The Ambassador in China (Gauss) to the Secretary of State

No. 2139

Sir: I have the honor to acknowledge the receipt of the Department’s instruction no. 489, January 6, 1944, in regard to a reported lack of adequate coordination among the several American Government agencies maintained at Chungking.

It is assumed that the Department has reference principally to the Embassy’s functions in the coordination of the activities of the China offices of civilian agencies; the Office of War Information, the Foreign Economic Administration, and the Inter-Departmental Committee (for the acquisition of foreign publications).

In general, coordination of the work of the several American Government civilian agencies affiliated with the Embassy has proceeded without major difficulty and I am on the whole satisfied with the present situation.

Foreign Economic Administration

This Administration now combines the former Office of Economic Warfare and the Lend-Lease Administration which formerly were represented independently at Chungking. With the combining of the two agencies, Mr. Walter Fowler, who had headed the Economic Warfare agency, was appointed by Washington to have over-all charge of the combined agency. Mr. Fowler is now in Washington on consultation. At the time of his departure it was suggested by F. E. A. in Washington that Mr. Franklin Ray, Assistant Administrator of the Lend-Lease Administration, then in China, should substitute for Mr. Fowler. The latter, however, felt that as Mr. Ray was not familiar with the O. E. W. work, it was not desirable that he should take charge of the combined agency. Therefore, the O. E. W. branch of the F. E. A. at Chungking is for the time being under the charge of Mr. Harry Lucker, Mr. Fowler’s principal assistant in O. E. W. work, while the Lend-Lease (civilian) branch of the Administration agency is in charge of Mr. Calvin Joyner, who had been sent out from Washington to handle civilian lend-lease matters. Mr. Franklin Ray has continued his work of supervising the establishment of the lend-lease representation at Chungking and Kunming. There has been no friction amongst these officers and the work of F. E. A. in China is proceeding smoothly, and, I believe, efficiently.

The Embassy maintains liaison with the F. E. A. agency through (1) a liaison officer of the Embassy designated to handle day-to-day [Page 15] contact and (2) through personal conferences by the Ambassador with the heads of the two F. E. A. divisions.

While Mr. Fowler was at Chungking he was in frequent consultation with the chief of mission on the work of his agency, informing the chief of mission of, and consulting him on, matters of major importance and policy—and at times, on minor matters. This liaison was completely satisfactory to me and I assume that it was satisfactory to Mr. Fowler.

Since Mr. Fowler’s departure for Washington there has not been frequent occasion for Mr. Lucker to consult with me; he has been carrying on the work under the policies laid down by Mr. Fowler. Recently he has consulted with me on such matters as proposed barter of commodities and the proposed use of gold bullion in payment for tin shipments. This liaison has been satisfactory.

Likewise, I have from time to time consulted with Mr. Joyner, and also with Colonel Gaud (the military lend-lease representative) on lend lease matters. This liaison has likewise been entirely satisfactory to the Embassy.

All telegraphic correspondence between F. E. A. and Washington is conducted through the Embassy. Copies of these telegrams are seen by me and by the Counselor49 as well as by the liaison officer of the Embassy for the F. E. A. agency. In order to expedite the dispatch and delivery of telegrams, the Embassy liaison officer acts on them immediately; outgoing telegrams are sent over my name (and submitted to me later for signature) and incoming telegrams are immediately handed over to F. E. A. (with copies to me later), unless the matters may seem to the liaison officer to require to be laid before me personally before dispatch or delivery of the telegrams.

The mail reports of the F. E. A. agency are sent under unsealed cover to the Embassy, examined by the liaison officer, and transmitted to Washington by pouch. Any matters of special interest or importance are brought to the attention of the Ambassador. All unsealed covers from Washington received by pouch for the F. E. A. agency are examined; where the letters or directives are accompanied by copies, such copies pass over my desk. Some sealed covers are received in the pouch for the agency. The Embassy has no means of knowing what they contain. I am satisfied, however, that any matters of importance coming under such covers would be brought to my attention by the agency.

The Embassy has sought to exercise its coordination activities intelligently and helpfully. Its supervision has not been merely perfunctory. The liaison is maintained as between all agencies. For [Page 16] example, the Cultural Relations specialist on electrical engineering has for some weeks been seeking to obtain from Washington a copy of certain American electrical standards for the use of the National Resources Commission. He has in mind, properly and with foresight, our future trade with China in electrical equipment and encouragement of the adoption by China of American standard specifications rather than European standards to which American manufacturers must adapt themselves. In connection with lend-lease requests for electrical equipment and the specification standards in the Chinese requests, the Embassy saw fit to hold up the transmission of telegrams pending a conference between the lend-lease representative and the Cultural Relations specialists. This consultation was held promptly and in good spirit, and with satisfactory result.

All in all, so far as concerns the Foreign Economic Administration, in its two branches, the former O. E. W. and O. L. L. A. activities, the coordination and supervision prescribed by the Department is being carried out. The measure of cooperation displayed by officers of the F. E. A. organization has been entirely satisfactory to me. The duties of the Embassy have been carried out in a spirit of complete goodwill and cooperation; there has been no attempt to interfere or direct or criticize; the work has been done quietly and without any attempt at public show. In my opinion the result has been entirely satisfactory.

Office of War Information

This organization is the oldest of the civilian war agencies established at Chungking in connection with the Embassy. It is known generally as the “American Information Service; American Embassy”. There is some tendency of late to have it known also as the China Division, Office of War Information.

This agency was started in a modest way under the competent direction of a former American press correspondent who continues at its head in its present greatly expanded form.50

I have felt for some time that this extensive and expensive organization cannot entirely be justified; that the “law of diminishing returns” has long since come into play; that the results obtained do not fully justify the heavy financial outlay; and that the O. W. I. headquarters in Washington has been much too lavish in the way both of salaries and allowances (including “representation” allowances to practically every member of the American staff, low as well as high; allowances which are an embarrassment to their Foreign Service colleagues at the same posts).

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However, the policy and direction of O. W. I. reposes in Washington, and, beyond repeatedly directing the attention of the head of the China agency to my view on the high cost of this activity, I have not felt that my duties to coordinate and in a general way, supervise this agency included any authority of direction in respect to its expenditures and set-up.

As in the case of F. E. A., an officer of the Embassy is specially designated as liaison officer for the O. W. I. agency, to maintain the day-to-day contact. Telegrams are handled in the same manner as in the case of F. E. A.; outgoing telegrams are sent over my name without delay unless they contain matters which the liaison officer considers should first be brought to my attention (which is seldom the case). Incoming telegrams are handed over to the O. W. I. agency through the liaison officer and copies come to me in the usual course. The mail from this agency to Washington is submitted in unsealed covers; it is examined before transmission. Copies are brought to my attention with any portions requiring special attention appropriately marked.

I also maintain direct personal contact with the head of this agency. When the agency was first set up this contact was close. As the organization has expanded, the head of the agency has more frequently been absent from Chungking and the opportunity for close personal liaison has not always presented. I have, however, maintained as close watch as possible over the activities of this agency.

I have had occasion from time to time to criticize certain activities; on several occasions, rather sharply. The faults have been due generally to oversight, lack of proper supervision, or lack of good sense and balance by subordinates. For example, I have had occasion several times sharply to criticize the material appearing in the American Digest—a weekly information sheet in English intended for circulation principally to American missionaries and others in the country, carrying a digest of the week’s war news and copies of or extracts from magazine and other articles. On one occasion the Digest carried an article on the American Negro Problem. On another occasion it carried articles on European political problems. Inasmuch as the Digest goes to a substantial number of Chinese and foreign residents as well as to Americans it was considered inadvisable that a Government publication of this sort carry articles of the type mentioned. I have not had frequent occasion to complain on this subject; but have felt that I should keep a sharp watch on the publication (which has been in the hands of subordinates of the agency). My complaint here is largely one of lack of responsible supervision.

I have also had some occasion to remind the chief of this agency that his staff members traveling in the interior are not properly “briefed” or instructed as to their status and their duties and the [Page 18] manner in which they should conduct themselves. They must not, intentionally or unintentionally, hold themselves out as American Government representatives. Their relations with the Chinese authorities must be correct and proper. When they make speeches I expect to receive summaries of their remarks, so that supervision may be maintained over their activities.

I have also been disposed to disapprove the opening of branch offices of the O. W. I. agency in places where there are no consular offices or Embassy officers on detail to supervise the activities. The desire to set up radio sending and receiving stations has had to be dealt with, and so on.

The volume of telegraphic exchanges between this agency and Washington, and agencies in India and elsewhere, has been exceptionally heavy; and I have doubted whether it is entirely justified. This work has heavily taxed the code facilities of the Embassy, but it has been done cheerfully and promptly. The agency has been provided code machines by its home office and authorized to carry on its telegraphic exchanges with its own personnel. So far it has not done so, but I understand that a code clerk is now en route to Chungking. When this agency conducts its own code work, paraphrases of telegrams are to be supplied to the Embassy. So long as this requirement is faithfully met, the arrangement is satisfactory to the Embassy.

All in all, I have no complaint to make regarding the cooperation of the O. W. I. agency or the attitude of the chief of the agency toward cooperation with the Embassy and coordination of the agency activities under the supervision of the Ambassador. Matters requiring my intervention or guidance have been handled without friction or dispute; they have not been unusually important and have not required reference to Washington; and whenever I have had occasion to call the chief of the agency into consultation and to emphasize the Embassy’s position and policy, and give the reasons therefor, there has been complete evidence of a desire to come into line and to stay in line.

This agency conducts certain work in connection with psychological warfare in collaboration with the U. S. Army, and in this connection the O. W. I. directives place the agency under the supervision of the Theater Commander. I have not had occasion to concern myself in these activities and I am not informed thereon.

Inter-Departmental Committee

This organization for the acquisition and microfilming of foreign publications for the several departments and agencies’ of the Government at Washington has some relation to the Office of Strategic Services, War Department, but in general appears to be independent. This agency for the time being is also in charge of the microfilm program [Page 19] of the Division of Cultural Relations of the Department of State. This program, designed to bring American publications, in microfilm form, to the Chinese universities and other organizations, serves’ as an instrument through which there can be dissemination of material from the United States in exchange, or encouragement of exchange, for publications of interest to the American Government which may be available in China.

This agency has cooperated satisfactorily with the Embassy. An officer of the Embassy serves as day-to-day liaison officer with the agency, and the chief of the agency comes to see me from time to time to inform me of his activities and his problems’. He also has access to the political officers of the Embassy for guidance and background in connection with the contacts he makes in his efforts to obtain publications in China to be microfilmed and sent to Washington.

The question of the relationship of this agency to this Embassy, and to O. S. S.51 was mentioned in the Embassy’s despatch no. 1914, December 15, 1943.52

O. S. S. and the Naval Observer

While the Department’s instruction under acknowledgment probably refers only to the matter of the coordination of the activities of civilian agencies of the Government at Chungking, mention should be made of the O. S. S. set-up and the Office of the Naval Observer “of the Embassy”.53 These agencies are understood to be affiliated with an organization headed by General Tai Li,54 who at the same time is the head of the Chinese Government’s dreaded secret political police, and intelligence and general “Gestapo” agency.

While the Naval Observer has been accredited as attached to this Embassy, he makes no reports to the Ambassador and information regarding the activities of his office is limited to rumor and report from other sources.

The Embassy by its despatch no. 1999 of January 6, 194455 recommended that the Naval Observer be detached from the Embassy for the very good reasons stated therein.

U. S. Army Headquarters

The Embassy of course has no coordinating authority in connection with the U. S. Army forces in China; but it is highly important that there be close cooperation and liaison in military matters [Page 20] having political aspects. At my instance, while I was in the United States for consultation last summer, this matter was taken up with the War Department and instructions were issued to General Stilwell56 (see Department’s instruction no. 391 of September 8, 194357).

I regret to say, however, that the Embassy does not regard the liaison and cooperation between it and the Headquarters of the U. S. Army Forces as entirely satisfactory. General Stilwell is, of course, frequently absent from Chungking for long periods of time, and the Headquarters does not appear to have an appreciation of the necessity of cooperation and liaison in political matters—and military matters having political aspect—with the Embassy as the representative political agency of the Government.

The question of Army finances in China is now to the fore. In that connection, Dr. Edward Acheson has been assigned as financial adviser to the Headquarters, and in respect to this matter there is now close and friendly cooperation and complete liaison through Dr. Acheson. The Embassy is most gratified to record and to express its appreciation of this situation. It would be happy if similar liaison and cooperation might exist in connection with other matters having political aspects. The attitude of Army Headquarters is not unfriendly; the lack of close liaison and cooperation is apparently due largely to a lack of understanding on the part of most of our Army officers of their relation to the political establishment of the Government and of the necessity for close liaison in this connection. There is apparently no intelligent recognition of the political aspect of problems which come to them as military matters.

The Embassy is doing what it can to encourage closer liaison and cooperation.

An officer of the Embassy is designated as the day-to-day liaison officer with Headquarters on routine matters. On the subject of the information received at the Embassy which might be of interest to Army Headquarters, liaison is through the Military Attaché,58 who has relations both with Army Headquarters and with the joint intelligence set-up known as JICA. The Ambassador and the Counselor are the appropriate officers of the Embassy for consultation in connection with political matters and military matters having a political aspect.

Respectfully yours,

C. E. Gauss
  1. George Atcheson, Jr.
  2. F. McCracken Fisher, Director.
  3. Office of Strategic Services.
  4. Foreign Relations, 1943, China, p. 760.
  5. Capt. M. E. Miles, U. S. Navy.
  6. Director of the Chinese Central Investigation and Statistics Bureau.
  7. Not printed.
  8. Lt. Gen. Joseph W. Stilwell, Commanding General, U. S. Army Forces, China–Burma–India (USAFCBI); Deputy Supreme Commander, Southeast Asia Command (SEAC); and Generalissimo Chiang Kai-shek’s Joint (Allied) Chief of Staff, China Theater.
  9. Not printed, but see letters from the Secretary of State to the Secretary of War, August 17, 1943, and from the Acting Secretary of War to the Secretary of State, August 28, 1943, Foreign Relations, 1943, China, pp. 91 and 107, respectively.
  10. Col. Morris B. DePass, Jr.