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understood because it forged external chains.

       The internal significance was even greater than the external. The loans were secured on the most important "direct" revenues reaching Peking—the Customs receipts, which were concerned with the most vital function in the new economic life springing up, the steam-borne coasting and river-trade as well as the purely foreign trade. That most vital function tended consequently to become more and more hall-marked as foreign; it no longer depended in any direct sense on Peking for protection. The hypothecation of these revenues to foreigners for periods running into decades—coupled with their administration by foreigners—was such a distinct restriction of the rights of eminent domain as to amount to a partial abrogation of sovereignty.

      That this was vaguely understood by the masses is now quite certain. The Boxer movement of 1900, like the great proletarian risings which occurred in Italy in the pre-Christian era as a result of the impoverishment and moral disorder brought about by Roman misgovernment, was simply a socio-economic catastrophe exhibiting itself in an unexpected form. The dying Manchu dynasty, at last in open despair, turned the revolt, insanely enough, against the foreigner—that is against those who already held the really vital portion of their sovereignty. So far from saving itself by this act, the dynasty wrote another sentence in its death-warrant. Economically the Manchus had been for years almost lost; the Boxer indemnities were the last straw. By more than doubling the burden of foreign commitments, and by placing the operation of the indemnities directly in the hands of foreign bankers by the method of monthly quotas, payable in Shanghai, the Peking Government as far back as fifteen years ago was reduced to being a government at thirty days' sight, at the mercy of any shock of events which could be protracted over a few monthly settlements. There is no denying this signal fact, which is probably the most remarkable illustration of the restrictive power of money which has ever been afforded in the history of Asia.

      The phenomenon, however, was complex and we must be careful to understand its workings. A mercantile curiosity, to find the parallel for which we must go back to the Middle Ages in Europe, when "free cities" such as those of the Hanseatic League plentifully dotted river and coast line, served to increase the general difficulties of a situation which no one formula could adequately cover. Extraterritoriality, by creating the "treaty port" in China, had been the most powerful weapon in undermining native economics; yet at the same time it had been the agent for creating powerful new counter-balancing interests. Though the increasingly large groups of foreigners, residing under their own laws, and building up, under their own specially protected system of international exchange, a new and imposing edifice, had made the hovel-like nature of Chinese economics glaringly evident, the mercantile classes of the New China, being always quick to avail themselves of money-making devices, had not only taken shelter under this new and imposing edifice, but were rapidly extending it of their own accord. In brief, the trading Chinese were identifying themselves and their major interests with the treaty-ports; they were transferring thither their specie and their credits; making huge investments in land and properties, under the aegis of foreign flags in which they absolutely trusted. The money-interests of the country knew instinctively that the native system was doomed and that with this doom there would come many changes; these interests, in the way common to money all the world over, were insuring themselves against the inevitable.

      The force of this—politically—became finally evident in 1911; and what we have said in our opening sentences should now be clear. The Chinese Revolution was an emotional rising against the Peking System because it was a bad and inefficient and retrograde system, just as much as against the Manchus, who after all had adopted purely Chinese methods and who were no more foreigners than Scotchmen or Irishmen are foreigners to-day in England. The Revolution of 1911 derived its meaning and its value—as well as its mandate—not from what it proclaimed, but for what it stood for. Historically, 1911 was the lineal descendant of 1900, which again was the offspring of the economic collapse advertised by the great foreign loans of the Japanese war, loans made necessary because the Taipings had disclosed the complete disappearance of the only raison d'être of Peking sovereignty, i.e. the old-time military power. The story is, therefore, clear and well-connected and so logical in its results that it has about it a finality suggesting the unrolling of the inevitable.

During the Revolution the one decisive factor was shown to be almost at once—money, nothing but money. The pinch was felt at the end of the first thirty days. Provincial remittances ceased; the Boxer quotas remained unpaid; a foreign embargo was laid upon the Customs funds. The Northern troops, raised and trained by Yuan Shih-kai, when he was Viceroy of the Metropolitan province, were, it is true, proving themselves the masters of the Yangtsze and South China troops; yet that circumstance was meaningless. Those troops were fighting for what had already proved itself a lost cause—the Peking System, as well as the Manchu dynasty. The fight turned more and more into a money-fight. It was foreign money which brought about the first truce and the transfer of the so-called republican government from Nanking to Peking. In the strictest sense of the words every phase of the settlement then arrived at was a settlement in terms of cash.^[5]

      Had means existed for rapidly replenishing the Chinese Treasury without having recourse to European stockmarkets (whose actions are semi-officially controlled when distant regions are involved) the Republic might have fared better. But placed almost at once through foreign dictation under a species of police-control, which while nominally derived from Western conceptions, was primarily designed to rehabilitate the semblance of the authority which had been so sensationally extinguished, the Republic remained only a dream; and the world, taught to believe that there could be no real stability until the scheme of government approximated to the conception long formed of Peking absolutism, waited patiently for the rude awakening which came with the Yuan Shih-kai coup d'état of 4th November, 1913. Thus we had this double paradox; on the one hand the Chinese people awkwardly trying to be western in a Chinese way and failing: on the other, foreign officials and foreign governments trying to be Chinese and making the confusion worse confounded. It was inevitable in such circumstances that the history of the past six years should have been the history of a slow tragedy, and that almost every page should be written over with the name of the man who was the selected bailiff of the Powers—Yuan Shih-kai.

      The Funeral of Yuan Shih-kai: The Procession passing down the great Palace Approach, with the famous Ch'ien Men (Gate) in the distance.

      The Provincial Troops of General Chang Hsun at his Headquarters of Hsuchowfu.

      The Funeral of Yuan Shih-kai: The Catafalque over the Coffin on its way to the Railway Station.

      The Funeral of Yuan Shih-kai: The Procession passing down the great Palace Approach, with the famous Ch'ien Men (Gate) in the distance.

      FOOTNOTES:

[1] As there is a good deal of misunderstanding on the subject of the Manchus an explanatory note is useful.

      The Manchu people, who belong to the Mongol or Turanian Group, number at the maximum five million souls. Their distribution at the time of the revolution of 1911 was roughly as follows: In and around Peking say two millions; in posts through China say one-half million—or possibly three-quarters of a million; in Manchuria Proper—the home of the race—say two or two and a half millions. The fighting force was composed

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