893.00/15183
Memorandum of Conversation, by the Ambassador in China (Gauss)79
On invitation of Madame Chiang Kai-shek, I attended a tea at the Chiang residence yesterday afternoon …
. . . . . . . . . . . . . .
After the usual exchange of courtesies (during which I extended my best wishes on his birthday), the Generalissimo turned to other subjects. I record the pertinent parts of the conversation.
[Here follow references to the “Tokyo–Nanking Alliance” and the Four-Power declaration.80]
3. The China Situation. He then asked me pointedly what I thought of the China situation at this time. I avoided any reference to the political and military situation by saying that since my return from the United States I had been particularly interested in bringing myself abreast of the general position and had lately been studying the economic developments which had taken place during my absence I continued that for the past six or more years China has been facing a rapidly developing economic situation which presented problems of great importance and difficulty even for trained economic experts; I had been a keenly interested observer of these developments and of the measures which had been taken to endeavor to meet them.
The Generalissimo then undertook an exposition of his views on the situation. He commented that the most important factor recently had been the provision of the gold loan from the United States. It had improved public confidence. He said that there are four important factors in the economic situation:
- 1.
- Public confidence.
- 2.
- Public administration.
- 3.
- Transportation.
- 4.
- Good harvests.
He regarded public confidence as of outstanding importance; and on this heading, he considered that two important elements in restoring or improving public confidence had been
- 1.
- The making available of gold by the United States.
- 2.
- The encouraging news of the progress of the war.
He repeated again that the action of the United States in making the “gold loan” available to China had been the most important factor [Page 372] in restoring confidence; and he wished that I would let this be known to Secretary Morgenthau. He said that he also thought that if some publicity could be given in the United States to the fact that gold had been made available to China, the resulting publicity in China would have a beneficial effect in further strengthening public confidence. He said that the improvement in public confidence was reflected in a greater stabilization of the prices of necessities which had recently been noted. (Note: At a recent press conference the Government spokesman told foreign correspondents that there has been a stabilization in the price of rice, cotton yarn and cotton cloth, and even a slight decrease—very slight indeed, but nevertheless a decrease—in the price of coal. CEG).
4. The End of the War. In response to my comment that I hoped that this improvement in the situation would continue, the Generalissimo said that he thought it would and that the end of the war is in sight. He said that he thought another year would see the principal battles fought and won; then perhaps it might take a little time to mop up and complete the picture.
The balance of the conversation was more personal—my health, the new Embassy quarters on the north bank, et cetera.82
- Copy transmitted to the Department by the Ambassador in China in his despatch No. 7758, November 1; received November 18.↩
- Signed at Moscow, October 30, 1943, Department of State Bulletin, November 6, 1943, p. 308.↩
- The Counselor of Embassy also had a conversation with Generalissimo Chiang, who expressed interest in pending efforts of the American Congress to repeal exclusion laws; for correspondence on the latter subject, see pp. 769 ff.↩