in this is the explanation of the fact which has so exercised Mr. Colquhoun, the misapprehension of which has led him so wildly astray. We may take as a crucial instance the North German steamers running between Singapore and North Borneo, which Mr. Colquhoun very directly implies were started in opposition to the P. and O. steamers running on that line, and so miserably, shabbily conducted, that the North German Lloyd (N.D.L.) saw its opportunity, and by its superior enterprise beat the P. and O. out of the field. In all this there is not a shadow of truth. The British steamers which, till early in last year, ran between Singapore and North Borneo, did not belong to the P. and O., but to an independent local company known as Holt's. There was no competition, no opposition; the trade, indeed, was so small that it was not worth it. Sir Alexander Swettenham, Colonial Secretary and Acting Governor of Singapore, stated in evidence that these steamers were only just meeting their expenses and having a little profit. It was well known as being the least profitable part of Holt's business. He was offered a very large capital sum if he would give this branch line up to the Germans, and he sold for that large sum. That, no doubt, was the only inducement which was brought to bear upon him.'* Sir Alexander believed that the price paid for the steamers was in excess of their value, and explained the object of the Germans in buying-as he understood it : 'They had only traffic enough, I believe, for the main line, from Germany to Singapore, once in twenty-eight days. When the N.D.L. had obtained from the Imperial Government a promise of a second subsidy if they would double their line and make it run every fortnight, it became necessary for them to find traffic for the second; and as they thought they were seriously handicapped by the fact that all these branch lines that run into Singapore were under the British flag, they said, "A main line without any feeding line is a mistake, and therefore we must acquire some feeding lines." Therefore arrangements were made for purchasing those feeding lines with great secrecy. The Government did not pay any portion of the purchase money, sent out a recommendation-from the very highest quarters-in so strong a form that it could not be disregarded, that certain persons or firms were to find the money.'t but Two other lines-one of them running from Singapore to Bangkok-were bought in the same way, or a little earlier. *Steamship Subsidies, Q. 2348. In no case was there any competition, healthy or otherwise; and in each, Sir Alexander was convinced, the only reason for selling was that they obtained a somewhat exaggerated price for steamers that were doing little more than pay their way. The whole question of the subsidies is one of the very greatest interest and most serious importance, but it is not to be discussed here as ancillary to a different though cognate subject. It has only been introduced on account of the extraordinary licence which Mr. Colquhoun has allowed himself in regard to it. It is difficult, if it is not impossible, to conceive that a man who for so many years has been at home in the East, who has travelled everywhere and seen everything, was ignorant of the fact that these foreign companies, which he expressly names, are heavily subsidised; that the small branch lines running to Singapore had nothing whatever to do with the P. and O. except in the way of trade; or that they were not forced to withdraw by competition or lack of energy, but were bought up at a fancy price. That the passenger accommodation of comparatively small cargo-boats was not palatial may be conceded, without in any degree explaining the savage and apparently unmeaning attack on the P. and O. Company and the whole conduct of the P. and O. business. But whatever may be the result of this remarkable phase of commercial war, it is evident that Germany will claim a full share of Eastern trade. This is no new determination on her part, and may be dated back to before her seizure of Kiao-chau, which she presumably wishes to convert ultimately into a great trading centre. The actual station is Tsing-tao (45 miles west of Kiao-chau city), where some ten millions sterling are being expended on a railway to the coal-field behind, the model town, and the deep-water harbour. Whether she will succeed in drawing trade to it, whether it will be more than a costly naval and military station, seems very doubtful. Mr. Colquhoun's account of it is not encouraging : 'Kiao-chau,' he says, 'has failed to flourish for several reasons. Great importance is attached to the independence of the local Government, we are told officially, but the place, artificially created and artificially maintained, is governed by red tape. The policy is to secure immediate and direct advantage to the Motherland. Everything German is favoured in a most ridiculous manner, but the German merchants, however enthusiastic they may be over the colonial policy, have hitherto shown a marked disinclination to settle or invest at Kiao-chau. No wonder that this should be the case when, accustomed to the most complete liberty, courtesy, and consideration in the neighbouring British colonies and treaty ports of China, they find themselves treated by their own officials like recruits in the hands of a Prussian officer. The treatment accorded them is galling in the extreme, and indeed must be unbearable, for the amour-propre of the German trader is not easily ruffled in the search for wealth.' Their policy of employing only Germans, even in subordinate posts which might very well be filled by Chinese, tends enormously to increase the cost of administration, and though much has been said of the intention to maintain it as a free port, it is in Mr. Colquhoun's opinion—very doubtful indeed whether it will or can be done : 'As long as Germany has only inferior places to colonise, and the German colonial system remains what it is, so long will German peasants decline to go to their own colonies, or German merchants to places like Kiao-chau. But the object of Germany is to establish at Kiao-chau a great naval base, a centre of German influence from which political control can be spread further and further afield. An increasing influence over-sea is certain to be one of the chief aims of the German Government-an influence which, in the absence of successful colonies, they will seek to sustain by means of these artificially maintained establishments, which are by no means to be dismissed as worthless. If they serve no other purpose, they are so many points d'appui from which Germany can claim, and not merely claim, but exercise, the right to have a say in the disposal of the various questions which may arise, and can, by sea or land, bring influence to bear on other nations, especially on the great colonial and maritime power-Britain.' But all this points to what Mr. Colquhoun considers imminent the break-up of China. He says: "The prospect of China's integrity being maintained is a very slender one, for a great portion of that country is already parcelled out into so many spheres-spheres that are being consolidated slowly but surely, and always with feelers cast out, as in the case of Germany and the Yang-tsze Valley, or pre-emption to provinces, as in the case of Japan. Under these circumstances it is useless to discuss the possibilities of China as it was a few years ago. We have to consider a China controlled in certain regions by various Powers, the still independent section of the country gradually diminishing in extent. .. Were China on the eve of a new departure, on her own initiative or under the guidance of Japan, it might be possible to foreshadow the future, which would be a repetition, on a greater or lesser scale, of the rise of Japan; but cut up by foreign Powers with diverging policies, and subject to outside influences, it is only possible to foresee the developement of vast regions at the hands of Western Powers, with the application of all their gifts of organisation, and each sphere a closed borough so far as possible.' Mr. Colquhoun knows China well, as a traveller and a trained observer; but we do not feel sure that in this he is right. When we consider how the modern developement of Japan really dates from an unsuccessful war and the forcible intrusion of Europeans, it is difficult not to think that something of the same kind is possible for China; and this is the opinion of Mr. Thomson, whose interesting work on China we have named above. Mr. Thomson has not, we believe, the extended acquaintance with China that Mr. Colquhoun has, but as a trained enquirer into the state of things around him, his judgement is not to be lightly set aside. It is possible that the report of a conversation which he held with a Chinaman of high position,' a Cantonese, may be nearer the truth than Mr. Colquhoun's more commonplace forecast. Do you think this trouble is over now?' he asked this Chinaman last October in Tien-tsin. The Chinaman had been educated abroad, and spoke English perfectly. 'Over!' he said, 'over! Why, I think this has only been a big preface. It may seem very dreadful to you Europeans, all this frightful devastation and slaughter, but I cannot help thinking that for China it has been really a blessing in disguise. We are accustomed to slaughter, and it has been much worse in our own internal revolutions in the Tai-ping rebellion, for instance than it has been now. What was needed was some terrible national humiliation, such as the sack of Peking, to awaken China from her long sleep; and I hope and believe that she really is awakening at last, that her sufferings now will prove to be the agony of a new birth.' This may, of course, be merely the Chinaman's wish to agree with his interlocutor, and to repeat, in other words, something that Mr. Thomson had previously said; but we do not think it is; we believe it is the expression of an opinion now held by many enlightened Chinamen, men who have seen and realised the power of Occidental civilisation. Mr. Thomson thinks that through the North and Centre of China there is a strong feeling of attachment to the present Emperor, and that during his life this will hold in check the anti-dynastic movement in the South in favour of foreigners and progress. 'It is led,' he says, 'by Sun-Yat-Sun, an energetic reformer, whom the Chinese Government made an unsuccessful attempt to seize in London two years ago. He has raised the standard of revolt in the country to the north of Canton, and all over the South of China men are flocking to join him. His aim, he declares, is to overthrow the present Manchu dynasty and to establish a Chinese dynasty in its VOL. CXCVI. NO. CCCCI. stead. ... If the Emperor were to die, there is no knowing what might happen.' He quotes letters emanating from, refers to proclamations issued by Sun-Yat-Sun, all to this effect-freedom, unity, and reform; freedom from foreign control- from the Manchu dynasty first of all; unity, in opposition to the threatened dismemberment of the empire; reform, as throwing the country open to the trade of the world. 'If,' he says, 'if, as there is good reason to believe, this southern revolt is extending into the Yang-tsze Valley, the consequences to Europe in the stoppage of trade and the difficulty of restoring anything like stability of government in the interior may be so momentous as to bring about an entire reversal of the present political equilibrium in the East-a reversal from which China may emerge as capable of standing by herself, of resisting foreign dictation as Japan now is. . . . The Chinese have quite as much aptitude as the Japanese, and the latter declare that the former would have gone through a like process of regeneration at the same time that they, the Japanese, did, if Great Britain had not interfered to put down the Tai-ping rebellion. . . . The more enlightened of the Chinese hope that their country may yet, like Japan, show itself capable of assimilating Western civilisation. They do not believe that China, with its vast mass of people knit together by a common written language, by the same historic traditions, by common religious beliefs, can ever be effectually broken up. . . . The Western nations, they say, may conquer China, may rend it asunder, but in time they will be driven out, and the Chinese will become once again the same great and undivided people.' But if this view of the present position of China is correct -and, on the whole, we think it agrees better with the facts as we know them-a tremendous change is about to take place, not only in what Mr. Colquhoun neatly calls 6 the centre of commercial activity,' but in the centre of political activity, and even in the centre of military energy. Is it likely that the rousing of China and its hundreds of millions of inhabitants will be a peaceful awakening? We think that more probably it will be a dawn red with blood, not of Chinese alone, but of many others who have disturbed their repose. Mongol hordes have before now spread terror over the East of Europe, and have made of Russia a land of bondage. What may happen if they again overflow their bounds, and back their overwhelming numbers with modern arms and modern science, it will be for the historians of the twentyfirst century to moralise on. The bloody wars which the Chinese have waged among themselves when, from time to time, they have broken loose from the artificial restraints |