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China, the United States Navy, and the Bethlehem Steel Company, 1909–1929

Published online by Cambridge University Press:  11 June 2012

William R. Braisted
William R. Braisted
Affiliation:
Professor of History, University of Texas
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Abstract

The tangled purposes of national economic policy in the early decades of the twentieth century are highlighted in Professor Braisted's analysis of an episode which pledged officers and secrets of the U.S. Navy to the advancement of American business in the Far East.

Type
Articles
Information
Business History Review , Volume 42 , Issue 1 , Spring 1968 , pp. 50 - 66
Copyright
Copyright © The President and Fellows of Harvard College 1968

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References

l Cotter, Arundel, The Story of Bethlehem Steel (New York, 1911), 6–11Google Scholar; Livermore, Seward W., “Battleship Diplomacy in South America,” Journal of Modern History, XVI (March, 1944), 31–48.CrossRefGoogle Scholar

2 Iron Age Review (August 26, 1909), 633 (December 8, 1909), 1313.

3 J. F. Meigs to Bureau of Ordnance, May 12, 1909, with endorsement by Washington I. Chambers, May 14, 1909, Meyer to Admiral M. Domecq Garcia, April 5, 1910, U. S. Cong., Information in Response to Resolution, Relative to Construction of Battleships for Argentine Republic, Sen. Doc. No. 2, 62d Cong., 1st Sess.

4 Memorial by Board of Revenue, October 4, 1909, in K 136, November 11, 1909, National Archives, Record Group 38, Office of Naval Intelligence Register, 1908, No. 10, E-9-d. Hereafter, files at the National Archives will be cited by their RG (Record Group) number. For an excellent study of China's unsuccessful efforts to build a modern navy before 1895, see Rawlinson, John L., China's Struggle for Naval Development, 1839–1895 (Cambridge, Mass., 1967).CrossRefGoogle Scholar

5 Meigs to Huntington Wilson, November 23, 1909, RG 59, State Department Numerical File, No. 18887/10.

6 Meyer to Secretary of State, December 13, 1909, ibid., No. 18887/12.

7 Wilson to Calhoun, May 12, 1910, telegram, RG 59, State Department Decimal File No. 893.34/14.

8 Calhoun to secretary of State, May 13, 1910, June 27, August 17, August 25, 1910, ibid., Nos. 893.34/23, 24, 429, and 437.

9 Tsai Feng to Taft, August 14, 1910, William Howard Taft Papers (Library of Congress).

10 For details of the visit, see the New York Times, September 20, 25, 30, October 1, 2, 1910; RG 38, Office of Naval Intelligence General Correspondence, Case No. 10264; RG 59, State Department Decimal File, No. 893.34.

11 Reginald Nicholson to secretary of State, October 18, 1910, RG 59, State Department Decimal File, No. 893.34/68. Gillis was at first given a leave of absence from the Navy so that he might assist private shipbuilders to secure contracts for men-of-war in Peking. Later, when this method was declared illegal by the Justice Department and by the Judge Advocate General of the Navy, Gillis was recalled to active duty, assigned to Peking with the title of assistant naval attache, and ordered to continue his assistance to American firms. Meyer to Attorney General, April 15, 1911, George W. Wickersham to Secretary of the Navy, April 18, 1911, RG 80, General Records of the Navy Department, No. 6077/32:3,4; Meyer to Gillis, April 11, May 1, 1911, RG 24, Bureau of Navigation Records, No. 604/84, 85.

12 Bethmann-Hollweg to William II, October 21, 1910, Germany, Auswartige Amt, Die grosse Politik der europäischen Kabinette, 1871–1914 (40 vols., Berlin, 1922–1927), XXXII, 151–54.Google Scholar

13 Aide Memoire, February 24, 1911, RG 59, State Department Decimal File, No. 711.9312/3a. For other materials relating to Liang's mission, see also State Department File, Nos. 893.34 and 893.51. Germany declined to conclude a general arbitration treaty with China. Von Kiderlin to Bernstorff, March 2, 1911, Grosse Politik, XXXII, 15.

14 Interview between Knox and Liang, April 6, 1911, RG 59, State Department Decimal File, No. 893.51/1411; Memorial relating to the Bethlehem Steel Company contract, with imperial rescript, October 21, 1911, RG 59, State Department Decimal File, No. 893.34/109.

15 Knox to Secretary of the Navy, April 12, 1911, ibid., No. 893.34/98a.

16 Meyer to Secretary of State, May 5, 1911, ibid., No. 893.34/99.

17 W No. 105, December 24, 1911, RG 38, Office of Naval Intelligence Register, No. 947, E-9-d; Calhoun to Archibald Johnston, January 1911, RG 84, Peking Post Files; Wilson to Calhoun, March 24, 1911, telegram, Knox to Calhoun, April 19, May 8, 1911, telegrams, RG 59, State Department Decimal File, Nos. 893.34/87A, 90, 93.

18 Johnston to Knox, January 30, 1911, Knox to Secretary of the Navy, February 3, 1911, RG 59, State Department Decimal File, No. 893.34/85; Meyer to Lt. Comdr. Frank B. Upham, May 19, 1911, RG 24, Bureau of Navigation File, No. 4570–50.

19 Beekman Winthrop to Johnston, July 29, 1911, RG 80, General Records of the Navy Department, No. 6320–153.

20 Agreement between the Bethlehem Steel Company (Schwab) and China (Tsai Hsun), October 21, 1911, RG 59, State Department Decimal File, No. 893.34/150.

21 Schwab to Knox, December 4, 1911, ibid., No. 893.34/105. Except for a brief, confidential telegram informing the State Department of the conclusion of the contract, the legation in Peking apparently made no report on Schwab's negotiations.

22 Summary of correspondence between Johnston and Gillis, Archibald Johnston Papers (in possession of Johnston family); Johnston to Josephus Daniels, June 26, 1913, RG 34, Bureau of Navigation File, No. 604–13.

23 Johnston to E. R. Grace, November 12, 1913, Johnston to Snyder, undated, Johnston to Schwab, September 28, 1913, Johnston Papers.

24 Gillis to Office of Naval Intelligence, November 20, 1913, telegram, RG 84, Peking Post File, 1913, No. 830; Reinsch to Secretary of State, November 19, 1913, Bryan to Secretary of State, December 1, 1913, RG 59, State Department Decimal File, No. 893.34/108; Memorandum by Rear Admiral Bradley Fiske, November 12, 1913, RG 24, Bureau of Navigation File, No. 3142/159.

25 Possibly, the Bethlehem Steel Company failed to press its negotiations with China at this time because Schwab was then arranging to build submarines for Britain in circumvention of the neutrality of the United States after the outbreak of World War I. See Smith, Gaddis, Britain's Clandestine Submarines, 1914–1915 (New Haven, 1964).Google Scholar

26 Johnston to Hsiung Hsi-ling, October 23, 1913, Johnston to Liu Kwang-hsing, October 17, 1913, RG 59, State Department Decimal File, No. 893.34/152.

27 Johnston and Gillis to Liu Kwang-hsing, January 6, 1914, ibid., No. 893.34/150; Johnston to Captain Liu Ch'uan-shou, January 17, 1914, Johnston Papers.

28 Schwab to Johnston, October 28, November 15, 1913, telegrams, Johnston to Schwab, October 31, November 7, 1913, telegrams, ibid.

29 Schwab to Johnston, December 16, 1913, telegram, Johnston to Schwab, December 17, 1913, telegram, ibid.

30 Schwab to Johnston, January 7, 1914, telegram, ibid.

31 Account of negotiations, ibid.; Johnston to Schwab, January 20, 1914, telegram, RG 59, State Department Decimal File, No. 893.34/114.

32 Account of negotiations, Johnston Papers.

33 Hsiung Hsi-ling to Johnston, January 22, 1914, RG 84, Peking Post File, 1914, No. 830.

34 Liu to Foreign Office, Peking, February 1914, Chinese Diplomatic Correspondence (Courtesy of the Institute of Modern History, Academia Sinica, Taipeh, Taiwan).

35 Interview between Reinsch and Hsiung Hsi-ling, January 21, 1914, RG 84, Peking Post File, 1914, 830. Reinsch even tried unsuccessfully to obtain a commitment from Yuan Shih-kai that British officers would not be employed in the Chinese navy.

36 E. T. Williams to Robert Lansing, December 9, 1914, December 17, 1917, Lansing to Secretary of the Navy, December 18, 1914, Daniels to Secretary of State, December 29, 1914, RG 59, State Department Decimal File No. 893.20/33–35.

37 Memorandum of conversation between Reinsch and Eijiro Yamaza, March 12, 1914, in Reinsch to Bryan, March 16, 1914, RG 59, State Department Decimal File, No. 893.00/2102; Bryan to Sutemi Chinda, May 19, 1914, State Department Decimal File, No. 893.345/2a.

38 Reinsch to Secretary of State, May 23, 24, 1914, telegrams, May 26, 1914, ibid., Nos. 893.51/1516, 1517, 1518, Bryan to Chinda, May 21, 1914, ibid., No. 893.51/1514; Reinsch, Paul S., An American Diplomat in China (Garden City, 1922), 83–84.Google Scholar

39 Struble to Charles Evans Hughes, 30 August 30, 1921, State Department Decimal File, No. 893.34/152.

40 Iinkai, Kato Haku Denki Hensan, Kato Takaaki (2 vols.: Tokyo, 1929), II, 192–93.Google Scholar

41 Text of Twenty One Demands, in Kato to Eki Hioki, December 3, 1914, Japan, Gaimusho, , Nihon Gaikō Nempyō Narabi ni Shuyō Bunsho (2 vols., Tokyo, 1955), I, 384.Google Scholar

42 Williams to Bryan, February 2, 1915, Woodrow Wilson Papers (Library of Congress).

43 Bryan to Chinda, March 13, 1915, United States, Department of State, Papers Relating to the Foreign Relations of the United States, 1915, 105–111.

44 George Guthrie to Secretary of State, March 21, 1921, telegram, ibid., 113–15; Takaaki Kato to Sutemi Chinda, March 13, 1915, telegram, Library of Congress, Microfilm of the Japanese Foreign Office Archives, PVM 12, Documents Relating to China (Shina Kankei), 3655. Hereafter cited as PVM 12.

45 Bryan to Wilson, March 22, 1915, Wilson to Bryan, March 24, 1922, Bryan to Guthrie, March 26, 1915, telegram, Papers Relating to the Foreign Relations of the United States: the Lansing Papers, 1914–1920, II, 409–414; Bryan to Guthrie, March 26, 1915, telegram, Foreign Relations, 1915, 116–17; Library of Congress, Microfilm of the Japanese Foreign Office Archives, SP 16, The Problem of the So-Called Twenty One Demands (Iwayuru Nijuikka-jo no Mondai), p. 16. Hereafter cited as SP 16.

46 Kato to Hioki, March 30, 1915, telegram, PVM 12, p. 3660.

47 SP 16, pp. 17–28.

48 Bryan to Chinda, May 5, 1915, RG 84, Peking Post File, 1915, No. 80.

49 Exchange of notes between Hioki and Lu Cheng-hsiang, March 25, 1915, Foreign Relations, 1915, 117.

50 In addition to a retainer of $6,000 a year, Gillis was promised a commission of one half of one percent on contracts that he might win from his patrons. (Knox, S. M. to Col. Bucker, E. G., September 23, 1915, “Investigation of the Munitions Industry,” Hearings before the Special Senate Committee Investigating the Munitions Industry (39 parts, Washington, 1934–1936), X, 2274.Google Scholar

51 George C. Davison to Gillis, February 13, 1915, April 5, 1915, May 19, 1915, Electric Boat Company Records (Baker Library, Harvard University).

52 Davison to Gillis, August 9, 1915, ibid.

53 Davis to Gillis, September 10, 1915, ibid.; Daniels to Davison, September 15, 1915, RG 80, General Records of the Navy Department, No. 6320/189.

54 Memorandum of interview between Wei Han and Schwab, October 27, 1915, Davison to Gillis, November 1, 1915, Electric Boat Company Records.

55 Henry B, Carse to Davison, February 15, 1915, ibid.

56 Reinsch to Secretary of State, January 10, 1917, KG 59, State Department Decimal File, No. 893.6351/2.

57 Contract between the Kiangnan Dockyard and the United States Shipping Board, July 10, 1918, National Archives, Record Group 32, United States Shipping Board, Legal Records of the Financial Department. For correspondence relating to this episode and to an abortive effort by the Pacific Mail Steamship Company to assume management of the dockyard, see RG 59, State Department Decimal File, No. 693.642.

58 Sir John Jordan to Ch'en Lu, May 5, 1919, Foreign Relations, 1919, I, 670.

59 Alusna Peking to Navintel, June 10, 1921, telegram, RG 38, Office of Naval Intelligence Register, No. 4789, E-9-c; Lee Ting-hsin to Charles R. Crane, June 9, 1921, RG 84, Peking Post File, 1921, No. 860.

60 Albert B. Ruddock to Secretary of State, August 29, 1921, Jacob G. Schurman to Secretary of State, November 21, 1921, RG 59, State Department Decimal File, No. 893.34/156.161.

61 From consul Nanking, January 13, 1922, ibid., No. 893.35/1; New York Times, February 19, 1922, p. 21.

62 Gillis was recalled to active duty to serve as naval attache in Peking during World War I, but he again resumed his civilian position as agent for the Electric Boat Company in 1919. Gillis to Davison, June 3, 1919, Electric Boat Company Records; George W. Struble to Secretary of State, August 6, 1921, RG 59, State Department Decimal File, No. 893.34/150; Gillis to Struble, October 31, 1921, RG 84, Peking Post File, 1921, No. 860.

63 MacMurray to Hughes, June 21, 1921, RG 59, State Department Decimal File, No. 893.34/162.

64 Lee to Ruddock, July 7, 1921, RG 84, Peking Post File, 1921, No. 860.

65 Hughes to American legation, Peking, August 4, 1921, telegram, RG 59, State Department Decimal File, No. 893.34/146.

67 Schurman to Secretary of State, April 3, 1922, telegram, RG 59, State Department Decimal File, No. 893.34/163; Alusna Peking to Navintel, April 6, 1922, National Archives, RG 45, Naval Records and Library Collection, Telegrams, Vol. 84.

68 Senior member to Secretary of the Navy, April 19, 1922, Endorsement by the General Board, May 19, 1922, Navy Department, Office of Naval History, General Board Papers, File No. 438.

66 Alusna Peking to Navintel, February 13, 1922, RG 80, General Records of the Navy Department, No. 6320–310:1.

69 Memorandum by MacMurray, April 12, 1922, RG 59, State Department Decimal File, No. 893.34/201.

70 Aide Memoire, May 4, 1922, and replies, Foreign Relations, 1922, I, 745–61.

71 Struble to Hughes, May 19, 1922, RG 59, State Department Decimal File, No. 893.34/201.

72 W. W. Yen to Schurman, June 20, 1922, RG 84, Peking Post File, 1922, No. 860.

73 Gillis to Carse, May 9, 1922, Electric Boat Company Records. The solicitor of the State Department held that the United States had no ground for objecting to the cancellation since the American government had prevented China from going ahead with the enterprise. Memorandum by solicitor, July 19, 1922, RG 59, State Department Decimal File, No. 811.34/187.

74 Objections by Japanese Naval General Staff, February 1923, in Kameji Ide to Tokichi Tanaka, February 10, 1923, Library of Congress, Microfilm of the Japanese Foreign Office Archives, MT 5.1.1.31, pp. 229–30.

75 Admiral Mark Bristol to Secretary of the Navy, undated, RG 59, State Department Decimal File, No. 811.32692/20.

76 Kellogg to Secretary of the Navy, March 19, 1929, ibid.

77 Memorandum by Stanley K. Hornbeck, August 22, 1929, ibid. No. 811.32793/23.

78 Contract between Navy Minister Yang Shu-chuang and Sir Miles Lampson, June 20, 1929, ibid., No. 893.30/48.

79 Nelson T. Johnson to Bethlehem Steel Company, July 11, 1929, ibid., No. 893.34/211.