893.50 Recovery/8–449
The Director of the Office of Far Eastern Affairs (Butterworth) to the Acting Assistant Administrator for Program of the Economic Cooperation Administration (Cleveland)
Dear Harlan: I am writing you at this time in continuance of our several conversations regarding the status of Formosa and the [Page 372] general policy which the Department believes should guide, at this time, ECA operations on the island.
The Department has requested the National Security Council to reconsider existing United States policy with respect to Formosa in the light of developments in the past two to three months. Specifically, the Department has requested that the Joint Chiefs of Staff submit to the National Security Council, their present estimate of the strategic importance to the United States of Formosa, particularly in light of the very real possibility that it will ultimately pass under Communist control in the absence of positive action on our part. I imagine that it will be several weeks before the Joint Chiefs will have submitted their reassessment on the basis of which the National Security Council will presumably then reconsider and restate our policy.
In the interval, the Department regards it as desirable that ECA continue without interruption or major change its present activities on the island. These are understood to include the importation of fertilizer and general supervision of its distribution, utilization of the services of the J. G. White Engineers, for general advice with respect to the operation of the island’s economy, continued distribution of the CRM96 medical supplies and moderate quantities of cotton, flour, etc., and finally, the continuation of the JCRR program on Formosa. It would also seem desirable that additional tonnages of fertilizer be programmed for delivery in time for the 1950 rice crops. All of these activities, as I understand it, are going forward.
Without attempting to prejudge any later decision of the National Security Council, it remains the view of the Department that no steps should be taken at this time to activate the industrial reconstruction program.
Sincerely yours,
- China Relief Mission (American).↩