ulterior designs of Austria-Hungary may have been at the conclusion of the treaty of Berlin, the expressions used, namely, "occupation and administration" do not amount to a grant or cession of territory, and however prolonged the occupation or administration may or might be it would nevertheless be, in contemplation of law, temporary. Each succeeding year, however, rendered the evacuation of the provinces less probable, if not more difficult, and reduced Turkish sovereignty to a claim of right. While article 25 of the treaty of Berlin did not subject Novibazar to Austro-Hungarian influence, the article reserved to Austria-Hungary "the right of keeping garrisons and having military and commercial roads in the whole of this part of the ancient vilayet of Bosnia," and that "to this end the governments of AustriaHungary and Turkey reserved to themselves to come to an understanding on the details." Within a year of the treaty of Berlin Austria-Hungary exercised the reservation and garrisoned Novibazar. Austria-Hungary, evidently, regarded its presence in Novibazar as of a temporary nature for upon proclaiming the annexation of Bosnia. and Herzegovina, the dual monarchy withdrew its troops from Novibazar, thus returning it to Turkish control. While this action on the part of Austria-Hungary may have simplified the problem, it did not solve it. The question still remained upon what terms would Turkey recognize the severance of Bosnia and Herzegovina from its temporal domain. After negotiation extending over several months it seems probable that an agreement has been reached between the two counties by the terms of which Austria is to pay Turkey 2,500,000 Turkish pounds, in instalments within a period of two years; that upon payment of the total sum a commercial treaty will come into force and that Austria-Hungary proclaims its protectorate over the Albanian Catholics. With the acceptance of this proposal the Bosnia-Herzegovina difficulty will be settled, at least for the present.

The difficulty with Bulgaria has been at times so acute as to threaten. a resort to arms. The situation in Bulgaria has been complicated by the fact that while the treaty of Berlin in its first article constituted Bulgaria an autonomous and tributary principality under the suzerainty. of the Sultan, Bulgaria has persistently and continuously claimed and exercised the rights of a sovereign state, and, as is well known, in 1885 annexed Eastern Roumelia which by virtue of article 13 of the Treaty of Berlin was to remain "under the direct political and mili tary authority of his Imperial Majesty the Sultan, under consideration

of political autonomy." By the annexation of Eastern Roumelia, Bulgaria violated the treaty of Berlin, and by its proclamation of independence on October 5, 1908, a still further violation of the treaty was committed. It must be said, however, that the claims of Turkey upon Bulgaria existed in theory, for in fact Bulgaria has for years past been independent. For example, it attended the Second Hague Conference in 1907 as an independent sovereign state on terms of equality with the other members of the conference, presented projects, voted as did the others, and signed the convention in its own name and in its own right.

Theoretically, however, Bulgaria was not independent. According to the conventional law of Europe it was and is, until its independence. is recognized, legally dependent upon Turkey. It is not to be supposed, however, that the development of the past thirty years will be checked and that Bulgaria would be subjected even nominally to Turkish control, but it is equally obvious that Turkey would be unwilling to renounce even a theoretical claim of right without compensation. Bulgaria has been willing to purchase the independence it claims and asserts, and Turkey is not unwilling to recognize the actual state of affairs. The difficulty exists in the fact that while Turkey is willing to accept one hundred and twenty-five millions of francs, in full satisfaction of its claims, Bulgaria is willing to pay but eighty-two millions. A dead-lock seemed to have arisen when through the ingenuity of M. Isvolsky, minister of foreign affairs for Russia, a proposal was made which has received the unqualified approbation of Bulgaria as well as of the signatories of the treaty of Berlin.

It appears that Turkey is indebted to Russia by reason of the RussoTurkish War in the amount of some twenty-two million pounds sterling, payable in seventy annual instalments. Russia agrees to cancel a sufficient number of instalments to enable Turkey to borrow the sum demanded from Bulgaria, namely one hundred and twenty-five millions of francs, and Bulgaria undertakes to reimburse Russia to the extent of eighty-two million francs in the form of an annual payment of about five millions for interest and sinking fund. As the London Times in its issue of February 2, 1909, points out, "The arrangement has the further advantage of eliminating financial control of Bulgaria's finances, without which she could not have raised a war loan abroad, while it will not impose any immediate heavy loss on the Russian exchequer. Instead of the eight million francs received annually from

the Ottoman bank Russia will for the next sixteen (eighteen?) years, draw five million francs from Bulgaria."

Settlement upon these terms will be a great diplomatic triumph for Russia which thus enables Turkey to enforce its demands without loss of prestige, enables Bulgaria to purchase its independence upon its own terms, at the sacrifice on the part of Russia of a part of a debt created for the independence of the Balkan states. M. Isvolsky's project is as generous as it is farsighted and statesmanlike. The complications of the Balkan situation are likely to be eliminated without a trace of ill-feeling to the satisfaction of all the parties in interest.

THE REMISSION OF A PORTION OF THE CHINESE INDEMNITY

1

In President's Roosevelt's message of December 3, 1907, he asked for authority to reform the Chinese indemnity, paid to the United States for the compensation of losses arising out of the Boxer troubles of 1900, by remitting and cancelling the obligation of China excess above the sum of $11,655,492.69. The indemnity allotted to the United States by the final protocol signed at Peking, September 7, 1901, amounted in round numbers to over $20,000,000, and of this sum China had paid to January 1, 1907, a little over $6,000,000. The desire of the United States was to secure compensation for losses actually suffered by its citizens in their business interests. It was not in any sense of the word in the nature of punishment or exemplary damages, exacted for a definite purpose. It was as just as it was generous that the United States should return the unexpended balance of the indemnity for its retention would be inconsistent with the purpose of the indemnity as understood by the United States and would properly be a cause of irritation to China by making its misfortunes a source of profit to a foreign government. The following quotation from the president's message places the proposed action of the United States. in its proper light.

It was the first intention of this government, at the proper time, when all claims had been presented and all expenses ascertained as fully as possible, to revise the estimates and account, and as a proof of sincere friendship for China voluntarily to release that country from its legal liability from all payment in excess of the sum which should prove to be necessary for actual indemnity to the United States and its citizens.

1 See Vol. 2, p. 160.

This nation should help in every practical way in the education of the Chinese people, so that the vast and populous Empire of China may gradually adapt itself to modern conditions. One way of doing this is by promoting the coming of Chinese students to this country and making it attractive to them to take courses at our universities and higher educational institutions. Our educators should, so far as possible, take concerted action toward this end.

On December 28, 1908, the President of the United States, acting upon the advice of Elihu Root, Secretary of State, issued the following executive order:

Pursuant to the authority of the joint resolution of Congress to provide for the remission of a portion of the Chinese indemnity, approved May 25, 1908, I hereby consent to a modification of the bond for $24,440,778.81, dated December 15th, 1906, received from China pursuant to the protocol of September 7, 1901, for indemnity against losses and expenses incurred by reason of the so-called Boxer disturbances in China during the year 1900, so that the total payment to be made by China under the said bond shall be limited to the sum of $13,655,492.69 and interest at the stipulated rate of four per centum per annum, and that the remainder of the indemnity to which the United States is entitled under the said protocol and bond be remitted as an act of friendship, such payment and remission to be made at the time and in the manner hereinafter provided, which I deem to be just, that is to say:

In accordance with the plan of amortization annexed to the original indemnity bond, the amounts payable hereafter by China to the United States would be as set forth in the schedule annexed hereto marked "Schedule A," and identified by the signature of the Secretary of State.

I have caused an account to be made by the Treasury Department in which the payments already made under the original bond are credited as against a debt of $13,655,492.69, with interest at four per centum per annum beginning July 1, 1901, in lieu of the original sum specified in the bond, and I find that after such credits, and including in such credits the sum of $85,223.04, which it is assumed will be paid on the 1st of January, 1909, there will remain on that day to be paid and retained by the United States, in satisfaction of the sum of $13,655,492.69 and interest thereon, the sum of $9,644,367.60.

It also appears by the said new account that the payment to and retention by the United States of the sums specified in the paper hereto attached, marked "Schedule B," and identified by the signature of the Secretary of State, will satisfy the principal and interest of the said sum of $9,644,367.60 by the end of the period contemplated in the original plan of amortization. And I direct that after the said 1st day of January, 1909, from the several payments made under the said bond of December 15, 1906, in accordance with "Schedule A," there be retained and paid into the Treasury of the United States only the sums specified in Schedule B; " and that the remainder of the said several payments so made by China in accordance with "Schedule A " over and above the sums specified by "Schedule B" be returned by endorsing back the drafts therefor, or otherwise, and thus remitted to the Government of China. The sums to be so returned in

each year will be as stated in the paper hereto attached marked "Schedule C," identified by the signature of the Secretary of State.

The provision contained in the original bond for an adjustment of interest because payments are made monthly instead of semi-annually will continue to be applicable to the payments of the sums specified in "Schedule B."