CONFIDENTIAL
that the problems of the Colony have now changed from the
confrontation of these emergency conditions.
Except in
degree and urgency, the basic problems are now not so different
from those of any large over-crowded city with a population
emerging from semi-destitution to semi-affluence, and with
better education and higher personal consumption prompting
rising expectations and a more critical attitude to living
conditions and government.
3. At one time the bulk of the population only asked from
government means of livelihood, a roof over their heads, and
to be left alone. Now there is, or shortly will be, a
demand for a better quality of life. This demand corresponds
with what we, as the administering power, would wish for
the people of a dependent territory, but in any case there
would probably be political risk in failure to satisfy
this demand before it becomes too strident. This fits in
with what I consider to be a basic condition for the
continuation of the Colony, namely that a wider margin omer
the standard of living in China must be maintained. As
I see it therefore the main problem for government now is
how to meet this demand, and secure the loyalty of the
potential demandeurs, while at the same time keeping within
the financial possibilities of the Colony. And this has to
prospect
be done against the background of the end of the lease in
26 years, and the stresses and strains this rejeet will
start to generate comparatively soon.
2.
CONFIDENTIAL
/4. The