893.00/1–849: Telegram
The Ambassador in China ( Stuart ) to the Secretary of State
[Received 7:52 p. m.]
58. Flushed with victory Communists are casting defiance at those who seek peace and giving every indication they will cease hostilities only on terms dictated by them. Meanwhile, Generalissimo’s New [Page 21] Year’s statement has started growing and irresistible demand for peace and Kmt leaders, except Generalissimo, are in quandary how to move. Communists’ publications of war criminal list, their vituperative New Year’s Day broadcast (see Embtel 14, January 4), their first violent reaction to Generalissimo’s New Year message (see Embtel 42, January 5) and their latest broadcast calling for repudiation by Nationalist Government of all treaties with US, add up to attitude of intransigence which offers little encouragement to Kmt peace seekers. Its effect on Generalissimo has, of course, been to confirm his opinion of incorrigibility of Communists and to sharpen his decision continue resistance. It is reported he massing what troops available for all out resistance in Nanking–Shanghai area. Meanwhile, Generalissimo moving large quantities gold, silver, other mobile assets to Taiwan and is apparently planning to make it an island fortress from which to continue fight against Communism. Appointment of Chen Cheng44 and Chiang Ching-kuo45 as Governor and Kmt Chief respectively of Taiwan, together with transfer air force headquarters, navy and industry to island, all confirm this intent. The effect of Generalissimo’s New Year’s Day speech, however, can not be undone. Regardless of cautious tone and even ambiguity of that statement, interpretation given it by press and public generally has snowballed into universal and powerful peace move throughout Nationalist territory. It is reported that at first rumors of peace, his hold over Kmt began to disintegrate and effect upon Nationalist troops along north Yangtze front can only be demoralizing to whatever fighting spirit may be left. It is difficult to see how even Generalissimo can combat or reverse this force now given public expression or regroup any semblance of Nationalist resistance to Communists once public disillusionment over chance of peace sets in. However, in his present plans, he will always have Taiwan to fall upon as outpost of continuing resistance.
This change of mind on Generalissimo’s part (if indeed it represents a change at all) [will] leave Vice President and his peace-seeking Ministers in an intolerable position. Their earlier feverish political activity is now paralyzed by Generalissimo’s growing conviction that negotiation with Communists is impossible and that continued resistance all the way to Taiwan is only course. The recent behavior of Pai Chung-hsi (see Embtel 2678, December 3146) has aroused Generalissimo’s suspicions and it is reported that even Li Tsung-jen is under surveillance. All this would seem to increase dilemma of “peace group” in Cabinet and may lead to open break between Generalissimo [Page 22] and “peace Ministers” led by Li and Pai. Accordingly most likely immediate developments would appear to be resumption military pressure by Communists, further deterioration Nationalists’ will to resist and condemned authority of Generalissimo as head of Government with resultant paralyzing effect on Li Tsung-jen and rest of peace party.
- Former Chinese Minister of War, Chief of the General Staff, and Director of Generalissimo Chiang Kai-shek’s Northeast (Manchurian) Headquarters.↩
- Son of Generalissimo Chiang Kai-shek.↩
- Foreign Relations, 1948, vol. vii, p. 722.↩