procedure. There
was now only a nine-year old boy between the Dictator and his highest
ambitions. Two final problems still remained to be dealt with: to give a
legal form to a purely autocratic rule, and to find money to govern the
country. The second matter was vastly more important than the first to a
man who did not hesitate to base his whole polity on the teachings of
Machiavelli, legality being looked upon as only so much political
window-dressing to placate foreign opinion and prevent intervention,
whilst without money even the semblance of the rights of eminent domain
could not be preserved. Everything indeed hinged on the question of
finding money.

There was none in China, at least none for the government. Financial
chaos still reigned supreme in spite of the great Reorganization Loan of
L25,000,000, which had been carefully arranged more for the purpose of
wiping-out international indebtedness and balancing the books of foreign
bankers than to institute a modern government. All the available specie
in the country had been very quietly remitted in these troubled times by
the native merchant-guilds from every part of China to the vast emporium
of Shanghai for safe custody, where a sum not far short of a hundred
million ounces now choked the vaults of the foreign banks,--being safe
from governmental expropriation. The collection of provincial revenues
having been long disorganized, Yuan Shih-kai, in spite of his military
dictatorship, found it impossible to secure the proper resumption of the
provincial remittances. Fresh loans became more and more sought after;
by means of forced domestic issues a certain amount of cash was
obtained, but the country lived from hand to mouth and everybody was
unhappy. Added to this by March the formidable insurrection of the
"White Wolf" bandits in Central China--under the legendary leadership of
a man who was said to be invulnerable--necessitated the mobilization of
a fresh army which ran into scores of battalions and which was vainly
engaged for nearly half a year in rounding-up this replica of the
Mexican Villa. So demoralized had the army become from long licence that
this guerrilla warfare was waged with all possible slackness until a
chance shot mortally wounded the chief brigand and his immense following
automatically dispersed. During six months these pests had ravaged three
provinces and menaced one of the most strongly fortified cities in
Asia--the old capital of China