893.00/7–2249: Telegram
The Minister-Counselor of Embassy in China (Clark) to the Secretary of State
[Received 11:16 p. m.]
Cantel 800. Burden of more than 2-hour conversation Chen Li-fu today was which came first, the hen or egg, he maintaining that economic aid must come before military victory and I taking other side argument. He is much uplifted by what he considers success Generalissimo’s [Page 451] visit Canton in which he claims to have played a large part and assures me that Kmt train is back on track, will be purged, streamlined and made efficiently functioning vehicle.
Chen insists that although all differences between Li Tsung-jen and Generalissimo were not removed, Li has been mollified—in other words, buttered up by Generalissimo—and is prepared go along with Generalissimo’s plans in full spirit cooperation. As earnest this cooperation he said Li had been persuaded not to insist on Pai Chung-hsi as Minister National Defense. Generalissimo’s line was that Pai’s talents were needed in command his armies and that other commanders being unfamiliar Pai’s capabilities might not trust his judgment as Minister National Defense.
Chen was much impressed by President’s speech Chicago35 and pleased with Secretary’s statement re Far Eastern pact.36 Although he repeated more than once that he had insisted to Generalissimo that Nationalist Government must itself demonstrate its ability do something before expecting aid from US, he kept coming back with expression hope we would in some way reconsider and provide at least stabilization loan or grant. It was on these occasions that the hen and egg question continually arose.
Sent Department, repeated Nanking 533, Shanghai 450, Taipei 75.
- Address entitled “Public Opinion and American Foreign Policy,” delivered on July 19, 1949, at the Imperial Council Session of the Shrine of North America; Department of State Bulletin, August 1, 1949, p. 145.↩
- Apparently statements by the Secretary of State at his press conference on July 13; see footnote 26, p. 444.↩