both debt consolidation and control upon China?
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If the conference breaks down on these issues are we not on safer ground in siding with the Chinese?
8. What alarms me most 18 the suggestion conveyed in your latest telegrams that yeu con- template the use of force by the powers to pro- tect the customs revenues, as the foundation ef the whole structure which your policy would erect is the maintenance intact of these reveries.
I have carefully re-examined the policy of the powers towards Canton in recent years with regard to customs revenues and my conclusion is that the repeated naval demonstrations from 1918 onwards were quite indefensible. I cannot, therefore, too clearly impress on you : that it is no longer possible for His Majesty's Government to join in any policy committing us to the use of gunboats and international naval demonstrations for such purposes. These methods are of a byegone era, cannet be resorted to today and I feel that on this ground alone your pro- posals require careful reconsideration.
9. The vital factor in the Chinese situation is the rapid development of Nationalism, which is the one permanent element with which we have to deal not only today but in the future. If we are
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