894A.00/6–1149: Telegram
The Consul at Taipei (Edgar) to the Secretary of State
[Received June 11—10:25 a. m.]
224. Since fall of Shanghai and Tsingtao and with influx of retreating troops to Formosa, a defeatist atmosphere had developed here. Soldiers are everywhere in schools, warehouses, private houses. Commercial activity Keelung harbor again at standstill due to crowding of troop ships. Rice unobtainable in markets but soldiers continue haul sacks through streets.
Several officials have resigned and are departing for US and Europe, others planning to. ECA Craig has requested his release. Chen’s continual conferences are general joke and guarantee of more speeches and less action. Criticism of Governor in general in official and semiofficial circles for his unwillingness or inability delegate authority and lack confidence in any subordinate. Craig says economy completely out of hand.
[Page 352]Backstage activities of Generalissimo add to feeling of futility. Am receiving reports that Formosans listening to Communist radio and have begun to balance Kmt against Communist regime. General feeling is island is falling apart and something drastic should be done but that nothing will.
Sent Department 224; repeated Off Emb Canton 74.