Marshall Mission Files, Lot 54–D270: Telegram
Colonel Marshall S. Carter 3 to General Marshall
92049. Please refer to 914454 and the many reference cables. With regard to training of air cadets, this program has been under way for some time and negotiations have been involved and protracted. At the present time three major programs have been approved. The Air Program of 24,000,000, a Navy Training Program of 5,000,000 and the Officer Program of 1,250,000. For purely budgetary and administrative reasons, it has been requested that the Chinese pay cash in advance. To date no cash has been received and the working levels of both State and War feel that the programs should be terminated on 30 June unless definite settlement is made prior to that time. It [Page 774] is possible that the Chinese are withholding payment in hopes that this training can be accomplished under the legislation now before Congress on a basis other than cash payment. If you have not already been approached by T. V. Soong5 you may expect a visit from him on this matter. I believe a compromise could be arrived at here which would require cash payment for the training already given, the establishment of a revolving fund on the order of $4,000,000 for quarterly operations and payment in cash by quarter for subsequent training. This proposal is being considered on the lower levels. Your views on the overall problem or support of the compromise proposal would be of great assistance.