893.5151/982: Telegram

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

75. From the Secretary of the Treasury for Adler. The following message you will please transmit to Dr. Kung. This is in reference to your cable no. 87 [89] of January 13, 1944.

1.
My attention has been called to the fact that progress is being made in the work on only part of the bases which the United States and China agreed to construct and that if work does not proceed on these bases our common war effort will be seriously impeded. I understand furthermore that on some bases construction has not begun at all.
2.
I am taking the liberty of expressing to you my personal views in this matter in view of the long history of close collaboration between my Department and your Ministry. Nothing I feel could be more conducive to lowering the prestige of China in the United States and the loss of the good will of the American people than the knowledge that in the building of these air bases China was not cooperating fully with the United States. There is no need for me to state that the assistance which has been given in the past by the United States to the Chinese people and their Government was possible only because [Page 835]of the good will which the American people have felt for China due in part to China’s great contribution to our common effort. I believe firmly that I speak in China’s best interests when I recommend that action be taken immediately for the building of the remaining bases.
3.
The economic difficulties which the Chinese Government now faces I fully appreciate but I am sure that you appreciate fully that the amount of United States currency which the Chinese Government is to receive for the building of these airports for which the United States is to make payment bears no relation whatever to the economic effect of the expenditures in Chinese national currency which are made for building these airports. Should there be any question as to the amount of United States currency that is to be paid for Chinese currency there would seem to be no reason why immediate allocation of the necessary local currency should not be made and work on these bases proceed under an interim procedure being proposed by the War and State Department representation leaving the final question of the United States currency equivalent for future determination.

The Commanding General should be shown a copy of this cable. [Morgenthau.]

Hull