Chapter V

That Japan, then, holds the whip hand in Manchuria, and expects to continue to hold it, is very clear. With China as yet too weak to protect herself, Japan is virtually master of the situation. Let us ask then--since this is in an American book--whether the Open Door policy is being enforced even now; to ask it of any one in Manchuria is to be laughed at. I tried it once in a Standard Oil office and the man in front of me roared, and an unnoticed clerk at my back, overhearing so absurd a question, was also unable to contain his merriment. It is not a question of the fact of the shutting-up policy, Chinese and foreigners in Manchuria will tell you; it is only a question as to the extent of that condition.

The truth is that the ink was hardly dry on the early treaties before the discriminations began. The military railroads, which Japan was in honor bound to all the world to use only for war purposes, were used for transporting Japanese goods before the military restrictions with regard to the admission of other foreign goods were removed. The Chinese merchant and his patrons were famishing for cotton "piece goods" and other manufactured products, and the Japanese goods coming over were quickly taken up and a market for these particular "chops" or "trademarks" (the Chinaman relies largely on the chop) was established. By the time European and American goods came back their market in many cases {88} had already been taken away. In some cases, too, their trademark rights had been virtually ruined by the closeness of Japanese imitation. Even on my recent tour, among consuls of three nations, at Manchurian points, I did not find one who did not mention some recent case of trademark infringement.

Then came the period of freight discriminations and rebates, when the Japanese (principally the Mitsui Bussan Kaisha, the one great octopus of Japanese business and commerce) secured freight rates that practically stifled foreign business competitors. The railway company now asserts that rebates (formerly allowed, it alleges, because of heavy shipments) are no longer given; but in many cases the evil effects of the former rebating policy remain in that Japanese traders were thus allowed to rush in during a formative period and establish permanent trade connections.

Meanwhile, too, the relations between the Japanese Government and the Mitsui Bussan Kaisha are so close that competitors are virtually in the plight of having to ship goods over a line owned by a rival--without any higher tribunal to guarantee equality of treatment. As was recently declared:

"Two directors of the South Manchurian Railway are also directors of
Mitsui Bussan Kaisha. The traffic manager of the railway is an
ex-employee of Mitsui. The customs force at Dalny is not only
entirely Japanese--no other foreigner in charge of a Chinese customs
office employs exclusively assistants of his own nationality--but a
number of the customs inspectors are ex-employees of Mitsui. The
Mitsui company also maintains branches all through Manchuria in and
out of treaty ports. In this way they escape the payment of Chinese
likin, or toll taxes. The Chinese have agreed that these taxes--2
per cent, on the value of the goods each time they pass to a new
inland town--shall not be paid so long as they remain in the hands
of the foreigner. American piece goods often pay likin tax, two,
three, or four times, while the Japanese--sometimes legitimately by
reason of their branch houses, sometimes illegally by bluffing
Chinese officials or smuggling through their military areas--manage
to escape likin almost altogether."

It may not be true that the Japanese customs officials at Dairen (the treaty provides that China shall appoint a Japanese {89} collector at this port), ignorantly or knowingly, allow Japanese goods to be smuggled through to Manchuria--although consuls of three nations a few months ago thought the matter serious enough to suggest an investigation--but the evasion of likin taxes in the interior is an admitted fact.

More flagrant still is another violation of international treaty rights. Under Chinese regulations foreign merchants are not allowed to do business in the Manchurian interior away from the twenty-four open marts, but it has been shown that several thousand Japanese are now stationed within the prohibited area, and Japan's reply to the Chinese Viceroy's protest is that he should have objected sooner and that it is now too late. Meanwhile, many Chinese merchants both in the interior and along the South Manchurian Railway, themselves paying the regular likin and consumption taxes, are finding themselves unable to compete with the Japanese, who refuse to pay these taxes. Thus Japan is gradually rooting out the natives who stand in her way, and, day by day, tightening her grip on the country.

She is advancing step by step as she did in Korea.

On the whole, the Mikado's subjects seem already to count themselves virtual masters of the country. Inside their railway areas and concessions they have their own government; in the majority of cases while in Manchuria I found it more convenient to use the Japanese telegraph or the Japanese postal system than the Chinese; and where I stopped at the little towns along the line it was a Japanese officer who came to inquire my name and nationality. When I was in Mukden the German consul there had just had two Chinese meddlers arrested for spying on his movements, only to find that they were acting under the direction of Japanese officials who claimed immunity for them! The fact that they have their soldiers back of them, and that they can be tried only in their own courts, also gives the Japanese unlimited assurance in bullying the natives. At Mukden the Japanese bellboy struck my Chinese rickshaw {90} man to get his attention. At Taolu some weeks ago some Japanese merchants who were there doing business illegally (for it is not an open mart) were interfered with, with the result that the Japanese authorities when I was in Mukden were preparing a formal demand for satisfaction, including indemnity for any injury to an unlawful business!

Manifestly, the new masters of Manchuria propose to teach the natives their place. "If a Chinaman is killed by a Japanese bullet," as a Chinaman of rank said to me in Manchuria, "the fault is not that of the man who fired the bullet: the Chinaman is to blame for getting in the way of it!"