Memorandum by Mr. Raymond C. Mackay, of the Division of Far Eastern Affairs, of a Conversation With Mr. L. R. Holbrook

Mr. Holbrook stated that he and most of his American associates at the Hangchow Flying School recently returned from China; that only one officer and two mechanics of the American personnel remained at the school; that he had accepted a new two-year contract with the Chinese Government in the capacity of a technical adviser to the Central Trust; that the Central Trust is the recently created purchasing department of the Central Government of China, which trust, although for the present confining its activities to the field of aviation, will, it is expected, ultimately effect purchases of all supplies for the Chinese Government. Mr. Holbrook stated that his present contract resulted from occasional association with the Soong family and rather intimate association with Dr. H. H. Kung; that he is now making a study of the American market for such aviation supplies as China may require; that he will eventually offer recommendations to the Central Trust but will not make purchases of any kind.

Mr. Holbrook also stated that he had been instructed to endeavor to obtain for the Hangchow Flying School the services of five American flying officers to replace other American officers whose contracts, like his own, recently had terminated; that the new officers will be employed only as instructors; that they will be civilians; and that they will not be military officers of the United States Government.

On taking leave, Mr. Holbrook made a statement to the effect that, as the son of an American Army officer (Major General Holbrook), he is first, last and always an American citizen and that he wished to make entirely clear the fact that he is not in the United States in an attempt to obtain for the Chinese Government aviation supplies or other equipment the free export of which to other governments is restricted in any way by the War Department or by other departments of the American Government.