CHINA: C. E. R. Seized

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With a suddenness that jolted the world from its hopes for peace in war-torn China, pygmy President Chiang-Kai-shek, who conquered all China in three years, seized Manchuria's 250-million-dollar Chinese Eastern Railway, 1,179 miles long, which belies its name by belonging to Soviet Russia. Seized and packed post haste from Harbin, headquarters of the C. E. R., were 174 Soviet railway officials and! employes. They scuttled north, minus their belongings, into Siberia. General Manager A. I. Emshanov who had refused the peremptory request of Lu-Yung-hwang, President of the C. E. R. directorate, to hand over the railway management, found himself suddenly being hustled with his office force through Harbin's cobbled streets and dusty squares and locked into his house preparatory to being booted from the country. Almost immediately, the Chinese assistant general manager, Shan Chi-khan, walked into the empty Em-shanov office, sat down, took charge for China and kept the trains moving despite riots.

The C.E.R.'s Telephone and Telegraph Co., seized by District Governor Chang Ching-Lin, reported the success of the stroke to President Chiang and to Manchuria's War Lord, Marshal Chang Hsueh-Liang, awaiting word at Peking where they had planned the coup.

Back to his capital at Nanking went satisfied President Chiang; up to his fortress at Mukden, Manchuria, 400 miles from Harbin went the "Tiger's Cub," young Chang, after helping to break the railroad treaty concluded by his father, the late, mighty Chang Tso-lin (TIME, July 2, 1928). Both went to marshal armies against further trouble for both knew that seizure of the C. E. R. was open signal to a battle by which they hoped to crush the Russian domination of China's wealthiest region.

Simultaneous with the seizure of the Railway, last week, the Chinese Government announced dead the treaty negotiated by Marshal Chang Tso-lin in 1924 covering its joint operation by Russia and China. President Lu Yung-huang, unmuzzled at last, explained: "Since 1924, violations of the Treaty have been numerous. . . . Soviet Communist propaganda through . , . the railway is proved by documentary evidence seized in the recent raid of the Soviet Consulate at Harbin. We are constrained to take the present drastic measures to safeguard China's interests." Distinctly a threat was his conclusion: "If Russia resorts to retaliatory measures, China is prepared to deal effectively with them."

In Peking Foreign Minister C. T. Wang announced the end of all diplomatic relations between China and Soviet Russia. He eased off the threat of war thus: "We are not inimical to Soviet Russia. Positively we are not unfriendly. But we will not tolerate Soviet propaganda."

While troops were reported massing last week on both sides of the Sino-Russo boundary, the Soviet Government signified it would do its utmost to prevent their clashing, despatched from Moscow by air Railway Commissioner L. B. Serebriakov to confer with China's Foreign Minister. Onlookers wondered how oldtime Bolshevik Serebriakov, now high in the Communist Party, would deal with Communist-enemy Wang. Wise ones pointed out that Comrade Serebriakov is also vice president of Amtorg Trading Corp. of Manhattan, giant trade outlet for Russian goods; that he would doubtless do his conciliatory best to avoid Russia's having to revert to the slow,