File No. 861.00/1795
The Minister in China (Reinsch) to the Secretary of State
[Received May 16, 9.12 a.m.]
Semenov advance continues. He announces policy not to interrupt Siberian Railway traffic. Allied passengers and freight under special permit are to pass. He is ready to turn over operation of railway to American commission.
Charles H. Smith, formerly aid to Ustrugov, reports Siberian Railway men anxious to have American assistance; believes coalition of forces in Siberia possible. Offers his services to investigate; speaks Russian.
My telegram of May 14, noon. Horvat disclaims intention to publish government proclamation. Japanese and Russian ministers [Page 162] recently informed the Chinese Government that the transfer of the Harbin-Changchun section to Japan was agreed to by Kerensky government and will be consummated when stable government established in Russia. This gave rise to loan rumor.
Situation in Siberia seems more favorable than ever for effective joint action of Allies and American initiative. A commission authorized to command moderate financial support would be able to reconstruct at least Siberia as an Allied factor. Should America remain inactive longer friendly feeling is likely to fail.