893.00/5–1849: Telegram
The Minister-Counselor of Embassy in China (Clark) to the Secretary of State
[Received 5:14 p. m.]
Cantel 408. Following summary of discussion by Parker29 with H. J. Shen30 at Shen’s initiative is representative of general attitude [Page 332] of growing number liberals in China who are both anti-Communist and anti-Kmt. This particular group is of special importance as comprising the more capable financial personnel in China who have ability not known to be available to Communists and greatly needed by them.
Future of Central Bank is subject violent tug war between Generalissimo and Li factions. Former pressuring Finance Minister Liu remove bank to Taiwan while Li group fearful such move will deprive government last remaining foreign exchange assets. Actual control bank operations now in hands small group younger American trained economists headed by H. J. Shen (now head Central Trust). Shen advised flatly that except for transfer foreign exchange operations Hong Kong, Central Bank had no plans move and that Liu had told him last night bank would not go Taiwan while he remained governor.
Younger liberal economists have been meeting together last few days discuss their future plans. Although still undecided, have tentatively agreed they should begin dissociate selves from Kmt bureaucracy and not follow either Li or Generalissimo rump governments. Shen has long insisted they “hate” Kmt and served only because they felt position with government financial institutions best method serving Chinese people. Men in this group have generally high integrity and because considerably more honest than most Chinese Government officials are without extensive personal resources. They now feel present government incapable of giving any considerable further service to Chinese people and they are unwilling retreat any further. Are approaching decision that China will need intelligent trained men who have understanding and appreciation western ideas. Therefore they inclined remain and although not organized into an active underground, exercise whatever influence possible as a result recognition and prestige they gain through their professional ability and background.
Group probably would not have left Shanghai except fearful personal safety under Tang En-po during transition period. Shen seeking advice from close American friends and elder Chinese statesmen as K. P. Chen and Li Ming, who now Hong Kong. If they remain China, will attempt maintain outside contacts through Chen and Li.
Sent Department Cantel 408; repeated Nanking 301, Shanghai 253.