_The key to the proper control of China and the building-up of
the new Republican State is the railway key_.... The revolution
of 1911, and the acceptance in principle of Western ideas of
popular government, removed the danger of foreign provinces being
carved out of the old Manchu Empire. There was, however, left
behind a more subtle weapon. _This weapon is the railway_. Russia
with her Manchurian Railway scheme taught Japan the new method.
Japan, by the Treaty of Portsmouth in 1905, not only inherited
the richer half of the Manchurian railways, but was able to put
into practice a new technique, based on a mixture of twisted
economics, police control, and military garrisons. Out of this
grew the latter-day highly developed railway-zone which, to all
intents and purposes, creates a new type of foreign _enclave_,
subversive of the Chinese State. _The especial evil to-day is
that Japan has transferred from Manchuria to Shantung this new
technique,_ which ... she will eventually extend into the very
heart of intramural China ... and also into extramural Chihli and
Inner Mongolia (thus outflanking Peking) unless she is summarily
arrested. _At all costs this must be stopped._ The method of
doing so is easy: _It is to have it laid down categorically, and
accepted by all the Powers, that henceforth all railways on
Chinese soil are a vital portion of Chinese sovereignty and must
be controlled directly from Peking by a National Railway Board;
that stationmasters, personnel and police, must be Chinese
citizens, technical foreign help being limited to a set standard;
and that all railway concessions are henceforth to be considered
simply as building concessions which must be handed over, section
by section, as they are built, to the National Railway Board_.

If the Shantung Railway Agreement is loyally carried out, this
reform--as to whose importance I quite agree with Putnam Weale--will
have been practically completed five years hence. But we must expect
Japan to adopt every possible means of avoiding the carrying out of her
promises, from instigating Chinese civil war to the murdering of
Japanese employees by Japanese secret agents masquerading as Chinese.
Therefore, until the Chinese actually have complete control of the
Shantung Railway, we cannot feel confident that they will ever get it.

It