893.00/10856: Telegram

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



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2. From various reliable sources there is a unanimity of view that banditry and communism in the Yangtze Valley and South China are of as much concern to Nanking as are their more organized adversaries in the North. The Provinces of Kiangsi and Hupeh are very largely in the hands of these irregulars and even Hankow itself is not considered to be entirely safe from the possibility of attack. Many of the district magistrates have fled and the more wealthy Chinese are in increasing numbers taking refuge in the treaty ports. The economic disorganization occasioned by these activities has been aggravated by the rice shortage in the Yangtze Valley and by the market disturbances caused by the unprecedented fall in silver. I am also informed that the recent growth of communism in China has brought about a renewed interest on the part of Moscow which is [Page 14] extending financial support to selected Chinese groups. Should this trend toward local anarchy continue unchecked the safety of foreign residents in many parts of the interior may be much more seriously jeopardized than it has been at any time since 1927. In this relation, see despatch of May 22nd from the Commander in Chief to the Secretary of the Navy just received by the Legation subsequent to the preparation of the foregoing telegram.

For the Minister:
  1. Telegram in three sections.