Foreign Relations of the United States, 1949, The Far East: China, Volume VIII

893.00/4–449: Telegram

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

Nanking, April 4, 1949—noon.
[Received 11:37 p. m.⁸⁰]

698. I do not believe there is serious disagreement between our views expressed in Embtel 663, March 28 to Department (repeated AmEmb Canton 198, Shanghai 304) and those of Embassy Canton set forth Cantel 179, March 30 (repeated Nanking 162, Shanghai 120). We too remain unconvinced that present peace talks can reach happy conclusion nor do we suggest continuing economic aid to Acting President and Government for purpose of bringing negotiations Peiping to successful conclusion. Rather we feel economic aspects China aid program should continue available to Li government to give him and his delegates [to] Peiping backbone to resist overwhelming Communist demands at peace table. Time is important for Nationalist Government and for anti-Communist cause. Longer they can resist in Peiping, longer they can spin out peace talks, better chance Li will have resisting eventually at Yangtze both militarily and politically. It apparent if Nationalist delegations unable resist at peace table there will be nothing left on national scale to resist militarily later. Nationalist delegation, without hope continued US economic assistance and steadily worsening economic-financial situation in their rear, cannot be expected resist with conviction or for period time tough, confident Communist delegation presently facing them Peiping. For these reasons we support and urge on Department continuation present level economic assistance to Acting President Li and his government during this, perhaps decisive, phase of continuing Chinese resistance to Communism. In this connection I am disturbed by implications last sentence Deptel 410, March 30.⁸¹

Any funds reauthorized by Congress should, I feel, be used to continue program on present impartial basis for all free China with no obvious emphasis on any one aspect or region. Political benefits in keeping alive present Nationalist Government as long as possible seem to me to outweigh any other considerations. If Li’s Cabinet should collapse as indications are it will next few weeks, unless there is both fiscal, moral support, question must be faced whether projects planned for other parts China will be politically worthwhile or even possible.

Sent Department 698; repeated Canton, Taipei.

Stuart

80. Text printed from corrected copy received April 6, 11:30 a. m.
81. Vol. ix, p. 752.