Memorandum of Conversation, by Mr. Philip D. Sprouse 48

Summarized below are remarks made to me by Dr. Lew49 during the course of my call on him today.

The only bright spot in the present situation in China is the free and intelligent discussion which takes place during Executive Yuan meetings. The present administration, as represented by the Executive Yuan, is the most able that China has had in many years. They are faced, however, with a seriously deteriorating economic and financial situation and an equally serious military situation. There is no real solution as long as there is civil war, which results in the expenditure of approximately 80% of the budget for military purposes. The U. S. should give the present administration economic and financial aid in order to provide support for an effective executive organ. The present Government has made many mistakes and has been subjected to much criticism, much of it justified, although there have been many exaggerations. General Chang Chun is aware of this and deplores many of the excesses of the military and the secret police, but he has no control over them. The military are responsible solely to the Generalissimo. For this reason General Chang Chun can take no steps to reduce military expenditures. Although all important matters are referred to the Executive Yuan, no one opposes any measure introduced or supported by the Generalissimo, who may be said to exercise a veto power over the Executive Yuan. If the U. S. were to give China financial and economic assistance, this would strengthen the position of the moderate progressive group in the present administration. Militarily, the Government should try only to contain the Communists in their present positions and build up a strong and healthy economy in the areas south of the Yellow River [Page 676] with U. S. financial and economic aid. The Government says that it can destroy the Communists by force, but this provides no solution for the problem. (Dr. Lew, by indirection, expressed disagreement with the Government’s view of its ability to destroy the Communists.) Asked what action the Government might take to strengthen its position and prestige among the Chinese people, Dr. Lew said that this was a question which could be answered only by the Generalissimo. Dr. Lew referred pointedly to U. S. responsibility for China’s present predicament in Manchuria as a result of the Yalta agreement.50

While Dr. Lew was somewhat guarded in his statements and explained to me that his position as the son-in-law of General Chang Chun made it difficult for him to talk as freely as he might otherwise, he expressed his views sufficiently—which may in a sense reflect something of General Chang Chun’s attitude—to indicate a pessimistic picture of the situation. I have known Dr. Lew for about two years and have always found him a fairly frank person with a definite pro-US orientation.

Philip D. Sprouse
  1. This memorandum and the one printed infra were submitted by Mr. Sprouse on September 19 to the Director of the Office of Far Eastern Affairs (Butterworth).
  2. Daniel Lew, member of the Secretariat of the Chinese Executive Yuan and son-in-law of Gen. Chang Chun, President of the Executive Yuan.
  3. Signed February 11, 1945; Foreign Relations, The Conferences at Malta and Yalta, 1945, p. 984.