—31—
recovery of the South Manchuria Railway being included in the resolutions adopted. At the same time, the U.S.S.R. and her citizens suffered from similar tendencies, while the White Russians, although they had no sovereign rights or exceptional privileges to surrender, were subjected to humiliation and ill-treatment.
Effect on domestic affairs.As regards domestic affairs, the Manchurian authorities had retained all the power they wanted, and they had no objection to following administrative rules and methods adopted by the Central Government so long as the essentials of power were not affected.
The Political Committee of the North-Eastern Provinces.Soon after the union, the Political Committee of the North-Eastern Provinces was established at Mukden. It was, under the nominal supervision of the Central Government, the highest administrative authority in the North-Eastern Provinces. It consisted of thirteen members, who elected one of their number as President. The Committee was responsible for the direction and supervision of the work of the Governments of the four provinces of Liaoning, Kirin, Heilungkiang and Jehol, and of the so-called Special District which, since 1922, had replaced the administrative sphere of the Chinese Eastern Railway. The Committee had authority to deal with all matters not specifically reserved to the Central Government and to take any action which did not conflict with their laws and orders. It was the duty of the Governments of the Provinces and of the Special District to carry out the decisions reached by the Committee.
The administrative system of the Provinces did not differ essentially from the organisation adopted in the rest of China. The concession made with regard to the preservation of Manchuria as an administrative unit was the most important difference. Without this concession, voluntary union would probably not have taken place. In fact, notwithstanding external changes, the old conditions continued to exist. The Manchurian authorities realised that, as before, their power derived much more from their annies than from Nanking.
The Army—Military expenditure 80 per cent of total expenditure.This fact explains the maintenance of large standing armies numbering about 250,000 men, and of the huge arsenal on which more than $200,000,000 (silver) are reported to have been spent. Military expenses are estimated to have amounted to 80 per cent of the total expenditure. The remainder was not sufficient to provide for the costs of administration, police, justice and education. The treasury was not capable of paying adequate salaries to the officials. As all power rested in the hands of a few military men; office could be owned only through them. Nepotism, corruption, and maladministration continued to be unavoidable consequences of this state of affairs. The Commission found grave complaints concerning this maladministration to be widely current. This state of affairs, however, was not peculiar to Manchuria, as similar or even worse conditions existed in other parts of China.
Heavy taxation was needed for the upkeep of the army. As ordinary revenues were still insufficient, the authorities further taxed the people by steadily depreciating the irredeemable provincial currencies[1]. This was often done, particularly of late, in connection with "official bean-buying" operations, which by 1930 had already assumed monopolistic proportions. By gaining control over Manchuria's staple products, the authorities had hoped to enhance their gains by compelling the foreign bean-buyers, particularly the Japanese, to pay higher prices. Such transactions show the extent to which the authorities controlled banks and commerce. Officials likewise engaged freely in all sorts of private enterprise, and used their power to gather wealth for themselves and their favourites.
Constructive efforts of the Whatever the shortcomings of the administration in Manchuria may have been in the period preceding the events of September 1931, efforts- ↑ See special studies No. 4 and No. 5, annexed to this Report.
