Foreign Relations of the United States, 1946, The Far East: China, Volume IX

Marshall Mission Files, Lot 54–D270

Memorandum by the Counselor of Embassy in China (Smyth) to General Marshall

[Nanking,] July 12, 1946.

With regard to Colonel Hutchin’s call yesterday morning and his question with regard to Article 7 of a proposed agreement¹¹ between the KMT and the Communists, it seems to the Embassy that problems of local administration created if and when Communist forces withdraw from areas they now occupy offer an excellent opportunity to test concretely the good faith of both sides with regard to the overall question of governmental reform.

In making suggestions herein, the Embassy is limited by lack of specific knowledge of the size of the areas and the number of people involved. However, it is suggested that consideration might be given the following procedure:

(1) That the Government declare any disputed zone a “special administrative area” and permit local governments already established to continue to function (pending elections mentioned below) under a “special administrative areas commission” to be appointed by the Government on nomination by the Steering Committee of the Political Consultation Conference.

This “commission” should be as non-partisan as possible. However, under present conditions it would be practically impossible to obtain the services of capable, qualified non-partisan Chinese because of their fear of party reprisals. Therefore, it would probably be necessary to adopt a system such as that already worked out for Executive Headquarters and truce teams.

(2) That the National Government request the United Nations Organization to supervise elections in the disputed areas, or, alternately, request supervision by the United States, or by several powers similar to the Greek precedent.

In any event, the “commission” would be merely a stop-gap pending the holding of elections in disputed areas. On the one hand, we would be able to determine whether or not the Communists have established themselves in certain areas through popular support of the agrarian population or by force and fear. On the other hand, we would be able to determine whether or not the present Central Government is really interested in the over-all question of governmental reform and whether or not it is really interested in its oft-repeated desire to “return the Government to the people”.

At first glance, the above suggested solution may seem overly optimistic and unrealistic. However, in an agrarian society such as that with which we are dealing in China, local governments are the most important units in the ruling system. For millions of people the district (hsien) magistrate is the only official of whom there is any knowledge or with whom there is any contact, and his character and integrity in the long run greatly affects the national scene. Furthermore, no high level of education is necessary in order to carry out a free election which, in the situation here contemplated, would merely constitute differentiation between right and wrong.

The use of the services of the United Nations Organization would be in complete accord with repeated policy statements of the United States that we are in favor of international cooperation through the medium of the Organization.

Robert L. Smyth

[Annex]

[Nanking,] July 12, 1946.

There is set forth below a suggested procedure for the “refugee” problem in disputed areas. It is assumed that the “refugees” are largely land holders dispossessed and driven out for some reason by either the Government or the Communists:

(1) The Government and the Communists agree to permit the free return to their original place of residence of any persons willing to return.

(2) A “special administrative areas commission” shall depute parties to investigate the land policy of local administrations and determine the equity or inequity of any dispossessions carried out thereunder.

(3) The investigatory parties shall be authorized to determine the feasibility of the return of land to dispossessed owners. In the event it is not feasible to return such land, an equitable cash settlement shall be determined by the “commission”.

(4) In addition, the investigatory parties shall report to the “commission” wherein any land policy enforced by any local administration is contrary to the laws promulgated by the Chinese National Land Administration.

This procedure would be at best but an inadequate stop-gap. The fundamental problems of China stem from her position as an agrarian nation with an overwhelming pressure of population on the land. Reduced to its essentials, the real basis of conflict between the Kuomintang Government and the Communists is the question of land tenure, land taxation and landlord–tenant relationships. Until this basic problem is attacked energetically and realistically by a national government, there is little likelihood that any program for the political and economic rehabilitation of the country can succeed.

At the present time the most important consideration is not the further enunciation of laudable principles or the promulgation of model laws, but the actual initiation, on however humble a scale, of land reform in specific areas.

The land problem in China is so vast that it must be attacked by stages and machinery must be created for the purpose. An important forward step would be the granting of authority to some such body as the “commission” referred to in the basic memorandum to determine equitable rents, revise oppressive contracts between landlords and tenants, initiate a policy of compulsory sale of excessive land holdings to the Government for resale on credit terms to small holders, and such other steps appropriate to the special needs of any given area. Such a program might be furthered by the use of both Chinese and foreign talent which is immediately available; in this connection, the suggestion is made that the “Executive Headquarters” concept might well be applied on a civilian level to the land problem—specifically Professor J. Lossing Buck, an American now in Nanking with the American Agricultural Mission, would be well qualified to serve as American land commissioner.

In any approach to the problem, however, one is faced with the hard fact of a central government which is a coalition of landlords and militarists with tremendous vested interests in the statics quo.

Robert L. Smyth

11. See draft of preliminary agreement prepared by General Marshall, June 29, p. 1246.