861.77 Chinese Eastern/401: Telegram

The Minister in China (MacMurray) to the Secretary of State

902. Legation’s 873, October 9, noon.

1.
Following from American Consul at Harbin:

“October 16, noon. Recent events Three Rivers district and Lahasusu have stirred deeply local inhabitants. It appears such events bound to continue unless some arrangements are made by Nanking and/or Mukden to settle railway dispute.

My suggestion of a solution would be for the Soviet and Chinese Governments to discharge entirely the present and to appoint new board of directors and revision committee on the ground that the present members including the Russians, now absent, showed themselves incapable of solving the problems which caused the present costly dispute. The neutral powers and the Japanese could act as delegates to a conference and could immediately elect new manager and appoint him. Managers would be permitted both sides in accordance with Mukden-Soviet agreement. This procedure would save the face of each side. New board could have its first meeting at Manchuria Station.

Russian side appears determined to regain rights by force, while Chinese side appears unwilling to give up control of the line. However, it is believed if present deadlock is not soon broken serious losses in lives and property already grave will ensue.

The method by which this suggestion could be brought to both sides is left for Legation to decide if it considers a conference feasible. Perhaps Japanese Government would be in the best position to act in this respect although a move in this direction by the German Government would be looked upon as less [more?] disinterested.

The Legation is requested to radio my suggestion to the Department.”

2.
I am not hopeful that any good results at this time could be obtained by the adoption of the above suggestion.
MacMurray