894A.01/2–849: Telegram

The Consul General at Taipei ( Krentz ) to the Secretary of State

35. Evidence increasing Generalissimo’s hand operating here. Trend to harsh police government marked in many actions. Economic situation worsening. C–C59 retainers active. Population restive, resentful military, especially CAF bad behavior. Good authority Chen to appoint General Lo Cho-ying, a deputy garrison commander, and that General Peng60 urges appointment General Sun Li-jen, also a deputy under him. Lo’s bad record well known. Chen Cheng has told high officials here he will govern here as he did in Hupeh, i.e., Kmt reactionary style. Wholesale replacements by generals believed held up partly for consolidating position and partly with one eye on US. All liberal Chinese [who] deplore trends have no recourse. Taiwanese opinion seems be that revolt before further Kmt digging in [is] advisable or golden opportunity lost. I attempt counsel patience and am urging Chinese moderation but feel situation deteriorating rapidly. Taiwanese action believed aimed wholesale sabotage, avoidance direct clash.

Over 80 members Legation [Legislative?] Yuan here, being paid locally, engaging politics.

Sent Department 35, repeated Nanking 30, PolAd Tokyo.

  1. The brothers Chen Li-fu and Chen Kuo-fu, leaders of a faction of the Kuomintang.
  2. Lieutenant General Peng Meng-chi, Deputy Commander of the Taiwan Peace Preservation Headquarters.