Foreign Relations of the United States, 1948, The Far East: China, Volume VIII

893.50 Recovery/7–848: Telegram

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

Washington, July 8, 1948—6 p.m.

1003. Re ECA²¹ intention continue CNC²² relief expenditures from Special Account (Shanghai’s Toeca 57, June 24²³), Dept requests comment Emb and ConGen policy aspects this program. Justification presented Reftel made primarily in terms political considerations.

Dept believes critical character inflation requires that such expenditures should be made only when projects justified by over-riding political importance from point of view US policy interests in China. Where can line be drawn on direct relief in China? Will not promotion such relief in urban centers attract refugees from Kmt²⁴ as well as Communist areas? No intention minimize humanitarian significance such projects, but this consideration should not be dominant criterion implementation US policy in present circumstances.

Dept not aware receipt any general reports re USFRP²⁵ direct relief for refugees and indigents, which explain its scope and importance in terms Reftel. What was status such persons prior USFRP and what were political repercussions in absence US-sponsored relief activity? Ref Toeca 57, (a) what is attitude “official ChiGovt circles” Special Account relief expenditures and, if regarded as politically important, what steps being taken by ChiGovt in this regard on its own initiative; (b) attitude what groups would cause embarrassment ECA Mission as result sharp curtailment such expenditures? (c) how important in light policy considerations is continuation “medical assistance to Govt and private hospitals and institutions” and “assistance provided voluntary agencies”? Would such assistance be primarily through provision [of] imported medical and other relief goods under ECA program, or through allocation Special Account funds as support operating budgets such organizations? If latter, what is your assessment longer-run consequences assumption such role by US Govt?

Sent Nanking as Dept’s 1003, repeated Shanghai as Dept’s 1231.

Marshall

21. Economic Cooperation Administration.
22. Chinese national currency.
23. This message from the ECA China Mission to its Washington headquarters reported the mission’s intention to continue and to add to production projects initiated by CRM, to slow down on relief assistance unless the flow of refugees to cities would prevent it, and to continue semi-relief projects such as medical assistance to hospitals and other institutions and assistance to voluntary agencies. The message indicated the Ambassador had been consulted on these matters. (Nanking Embassy Files, Lot F79—800 China Aid)
24. Kuomintang (Nationalist Party).
25. United States Foreign Relief Program, administered by CRM.