793.94/7096: Telegram
The Second Secretary of Legation in China (Atcheson) to the Secretary of State
[Received June 21—10:45 a.m.]
175. 1. It is reported but not confirmed that the Kwangtung air force has sent a number of planes to the Hunan border to be prepared for eventualities. It is reliably reported that Pai Chung Hsi has sent an emissary to Chiang Kai Shek at Chengtu and this is taken as a hopeful sign.
2. Irrespective of any outside influence toward an open break with Nanking, there are said to be concrete causes of dissatisfaction in Kwangtung and Kwangsi arising from measures taken by the National Government to consolidate its position in nearby provinces. The establishment of government authority in Kiangsi following the departure of the Communists, the more recent reorganization of the Kweichow Provincial Government and the achievement in May of an apparently good understanding between the Yunnan Chairman [Page 270] and Chiang Kai Shek have tended to isolate the two Kwangs strategically and are understood to have had an adverse economic effect upon them. It is reported that shipment of opium from Szechwan and Yunnan which formerly passed through and paid revenues in Kwangsi and Kwangtung have been diverted and that the former general trade with Kiangsi has likewise been lost. Furthermore, the National Government has had plans, which have not been effectuated presumably because of Ho Chien’s ambiguous position, of stationing a considerable body of Chiang’s troops in Hunan and of constructing a series of air fields from Changsha in the direction of the Kwangtung border. These considerations are said to have caused Chen Chi Tang and Pai to feel that Chiang was working slowly but effectively for their ultimate elimination and they took advantage of the difficulties in North China to undertake some maneuver which has caused the grave disquiet in Nanking mentioned in previous telegrams.