American Government to educational and cultural purposes, paying especial attention to scientific requirements. Moreover, it is the intention of my Government to intrust the administration of the funds to a Board which shall be composed of Chinese and American citizens as members, and also to avail itself of the services of experts in working out the details along the lines indicated. Upon the formulation of some definite plan I shall take pleasure in laying it before you for your consideration. Accept [etc.]

SAO-KE ALFRED SZE

493.11/1015

The Chinese Minister (Sze) to the Secretary of State

WASHINGTON, June 14, 1924.

SIR: I have the honor to inform you that I have received a cable message addressed by the President of the Republic of China to the President of the United States of America,88 the text of which is enclosed herewith.

I shall be greatly obliged if you will be so kind as to transmit the message to its high destination.

Accept [etc.]

[Enclosure-Telegram]

SAO-KE ALFRED SZE

The President of China (Tsao Kun) to President Coolidge

89

MR. PRESIDENT: I consider it a privilege to bespeak, on behalf of my fellow citizens, to Your Excellency and the people of the United States our sincere appreciation of the generosity shown in the remission of their portion of the 1901 indemnity. The remission of a part of this indemnity in 1908 contributed much to the special friendliness toward the people of the United States, which had developed in the hearts of the Chinese people ever since the beginning of intercourse between our two peoples. The present action will still further increase the friendliness, and Your Excellency's Government have thus placed the people of China under an endless debt of gratitude to the people of the United States.

88

TSAO KUN

'On the same day the Chinese Minister transmitted a similar expression of appreciation from the Chinese Minister for Foreign Affairs to the Secretary of State (file no. 493.11/1016).

89 Acknowledgment of this message was transmitted in telegram no. 134, June 28, 1924, to the Minister in China (file no. 493.11/1045a).

493.11/1103a

The Secretary of State to President Coolidge

WASHINGTON, December 15, 1924. MY DEAR MR. PRESIDENT: I have the honor to invite your attention at this time to the matter of the exercise of your authority in remitting to China the balance of the Boxer Indemnity. This remission is to be in accordance with the provisions of the Joint Resolution of May 21, 1924, (a copy of which is enclosed)," at such times and in such manner as you shall deem just.

The steps heretofore taken are these: On June 14 the Department transmitted to the Chinese Minister in Washington a copy of the Joint Resolution. Mr. Sze then stated that his Government intended to intrust the administration of the funds to a Board which should be composed of Chinese and American citizens, to avail itself of the services of experts in working out the details of this arrangement, and, upon the formulation of a definite plan, to lay it before the Department for its consideration. In pursuance of this plan, Doctor Paul Monroe, Director of the Teachers College of Columbia University, proceeded to Peking last August at the instance of the Chinese Government, and held conferences with Chinese officials and educators. As a result of conclusions thereby reached, a Presidential Mandate was issued on September 17, creating the "China Foundation for the Promotion of Education and Culture," and appointing nine Chinese and five American citizens members of the Foundation and trustees of the funds to be realized from the successive remissions of the balance of the Indemnity. It is my understanding that, by this action, the Chinese Government definitely divorced itself from any future control or supervision over the funds of the Indemnity, surrendering the authority, which it would otherwise normally exercise, to the Foundation, which, under the terms of its constitution is a self-perpetuating body.

While not undertaking to give formal approval to the measures which the Chinese Government has thus far adopted, the Department has made known to the Minister of Foreign Affairs that it perceived no objection to the personnel of the Board of Trustees. Before, however, venturing to recommend to you affirmative action on this matter, it has seemed to me highly desirable, and perhaps essential, that this Government should receive some reasonably definite statement as to the general purposes to which the Foundation contemplates devoting the Indemnity funds. While appreciating that the determination of the specific uses of the funds within its control will perhaps form the most important function of the Board of

90 Ante, p. 554.

Trustees, and not desiring inappropriately to circumscribe its latitude of action, I have felt that this Government might subject itself to criticism, were it not to require some such statement as I have indicated, in order that there may be an assurance that the funds will actually be expended in conformity with the intent of the Congress. With a view to providing a satisfactory formula, there has been informally suggested to me the following Resolution:

"That the Board of Trustees of the China Foundation for the promotion of Education and Culture resolves that the released Boxer Indemnity funds shall be used for the promotion of scientific study, for the application of modern science to the specific needs of China, and for the training of individuals and the conduct of experiment, either individual or group, for the application of modern science to the specific conditions of China."

The language of this resolution appears to me quite satisfactory, but before proceeding further with respect to this question I should like to have your views. Should the course suggested meet with your approval, I shall be glad to take such further action as will, within the near future, I hope, enable the Department formally to submit to you its recommendations.

There are certain other facts in our relations with China, which, although not directly connected with the question of the remission of the Indemnity, nevertheless seem to me to deserve consideration simultaneously. There have been within the last few years numerous instances in China of assaults and depredations by Chinese bandits and soldiers upon the persons and property of American citizens. In a majority of these cases, the Department has had reason to hold that the outrages, as well as the failure to take steps properly to punish those guilty of them, were due to the negligence of the Chinese Government; and, as a result, numerous claims for damages have been presented to that Government, a large portion of which remain unsatisfied.

I also regret to be obliged to bring to your attention the further fact that, in order to tide over financial emergencies in the last few years in connection with the maintenance of Chinese students in this country, representatives of the Chinese Government in Washington have borrowed from local banks amounts aggregating approximately $180,000, which sums, although long overdue, have not as yet been repaid. These banks have sought to have a sufficient sum to cover these obligations retained from any funds that may be remitted to China. The Department has, however, taken the position that these loans, from a strictly legal point of view, are on the same basis as any other financial obligation of the Chinese Government to American citizens, and that it could not recommend the action desired by the banks without, at the same time, discriminating

against numerous American creditors of the Chinese Government, the total of whose overdue obligations far exceeds the amount involved in the remission of the Indemnity.

In both of the above classes of claims against the Chinese Government, I am, however, of the opinion that not only a legal, but a particular moral, obligation rests upon the Chinese Government to pay those American citizens whose interests are suffering by reason of a failure to liquidate their just claims. At the moment this Government is demonstrating its friendship for China by the return of the Indemnity, it would seem peculiarly fitting for the Government of that country to make an endeavor to satisfy these claims.

I therefore propose, if it meets with your approval to make these views known to the Chinese Government in such manner as may seem most appropriate for the purpose of bringing those now in authority in that country to a realization of the peculiar obligation resting upon the Chinese Government promptly to meet its commitments to American citizens of the character which I have described.

Faithfully yours,

CHARLES E. HUGHES

CONCURRENCE BY THE UNITED STATES IN THE CONTENTION BY CERTAIN POWERS THAT THE BOXER INDEMNITY PAYMENTS SHOULD BE MADE IN GOLD CURRENCY"

493.11/962: Telegram

The Minister in China (Schurman) to the Secretary of State

PEKING, January 25, 1924-4 p. m. [Received January 26-1:10 a. m.] 44. 1. Protocol circular of January 18th submitted proposed draft of note from dean of the diplomatic corps, acting in behalf of all the powers signatory to the protocol of 1901,92 to Minister of Foreign Affairs, concerning execution by Chinese Government of Sino-Belgian understanding of February 15 [5?], 1918, respecting Boxer Indemnity payments referred to in my telegram no. 15, January 10, 11 a. m. [noon?].93 After rehearsing the negotiation of the undertaking and that up to now no payments have been made, or funds set aside to cover such payments, the draft note contains a concluding paragraph as follows:

"The representatives of the powers above mentioned (protocol powers) are of opinion that under these circumstances the obliga

"Continued from Foreign Relations, 1923, vol. 1, pp. 592-605.

02 Foreign Relations, 1901, Appendix (Affairs in China), p 312.

tions arising from the final payments of 1901 with regard to the indemnity have not entirely been met and consequently they wish me to request Your Excellency to be good enough to instruct the Inspector General of Customs that, as the payments due to the Belgian Government for the refunding of the suspended indemnity installments have-together with the other indemnity payments and the services of the loans concluded previous to 1900-priority before all other payments out of the customs funds, he should make the necessary arrangements accordingly."

2. I indorsed observation on circular to effect that this arrangement did not appear to have been communicated to the American Government and since United States was not signatory to the Allied Powers' joint memorandum of that year relative to method of effecting individual arrangements for the payment of the suspended portion of the indemnity, I desired to hear from my Government before taking action in the matter.

94

3. In requesting telegraphic instructions whether I should participate in supporting the Belgian Government in this matter, I venture to direct the Department's attention to the fact that it would appear from the joint memorandum of 1918 referred to in my observation that each of the powers signatory, namely, Belgium, France, Great Britain, Italy, Japan, Portugal and Russia, are at liberty to effect individual arrangements with the Chinese Government as to the method by which the suspended portion of the indemnity shall be paid. Therefore, if we now assist the Belgian Government in securing execution of its preferential treatment arrangement with the Chinese authorities, a precedent will be established for our acting similarly in the event of any other of the afore-mentioned of having made or making such individual arrangements with the Chinese Government possibly in terms especially advantageous to the respective powers. Likewise, it is to be observed that thus far we have made no arrangement ourselves with the Chinese Government regarding the payment of the suspended portion of the indemnity. While the desirability of perfect unanimity among the protocol powers in all that relates to the execution of that instrument is evident, I venture to suggest that disadvantages may arise from our associating ourselves with the other signatories in invoking the protocol to support an arrangement like the present one. I am not convinced that the obligation of China to pay the suspended Belgian indemnity at a particular time and in a particular manner is an obligation of the same order

"For correction of date, see Minister's no. 51, Feb. 2, p. 561.