893.00/9–2844

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

No. 3018

Sir: I have the honor to transmit copies of the following reports prepared by Mr. John S. Service, Second Secretary of Embassy on detail to General Stilwell’s Headquarters, now in Yenan, Shensi (seat of the Chinese Communist regime) as a member of the United States Army Observer Section.

(1)
Report no. 15, August 27, 1944, “Interview with Mao Tse-tung”;
(2)
Report no. 20, September 3, 1944, “The Need of an American Policy Toward the Problems Created by the Rise of the Chinese Communist Party”;
(3)
Report no. 16, August 29, 1944. “Desirability of American Military Aid to the Chinese Communist Armies”.

There is enclosed with Report no. 15 (sub-enclosure to enclosure No. 1) a memorandum of a conversation which Mr. Service had with Mr. Mao Tse-tung, Communist leader, on August 23, 1944. In the course of this conversation Mr. Mao suggested the desirability of the creation of a provisional national congress in China in place of the present single-party rule of the Kuomintang and of the American Government’s using its influence to compel the Kuomintang to carry out such a proposal. Mr. Mao raised the question of the attitude of the United States toward the Chinese Communist Party and said that if United States military forces land on the coast of China there will have to be cooperation with both Kuomintang and Communist forces—preferably in separate sectors. Mr. Mao made a plea for American cooperation and the granting of assistance to the Chinese Communist Party and said that the Chinese Communists must and will cooperate with the United States. In his covering report, Mr. Service expressed the belief that Mr. Mao spoke with frankness and offered the observation that Mr. Mao’s statements were the clearest indication he had yet received of the part the Chinese Communists hope to play in the future of China. Mr. Service also reported that there was at the time a significant concentration of Communist political and military leaders in Yenan for the probable purpose of discussing present-day and future Chinese Communist policies. Mr. Service observed, in this connection, [Page 600] that the most important question or factor to the Communists is American policy.

In Report no. 20 (enclosure no. 2) Mr. Service refers to the rise of Communist power and the decline of the Kuomintang influence and strength, and suggests that as a result it may be necessary in the near future for the United States to decide on a definite policy in relation thereto. After reviewing the trend of events and coming to the conclusion that there is likely to be either future Communist control of China or important Communist participation in its government, Mr. Service concludes that the nature, policies and objectives of the Chinese Communist Party are of vital long-term concern to the United States and that the determination of our policy toward that Party should be based, in part at least, on a study of the actual accomplishments of the Chinese Communist Party, its present and future policies and the quality and capacity of its leadership. Mr. Service points out that reports on the military accomplishments of the Chinese Communist Party have been submitted (those coming into the possession of the Embassy have been or are being transmitted to the Department) and that other reports on a variety of Communist accomplishments are to be submitted in the future.

In Report no. 16 (enclosure no. 3) Mr. Service suggests that the United States should supply the Chinese Communists with urgently needed military supplies and training in the use of such supplies, to be followed later by actual tactical cooperation. Mr. Service points out that the implementation of such a policy is likely to meet with resistance from the Kuomintang, and suggests that the United States must decide whether the gains which can be reasonably expected to accrue from assisting the Communists will justify the overcoming or disregarding of anticipated Kuomintang opposition. He expresses the view that the limiting of American support and assistance to the Kuomintang alone will not win the United States an effective ally whereas impartial support of the Kuomintang and the Communists will provide an effective force in the latter, will be a constructive influence in China, and will almost certainly prevent the outbreak of civil war. Asserting that it is an incontrovertible fact that the Chinese Communists have maintained and strengthened themselves militarily in a very large area of north and central China; that they hold strategic positions in proximity to all Japanese communication lines north of the Yangtze River; that Communist forces are capable and experienced in mobile and guerrilla warfare; that they possess the popular support of the people; and that their material requirements are simple and moderate, Mr. Service observes that the furnishing of the Chinese Communists with moderate quantities of supplies will improve their effectiveness.

[Page 601]

Although Mr. Service’s estimate of the accomplishments and capabilities of the Chinese Communists may be modified by the further studies and investigations being undertaken by the United States Army Observer Section now operating in Communist-controlled areas, it seems clear that the problems touched upon in the enclosed reports are of ever-growing concern to the United States not only because of the trend of events in China but also because the war in the Pacific is approaching Japan and the China coast. It appears that we are to be faced inevitably with the problem of determining whether the Chinese Communists are to be supplied with American arms and equipment in the struggle against Japan. If the decision is made to supply the Communists with American arms and equipment, we shall then be faced with the further problem of how such arms and equipment are to be supplied. Under present circumstances—the continued inability of the Kuomintang and the Communists to reach a political and military agreement or to cooperate in the war against Japan—we may expect the Kuomintang, as Mr. Service has suggested, to oppose our furnishing the Communists with arms and equipment. If such Kuomintang opposition should materialize and if the Kuomintang and the Communists fail to patch up their differences, we shall then be faced with a very complex problem. It seems obvious that an attempt to supply the Chinese Communists with American arms and equipment without first obtaining the sanction of the Kuomintang Government in Chungking—which we have in the past and continue to recognize as the Government of China—would produce serious repercussions, if indeed it did not bring about the collapse of the Chiang Kai-shek regime. On the other hand, our compliance with Kuomintang wishes not to supply the Chinese Communists with arms and equipment might be expected to hamper the conduct of military operations against the Japanese and perhaps prolong the war.

It seems apparent that the most satisfactory solution to the problems posed above would involve a thoroughgoing reconciliation between the Kuomintang and the Communists and a hard-and-fast agreement to unite and cooperate. Such a reconciliation and agreement might be both political and military in character, or it might be military alone. It might involve participation of the Communists and perhaps other independent political groups in some way in the National Government; it might be limited to the formation of some kind of coalition military council to deal with military affairs and coordinate the activities of the Chinese armies. Or it might involve some arrangement under which an Allied field commander might be appointed to the control of the armies of the two factions. Admittedly the prospects for Kuomintang–Communist reconciliation and agreement are not at present bright, but the bringing to bear of American [Page 602] influence on both factions may even yet result in a harmonious solution. The only alternative appears to be a continued and progressive disintegration of the situation in China, followed perhaps by chaos and a consequent grave impediment to the prosecution of the war against Japan.

Respectfully yours,

C. E. Gauss
[Enclosure 1]

Report by the Second Secretary of Embassy in China (Service)

No. 15

Subject: Interview with Mao Tse-tung.

To: Commanding General, Fwd. Ech. USAF–CBI, APO 879

1.
There is attached a memorandum of a conversation on August 23, 1944, with Mao Tse-tung, Chairman of the Central Committee of the Chinese Communist Party. This memorandum is necessarily a summarization, in as much as the conversation lasted for six hours, but it has been prepared from notes made during the interview.
2.
Chairman Mao believes that the influence of the United States in China can be decisive if applied now and that American policy is accordingly a vital concern of the Chinese people. He therefore wants to know what that policy is, or is likely to be. He raises the questions of American policy toward the problem of China’s democracy, toward the Communist Party, and toward the civil war that he considers inevitable if democracy is not achieved during the present war.
3.
Specifically, Chairman Mao seeks American support of a proposal that a new National Government be set up by the calling of a conference of all leading political groups in China.
4.
The meeting was on the initiative of Chairman Mao and he directed the conversation. His attitude was friendly and informal, and I believe that he spoke with frankness. Certainly his statements were direct and revealing. I consider them the clearest indication we have yet received of Communist thinking and planning in regard to the part they hope to have in China’s national affairs in the near future.
5.
There are a number of indications that the Communists believe that in the near future they will be faced with the making of important decisions in regard to their future line of action. Now assembled in Yenan are most of the important leaders, not only of the central Party and Army organizations, but also of the bases and armies in the field. These include:
  • P’eng Teh-huai, Vice Commander of the 8th Route Army in command of the Field Headquarters, Southeast Shansi.
  • Nieh Jung-chen, Commander-in-chief of the Shansi-Hopei-Chahar military District.
  • Chen Yi, Acting Commander-in-chief of the New 4th Army.
  • Lin Piao, Commander of the 115th Division, 8th Route Army. Yang Hsiu-feng, Chairman of the Shansi–Hopei–Shantung-Honan Border Region Government.
  • Lo Jui-ch’ing, Chief of the Political Department of the Field Headquarters, 8th Route Army.
  • Chu Jui, Communist Party Secretary for Shantung.
This list is incomplete and includes only better-known names. It does not, of course, include the majority of the top Communist leaders, such as Mao Tse-tung, Chou En-lai, Po Ku, Wang Ming, Liu Shao-ch’i, Chu Teh, and Yeh Chien-ying who are now, as normally, in Yenan.
6.
These men obviously did not come here in connection with the Observer Section—some have been on their way since March, 1944, when it could not be known that we might be coming to Yenan. When questioned about this unprecedented concentration of influential leaders, the Communists merely say that they are here for conferences to prepare for the counter-offensive.
7.
Despite this disinclination to go into detail regarding the character of these conferences, it is obvious that the Communists are considering the problems connected with:
(a)
The weakening of the Kuomintang and the deterioration of conditions in Kuomintang China;
(b)
The probable development of the closing stages of the war in China;
(c)
The probable strategy of the Kuomintang toward the Communists in these last stages and immediately afterward.
8.
Related to these problems is the present attempt to negotiate a compromise with the Kuomintang. The Communists have now practically given up hope (if they ever had any) that these will be successful without strong outside pressure on the Kuomintang. Japanese military pressure, it seems, will not be enough to overcome the Kuomintang’s anti-Communism.
9.
Also related, if the Kuomintang is going to collapse or if it is going to be in a position to be aggressively anti-Communist at the end of the war, is the problem of preparation by improving the Communist position. This may have an effect on Communist participation in the war. They are not going to stop fighting. But they may be more interested in directly extending their control, and less willing to sacrifice their strength and advantages to over-all United Nations strategy. It may, for instance, decide whether the Communists extend their operations into the area east of the Pinghan Railway which has now been cut off from direct Kuomintang control (see paragraph 1 of my report no. 7, August 4, 19446) or whether they [Page 604] attempt to take advantage of the Japanese campaign along the Canton–Hankow line to re-establish their old bases in Southeast China (this will be discussed in greater detail in my despatch no. 19 of August 317). Both of these expansions can be justified as definite aids to the war against Japan. But in present circumstances they will mean more friction with the Kuomintang and moving closer to a condition of actual civil war. The question must therefore be considered whether this is desirable, and whether the United States desires and will support such vigorous Communist activity.
10.
Basic to all these problems, the Communists believe, are the policies and actions of the United States. We have the ability to bolster the Kuomintang and keep it in power; we will determine the development of the war in the China theater; we can, if we wish, prevent civil war and force the Kuomintang toward democracy. These American policies will decide whether the Communists must play a lone hand and look out for themselves, or whether they can be assured of survival and participation in a democratic China and so cooperate wholeheartedly in the war. The Communists want our understanding and support: they are anxious to do nothing to alienate us or compromise that support.
11.
The most important question—and at present the greatest unknown—to the Communists, therefore, is American policy. This orientation toward the United States is clear. The Communists do not, for very practical reasons, expect that Soviet Russia will be able to play a large part in China. And they believe, for the sake of China’s unity on a democratic basis, that this Russian participation should be secondary to that of the United States.
12.
It is requested that copies of this report be transmitted to the American Ambassador at Chungking and Headquarters, USAF–CBI, for the information of Mr. Davies.
John S. Service

Approved for transmission:
David D. Barrett, Colonel, G. S. C.

[Subenclosure]

Memorandum by the Second Secretary of Embassy in China (Service) of a Conversation With Mao Tse-tung

(After a short general conversation Mao said that he would like to talk about Kuomintang–Communist relations. The following is the gist of his remarks.)

The relationship between the Kuomintang and the Communist Party is the key to the problem of China. In the first stage, from 1922 [Page 605] to 1927, there was cooperation. This made possible the success of the Northern Expedition and the rise to power of the Kuomintang. But as soon as the Kuomintang got that power it sought to monopolize it; it turned against and tried to exterminate us. The result was the second stage—the ten years of civil war from 1927 to 1937. The third stage, a return to cooperation, was impelled by the imminence of the Japanese invasion. It has continued precariously up to the present.

This cooperation of the third stage was not entered into gladly or willingly by the Kuomintang. Its acceptance by the Kmt has never been sincere or whole-hearted. It was forced on the Kmt by five factors:

1.
The Japanese attack
2.
The pressure of foreign opinion
3.
The enduring strength of the Communists—exploited at Sian
4.
The will of the people of China—to resist Japan
5.
The internal weakness of the Kmt—which made it unable to defeat us.

The end of the war (and even its approaching end) will bring a shift in these forces.

The defeat of Japan will eliminate the most powerful and positive of these factors.

The Communists are stronger than before. In this way it can be said that their influence for unity and against civil war is greater. But as long as the Kmt is under its present type of leadership this greater Communist strength makes the Kmt more determined on Communist elimination. This can work only up to a certain point: if the Communists are too strong, the Kmt will not dare to attack them. But the Kmt leaders are so grasping for power that they may take long chances.

The people of China are still inarticulate and politically repressed. They are kept so by the Kmt. The liberals, students, intellectuals, publicists, newspaper interests, Minor Parties, provincial groups, and modern industrialists (who have been disillusioned and see no future for themselves in Kuomintang bureaucratic industrialization) are numerous. But they are disorganized, disunited and without power. Over them Chiang holds the bayonets and the secret police.

The Kuomintang is an amorphous body of no definite character or program. The liberal groups within it have no strong leader, no rallying point, and no aggressive platform. If they did have these they would have no way, under present circumstances, of reaching the people. The controlling leaders of the Kuomintang, though divided into jealous cliques, are all anti-Communist and anti-democratic. They are united by their selfish determination to perpetuate their own power.

[Page 606]

Considering these factors alone it seems inevitable, if the country drifts along under the present leadership, that there will be Kuomintang provoked civil war.

We Communists know civil war from bitter experience. We know that it will mean long years of ruin and chaos for China. China’s unity, her stabilizing influence in the Far East, and her economic development will all be delayed. Not only the Chinese but also all nations having interests in the Far East will be affected. China will become a major international problem. This vitally concerns the United States.

One thing certain is that we Communists dread civil war. We abhor it. We will not start it. We will do our best to avoid it—even though we know that as things now are (provided that the Kmt does not receive foreign help) we would eventually win. But the Communists are of the people. The people’s interests are our interests. The people will not submit for long to the despotic Fascism which is now apparent in Chungking and Sian, and which is foreshadowed even more menacingly in books like Chiang’s China’s Destiny. If the people fight, the Communists must fight along with them.

The hope for preventing civil war in China therefore rests to a very great extent—much more than ever before on the influence of foreign countries. Among these by far the most important is the United States. Its growing power in China and in the Far East is already so great that it can be decisive. The Kuomintang in its situation today must heed the United States.

American policy in China therefore becomes not merely a matter of concern to Americans alone; it is also a question of the most vital interest to the democratic people of China. The Chinese people, accordingly, are interested in three general questions.

First, is there a chance of an American swing back toward isolationism and a resultant lack of interest in China? Are Americans [going to ?] close their eyes to foreign problems and let China “stew in her own juice”? We Communists feel that this problem will not arise if Roosevelt is re-elected.

(This and other questions about the United States were addressed directly to me. I therefore made it clear, in the most explicit terms, that I had no official authority and that my replies were only my purely private and completely unofficial opinions.

On the above points, I mentioned America’s long and special interest in China; the fact that we would have no internal reconstruction problem as a result of war destruction; that on the contrary our greatly expanded economy and our more international outlook would impel us to seek trade and investment beyond our borders; that it was therefore unlikely that we would become isolationist or unconcerned about [Page 607] China; and that I doubted whether administration of the country by either Republicans or Democrats would fundamentally affect our China policy.)

Second, is the American Government really interested in democracy—in its world future? Does it, for instance, consider democracy in China—one-fourth of the world’s population—important? Does it want to have the government of China really representative of the people of China? Is it concerned that the present government of China, which it recognizes, has no legal status by any law and is in no way representative of the people of China? Chiang Kai-shek was elected President by only 90 members of a single political party, the Kuomintang, who themselves cannot validly claim to represent even the limited membership of that party. Even Hitler has a better claim to democratic power. He was selected by the people. And he has a Reichstag. Does the United States realize the obvious fact that the present Kuomintang has lost the confidence and support of the Chinese masses? The important question, however, is not whether the American Government realizes this fact, but whether it is willing to try to improve the situation by helping to bring about democracy in China.

(I referred to the numerous official American statements regarding unity in China and our general hope for democratic development in all countries. I mentioned the apparent trend of at least an important part of American opinion as shown in recent critical articles in the American press.)

It is obvious that the Kuomintang must reform itself and reorganize its government. On its present basis it cannot hope to fight an effective war. And even if the war is won for it by the United States, subsequent chaos is certain.

The government must broaden its base to take in all important groups of the people. We do not call for full and immediate representative democracy: it would be impractical. And, under Kuomintang sponsorship and control, it would be an empty fraud. But what can and should be done—at once—is to convene a provisional (or transitional) National Congress. To this all groups should be invited to send delegates. These delegates must not be selected and appointed by the Kuomintang, as in the past. They must be genuine representatives—the best qualified leaders. They should include the Communist Party, all Minor Parties, the intellectual groups, newspaper interests, students, professional groups, central organizations of cooperative societies, labor and other mass organizations.

A workable compromise for the distribution of strength might be that the Kuomintang would have one-half of the members, all others together the other half. It would have to be agreed beforehand, for [Page 608] reasons of practical politics, that the Generalissimo would be confirmed as Temporary President.

This Provisional Congress must have full power to reorganize the Government and make new laws—to remain in effect until the passage of the Constitution. The Government should be directly responsible to the Congress. Its functions and powers might be somewhat like those of the British House of Commons.

The Provisional Congress would also have full charge of the preparations for full democracy and Constitutionalism. It would supervise the elections and then convene the National Congress. It would then turn over its powers and pass out of existence.

Is the American Government willing to use its influence to force the Kuomintang to carry out such a proposal? Is the American Government willing to make the proposal and actively support it?

(Chairman Mao made the suggestion that this matter was of such importance that it would warrant my making a trip to Chungking to present it to the Ambassador. I said that the Ambassador would be fully informed. I also suggested that we had already heard this general proposal from other quarters in Chungking.

Subsequently on August 26 I learned in a conversation with Chou En-lai that the Politbureau of the Communist Party was considering the making of this proposal to the Kuomintang. They would base it on the Kuomintang’s refusal to discuss the Communist demands for democracy in their present negotiations on the ground that they are “too abstract”.)

Third, what is the attitude and policy of the American Government toward the Chinese Communist Party? Does it recognize the Communist Party as an active fighting force against Japan? Does it recognize the Communists as an influence for democracy in China? Is there any chance of American support of the Chinese Communist Party? What will be the American attitude—toward the Kuomintang and toward the Communists—if there is a civil war in China? What is being done to ensure that the Kuomintang will not use its new American arms to fight a civil war?

(These questions, especially the points raised in the second and third, formed the framework of our further conversation. I returned to a number of points for further amplification and discussion.

Regarding the question of “support” of the Communist Party, I pointed out that the question was obscure and, in any case, premature inasmuch as the Communists themselves publicly supported the Central Government and Chiang Kai-shek.)

We Communists accepted Kmt terms in 1936–7 to form the United Front because the foreign menace of Japan threatened the country. We are, first of all, Chinese. The 10 years of inconclusive, mutually [Page 609] destructive civil war had to be stopped in order to fight Japan. Even though we had not started the civil war, we took the lead in stopping it. Also, the foreign countries recognized the Kmt and Chiang; they did not support us. But the United Front was not all one-sided: The Kmt also promised political reforms—which they have not carried out.

Our support of Chiang does not mean support of despotism: we support him to fight Japan.

We could not raise this question of recognition before. In a formal sense it is still premature. We only ask now that American policy try to induce the Kuomintang to reform itself. This would be a first stage. It may be the only one necessary: if it is successful there will be no threat of civil war.

But suppose that the Kmt does not reform. Then there must be a second stage of American policy. Then this question of American policy toward the Communists must be raised. We can risk no conflict with the United States.

We can ignore the question of the supply of American arms now which can be used by the Kmt in a future civil war. But must we expect a repetition of past history. In the early days of the Republic, the Powers recognized only Peking—long after it was apparent that the only government that could claim to represent the people of China was that in Canton. Nanking was not recognized until after the success and completion of the Northern Expedition. Now the internal situation in China is changing. The lines are not yet clearly drawn. But a somewhat similar situation may develop. Will the United States continue to give recognition and support to a government that in ineffectiveness and lack of popular support can only be compared to the old Peking Government?

(I suggested the diplomatic impossibility of withdrawing recognition from a government that had not committed a directly unfriendly act, the obvious undesirability of working behind a recognized government to support an opposition party, and finally the delicacy of the whole problem of interference in the domestic affairs of another country.)

America has intervened in every country where her troops and supplies have gone. This intervention may not have been intended, and may not have been direct. But it has been nonetheless real—merely by the presence of that American influence. For America to insist that arms be given to all forces who fight Japan, which will include the Communists, is not interference. For America to give arms only to the Kuomintang will in its effect be interference because it will enable the Kuomintang to continue to oppose the will of the people of China. “Interference” (Mao noted his objection to the term because [Page 610] of its having no meaning in this situation) to further the true interests of the people of China is not interference. It will be welcomed by the great mass of the people of China because they want democracy. Only the Kuomintang is against it.

We do not ask the stopping of all aid to the Kmt forces. The effect would not be good on the war. The Kmt would collapse and the American landing in China will be more difficult.

(Chou En-lai in a subsequent conversation developed the following themes along related lines: (1) The giving of American arms only to the Kmt is sure to mean civil war; (2) We must not ignore the possibility that Japan may try to end the war by a “surrender” to Chiang Kai-shek. This will be a trick on the other Allies and will in effect be a compromise based on Japan’s desire to keep a weak Kuomintang rather than a strong, unified and democratic government in China; (3) The only way to be sure of decisively winning the war in China and avoiding civil war is to give arms to both Kuomintang and Communists.)

(I raised the question of how American influence could be exerted effectively, expressing skepticism about “dictation” to Chiang. Mao vigorously rejected my suggestion.)

Chiang is in a position where he must listen to the United States. Look at what happened in Honan, is happening now in Hunan, and shows every sign of happening in Kwangsi! Perhaps it will be Yunnan next. Look at the economic situation! Chiang is in a corner.

Chiang is stubborn. But fundamentally he is a gangster. That fact must be understood in order to deal with him. We have had to learn it by experience. The only way to handle him is to be hard-boiled. You must not give way to his threats and bullying. Do not let him think you are afraid: then he will press his advantage. The United States has handled Chiang very badly. They have let him get away with blackmail—for instance, talk of being unable to keep up resistance, of having to make peace, his tactics in getting the 500 million dollar loan, and now Kung’s mission to the U.S. and the plea for cloth. Cloth! Are we or are we not fighting the Japanese! Is cloth more important than bullets? We had no cotton here in the Border region and the Kmt blockade kept us from getting any from the parts of China that did have it. But we got busy and soon we are going to be self-sufficient. It would be 100 times easier for the Kmt, and if they were a government that had an economic policy they would have done it themselves.

With Chiang you can be friendly only on your own terms. He must give in to constant, strong and unified pressure. Never relax on your objectives: keep hammering at him.

[Page 611]

The position of the United States now is entirely different from what it was just after Pearl Harbor. There is no longer any need or any reason to cultivate, baby or placate Chiang. The United States can tell Chiang what he should do—in the interest of the war. American help to Chiang can be made conditional on his meeting American desires. Another way for American influence to be exerted is for Americans to talk American ideals. Every American official meeting any Chinese official, in China or in the United States, can talk democracy. Visits like Wallace’s give good opportunities; there should be more of them. Kung’s presence in the United States should not be wasted.

Every American soldier in China should be a walking and talking advertisement for democracy. He ought to talk it to every Chinese he meets. American officers ought to talk it to Chinese officers. After all, we Chinese consider you Americans the ideal of democracy.

(I suggested that the use of our Army as a political propaganda force was alien—and that we had nothing corresponding to the Communist Political Department to indoctrinate the troops and direct such work.)

But even if your American soldiers do not actively propagandize, their mere presence and contact with Chinese has a good effect. We welcome them in China for this reason. The Kuomintang does not. It wants to segregate them and keep them from knowing what conditions really are. How many American observers do you have now in the front lines? We are happy to take your men anywhere. The Kmt is worried about the effect of a lot of Americans in China. They fear an American landing only second to their fear of Russian participation.

The presence of Americans is good in another negative way. If Americans are scattered widely they will have a restraining effect on the Kuomintang. It will be more difficult for the Kmt to start trouble. An example is Kunming. It has become a center of liberal thought and student freedom because the Kmt doesn’t dare to arrest and throw the students into concentration camps under the eyes of so many Americans. Compare this with Sian, where Americans are very few and the Secret Police unrestrained.

Criticism of the Kuomintang in American periodicals is good. Its effect may not be immediately apparent. Sometimes it may even seem temporarily to have a bad reaction. But if it is fair (the Kmt will know if it is) it causes the Kmt to hesitate and think—because they need American support.

Finally any contact you Americans have with us Communists is good. Of course we are glad to have the Observer Section here because [Page 612] it will help to beat Japan. But there is no use in pretending that—up to now at least—the chief importance of your coming is its political effect on the Kuomintang.

(I noted his emphasis on American landing in China and suggested that the war might be won in other ways and a landing not necessary.)

We think the Americans must land in China. It depends, of course on Japanese strength and the developments of the war. But the main Japanese strength is in the Yangtze valley and North China—not to speak of Manchuria.

If the Americans do not land in China, it will be most unfortunate for China. The Kuomintang will continue as the government—without being able to be the government.

If there is a landing, there will have to be American cooperation with both Chinese forces—Kmt and Communist. Our forces now surround Hankow, Shanghai, Nanking and other large cities. We are the inner ring: The Kmt is further back.

If there is to be this cooperation with both Communist and Kmt forces, it is important that we be allowed to work in separate sectors. The Kmt is too afraid of us to work with us. Their only concern will be to checkmate us. When we are in separate sectors, the U. S. Army can see the difference: That we have popular support and can fight.

(I questioned whether open civil war was, as he had suggested, inevitable if the Kmt was not restrained or induced to reform.)

We can say that civil war is “inevitable but not quite certain.” Subjectively, the present Kmt leaders are determined on the elimination of the Communists. They are afraid of us just as, and for the same reason as, they are afraid of the people. Objectively, there are factors—the five mentioned at the beginning of the talk—which restrain the Kmt. The strongest of these—the Japanese will be out of the picture. Another—strong because outside and independent of the Kmt—is foreign opinion. But it is now unpredictable. The Kmt still hopes that foreign influence may be on its side.

The Kmt is already busy preparing pretexts for civil war. The more you know of us and conditions in our areas, the less value these pretexts will have.

So the Kmt may resort to indirect methods of attack. It will be hard to define or set a line to its aggression.

But if the Kmt undoes the progress that has been accomplished in our areas, if they take away the new democratic rights of the people, the people will resist and will demand our help.

Another line of Kmt action will be through the puppets. The puppets will turn back to the Kmt—claiming to have been “patriotic” all the time. The Kmt will then use the puppets to hold the cities [Page 613] and areas from which the Japanese withdraw. They will incite the puppets to attack us and to create friction.

(Chou En-lai carries this line further by suggesting that this may be a part of the possible fraudulent Japanese surrender to Chiang: The Japanese will turn over their arms to the puppets (or the Kmt) on the condition that the Communists will be liquidated.

This may seem at first a little far-fetched. The only possible comment is that the forces involved in this situation are so complicated and their hatreds so intense, that almost anything is possible.)

The fact is clear, even to the Kuomintang, that China’s political tendency is toward us. We hold to the Manifesto of the First Kuomintang Congress.9 This is a truly great and democratic document. Sun Yat-sen was no Communist. The Manifesto is still valid. It will not quickly pass out of date. We will hold to it even if the Kmt should collapse because its general policies are good and suited to China. Everything we have done, every article of our program, is found in that document.

Of course, we do not pretend that we are perfect. We still face problems of bureaucracy and corruption. But we do face them. And we are beating them. We welcome observation and criticism—by Americans, by the Kmt or by anyone else. We are constantly criticizing ourselves and revising our policies toward greater efficiency and effectiveness.

Our experience proves that the Chinese people understand democracy and want it. It does not take long experience or education or “tutelage”. The Chinese peasant is not stupid; he is shrewd and like everyone else, concerned over his rights and interests. You can see the difference in our areas—the people are alive, interested, friendly. They have a human outlet. They are free from deadening repression.

(I queried his emphasis on the importance of the United States and his neglect to consider Russia.)

Soviet participation either in the Far Eastern War or in China’s post-war reconstruction depends entirely on the circumstances of the Soviet Union. The Russians have suffered greatly in the war and will have their hands full with their own job of rebuilding. We do not expect Russian help.

Furthermore, the Kmt because of its anti-Communist phobia is anti-Russian. Therefore Kmt-Soviet cooperation is impossible. And for us to seek it would only make the situation in China worse. China is dis-unified enough already! In any case Soviet help is not likely even if the Kmt wanted it.

[Page 614]

But Russia will not oppose American interests in China if they are constructive and democratic. There will be no possible point of conflict. Russia only wants a friendly and democratic China. Cooperation between America and the Chinese Communist Party will be beneficial and satisfactory to all concerned.

(I jokingly remarked that the name “Communist” might not be reassuring to some American business men. Mao laughed and said that they had thought of changing their name but that if people knew them they would not be frightened.)

The policies of the Chinese Communist Party are merely liberal. Our rent reduction is from the old 80–70–60% down to the legal (by unenforced Kuomintang law) 37½%. Even this we only try to accomplish gradually because we don’t want to drive away the landlords. Our limit on interest is 10% a year. This is not extreme—though it is much lower than it used to be.

Even the most conservative American businessman can find nothing in our program to take exception to.

China must industrialize. This can be done—in China—only by free enterprise and with the aid of foreign capital. Chinese and American interests are correlated and similar. They fit together, economically and politically. We can and must work together.

The United States would find us more cooperative than the Kuomintang. We will not be afraid of democratic American influence—we will welcome it. We have no silly ideas of taking only Western mechanical techniques. Also we will not be interested in monopolistic, bureaucratic capitalism that stifles the economic development of the country and only enriches the officials. We will be interested in the most rapid possible development of the country on constructive and productive lines. First will be the raising of the living standard of the people (see what we have done here with our limited resources). After that we can come to the “national defense industry” that Chiang talks of in his China’s Destiny. We will be interested in the welfare of the Chinese people.

America does not need to fear that we will not be cooperative. We must cooperate and we must have American help. This is why it is so important to us Communists to know what you Americans are thinking and planning. We cannot risk crossing you—cannot risk any conflict with you.

[Page 615]
[Enclosure 2]

Report by the Second Secretary of Embassy in China (Service)

No. 20

Subject: The Need of an American Policy Toward the Problems Created by the Rise of the Chinese Communist Party.

To: Commanding General, Fwd. Ech. USAF–CBI, APO 879.

An important development in China during, and partly as a result of, the war against Japan has been the phenomenal growth and spread of influence of the Chinese Communist Party. It is now in control of most of North and a part of Central China, and is the only active force carrying on the war there against the Japanese. It claims, probably with some foundation, the effective government of 86,000,000 people—about one-fifth of the population of China.

This development has come at the same time as an apparent loss of vitality of the Kuomintang, and a deterioration of conditions in the areas under its control. These have had serious effects on the prosecution of the war by the Central Government.

This shift in the balance of Chinese political forces has resulted in internal tension—due primarily to the Kuomintang’s fear of losing its monopolistic power—which has brought about a situation practically equivalent to civil war. This has had further depressive effects on the Kuomintang’s will and ability to fight Japan, and will be an impediment to the unity, democratic progress and economic rehabilitation of China which the United States (not to speak of the great majority of the Chinese people) hoped for.

Without the intercession of external factors, it now seems inevitable that this tension will result in catastrophic civil war—probably soon after the defeat, chiefly by our efforts, of Japan.

Even though such a civil war would be immensely harmful to our own interests, we must consider that we would be accused—with much justification—of having contributed to it by our present arming of the military forces of the Kuomintang.

These various circumstances may force the United States, despite its natural disinclination, to take a more or less active part in the influencing of China’s internal affairs. Our influence in China will never be greater than it is now: And progress of events in this part of the world will not allow delay. The crisis will increase as the defeat of Japan is approached. It may therefore be necessary in the very near future for the United States to decide on a definite policy in regard to the problems created by the rise of the Chinese Communist Party.

[Page 616]

The ramifications of these problems do not need emphasis. They are of great and immediate military importance; but they are also highly political in their short and long term effects.

For instance, we may well decide, on the basis of what the Chinese Communist military forces have achieved and their apparent potentialities for contributing to the defeat of Japan, that those military forces deserve our active support—probably in the form of military supplies.

It may not be necessary for us to give this support directly and against the opposition of the Kuomintang. Our diplomatic influence, quietly but firmly exerted, or the growingly obvious deterioration of its own position, may impel the Kuomintang to share its power with a more truly representative national government. This presumably would have to include the Communists. There would then be a new United Front, the present blockade of the Communist areas would be ended, and the Government itself should give the Communist forces, as a part of the national armies, some share of American supplies. Present indications, however, do not encourage hope of such a reversal of attitude by the Kuomintang. It is probable, even if a nominally national government is set up, that the Kuomintang would continue to block any aid to the Communist forces. Should we, under these circumstances, insist on giving this military aid?

The giving of any American military support to the Communists, whether directly or by some indirect means as mentioned above, would be certain to have an important effect on the political situation in China. The Communist army is as much a political as a military force. These dual characteristics cannot be separated. And this political nature cannot be taken away—even by incorporation of the Communist forces into the National Army. Our support would be generally interpreted as an indication of American approval. And by improving the military effectiveness of the Communist forces, it would increase their claimable share in winning the war. Both of these factors would raise the prestige of the Communist Party and ultimately its influence in China.

This boosting of the Communists might swing the balance of political forces in China far enough so that the Kuomintang would be forced to reform its policies and—even more important—the manner of their execution, to change its present reactionary leadership, and thus to move toward the cooperation with the Communists which would lead toward unity, democracy and national strength. These are the effects we would hope to have result.

We could not, however, ignore the possibility that the present Kuomintang leadership—apparently lacking in statesmanship and thoroughly selfish for power—will not, even under these conditions, [Page 617] release its stranglehold on the Party. If the Kuomintang thus refuses to reform itself, it will be courting suicide. It will, indeed, be questionable whether it can in this form survive the crisis of the present war. If it does survive, we can at least be confident that we will have prevented, by our moral and material support of the Communists, the civil war that would otherwise have been certain.

If this possibility of the collapse of the Kuomintang—chiefly through its own intransigeance—is admitted, we must consider what forces would rise to take its place in China. At present it appears certain that the strongest of these would be the Communist Party, and that after a fairly short period it would succeed in unifying the country.

Even if the Communist Party does not have this opportunity to rise to control, we must expect, because of the vitality it is showing and the popular support it has won, that it will be influential in China and an important element in the democratic structure which must, as an alternative, be created.

We can limit ourselves to these two possibilities of (a) Communist control of the country, or (b) important Communist political participation, because it is now apparent that the present Kuomintang cannot unaidedly exterminate the Communists, and because it can be taken for granted that we will not willingly, or knowingly, give this aid. The Communist Party, therefore, under any circumstances, must be counted a continuing and important influence in China.

Whichever possibility—control or influential participation—is realized, it is obvious that the nature, policies and objectives of the Chinese Communist Party are of vital long-term concern to the United States.

Answers to these questions, and the determination of our proper policy toward the Chinese Communist Party—whether we use our diplomatic influence in its favor, whether we remain neutral, or whether we ignore the Communist Party and continue our support only of the Kuomintang—should be determined, in part at least, by the study of: (1) the actual accomplishments of the Communist Party; (2) its policies, both present and what they may be expected to be in future; and (3) the quality and capacity of its leadership.

The military accomplishments of the Chinese Communist Party during the present war, and the fact that these depend on a political base of popular support which the Communists have created, are now fairly well known. I have touched on these subjects in my reports nos. 6 (August 3),10 10 (August 15),11 17 (August 30),12 18 (August [Page 618] 31)13 and 19 (August 31).14 Colonel Barrett has also submitted a number of reports on the Communist participation in the war, the development of their main bases, and the quality of their military forces and arms. In addition a series of reports will be submitted on specific phases of Communist accomplishments: the extent of democracy in the areas under their control; their methods for the creation of popular support; their political use of the Army; the organization and working of their governments; their educational program; their legal system; the economic developments in their bases, and so on. Because of the importance of the time element, the logical order will be in some cases reversed by submitting generalized reports before the completion of basic specialized studies.

To commence work on the other two proposed points, there are being attempted in following reports: (1) an analysis of present Communist policies and probable extensions into the future; and (2) a general group impression of the personality, character and apparent capability of the leaders of the Communist Party.

John S. Service

Approved for transmission:
David D. Barrett, Colonel, G. S. C.

Requested distribution:

It is requested that copies of this report be transmitted to the American Ambassador at Chungking and Headquarters, USAF–CBI, for the information of Mr. Davies.

[Enclosure 3]

Report by the Second Secretary of Embassy in China (Service)

No. 16

Subject: Desirability of American Military Aid to the Chinese Communist Armies.

To: Commanding General, USAF–CBI.

The U.S. Army has made a start in cooperation with the military forces of the Chinese Communists. So far this has been passive on our part—the tapping of Communist intelligence sources and the rescue of American air crews. The obvious success which this half-way cooperation has had should lead logically to the consideration of more active measures.

Such active cooperation would begin with our furnishing basic military supplies now desperately lacked by the Communist forces. It [Page 619] should be supported by training in the effective use of these supplies. It should be planned to lead, as the war in China develops into its late stages, to actual tactical cooperation of Communist with air and other ground forces.

The physical difficulties of supplying the Communist forces admittedly will be great. These difficulties can be overcome. But the decision to start this cooperation will involve questions of both military and political policy. It is sure, to begin with, to meet the strong and obstinate opposition of the Kuomintang. We must decide whether the gains we can reasonably expect from aiding the communists will justify the overcoming—or disregarding—of this Kuomintang opposition.

The decision, I suggest, depends on the following considerations:

A. Political

We are now enough acquainted with conditions in China, and sufficiently experienced in cooperation with the Kuomintang, to say that the Kuomintang—as it is today—is weak, incompetent and uncooperative.

The chief concern of the politically blind and thoroughly selfish leaders of the Kuomintang is to preserve their tottering power. Lacking popular support and afraid to carry out reforms necessary to gain it, the Kuomintang knows that its miserable and dispirited conscript armies cannot stand combat against the Japanese. But its power depends, in its present narrow view, on the preservation of those armies and the equipment which it hopes we will give them. Lacking any effective economic policies, the Kuomintang is allowing the country to drift rapidly toward an economic collapse. It fears that this process will be accelerated by any large-scale military operations—by itself or by us—in China.

The Kuomintang therefore fears, and seeks to avoid, the further attrition of its resources by large-scale involvement in the war. It wants to have the war won for it—outside of China. It fears, second only to its fear of Russian participation, a large-scale extension of American military operations onto the Chinese mainland.

The situation as far as the Chinese Communists are concerned, is just the opposite. The war has given them the chance to grow and greatly extend their influence. They have acquired real popular support and mobilized an important part of the population of North China by convincing the people that this is their war and that they must take a part in it. The fact that their aggressive participation in the war against the Japanese has given the Communists their chance to come to by far their greatest power is of great importance. The Communists realize that if they play a major part in winning this war they will greatly strengthen not only their domestic, but also [Page 620] their international position. For these, if for no other more idealistic and patriotic reasons, the Communists really want to fight.

Against this background, the following conclusions can be drawn:

(a)
The limitation of our support and supplies to the Kuomintang will not win us an effective and whole-hearted ally.
(b)
Instead, it will only encourage the Kuomintang in its present undemocratic tendencies. While it may help to prolong the Kuomintang’s precarious power, it is doubtful, as long as the Kuomintang refuses to reform, whether it can for long delay the inevitable internal crisis. It may even encourage its Fascist-minded leaders to embark on a civil war which could only be disastrous to China, to post-war peace in this part of the world, and to our peaceful interests here.
(c)
The impartial support of both Kuomintang and Communists will make effective at least one force, the Communists, which is really interested in fighting.
(d)
Such impartial support will actually be a constructive influence in China. The Kuomintang will be forced to compete not only for our support but for that of the Chinese people. We may thus help to stimulate the Kuomintang toward reform.
(e)
Finally, the aid we give the Communists will almost certainly make it impossible for the Kuomintang to start a civil war. At the same time we will not likely be contributing to a Communist-provoked civil war; their policies are against civil war, the weapons they want from us (in contrast to those asked for by the Kuomintang) are light and simple rather than heavy offensive weapons, and, if the progress of the Kuomintang which our policy should promote is realized, civil war will be unnecessary.

Summing up: If the Kuomintang is actually what it claims to be—democratic and sincerely anxious to defeat the Japanese as quickly as possible—it should not oppose our insistence on giving at least proportional aid to the Communists. It is not too much to say that the strength of Kuomintang opposition will be a measure of the desirability of support of the Communists.

B. Military

Although we have not yet completed field observations in the actual fighting zones, enough is now known about the Communists to warrant the drawing of a number of conclusions. These are supported by the results of such cooperation as we have already received from the Communists. But above all else is the incontrovertible fact that the Communists, starting from almost nothing at the beginning of the war, have not only maintained but greatly strengthened themselves in a very large area of North and Central China, where they continue to tie down considerable Japanese forces.

(a)
The Communist forces hold strategic positions along and in very close proximity to all the Japanese communication lines north of the Yangtze River. The map of their positions speaks for itself. [Page 621] Communist claims are supported by their furnishing of intelligence and by their rescue of American air crews. From these positions they have access to the main cities and can cut the railways. As our control of the China Sea becomes more complete, these communications will become more important. They will, for instance, be vital to the Japanese if we make a landing anywhere in South China—or even if Hankow is attacked.
(b)
The Communist forces are capable and experienced in mobile and guerrilla warfare and have the morale and determination to carry out such operations.
(c)
They have the popular support of the people in the areas concerned which is necessary to the conduct of such operations on a wide scale and over a protracted period. This popular support gives them great manpower reserves of a useful, because voluntary and already partially trained, type.
(d)
Their matériel requirements are simple and moderate. With them a little will go a long way. They fully realize that they are unable, and the conditions of their terrain and operations prevent them from using heavy and complicated modern equipment.
(e)
The furnishing to the Communists of moderate quantities of supplies will not only improve their effectiveness (making it possible, for instance, for them to take isolated blockhouses or to hold a bridge long enough to carry out proper destruction), it will also enable them to add to their supplies, as they have done in the past, by the capture of quantities of Japanese equipment. Their position inside the areas of Japanese occupation and the tactics they employ facilitate this self-supply.
(f)
The tonnage of supplies given to the Communist forces, even though not large, will be much more effective in disrupting communications, sabotaging industries and supplies, and killing Japanese than the same tonnage put into the supply of the air forces for similar purposes. Air bombing is not only wasteful and often ineffective; it will also require, with the distance of targets in North China from our useful bases, great expenditures of gasoline, maintenance supplies and other equipment. A much better job could be done in destroying and keeping out of use a Japanese railway, for instance, by numerous coordinated guerrilla attacks along an extended stretch of line. Japanese garrisons not only on the railway itself but all through the occupied territory would have to be increased if the Communist forces had sufficient supplies to make them effective. Japanese losses and expenditures in equipment in these operations would be much greater than suffered from isolated bombings.
(g)
The use of the Communist forces for this guerrilla warfare and the demolition of communications in the far rear of the Japanese would permit concentration of the air force on other important tasks. For instance, before a coastal landing the Communists over a considerable period could be given sufficient supplies and trained in their use. When the landing is about to be, and after it has been made, the air force can devote itself to direct support because the already equipped and prepared Communist forces will be able to relieve it of the responsibility of attacking and disrupting the communications from Manchuria to the Yangtze.
[Page 622]

Conclusion:

Consideration of all these political and military factors, I propose, warrants the extension of American military aid to the Chinese Communist armies.

John S. Service

Approved for transmission:
David D. Barrett, Colonel, G. S. C.

  1. Not printed, but see despatch No. 2923, September 1, from the Ambassador in China, p. 536.
  2. Ante, p. 527.
  3. January, 1924; see United States Relations With China, p. 42, and Chinese Ministry of Information, China Handoook, 1937–1945, p. 66.
  4. Not printed, but see despatch No. 2913, August 29, from the Ambassador in China, p. 525.
  5. Not printed.
  6. Not printed, but see despatch No. 3052, October 11, from the Ambassador in China, p. 635.
  7. Not printed, but see despatch No. 3057, October 13, from the Ambassador in China, p. 644.
  8. Ante, p. 527.