T
2
the hands of Mr. Hu Chun. The elimination of official control urged in the pamphle above referred to would therefore appear to be, at any rate nominally, an accomplished fact.
I have, &c.
(Signed)
Inclosure 2 in No. 1.
HARRY H. FOX,
3
(a.) That the Company be a commercial Company, of which the shareholders shall we entire control.
(b) That the amount of share capital be fixed and the liability of shareholders mited.
(c.) That all financial transactions of the Company be made in dollars.
d.) That the face value of shares be changed from 30 taels to 100 dollars and dollars. It is pointed out that 50 taels is too much for the bulk of the population pay; on the other hand, any considerable reduction in cost might result in the Hence ompany finding itself at the mercy of an ignorant majority of shareholders. is proposed that the example of the Chekiang Railway Company be followed, and (e.) That the Directors and employés of the Company be forbidden to engage in outside business, and that if an official is appointed a Director by the shareholders shall, as in Japan, resign any other offices he may hold.
Précis of a Pamphlet, issued for private circulation, by the Han-lins Hu Chun, Yu Chores of two values issued.
and forty-two Szechuanes: Students in Japan, criticizing the General Administration of the Chuan-Han Railway.
THE authors, after explaining the important role that railways play in the commercial development of a country, quote the Regulations issued by the Board of Commerce for the formation and management of Companies, and proceed to point out that the Chuan-Han Railway Company contravenes these Regulations in twe particulars :-
1. Because, if it is an official and commercial Company, the capital should be subscribed in equal shares, i.e., 25,000,000 taels each; but as a matter of fact the capital has been, with the exception of a sum of 250,000 taels paid in by the Provincia Treasury, entirely raised by private shares, rent shares, and donatious. The Company therefore obviously comes under the heading of "Commercial Companies," and a such should be controlled by the people of Szechuan, and not by the officials.
(f.) That the capital of the Company be not diverted for any other purpose. (g) That the present method of collecting rent taxes be discontinued, and a ogressive tax on the incomes of the big landholders substituted.
The authors recognize that the system of rent taxes cannot be abolished owing to sufficiency of voluntary subscriptions, but they point out that the present arrange- ent, whereby the small proprietors whose income does not exceed 10 piculs per um pay at the same rate as their richer neighbours, is both unfair and inexpedient, e amounts received from the poor proprietors being insignificant, and the tax dering the railway unpopular. They therefore propose that the total capital to raised by rent shares shall be definitively fixed, that the average amount to be llected each year shall be calculated on the collection of the last two years, and that tax, which will be progressive, shall not be levied on incomes under 50 piculs per The above, say the authors, are some of the principal points to be considered in rawing up the new Regulations. If it is objected that the total elimination of official the ontrol would be unwise, there being good as well as bad officials, the authors reply at they do not object to the officials as individuals, but as a class; whereas the entry on the directorate will be dependent on the will of the shareholders, the
2. Because the Company has never obtained the necessary sanction of the Board of Commerce as prescribed by the Regulations. There is reason to believe that the Viceroy intended the gentry and merchants to obtain this sanction themselves showing clearly that he regarded the railway as a commercial undertaking.
The authors then enumerate the four principal reasons why, in their opinion, Railway Company has so far been a failure:---
mum.
1. The unwillingness of the people to subscribe, caused by their distrust of the icials will not. They quote the case of the Hupeb cotton mills, which were a failure officials. In the authors' own words, "the people have no faith in any undertakin ader official control, but which paid handsomely as soon as they were taken over by be merchants. To the objection that if the officials are allowed to have no share in controlled by the officials.
2. The diversion of the Company's capital to other purposes, such as the management the Company will be unable to obtain official protection when It is admitted that this chargquired, the authors reply that the fact that the officials do not participate in the Thibetan expedition and the Chung-king mint. cannot be proved, as no one has had access to the Railway Administration's accounts anagement of the Company does not relieve them of their responsibility in regard to but the authors ask "If a portion of the railway funds were not used for these protection of its interests. Again, it may be said that in other provinces it was be gentry themselves that started the idea of building the railway, whereas in Sze- undertakings, where did the money come from?"
As these taxes are apparently to ban the idea originated with the Viceroy. This the authors admit, but they main- 3. The deplorable institution of rent taxes. collected until the railway is completed, they may remain in force for anothen that the fact of the Viceroy having been the originator of the scheme does not 100 years, in the same way as the war taxes imposed in the reign of Hsien Feng fotitle him er officio to its subsequent management and control, although it may, as is e case in other countries, justify his expecting some reward. This he will find in the suppression of the rebellion are still existent,
4. The co-operation of officials and gentry in the administration has not beene love of his people and the gratitude of posterity. They add that if the railway success, as the latter, who should, properly speaking, safeguard the people's interest comes an accomplished fact the name of Hsi Liang will in days to come be held in allow themselves to be "run" by the officials, and responsibility is shifted from onen greater reverence than that of the famous Li, who, during the Sung dynasty,
ovided Szechuan with a network of roads and cauals. to the other as they find it convenient.
The authors conclude by recommending their pamphlet to the careful considera- We have here on of all patriots, and exhorting their readers to act now before it is too late.
(Signed) HARRY H. FOX. Chengtu, March 12, 1907.
Matters have now, says the authors, reached a deadlock. Company which exists in name but not in fact; no one knows who are its responsibl Directors, and instead of the people controlling it as they should do, it controls them One might as well ask a cripple to perform acrobatic feats as to ask such a concern construct a railway !
th
However, the authors admit that criticism is not all that is required, and so the procced to indicate a remedy. This is nothing short of a complete reconstruction of Company on the following lines :-----
To begin with, the Company requires a new set of Regulations defining exacti its objects, the selection of its Directors, and the powers conferred upon them. Thes Regulations should be submitted to a general meeting of shareholders for the approval. It is suggested that the following recommendations should be include in the new Regulations :-
Note.-The French Consul was shown the original pamphlet, but did not make a opy of the Chinese text. The above précis is taken from a French translation of the !cument.-H. H. Fox.
F
300