Dr. Reinsch's Proposed Solution:
'A Practical Policy and an Interim Loan Peking, Sept. 9.
Speaking at an informal gathering of high officials and prominent personages at Dr. Wellington Koo's residence yesterday afternoon on the subject of Chinese financial independence," Dr. Paul Reinsch, former American Minister to China, said "Tf Chinese financiers and bankers take the initiative in elaborate ing a practical policy they can undoubtedly count on international support. The present situation calls for self-help, at least in initiating a plan, as the other nations are too busy with their own affairs. A practicable proposal regarding Chinese finance would, however, receive support. Nevertheless, we must realize how near China is to a financial breakdown and what it would mean. The underlying economic condition of China is so favourable that the financial problems could be easily handled were there initiative and Dr. Reinsch proposed "a Constitution interim loan" of G.$2,000,- 000 monthly for 10 months to give the Government a chance to exist without worry during the Constitution-making period. Meanwhile, a financial commission would elaborate a system of revenue reform with the ce-operation of national and foreign banking representatives. It should be proposed fo the Consortium to make the above Joan and its representatives should ce-operate with the financial commission. This was the time such assistance should be given. Later, it would be unnecessary, or too late to avert financial disaster. Such ce-operation between the Chinese Government, Chinese bankers and foreign financial experts would in_ itself restore the credit of the Government.
Should the Consortium decline to make such a loan or propose terms which would induce a long discussion by Parliament and consequent delay in the completion of the Constitution it would then become necessary to invite banks outside the Consortium to take up the matter.
The taxable resources of China, when they could once be reached by new legislation after the Constitution has been established, were far more ample. he said, than the resources available in any other country except the United States. What China needed was not the much-discussed "'strong man" but only a good financier and team work between the Chinese Government and the bankers. "China does not come before the world as pleading for assistance but as offering a plan for the development of her financial resources."
Text read from the printed page and cleaned; old type leaves the occasional error.