893.00/1–2347

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

No. 442

Sir: I have the honor to comment for your information upon the present outlook for any possible resumption of negotiations between the Chinese Government and the Communist Party. The former has at last made its formal proposal that a delegation be sent to Yenan. There seems to have been nothing in the way in which this was done nor any recent utterances or actions by Government leaders to prejudice the Communist Party reaction to this proposal. But the reply was prompt and categorical to the effect that if the Government would agree to the two previously made conditions the negotiations could be resumed in Nanking; if not, nothing would be gained by sending a delegation to Yenan. The local Communist Party representatives insist, however, that they do not intend by this to break off such negotiations, but rather to clear the ground for them in the future. Strange as it may seem, I believe that they really mean this.

They are becoming increasingly confident that in the next few months the Government will be forced to reopen the discussions and that they can then dictate their own terms. It is therefore to their advantage to wait. This is not only because of the more obvious aggravation of fiscal and economic problems and the consequent popular discontent. They are counting on a more negative American policy and on developments at Moscow in March that will serve their purpose. I also have the impression that they have more reason to be encouraged over the military situation than during those months when they were obviously eager to end the fighting. This is probably not so much because of any improvement on their side as the defection of Government troops due to corrupt or incompetent officers and the waning morale of the men. One need not accept the Communist [Page 25] Party figures to suspect that the Government is not announcing its real losses. Another explanation for the uncompromising Communist Party attitude is—if my surmise is correct—that they came to feel that they had yielded too much in the original PCC agreements in the matter of military reorganization and determined not to be caught unawares again. If this is true, the Government leaders blundered all the more seriously in not having scrupulously observed those agreements and thus held the Communist Party faithful to them also.

The controversy over the Yellow River project and the agreement which has now apparently been concluded are an epitome at once of the complex and baffling factors in all these negotiations and of their elusive potentialities. The Communist Party has been insisting on a period of five months during which they might evacuate the settlers from the old river bed before its restoration, and has been making bitter charges against the Government—more or less true. They have undoubtedly been influenced by their ineradicable suspicions and by partisan military considerations. The Government in turn has been remiss in making the promised payments and has had its full share of military rather than humanitarian motives. Its engineers, primarily concerned with their own professional reputation and livelihood, have insisted on a prompt closure of the dam which from a purely technical viewpoint would be wise. General Edgerton33 and his American associates have argued for a two months’ delay as justifiable in view of the political issues despite the engineering risks. President Chiang finally drew the deadline at February 15. General Edgerton felt that his patience had been exhausted and was about ready to carry out his threat of withdrawing all UNRRA aid when on January 20, after hours of earnest discussion, Mr. Tung Pi-wu34 agreed to a postponement of three months. True, he points out that this must be approved by the local farmers, and the Government must be persuaded to go against the advice of its engineers, but at this writing the outlook is fairly hopeful.

As I have urged in a previous despatch, as long as President Chiang remains in office with his present mental and physical vigor he will continue to be the determinative force in Government policy. He is doubtless correct in his assertion that he can deal with his reactionary associates. There is in this sense a modicum of truth in General Chou En-lai’s recent declaration that Chiang Kai-shek is himself the chief reactionary. With all of his stubborn will and the habits formed by training and temperament, he is by no means inflexible in policy—rather [Page 26] the opposite. It is perhaps more true of him than of most men that he is very largely controlled by fears and hopes. In his desire to fulfill his duty to the nation he has been recently tending toward the aim of establishing democracy in China and of becoming the leader of the liberal and public-spirited element. His intransigence stems chiefly from fear. His hopes are centered in the response he might receive from the element among his countrymen just referred to and from American aid. This latter is, of course, mainly—but by no means wholly—material, and is in his thought a means to an end beneficial to both countries. To furnish him with sound advice and assist him to accept and act upon it, to encourage his aspirations without endangering the true interests of this nation or even more important international issues, to temper sympathetic friendliness with wise refusals while maintaining a generally affirmative attitude, is the delicate but splendidly creative opportunity for American statesmanship.

Respectfully yours,

J. Leighton Stuart
  1. Maj. Gen. Glen B. Edgerton, American director of the China office, United Nations Relief and Rehabilitation Administration (UNRRA).
  2. Senior member of the Chinese Communist delegation remaining at Nanking.