, under the lead of Gambetta, administered the Government until a republic was established. Naturally, the bankers have been desirous to safeguard their loans with conditions that would hold good in the future, whatever the outcome of the present trend toward a stable republican form of government may be. When the eighteen provinces of China have accepted the Constitution of the centralized Government and have yielded up the delegated powers upon which a strong and progressive authority may be established, less difficulty will be encountered, it is contended, in negotiating such a loan as has been under consideration.
    More than has been apparent on the surface, the powers have been aiming to assist China to form a stable Government and to protect the empire from unwise and extravagant expenditure of the funds to be provided by the proposed loans. Proper audit and control of these expenditures are regarded as of the first importance as conditions to the arrangement.
    The fact that the Wendell Jackson syndicate is willing to make a loan without the safeguards that have been agreed on as indispensable by the bankers of the six-power group is not taken by the State Department to be in the least degree conclusive as to the prospects of the final success of the proposed six-power loan. On the contrary, there is reason to expect a very different phase of the situation within a few days, which will show that only by a loan under the concert of the powers will the progress of the new Government of China be assured. It is known that none of the four powers originally assenting to the concert of action in regard to loans in China has in any manner changed its attitude toward the proposed loan. Even Great Britain, where the Jackson syndicate is operating, is unfriendly to the loan undertaken by that syndicate.
    With this fact staring it in the face, France possessing the power to close its money markets to the bonds, and Germany likely to accomplish the same result in its own way, it is predicted that no loan of any proportions, certainly not one of $350,000,000, can be supplied by the independent syndicate. The Belgian loan, which was several times larger than the Jackson loan, failed for want of moral support among the powers, and it is hardly reasonable to expect, so officials here say, any better fate for this later attempt to evade the concert of the powers. In discussing the matter to-day Huntington Wilson, Acting Secretary of State, said:
    "I see in the statement of the bankers nothing which could be interpreted as an abandonment of the work of the six-power group, which has already been a very valuable factor in the policy of concerted action that has from the beginning been of such immeasurable benefit in dealing with the Chinese situation. The broad principle of international co-operation and concerted action, applied in favor of international loans to China upon thoroughly sound and helpful bases as best alike for China and the powers, remains precisely as hitherto the policy of the Department of State, and is in complete harmony with that of the other Governments concerned.
    "It is not reasonable expect that a plan which has been under consideration by the powers for the better part of a year, and which involves great international interests, will be given up in a day because of some sudden fortuitous occurrence not in line with the original movement."
    It is said at the State Department that the six powers have really at heart the best interests of China, and that they are trying to keep her from falling to pieces. By insisting on safeguards in the use of the proceeds of the proposed large loan, these powers, it is explained, are not only acting in a manner dictated by caution as to the security of the loan, but in the line of international philanthropy.
    The Chinese fear foreign domination and are averse to accepting some of the conditions. Yet the possibility of foreign domination after intervention in consequence of unwise use of the money loaned is just what is in the minds of those who are arranging the proposed loan. It is better for China, officials here say, to make a moderate loan and to use it carefully and well, and by this caution furnish no reason for foreign intervention, than it is to be borrowing right and left upon random and ill-considered terms.
    One of the difficulties in the situation is the aversion in the provinces to the National loan. The feeling there is that the central Government is selling out to the powers, and that if the loan is made a republican form of government will be impossible.
    At the same time, provincial pride more than anything else is believed to stand in the way of a constitutional form of government for all China. This makes it all the more necessary for the powers to insist on the conditions they have framed, and at the same time makes the irregular financing undertaken by the Jackson Syndicate really harmful to China. The long and short of the situation is that the United States Government, as a matter of policy, will stand by the Knox note concerning the concerted action of the six-power group. If some banks withdraw, others will in the course of time take their places, and eventually the loan, it is declared, will be consummated.