The Acting Secretary of State to Rear Admiral Sidney W. Souers, Executive Secretary to the National Security Council

My Dear Mr. Souers: I have received a copy of your memorandum of October 734 to the Secretary of Defense summarizing the action [Page 327] of the National Security Council at its 23rd meeting regarding the presence of United States Armed Forces in Tsingtao, China. I have also received a copy of the Navy Department’s summary34a of the same proceedings.

The capture of Tsinan by the Chinese Communists has resulted in a large Communist force in Shantung Province which is, as far as is known, not committed to action and which may at any time move against and rapidly reduce the Nationalist defenses at Tsingtao. Under these conditions the presence of U. S. Naval Forces in the city gives rise to a critical situation which requires urgent consideration by the Council. In my opinion it would be most unwise to defer this consideration pending conclusion of a general study of the position of the United States in China, as was suggested during discussion of the problem at the 23rd meeting of the Council. I accordingly recommend that this subject be placed on the agenda for consideration at the next meeting and that it be brought again before the Council for review in six weeks.

It is evident that it would be contrary to the interests of the United States to have its armed forces drawn into active hostilities with the Chinese Communists. This Department holds the view that under present conditions the serious danger of such involvement which arises from the presence ashore in Tsingtao of several thousand United States Naval and Marine personnel with their dependents is not counterbalanced by commensurate advantages to the United States. Nevertheless, it is recognized that an abrupt withdrawal or even steps indicating an intention to withdraw might, in present circumstances, adversely affect American prestige and the morale of defending Nationalist troops and would probably invite Communist attack.

The problem essentially is to extricate Admiral Badger’s command from a situation which is becoming untenable and to carry out this operation in such a way as to cause minimum damage to American prestige and Chinese morale. In order to accomplish this under existing conditions it is believed that Admiral Badger should at once take steps to effect in an orderly manner the evacuation of Navy dependents at Tsingtao and, insofar as possible, the liquidation or transfer to shipboard of shore-based activities. His objective should be to place his command insofar as possible on a mobile basis which would permit a seemly and rapid withdrawal from shore to ship should this become necessary either as a result of Communist attack or a final decision of national policy. At the same time steps should be taken, in the discretion of the Department of the Navy, to strengthen Admiral [Page 328] Badger’s defensive position at Tsingtao. It is believed that if these two operations are coordinated and carried out simultaneously, the evacuation of dependents and liquidation of shore installations would be looked upon as an integral part of the Navy’s preparations to defend itself and could be carried out without jeopardizing Nationalist morale or encouraging a Communist attack upon the city.

The course recommended in the preceding paragraph is based upon the assumption that if the U. S. Navy manifests an intention to defend itself in Tsingtao, the Communists will under present circumstances be deterred from launching an attack on the city in the immediate future. Given the past reluctance which the Communists have shown to attack Tsingtao and the existence of several other possible Communist objectives in north China which would appear more attractive strategically than an attack on Tsingtao, this would appear a valid assumption. Should the presently uncommitted Communist forces in Shantung move in force against one or more of these other objectives, the threat to Tsingtao would be temporarily lifted and a favorable opportunity for completing the shore to ship operation would be presented. By having already evacuated his dependents and liquidated nonessential shore installations, Admiral Badger would be in a much better position to act upon any subsequent decision of the National Security Council.

It is, of course, possible that the measures discussed above will not prevent a Communist attack on the city. It should be recognized that the effect on American prestige and Chinese morale of undertaking a withdrawal under these circumstances would probably be even more serious than at present and it may become necessary, should the contingency arise, to determine whether American interests can best be served by complete withdrawal from Tsingtao waters or by withdrawal of all Naval units to shipboard in Tsingtao Bay with the intention of maintaining strict neutrality during the course of the battle. In either case, Admiral Badger’s position will be greatly strengthened if his forces are already largely based on his ships, thereby enabling evacuation from the city in a rapid and orderly manner.

As the opportunity for phasing out naval operations at Tsingtao with minimum disadvantage to the United States has passed, no entirely safe course is now available. In making its recommendation, the Department of State has attempted to evaluate relative risks and to select that course which, in the light of existing circumstances, seems most expedient. Accordingly, I request that this letter be circulated to the other members of the Council for their information prior to the next meeting.

Sincerely yours,

Robert A. Lovett
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