[Enclosure]
Memorandum of Conversation, by the Chargé in
China (Vincent)
Chungking, April 23,
1943.
Yesterday I had tea with Dr. Wang Shih-Chieh, at his invitation, and a
two-hour discussion regarding various subjects introduced by Dr. Wang.
Dr. Kuo Pin-chia, close friend of Dr. Wang, was present throughout most
of the conversation.
Dr. Wang said that he would like to have clarified in his mind the
relation between the Embassy and the various other official American
organizations represented in Chungking. He mentioned specifically the
American Information Service, the Board of Economic Warfare, and the
American Army. I told him that the AIS represented the Office of War
Information in Washington which was an organization separate from the
State Department but that the director of AIS (Mr. Fisher, and in his
absence Mr. Stewart) operated under the general supervision of the
Embassy and in close cooperation therewith. The same situation, I said,
obtained with regard to representatives in China of the Board of
Economic Warfare. I described in general terms the personnel, setup, and
work of each. With regard to the Army, I told Dr. Wang that General
Stilwell’s Command in this area was completely independent of the
Embassy but that there were, as occasion therefor arose, exchanges of
view between the one and the other on matters of mutual interest or in
regard to matters in which the one or the other desired specific
information or assistance. In reply to his inquiry I told him that there
was no provision for regular conferences between the Army Command and
the Embassy. Dr. Wang did not indicate the reason for his inquiry (I
think it was simply curiosity) and I did not pursue the subject.
Knowing that Dr. Chien Tuan-sheng was a friend of Dr. Wang, I mentioned
two articles which I had read recently by Dr. Chien on China’s post-war
peace problems (Embassy’s despatch no. 1062 of April 7, 1943 and
despatch no. 1078, April 14, 194315a). Dr. Wang said that he was familiar with Dr.
Chien’s ideas on the subject but had not read the articles. I mentioned
Dr. Chien’s discussion of “welfare economy” for China as distinguished
from “defense economy”. I
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referred to comments made to me recently by Dr. Tseng Yang-fu, Minister
of Communications, who had said that it was impossible in China to make
such a distinction with regard to the future economic problems of China
and that anyone who attempted to do so was talking hypothetical
nonsense; that post-war development of industry and mining, of
communications, and of trade, would be for the welfare and defense of
the Chinese people. I had pointed out to Dr. Tseng that this might be
true with a very large proportion of post-war economic development but
that there would be an important minor proportion where a cleavage
between the two objectives might exist. The question would arise, for
instance, in connection with the steel industry which he had proposed
developing; that is, whether the steel was to be used in machinery to
produce consumers goods or for armament. It might also arise in
connection with a choice of routes over which to build his proposed
railways. Dr. Wang commented that the distinction made by Dr. Chien
between the objectives of postwar economic development was certainly one
which was very much in the minds of Chinese leaders at this time. He did
not feel that Dr. Chien’s discussion was irrelevant to China’s post-war
economic problems but he did not give any indication of his own views.
(I surmise that he inclines toward Dr. Chien’s viewpoint.) The
discussion was concluded with my remark that China might find that
economic development which contributed effectively toward raising the
standard of living of the Chinese people might in the long run prove a
better defense for China than a modern military organization on an
extensive scale which the Chinese people could ill afford.
Dr. Wang asked me about the post-war monetary plans and ideas that had
recently been given prominence in the press. He had heard that America
was making a strong bid for Russian adherence to the American monetary
stabilization plan. He subsequently expanded this statement by saying
that Britain was also making a bid for Russian support of the British
plan. I told Dr. Wang that I had no official information on the subject.
He said that he understood the British envisaged discussions only
between Great Britain and America in the initial stages, whereas the
Americans seemed to have left the matter open with a view to general
discussion among all interested nations. I told him that I knew nothing
of the British ideas for consideration of their scheme (I understand
that the British scheme has been submitted to the Chinese Government for
its consideration) but that I thought we were prepared to discuss our
scheme with interested nations; that these discussions would be more or
less along the line of an informal exchange of views; and that the
participants would probably be our own Treasury officials and the
financial experts of various interested countries some of whom were
already in the United States.
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Dr. Wang said that he did not feel there was any fundamental difference
in the American and British objectives which would prevent an agreement
with regard to a stabilization plan. He expressed preference for the
British emphasis on trade rather than gold as the basis for a
stabilization fund, and he thought that the Russians might also find the
British scheme preferable. With regard to the Russians, he said that any
scheme which envisaged that the Russians might be willing to abandon or
modify their managed socialist economy, particularly with regard to
foreign trade, would be unrealistic. He suspected that the Americans
were inclined to be naively sanguine in this regard. He said that
probably many countries would have government-controlled foreign trade
after the war. Such would be the case with China, he felt sure. I told
him that from what I had heard and read I thought that our Treasury
officials and others had a fairly clear, as well as sympathetic,
understanding of the Russian post-war economic position. Dr. Wang said
that he had seen the British scheme and asked me whether I had a copy of
the American scheme. I told him I did not but would endeavor to get one
from Mr. Adler, our Treasury Department representative on the Chinese
Stabilization Board.
[Here follow four paragraphs of comment regarding post-war Europe.]
Dr. Wang next spoke of global strategy in the war and asked whether I
thought that, if an offensive in Western Europe failed to come off this
year or was inconclusive by next autumn, a revised strategy might not be
decided upon to take the place of the strategy which he assumed was
adopted at the Casablanca Conference. He had in mind obviously the
question whether or not greater attention might be given to the Pacific
theater of the war. I remarked that, as he clearly understood, I was not
competent to comment on military strategy and that I did not have any
“inside” information. He asked for my personal view. I said that my own
view was that an offensive in Western Europe would take place this year
and that it would be sufficiently conclusive to indicate clearly that
the end of the war was approaching in Europe if in fact it did not
actually bring about the defeat of Germany. I went on to say, however,
that there seemed to me to be some confusion in Chinese thinking
regarding the American, and the British, attitude toward the two
principal theaters of the war—Europe and the Pacific. America and
Britain were in complete agreement regarding prosecution of the war, but
the roles they had to play were not identical. Great Britain must of
necessity devote its principal if not its entire attention to the
European theater. Transference of any considerable British strength from
Europe to the Far East would be unsound. Therefore when Churchill spoke
of
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giving prior attention to
the battle in Europe he was not simply expressing a preference but was
stating a necessity. With America the situation was not exactly the
same. We were aiding in Europe and would continue to do so in increasing
degree but this did not mean we were neglecting the Pacific area. To
commence a real offensive in the Pacific additional naval strength was a
necessity. Air strength was a vital adjunct to a navy but it could not
operate successfully without a navy in the type of warfare which must be
conducted in the Pacific. It was my thought therefore that from the
American point of view an offensive in the Pacific was not contingent,
as in the case of the British, upon victory in Europe but upon the
progress made in our construction program of naval and merchant vessels.
From what I had heard, progress of this program was very encouraging and
would, I thought, warrant greatly increased activity in the Pacific
area, if not an all-out offensive, before the end of this year. I again
pointed out that, while success in Europe obviously would be an aid to
our offensive in the Pacific theater, that offensive was not actually
being made contingent upon success in Europe. Referring back then to Dr.
Wang’s question, I said that, whereas developments might call for
alterations in tactics, American strategy with regard to the Pacific
area was already decided upon and would be pursued irrespective of the
question which he had raised regarding developments in the European
theater.
Dr. Wang and Dr. Kuo expressed appreciation of this viewpoint. Dr. Kuo
made the startling statement, for a Chinese, that he believed the
American offensive would be carried out in so far as possible directly
against Japan and that offensives in Burma and China would be of
secondary importance.
The conversation closed. Dr. Wang said that we should have another
meeting very soon at which time we could discuss problems more directly
concerned with the situation in China and in relation to China.
