S/SNSC files, lot 63 D 351, NSC 166 Series

No. 149
Statement of Policy by the National Security Council1

top secret
NSC 166/1
[Page 279]

U.S. Policy Towards Communist China

[Here follows a table of contents.]

general considerations

The Problem

1. The emergence of a strong, disciplined, and revolutionary communist regime on mainland China has radically altered the power structure in the Far East. With the minor exceptions of Hong Kong and Macao, American, Japanese, and European power and influence has been abruptly extruded from the whole vast area between the Amur, the Himalayas and the Gulf of Tonkin. Simultaneously, Russian influence has been abruptly advanced southward to areas in which neither the Czars nor the Soviets have hitherto had more than passing influence—China south of the wall, China south of the Yangtze, and Southeast Asia. The primary problem of U.S. foreign policy in the Far East is to cope with the altered structure of power which arises from the existence of a strong and hostile Communist China, and from the alliance of Communist China with the USSR. (1)2

Elements of the Problem

2. In sum the elements of the problem with which U.S. policy toward Communist China must cope are:

a.
The Chinese Communists have established strong, centralized political control over mainland China; and have so far succeeded in coping with their economic problems. They may face political pitfalls in the future, and there are limits on their capacity to achieve a strong, modern economy; but for the foreseeable future it is probable that they will continue to make some progress in developing the economic and political strength of their regime. The Chinese Communists have considerable military capabilities, which for the present are largely dependent upon Russian assistance. Their capabilities are sufficient to make invasion of China very costly, and to require the commitment of major U.S. and Western resources to counter further military adventures undertaken by the Communists outside their present area of control. (3–18)
b.
The nationalist and Communist imperatives of the Peiping regime impel the Chinese Communists toward eventual recapture of the historically Chinese territories which the U.S. and the West now hold or protect; toward eventual expulsion of Western or Western-allied forces from adjacent mainland areas; and toward substitution of Chinese Communist influence for that of the West in the other areas of the Far East. Even if particular Far Eastern issues were resolved to the satisfaction of Peiping, the Chinese [Page 280]Communists, as Communists, would continue to maintain a basic hostility to the West in general and the U.S. in particular. (19–25)
c.
The Sino-Soviet partnership is based on powerful ties of common ideology and mutual interest between the Soviet and the Chinese Communist regimes; it has proved of considerable value to both partners; the conflicts of interest of both partners with the non-Communist world are for the present much more intense than conflicts of interest between the partners. There are hazards for the alliance in both the short and the long term which center on the relationship between the partners. But the potential dangers to the alliance will stem primarily from the inner workings of the partnership and only secondarily from the nature of external pressures or inducements. (26–33)
d.
Non-Communist Asia, with the possible exception of Indochina, can, under conditions of continued Western assistance, cope with the present level of Chinese Communist and native Communist pressures. Non-Communist Asia has the potential of developing considerable strength, particularly at the extreme ends of the East Asian periphery in Japan and India. This potential cannot, however, be rapidly realized. Non-Communist Asia will continue to require Western protection against Communist military attack. (34–45)
e.
Although U.S. capabilities for exercising pressures inside as well as outside China are limited, the United States through economic restrictions and through persuasion of its Allies to exercise similar restrictions, can impose difficulties and delays upon Chinese Communist efforts to achieve industrialization and oblige the USSR to continue to carry the burden of assisting Communist China. The United States, through political measures, can impose impediments to general international acceptance of the Chinese Communist regime, thus reducing Peiping’s effectiveness in rendering propaganda support to the USSR and forestalling an increase of Chinese Communist prestige. (46–55)

policy conclusions

3. It would be in the interest of the United States to secure a reorientation of the Chinese Communist regime or its ultimate replacement by a regime which would not be hostile to the United States. However, in the absence of further Chinese Communist aggression or a basic change in the situation, the following policies are currently unacceptable to the United States:

a.

The overthrow or replacement of the Chinese Communist regime by the use of U.S. armed force.

In view of the political and military capabilities of the Chinese Communists, the importance to the Soviets of the Chinese Communist connection, and the attitudes of the major allies of the United States, such an attempt would involve: (4–8, 16–18, 28–29, 46–47, 56–57)

(1)
Full U.S. mobilization.
(2)
Heavy casualties.
(3)
The deployment of a major proportion of U.S. armed forces to the China theater.
(4)
Possible use of a significant proportion of the U.S. atomic stockpile and employment of a major proportion of its atomic carriers.
(5)
Almost certainly a split of the U.S.-led coalition.
(6)
Probability of military intervention by the USSR and a very high risk of global war.

b.

Support with U.S. forces of an attempt by the Chinese Government on Formosa forcibly to overthrow the Chinese regime.

Such support would necessarily involve such extensive use of U.S. armed forces as would result in substantially the same costs and risks for the United States as a U.S. attempt. (4–8, 16–18, 2829, 42, 56–57)

c.

Concessions to Communist China designed to overcome the regime’s basic hostility to the West.

The United States cannot maintain its security position in the Far East if it makes concessions sufficient to satisfy Chinese Communist ambitions, which include: (1) the recovery of Formosa and other historically Chinese territory, (2) the withdrawal of Western armed forces from areas contiguous to China, and (3) the substitution of Chinese Communist influence for Western influence in other areas of the Far East. In any case, U.S. concessions would not necessarily alter the deep ideological hostility of the Chinese Communists to the United States and the West or destroy the SinoSoviet Alliance. In fact, there is no evidence that lesser concessions of an economic and prestige nature would induce the Chinese Communists to agree to settlements of major outstanding issues acceptable to the United States. (19–25)

4. In the absence of further Chinese Communist aggression or a basic change in the situation, the policy of the United States toward Communist China should currently be to seek, by means short of war to reduce the relative power position of Communist China in Asia:

a.
Primarily by developing the political, economic and military strength of non-Communist Asian countries. (34–45)
b.
At the same time by weakening or at least retarding the growth of Chinese Communist power in China. (53–54)
c.
By impairing Sino-Soviet relations. (52)

5. To carry out the policy stated in paragraph 4 the United States should:

a.
Maintain the security of the off-shore island chain. (48–49)
b.
Be prepared to prevent, with the use of U.S. armed forces if necessary and feasible, further territorial expansion elsewhere by the Chinese Communists. (48–51)
c.
Assist, where necessary, non-Communist governments in the Far East to counter Communist subversion. (37–40)
d.
Foster strong and healthy non-Communist governments in the Far East, particularly in Korea, Formosa and Indochina, which border on Communist China. (34–44, 55)
e.
Assist in the development of the political, military and economic strength of Japan and, on a selective basis, of other non-Communist Asian countries where a practicable basis for such development exists. (34–44, 55)
f.
Continue to explore the potentialities of collective arrangements in the Pacific area and to encourage the countries of this area to resolve their differences and overcome other obstacles to cooperation in the area. (45)
g.
Continue to exert political and economic pressures against Communist China, including unconventional and covert pressures, at least until settlements satisfactory to the United States can be achieved in the areas around Communist China. (53–54)
h.
Continue to recognize and support the Chinese National Government on Formosa as the Government of China and the representative of China in the United Nations and other international bodies; assist it in achieving increased support from all non-Communist groups; and increase the effectiveness of its armed forces for action in defense of Formosa, for raids against the Communist mainland and seaborne commerce with Communist China, and for such offensive operations as may be in the U.S. interest. (42, 54)
i.
Employ all feasible means, covert and overt, to impair SinoSoviet relations.
j.
Attempt to convince the other members of the free world of the soundness of U.S. policies toward Communist China and of the advisability of their adopting similar policies, without, however, imposing such pressures as would be seriously divisive. (54, 56–57)

[Enclosure]

NSC Staff Study on U.S. Policy Toward Communist China

the problem

1. The emergence of a strong, disciplined, and revolutionary Communist regime on mainland China has effected a radical alteration of the power structure in the Far East. With the minuscule exceptions of Hong Kong and Macao, American, Japanese, and European power and influence has [have] been abruptly extruded from the whole vast area between the Amur, the Himalayas and the Gulf of Tonkin. Simultaneously, Russian influence has been abruptly advanced southward to areas in which neither the Czars nor the Soviets have hitherto had more than passing influence—China south of the wall, China south of the Yangtze, and Southeast Asia. The primary problem of U.S. foreign policy in the Far East is to cope with the altered structure of power which arises from the [Page 283]existence of a strong and hostile Communist China, and from the alliance of Communist China with the USSR.

elements of the problem

2. The objectives which the U.S. can reasonably set for itself in coping with this problem, and the courses of action which it can prudently adopt to achieve those objectives, are necessarily conditioned by the elements of the problem. The elements of the problem to which the U.S. must address itself are: (a) the present and prospective capabilities—political, economic, and military—of Communist China; (b) present and prospective Chinese Communist intentions toward non-Communist Asia and the West; (c) the nature and prospects of the Sino-Soviet connection; (d) present and prospective capabilities of non-Communist Asia; (e) the scope and limitations of U.S. and Western capabilities with respect to Communist China; (f) the bearing of U.S. policy toward Communist China on U.S. relationships with the Free World.

chinese communist capabilities

Achievements

3. If the Peiping regime is judged solely on the basis of its achievements, its capabilities must be assessed as formidable. In the course of half a decade the Chinese Communists have succeeded in defeating and replacing the National Government of China on the mainland, in consolidating, extending, and intensifying the control of the central administration, and in largely rehabilitating the Chinese economy, while at the same time undertaking a Communist political and social revolution of vast proportions. The Chinese Communists have:

a.
Conquered all of China except Taiwan, including Manchuria, Sinkiang, and Tibet.
b.
Destroyed organized Chinese Nationalist military strength on the mainland and reduced banditry to its lowest level in recent Chinese history.
c.
Eliminated most of the Nationalist political influence on the mainland.
d.
Imposed centralized administrative and military controls on China, including areas that were able to preserve autonomy under the dynasties and under the Republic; extended these controls into every aspect of Chinese life, including the villages, which under previous forms of Chinese government had only indirect contacts with the central administration.
e.
Executed a radical and often violent redistribution of land and in the process upset traditional political and economic patterns, broken the economic power of the landlords and rich peasants, destroyed the prestige and leadership position of the rural gentry, [Page 284]and established the new Communist cadres in an effective position of leadership.
f.
Established a system of taxation and state controls over production and marketing of agricultural products and gained a firmer hold on Chinese agrarian output than has been achieved by any previous Chinese government.
g.
Extended state ownership of key industrial enterprises and established state control over most raw materials and labor, and reduced the private sector of urban enterprise to economic and political impotency.
h.
Created a massive and centrally-directed apparatus of propaganda, indoctrination, and terror, involving the full-time employment of 3–5 million persons and mass organizations with a membership of over 100 million persons, to control the Chinese population.
i.
Initiated an attack upon basic traditional Chinese institutions and values, such as filial piety, feminine subservience, family and clan loyalties, localism, and philosophical and religious humanism; and achieved initial successes in replacing these values with those of the Communist dialectic among important segments of the Chinese population, particularly the youth.
j.
Created numerous Soviet-type institutions: model agricultural collectives, state farms, and countless agricultural cooperatives that are designed as precursors for universal collectivization, as well as urban industrial combines patterned in organization, labor practices, and production techniques on Soviet industry.
k.
Attained a position of leadership among Asian Communist movements and regimes and supported some of these with aid and technical assistance.
l.
Fought a three-year war, confined to Korea, against UN forces, while at the same time accelerating the totalitarian organization of the Chinese polity and economy.
m.
Established a close working relationship, based on common ideology and mutual power interest, with the USSR in the face of Chinese nationalism and ethnocentrism.

Political Prospects

4. In the course of these achievements, the Chinese Communist Party was able to transform itself from a hard-core, rural-based, peasant-supported guerrilla movement into the ruling elite of the largest population of the world. It accomplished this without loss of cohesiveness and discipline among its top leadership and without loss of standing within the world Communist movement. In fact, the Chinese Communist Party stands alone among major Communist movements in having survived a war and post-war periods without top-level purges and major shakeups and in having established for itself a position of prestige and independence within the Communist bloc.

5. It is obvious that Chinese Communist achievements can in large degree be attributed to factors other than the political competence of the Chinese Communist leaders. The Chinese Communists [Page 285]have had the advantage of operating in a fluid and revolutionary situation. They have benefited from the collapse of traditional Chinese civilization under the political, economic, military and cultural impact of the West in the 19th and 20th centuries. They have benefited from the dislocation and nationalistic impetus which accompanied the Japanese war and occupation. They have benefited from the political and military ineptness and loss of will of the Chinese Nationalists in the post-war period of political competition and civil war. They have benefited from the defeat and dismemberment of the Japanese Empire, the wartime weakening of the European colonial powers, and the immediate post-war lassitude of the United States. They have benefited from the Soviet example, from Russian assistance, and from their alliance with the USSR.

6. It is also obvious that the Chinese Communists are confronted by political problems of major proportions. Already, in fastening totalitarian controls upon the Chinese population, in undertaking the building of an industrial economy on the slim margins afforded by the agrarian economy, in undertaking their assault on traditional social forms and values, the Communists appear to have alienated considerable segments of the populace since their initial conquest of China. In spite of continuing Communist success in mobilizing the loyalty of the party, the army, and the youth, there is evidence that increased taxation and regimentation has stimulated peasant opposition, that intellectual and professional groups are disaffected by a drop in their standard of living and by the campaigns of terror and intimidation, that merchants and petty shopkeepers are resentful of the heavy taxes and government competition, and that there is a widespread repugnance to interference with personal and family life, enforced frequent attendance at meetings, and the general atmosphere of fear. The Communists have sacrificed popular support in the interest of establishing rigid controls, while retaining the loyalty of certain key groups. Although the history of modern totalitarian regimes offers us little comfort as to the consequences of such a shift, the Communists do face the difficulties potentially inherent in operating on a narrower base of popular support.

7. The long term holds even more critical political problems for the Chinese Communists. They face the task of coping with the slackening of spirit, dedication and unity which almost unavoidably follows the achievement of power by a revolutionary party. They are far from conquering, and may encounter perilous difficulties in overcoming, the tenacious forces of Chinese traditionalism and particularism. The very magnitude of their success in erecting a completely centralized administration poses for them the potential problem of estrangement between an isolated, highly organized [Page 286]central leadership and the vast population of the broad reaches of China. The Chinese Communists face eventually that problem of succession to a strongly entrenched personal leader which the Russians have already encountered. They face also the complex of internal Chinese political problems which may arise from continued Chinese Communist conformity to Soviet policy and guidance—problems stemming from Chinese nationalism, from the political stature and ambitions of the Chinese Communist leadership in the international Communist movement, and from the potential conflicts between Chinese and Soviet national and party interests. Most important, the Chinese Communists face the political hazards of attempting to force the rapid development of an industrialized economy by gross governmental extortion of the substance of a population which already is hardly at a subsistence level.

8. It would be foolhardy to prophesy that the Chinese Communists will successfully surmount the variety of political difficulties which they will unavoidably encounter if they pursue their present policies. But it would be equally foolhardy to assume that they will not. The history of China through the centuries demonstrates that there is no basic incompatibility between rigidly orthodox, doctrinal, authoritarian government and the Chinese temperament. Historically China is accustomed to rule by bureaucracy and the Chinese have been wont to have standards of personal conduct and habits of personal thought set by the bureaucracy. The Chinese Communists have demonstrated considerable capacity to cope with the political problems they have thus far encountered, and their monopoly of media, of information and of instruments of propaganda and terror will assist them in attempting to surmount their political difficulties. Unless and until they encounter problems with which they cannot cope, it is only wise to assess their political capabilities as formidable.

Economic Prospects

9. Chinese Communist economic effort has thus far been addressed most importantly to the task of reorganizing and rehabilitating the economy which they inherited. At the time of the takeover the levels of agricultural and industrial production, the stability of the currency, and the general condition of the transportation system in China had reached a very low point as a result of eight years of war against Japan and four years of civil war. Consequently, the mere restoration of peace and order to the countryside and relief from the accumulated destructive pressures of war and rebellion would have enabled the industrious Chinese people to make significant economic gains as compared with 1949. The Communists have restored agricultural production to something approximating [Page 287]prewar levels. While the rehabilitation of industry has been less complete, largely due to the dimensions of the task imposed by the casualties which the Japanese-developed industrial plant in Manchuria incurred from Russian removals and civil war, the Chinese Communists have made considerable progress in the direction of prewar output. The Chinese Communists have also successfully rehabilitated and extended somewhat the modest railroad network of China, facilitating an expansion in domestic trade and a broadening of local markets. The regime has undertaken a highly publicized, but relatively modest, public works program, particularly in the field of flood control and irrigation.

10. While total output has been rising, the Chinese Communists have instituted fiscal practices which, supplemented by confiscation, extortion, and political pressure, have restrained a rise in consumption and enabled the regime to secure an increasing volume of resources with which to support the burgeoning bureaucracy, the Korean war, and a modest but expanding investment program. Some of these resources, such as the foreign currency, gold and silver hoards which were forced out of private hands, heavy capital levies on business firms in the guise of fines, and other revenues from confiscated lands and holdings of the Chinese National Government and its officials, are no longer available to fill the coffers of the regime. Special demands for revenue from now on must be met largely from current national income. The Communists have taken over for the state the major portion of industry and transportation and have organized state controls over the production and marketing of the products of the remaining industrial sector of the economy. They have also implemented a rigorous system of farm tax collections and organized state controls over the marketing of the products of the agricultural sector of the economy.

11. The Chinese Communists have secured for the present a stable economy with the capacity for a moderate investment program. Although there are indications that Peiping already has had to scale down initial objectives, barring the dissipation of resources through major agricultural disasters, involvement in a large-scale war, or misallocation of resources through an over-ambitious investment program, it would appear that the regime could be expected to embark on a modest 5-year program without major economic mishaps. Despite a moderate investment program, several factors suggest that the Chinese Communists within this short-run period may secure respectable increases in output. With the skill and ruthlessness in manpower organization demonstrated by the Chinese Communists, it is not unlikely that the underemployed labor in agriculture can further be drawn into production through expanded public works and other programs without large inputs of [Page 288]capital. Moreover, with Communist China’s present obsolete and underdeveloped industrial plant, a relatively high return of output for investment may be expected if investment is directed at modernization and consolidation of the existing industrial complex. The pronouncements of the Chinese Communists on their 5-year plan suggest that this is the sort of program they have in mind, and on this basis a realistic appraisal of Communist China’s economy five years hence, even with continued Western trade controls, might well be that an increase in output, although with little change in the structure of the economy, will have been achieved, and that the capacity for capital formation will have improved.

12. Over the long-term period, however, Communist China faces several major economic obstacles. Demography poses for the Chinese Communists a major economic and political hazard. The population of some 475,000,000 has been limited in its growth by the classic Malthusian checks of disorder, pestilence and famine. The political necessities of the Chinese Communists have impelled them to restore order, to undertake extensive campaigns for mass literacy and public health which reduce the efficacy of the mass killers, and to devise for governmental purposes methods of accumulating and distributing food which also tend to counter famine. The Communists are willy-nilly intensifying the problem of population growth.

13. Chinese Communist attempts at industrialization will necessarily place upper limits on population increase. Investment capital must primarily come out of agricultural production, and capital formation will necessarily impose limits on consumption and thus upon population growth. But present and continued increases in population will obviously create difficulties for the process. At best, by reason of increased numbers of mouths to feed, the task of capital formation will be more costly. Almost unavoidably the effort to mobilize investment capital for the state will increase requirements for widespread and costly security controls in the countryside. And there is always the political hazard that the increased extortions of the state and forced limitations on consumption will lead to rural resistance or peasant revolt.

14. The ambitious schemes of the Chinese Communist regime for industrialization must also reckon with the relative paucity of China’s natural resources. Although China possesses large, high-grade coal deposits, iron ore reserves are relatively modest and much of these deposits is either low-grade ore or poorly situated in relation to coal deposits. Moreover, China appears to be deficient in oil and (with the exception of tin, tungsten and antimony) other essential minerals. Apart from minerals, there are no large amounts of uncultivated arable land, while timber resources, located primarily [Page 289]in Manchuria, are meager. The limited nature of these resources indicate, first, that although China may industrialize greatly over its present level the prospects are unlikely that China will become a major industrial power, and second, that the process of industrialization will be relatively costly owing to the high developmental and operating costs involved in exploiting limited and low-grade resources and owing to the limitations of Chinese technical and managerial skills.

15. In assessing the economic prospects of the Chinese Communists, and the political implications of those prospects, it is wise to admit that the Communist regime has thus far shown adeptness in attacking its economic problems. The Communists have managed to secure effective control over the agricultural output, and in the process have avoided methods which would provoke violent resistance. They are moving ahead with a variety of rural cooperative organizations which step by step they are guiding in the direction of collectivization, particularly in the grain growing and industrially important region of Manchuria. In general, however, they have avoided forcing the pace to a point where they prematurely arouse the constant sensitivity of the peasant about his ownership of land. They have proceeded more ruthlessly in the direction of complete state control of trade and industry, but have timed their confiscations and encroachments according to a judicious calculation of the diminishing political risks which they encounter from the increasingly impotent middle class. They have concocted ambitious plans for industrial development, but have not hesitated to trim them as the costs or risks appeared too great. The Communists face Herculean tasks in the economic field. It seems unlikely that they can soon achieve a modern economy or major economic capabilities. And if the Communists move too fast their victories may well be Pyrrhic. As yet, however, there is not sufficient ground for estimating that the regime will encounter insuperable economic difficulties or that its political control will founder on the reef of economic obstacles.

Military Capabilities

16. The achievement of the Chinese Communist regime in Korea has been a military feat of no mean proportions, and instructive as to the extent of Chinese Communist military capabilities. The Chinese Communists, with Russian assistance, were able to organize, train, equip, supply, and commit massive ground forces in the Korean peninsula. These forces fought with courage, aggressiveness, and with notably few desertions. They demonstrated skill and energy in camouflage and entrenchment. As the war progressed the Communists demonstrated increasing capabilities and proficiency [Page 290]in the artillery arm. They accumulated considerable capabilities and limited experience in air warfare, although the bulk of air combat appears to have been undertaken by the Russians. The Communists devised means, frequently primitive, for logistic support of their front line units in the face of uncontested air and naval superiority on the part of the UN Command. Towards the end of the war Communist ground-to-air anti-aircraft capabilities were extensive.

17. But the Korean hostilities are also instructive as to the present limits of Chinese Communist military capabilities. All of the aircraft, and perhaps some 90 per cent of the ground force equipment and munitions of the Chinese Communist forces appear to have been supplied by the USSR. Chinese Communist military capabilities are thus in large degree derivative rather than primary. The Chinese Communist air force appears to have borne only a minor share of defensive air operations; and conducted almost no offensive operations. The Chinese Communists demonstrated no amphibious capability. In spite of the proximity of North Korea to the most highly developed communications system in all of China—the Manchurian system—the proximity of North Korea to the Soviet supply centers in the Maritime Province, the freedom from attack which these areas were vouchsafed by UN self-denial, and the limited length of the communication lines which had to operate under Allied attack (200–250 miles)—in spite of these advantages the Chinese Communists were never able to provide sufficient logistic support to enable their forces to undertake sustained offensive operations. Chinese offensives, in which the Communists enjoyed considerable numerical superiority, repeatedly ground to a halt, checked in part by skillful Allied resistance, but also by logistical deficiencies. The Chinese Communists also demonstrated marked tactical deficiencies, foregoing maneuver and deception in favor of repeated frontal mass assault with consequent acceptance of heavy losses for minor gains.

18. On the basis of the Korean experience, and of our intelligence as to the level and quality of Chinese Communist forces not committed in the Korean theater, it may be estimated that the Chinese Communists, with continued assistance from the USSR, have a considerable capability for defending mainland China against amphibious or ground assault; modest defensive and offensive air capabilities; limited amphibious capabilities; and negligible naval capabilities. However, within their own borders, on terrain favorable for mechanized maneuver, and with their lines of communication subject to all-out air attack, the numerical superiority of the Chinese Communists would lose much of its effectiveness. The Communists do have major capabilities for offensive military action against [Page 291]areas adjacent to them on the mainland, but Chinese logistical deficiencies place upper limits on the magnitude of these capabilities. It might be estimated that in circumstances where the Chinese were to be opposed, outside their borders, by major, modern military forces, the Chinese Communists would not have sufficient capabilities to achieve decisive victory.

chinese communist intentions toward non-communist asia and the west

19. In its relations with non-Communist Asia and the West, Peiping is motivated by interacting factors derived from the concurrently Chinese and Communist nature of the regime. As a nationalistic Chinese regime, Peiping wishes to reassert China’s position as an Asian and a world power. As a Communist regime, it assesses its enemies and friends and its objectives in terms of the objectives of world Communism and the Marxist analysis of history. Related to these basic ingredients are Peiping’s recognition of the value of the Soviet alliance, its desire nevertheless to exercise leadership in Asia generally and in the Asian Communist movement specifically, and its desire to complete by its own means the Soviet-type revolution it has initiated in China.

20. To promote its position and power from both the domestic and world (especially Asian) standpoints, Peiping apparently feels that it must convince Chinese and Asian opinion that Communist China is becoming a great and progressive nation. It appears to believe that expansion of Communism and of China’s leadership in Asia, as well as the regime’s internal popularity, depend to a considerable extent upon propagating the idea that Communist China is making dynamic progress in industrialization, popular welfare, and strength. The importance attached to these considerations is indicated in the tremendously organized efforts for self-advertisement to Asia that the regime is making, in its extreme concern of maintaining prestige, and in its sensitivity to setbacks in its industrialization program from the standpoint of psychological consequences.

21. Peiping’s foreign policies, however, are not motivated purely by an aggressive urge. The psychology of fear plays an important role. Peiping suffers from traditional Chinese suspicion and fear of the outside world and is keenly conscious of the ideological hostility of the West. The difficulties inherent in the defense of its extensive frontiers have therefore made Peiping doubly sensitive to the development of potentially hostile military powers or coalitions in the Far East, particularly based on Japan.

22. Peiping appears to believe that in the area of foreign relations the above factors can best be served by dynamic policies directed [Page 292]ultimately at a Communist seizure of power in other Asian countries. However, Peiping recognizes that in specific local and world contexts this ultimate aim may involve risks and costs that the regime is not able to assume. Without abandoning the ultimate aim, Peiping’s policies are therefore often directed at intermediate goals of an economic, political, or security nature. These short-range goals usually fall within the framework of a world Communist strategy aimed at neutralizing sources of Western support in Asian countries, preventing the rise of stable, firmly anti-Communist governments wherever possible, encouraging “neutralism,” and perverting to Communist purposes Asian strivings for independence, progress, and peace.

23. The balance of Peiping’s policy emphasis between long-range and short-range goals, and its willingness to assume risks and costs, varies from time to time and place to place. In 1949–50 Peiping proclaimed itself the fountainhead of an Asian policy of “armed struggle” and direct seizure of power by Communist groups—a policy that saw its climax in the north Korean attack on the Republic of Korea in June, 1950. With the growing stability and military capability of non-Communist governments in such countries as Burma, Malaya, the Philippines, and Japan, and with the defeat of the Communist offensives in Korea in the spring of 1951, this shifted to one of limiting rather than expanding existing warfare and of emphasizing in many areas “peaceful” rather than violent methods, thus conserving Communist potentials for the future. As part of this policy, Peiping became the center of the Asian “peace” movement and encouraged Communists throughout Asia to seek out the broadest possible alliance with all potentially anti-Western elements. At the present time, with the Korean truce, Peiping’s policy emphasis is for the moment predominately on “peace,” with the conspicuous exception of Indochina, where military methods appear to the Communists to hold a promise of maximum gain at minimum risk.

24. Within the above framework of foreign policy objectives, a number of specific goals of Peiping’s current Asian policies can be discerned:

a.
For both security and prestige reasons, Peiping is anxious to restore Chinese sovereignty over all historically Chinese areas with the possible exception of Outer Mongolia. This aim was largely accomplished with the conquest of the Chinese mainland, including Tibet, and with the establishment of at least a temporary modus vivendi on the Sino-Soviet Asian frontier which recognized Chinese sovereignty in these areas. However, Taiwan remains in the hands of the anti-Communist U.S.-supported National Government; Hong Kong remains British; Macao remains Portuguese; and the naval base of Port Arthur remains under Soviet military control. Ultimately, [Page 293]the Chinese Communists will hope to regain full sovereignty over all those areas. Peiping’s other possible territorial aspirations appear less important. On the undemarcated sections of the Sino-Burmese and Sino-Indian borders, Peiping will presumably advance at least the traditional Chinese claims—current Chinese Communist maps of these areas indicate Chinese Communist claims well beyond any put forth in negotiations by the National Government, but none of these claims has been formally advanced by Peiping.
b.
Beyond the historically Chinese areas, Peiping apparently feels it has preeminent security interests in certain border areas, particularly North Korea, North Burma, and Northern Vietnam. Peiping would presumably go to considerable lengths to prevent the establishment of strong Western military forces in these areas. (It is significant that the primary reason advanced by Peiping propaganda in its Korean intervention was the security of Manchuria—a factor that certainly weighed heavily in the Chinese decision to intervene.)
c.
In Southeast Asia, Peiping’s interest is two-fold. Like any Chinese government it is interested in cultivating the sizeable Chinese minorities, whose status reflects on China’s prestige and who are a useful source of trade and foreign exchange, as well as potential instruments for present and future Communist operations in these areas. As a leader of Asian Communism, Peiping is interested in expanding its influence among Southeast Asian Communist movements and in providing these with aid and guidance.
d.
In Northeast Asia, Peiping’s interest is to insure the safety and potential for future expansion of the North Korean regime and to attempt to neutralize the threat of Japan. In this area, short-range policy may emphasize Korea but in the long run the Peiping regime is most deeply concerned over Japan, which alone of Asian countries could be a military threat to Communist China even in the absence of substantial Western military forces.
e.
In the field of economics, Peiping is anxious to extend its commercial contacts throughout Asia, particularly with Japan, not only because of the need for trade in China’s five-year program of industrialization, but also because trade and trade offers are considered by the Communists to be powerful weapons in neutralizing the anti-Communist posture of many Asian governments.
f.
In the field of diplomacy, Peiping is interested in occupying China’s seat in the UN and in establishing formal relations with Asian countries (with the exception of the Associated States of Indochina, which Peiping cannot recognize because of its relationship to Ho Chi Minh3). In the case of Japan, Peiping is restricted by having to coordinate its activities with those of the USSR and by its untempered opposition to the San Francisco treaty4 and the present U.S.-oriented government.
g.
Peiping’s domestic policies—centered at present around the programs of industrial and military modernization and social and [Page 294]political sovietization—must compete with the foreign policy objectives described above. As international Communists, the Peiping leaders are acutely aware of the importance of the international environment to their domestic program and of the “threat of capitalist encirclement.” They have not, therefore, demonstrated any willingness to sacrifice major elements in their foreign policy, such as their Asian leadership role, their security considerations in bordering countries (such as North Korea and Vietnam), or their status in the Soviet bloc, merely to further a domestic program or to prevent repercussions unfavorable to domestic programs (such as economic sanctions). Where shifts in foreign policy have taken place, these usually seemed to have been based primarily on changing international conditions.

25. From the viewpoint of Peiping, Western (i.e., U.S.) opposition and a Western (U.S.) threat is in evidence in relation to every objective of Chinese Communist foreign policy. The Chinese Communists see obstacles to their policies in British retention of Hong Kong, U.S. protection over and assistance to Taiwan, U.S. participation in the defense of Korea, U.S. aid to Indochina and other Asian countries that are resisting Communist inroads, U.S. participation in the military, political, and economic resurgence of Japan, and U.S. support of political pressures and economic restrictions against Communist China. Many of these specific foreign policy objectives of the Peiping regime, whether territorial, political, or economic, would be shared by any strong, independent, nationalistic Chinese government. However, of importance from the viewpoint of U.S. policy is the fact that Peiping’s adherence to Communist doctrine alters not only the intensity but also the direction of Peiping’s policies. In the case of the Chinese Communists, ultimate opposition to the West would not be reduced if individual sources of friction were removed, since Peiping shares the world Communist objectives of placing under Communist control not only Asia, but the West as well. Peiping opposes the West not only where Western power is in evidence, as in Japan, but also where Western influence has been virtually destroyed and no longer represents an immediate threat to its rule, as in the field of Chinese education, because it is the West—not only as a military, political, and economic system, but also as an ideology—that is antithetical to the foundations of the Chinese Communist system. No settlement of individual issues, no compromises, could in Chinese Communist eyes resolve the basic conflict between the two systems.

natures and prospects of the sino-soviet connections

26. The relationship between the Kremlin and the Peiping regime is clearly distinct from the relationship between the Kremlin and the other Communist states. The distinction has been frequently [Page 295]described as consisting of the difference between a junior partner and a satellite relationship. The essence of the differentiation in the relationships is that whereas in the satellite states the Kremlin rules in detail, lays down precise instructions for particular actions, and administers the internal hierarchy of personalities and power, with Communist China the Russians appear to act almost entirely on the basis of state to state negotiation, assistance, and advice. “The great Chinese people”—to use the constantly reiterated Russian phrase—appears to be dealt with as a unit which is authoritatively represented by the Peiping government, and the collective Chinese Communist leadership. In the satellites, on the other hand, the channels of authority appear to run from the Kremlin to varying, individual Communist leaders. The Russians handle the satellites through disciplinary control over individual Communist party members. They appear to deal with Communist China as a close, but relatively independent ally.

27. Granted that we know very little as to how and why things happen in the murky recesses of the centers of Russian and Chinese state and party power, the evidence as to the basic nature of the Soviet-Peiping relationship is reasonably conclusive. Pertinent indications include the special mention of China as distinct from the “Peoples Democracies” in all Russian statements; the unique distinctions reserved for Mao Tse-tung and Chinese Communist revolutionary theory and tactics in Russian political literature; the relative deference with which the Russians treat the Chinese representatives on all public occasions; the relatively independent role of Chinese Communist representatives in the few international gatherings in which the Chinese Communists have thus far taken part. There is also scanty but convincing intelligence as to the manner in which Russian personnel in Manchuria appear to have deliberately avoided intervention in Chinese Communist internal affairs and, even in cases where enterprises were still jointly owned and operated, confined themselves to technical advice, leaving all such problems as personnel, labor management and political indoctrination to the Chinese. Perhaps most important, there is no good evidence in the high command of the Chinese Communist party of those shifts of personnel which in the Satellites indicate direct Soviet intervention in local party affairs. The apparent stability of the roster of the Chinese Communist top command is in itself the strongest indication the Russian-Chinese relationships are on a state-to-state basis.

28. The bases of the Russian-Chinese partnership are varied. The Soviets and the Chinese Communists share the vocabulary and substance of a system of political thought, and the forms and practices of a pattern of political action. Ideological affinity provides cement [Page 296]for the alliance. Both Russians and Chinese Communists believe themselves confronted with the common threat of hostile power based on Japan. The Chinese Communists and the Russians share the grand objective of eliminating Western power and influence from the Far East—the Russians because their global purposes call for a weakening of the West; the Chinese because in addition to their communist aspirations, their nationalist drives center on the recovery of Chinese territory, the removal of Western threats to their borders, and the extension of Chinese influence throughout the Far East.

29. The profits which have already accrued to both the Chinese and the Russians from their partnership augur well for continuance of the connection. The Chinese Communists have secured from the Soviets matériel and training assistance for creation of a sizable modern army and a fair-sized air force. They have benefited from Russian technical advice in the rehabilitation of Chinese industry, mining, power production and transportation. They appear to have received assistance from the Russians in capital goods. They have received USSR support for UN membership and acknowledgment of their status as a great power. Up to the present, they have, because of the Russian connection, remained immune from hostile attack while conducting a major war against the United States and its Allies. The Russians have profited from Peiping’s intervention in Korea which preserved the Communist state of North Korea, forestalled the installation of hostile forces on the Soviet borders, and prevented a major defeat for the Soviet bloc. And the Soviets have benefited from the assistance which Peiping has given in spreading communist influence and propaganda, and in projecting the Soviet peace offensive into East Asia. The alliance must seem invaluable to both Soviet and Chinese Communist leaders.

30. Yet there are major potentials for tension and discord in the Sino-Soviet partnership. In the long term, too great success on the part of the Chinese Communists might produce in the Russians real concern. The Russians could hardly view with equanimity the development of an independent China on its frontiers which was powerful, well armed, industrially competent, and politically united. Chinese Communist successes in achieving reduction of Western power and influence in the Far East might confront the Russians with a partner whose ambitions could be achieved at cost not to the West but to the Russians themselves.

31. And in the shorter term there are potential hazards for the partnership. From the inception of the Peiping regime there have been a number of problems not fully resolved; these center on: the degree of Soviet intervention and control in Manchuria, Mongolia, [Page 297]and Sinkiang; the status of Mao Tse-tung in world Communism; the degree of conformity of Chinese internal policies to a world Communist “line”; the extent to which the Chinese should dominate or influence the Communist Parties of South Asia and Japan; the questions of the volume and Chinese repayment for Soviet military and economic aid; the basic anti-foreign feelings of the Chinese people. Any or all of these problems may come to plague the partnership.

32. It may, moreover, become increasingly difficult for the Russians to maintain the circumspection which they have hitherto displayed in dealing with the sensibilities of their junior partner. The men of the Kremlin are not in the habit of dealing with their lessers in any terms except those of strict control. New strains within the Kremlin leadership might prompt the Chinese Communists, confident of their own regime’s stability, to adopt an attitude of arrogance and greater independence. As the inevitable differences in interest, viewpoint, or timing of actions develop between the Russians and the Chinese; as the Chinese tend to become importunate in their demands for Russian assistance or support; or as the role of the Chinese as viceregents for international communism in the Far East becomes too independent and self reliant—there will be strong temptation for the Russians to attempt to move in the direction of greater disciplinary control over the Chinese Communists. If the time ever comes when the Russians feel impelled to contest with the Chinese Communist leaders for primacy in the domestic apparatus of control of the Chinese regime, the alliance will be critically endangered. For, as has been stated before, the Chinese Communist leaders are Chinese as well as Communists.

33. It seems evident that the potential difficulties of the Sino-Soviet connection will stem primarily from the internal workings of the partnership and only secondarily from the nature of external pressures or inducements. The West to be sure can strive to create those pressures or inducements which might be most apt to provide the context for increase of tension in the partnership. But short of inflicting on the Chinese Communists an outright military defeat it seems improbable that the West can through its pressure alone break the alliance. It also seems improbable that the West can through accommodation create a situation in which Chinese conflicts of interest with the Russians are greater than Chinese conflicts of interest with the West; the initial Chinese Communist choice of partnership with the Russians in 1949, when the Western powers, including the United States, had obviously reconciled themselves to the defeat of the Nationalists and the supremacy of the Communists in China, and were making gestures of accommodation, has already given some indication of the limited efficacy of [Page 298]appeasement as a weapon against the continuation of the alliance. In the last analysis the continued strength of the Chinese connection with the Russians will depend primarily on the degree to which the Chinese are successful in conforming their particular courses of action to the general outlines of Russian policy, and above all on the degree to which the Russians are successful in restraining themselves from attempts to exert direct disciplinary control over the Chinese Communist leaders. Thus far there has been no evidence that either partner will fail to pursue courses of action that will preserve their present relationship.

capabilities of non-communist asia

Present Capabilities of Non-Communist Asia

34. It is evident that the capabilities of the non-Communist Asian countries vis-à-vis the Chinese Communists are for the moment almost purely defensive. The Chinese Communists may have cause to worry about the degree to which these countries may serve as channels or instruments for aggressive action on the part of the U.S. and the West. The existence of the Chinese National Government on Taiwan poses a potential military threat to the Chinese Communists; the potential development of Japan or India may give them major concern. But as of now no country of non-Communist Asia poses in its own right a major political or military threat to Communist China, and for the U.S. and the West the central immediate problem is the capacity of the non-Communist countries to hold against or to be assisted to hold against the political, economic, and military thrust of the Chinese Communists.

35. Militarily, no one of the countries on the mainland whose geographic position makes them the immediate potential targets of Chinese Communist aggression, (Korea, the Associated States, Thailand, Burma) has the military strength to counter independently Chinese Communist armed forces. South Korea with the U.S. assistance has developed major military forces, but has obviously not reached and never can reach the point of being able to defend itself alone. The French and Associated States are hardly able to hold their own against present Vietminh forces, and could not withstand a Chinese Communist intervention. The military capabilities of Burma and Thailand are minor.

36. Of the countries protected by sea or distance from Chinese Communist attack, Nationalist China and India have presently the largest and best developed armed forces. Without U.S. naval and air protection, however, Formosa could probably not defend itself against Communist attack; and Indian capabilities to withstand Chinese Communist attack through Burma would be questionable. [Page 299]Japan, while having the capability to develop indigenous military strength, does not presently appear to be willing to create the forces necessary to defend itself from an external attack.

37. With the possible exception of Indochina, the non-Communist region of East Asia does as a whole appear to have the capabilities—under conditions of continued U.S. and Western assistance—to cope with the present range of internal and external Chinese Communist and local Communist pressures. Communist rebellions are slowly but perceptibly being suppressed in Burma, Malaya, and the Philippines. Communist parties and front groups do not presently present a serious threat to the position of any of the governments except in Indochina and possibly in Indonesia. Instabilities arising from political inexperience, apathy toward political processes, remnant colonial issues, and economic distress weaken the governments of most countries of the area but not to the point of making them so vulnerable to Communist political warfare as to threaten their existence.

38. Economically, there is no country in non-Communist Asia which is presently closely tied to the Communist bloc or which is in immediate danger of falling under Communist economic domination. There are, however, throughout the area vulnerabilities to Communist pressure for expanding trade. The falling markets for agricultural and mineral exports create specific vulnerabilities in the case of Indonesia, Malaya, Thailand and Ceylon; and the general over-all drive for trade and foreign markets impels the Japanese to seek for expanded trade with the Communist held mainland.

39. In the non-Communist Asian region as a whole, there are factors which make it possible for the U.S. and the West to exert influence and provide effective assistance. Throughout most of the area there is a fear of Chinese expansionism which, provided Western support continues, can be expected to produce increased efforts against Communism rather than ostrich-like immobility. Despite the attraction of Marxist theory through most of the region, there is considerable evidence that at least among some of their most influential political leaders there has been increasing disillusionment on the part of such Asian “neutralist” countries as India, Burma, and Indonesia with respect to the Chinese Communists. Leaders of these countries, while for various reasons maintaining their aloofness from power alliances, seem to be more wary of Chinese Communist intentions towards their countries and more seriously concerned with Communist activity within their borders than when the Peiping regime was first established. The reaction of the overseas Chinese community to the Peiping regime has also been influenced by these factors and by the ruthlessness of the regime’s economic policies on the mainland particularly those directed at private [Page 300]enterprise. It seems safe to say that the regime is less popular with the overseas Chinese now than during its first year. In the absence of sharp changes in the general conduct of the Chinese Communists both at home and overseas it can be fairly estimated that the attitude toward the Peiping regime both on the part of the Asian countries on its periphery and on that of the overseas Chinese as a whole will continue to harden.

40. Conversely, there is a considerable appreciation of many aspects of Western culture and technical achievement, and a growing appreciation that many facets of U.S. behavior and policy toward the underdeveloped countries are compatible with their own objectives. In the “neutralist” nations, this realization seems to be emerging alongside continuing opposition to any appearance of “colonialism,” and a belief that U.S. policy is, despite the best of motives, governed more by the necessity of preserving the Western coalition with the colonial powers than by the interests of the Asian countries.

Prospective Capabilities of non-Communist Asia

41. In the absence of direct Chinese Communist military intervention, it may be expected that non-Communist Asia as a whole will in the course of the next few years, show some improvement in terms of political stability, domestic economic development, and controls over internal subversive elements. A considerable increase in the strength of the non-Communist position would arise from the defeat of the organized forces of the Vietminh in Indochina, but such a defeat would be likely only if considerably increased external assistance were placed in support of the Associated States, and the people became convinced they were fighting in their own behalf. There are no immediate prospects of rapid development of strength in the two countries which, potentially, can contribute most to a restoration of balance of power in Asia—Japan and India. There is an obvious ceiling on the potential power of Taiwan and there are no immediate prospects for rapid development of regional cooperation for the purpose of mutual defense.

42. The Chinese Government on Taiwan is a considerable asset to the U.S. position in the Far East. The existence of the Chinese Government on Formosa offers an at least symbolic alternative to Communist control of the mainland, and helps to frustrate the Communist objective of gaining international acceptance as the sole representative of the Chinese people. Taiwan also offers material competition to Peiping as a center for the loyalties of the overseas Chinese. The military forces of the Nationalists constitute the only readily available strategic reserve in the Far East and as such assist in discouraging the Chinese Communists from further military [Page 301]adventures. Despite the fact that these forces are inexorably aging, they provide, for the short term, a valuable deterrent force and one which could be used in a variety of ways in the contingency of further Chinese Communist aggression.

43. Japan, by reason of its developed industry, and the relatively advanced technical training and aptitudes of its population, is the one Asiatic power which has the potential of becoming an independent military threat to the Chinese Communists. But even assuming rapid progress toward rearmament, the Japanese will not be independent of U.S. military support for a considerable period. Japanese cooperation with U.S. defense planning will probably continue, but collaboration with respect to over-all objectives in the Far East will be tempered to some extent by the strong Japanese desire to restore commercial relations with the China mainland. Japanese leaders seek—and appear to consider feasible—a modus vivendi with Communist China which will leave internal and external security unimpaired; some leaders have indicated a conviction that Japan could usefully function as a bridge between China and the West. Although import and export requirements make Japan vulnerable to economic pressures affecting her access to the world market, even assuming a continuation of U.S. assistance, Japanese susceptibility to Communist overtures or threats will probably be overshadowed by the prevailing belief that its national interests are best served by close relations with the West. The Japanese Communist Party will preserve its ability to conduct sabotage operations but will not be capable of seizure of power. All in all it will be some time even under optimum conditions, before Japan possesses the capability of exercising leadership in Asia.

44. India, by reason of its size and population, its potential for economic and military growth, and the political leadership and prestige of Nehru in the other countries of Southeast Asia, also offers a potentially important counterpoise to Communist China. But India’s domestic and external problems make it unlikely that in the near future there will be rapid development of India’s capabilities vis-à-vis Communist China. Barring Nehru’s death or disability, the Congress Party over the next few years may be expected to retain control of the government, or to dominate a coalition if its majority should be cut. The Communist Party will probably not soon become a serious threat to the internal security of the nation or to the position of the government. Continuing economic and social backwardness, however, will be difficult to remedy. India can be expected to maintain its policy of non-alignment with either East or West, to continue to play an active role, in concert with other members of the Arab-Asian group when possible, in efforts to reduce tensions and to settle specific problems among the great [Page 302]powers and to take measures in defense of its own territory if necessary. Indian contributions to the security of the non-Communist area against Communist China will be heavily contingent on the status of the still unresolved dispute over Kashmir, a problem which currently pins down the major portion of both Indian and Pakistani armed power.

45. Prospects for regional cooperation in non-Communist Asia are inhibited by the conflicting purposes of the various Asian nations with regard to collective action. On the one hand, the strongly anti-Communist states of Korea, Nationalist China, the Philippines, and Thailand share an interest in the development of mutual security arrangements, but the attraction derives more from the possibilities for U.S., or Western, participation and assistance than from the prospects of effective collaboration among these geographically separated states. On the other hand, the independent states of the “neutralist” group—primarily India, Indonesia, and Burma—share a desire to play an active, but essentially political role, as a third force operating apart from the major power constellations and their conception of Asian unity probably still embraces Communist China. There seems to be little common ground, therefore, on which the shared aspirations for security from external aggression can develop into collaborative arrangements for defense either with or without the participation of Western nations. U.S. efforts to promote such arrangements might prejudice the “neutralist” group even though individually they might be willing to accept U.S. military aid. There is, however, a potential for further extension of regional cooperation, along economic and cultural lines, among the independent states of Southeast Asia, which, in time, might lead to a sense of common purpose sufficiently strong to dictate common efforts for defense.

u.s. and western cabilitiesi vis-à-vis communist China

46. In the military field it is hardly necessary to say that the United States and the West possess very considerable offensive capabilities for action against the area controlled by the Chinese Communist regime. The United States alone has naval and air power adequate to establish an effective close-in blockade of the China coast, and to undertake naval bombardment of coastal areas. United States air power exerted against mainland China in sufficient force and employing all available weapons could impose decisive damage on the Chinese Communist air force and its facilities, destroy the essential elements of the modern industrial sector of the Chinese Communist economy, and inflict heavy and perhaps crippling damage on the Chinese transportation net. U.S. sea and air power would make it possible for the United States to effect [Page 303]lodgement of U.S. or Allied ground forces on the mainland and to support large-scale land campaigns.

47. It is not possible to forecast precisely the end result of full exercise of U.S. military capabilities against Communist China because of the variables which would be introduced by USSR counteraction. It is highly probable that an all out U.S. military effort against Communist China, undertaken with the design of overthrowing the Peiping regime, would result in Russian military intervention, and quite possibly in global war. Such an undertaking would in any case bear high costs for the U.S., probably including full U.S. mobilization, would commit to the China theater a high proportion of U.S. forces, might absorb a considerable proportion of the U.S. atomic stockpile and of U.S. atomic carriers, and would probably result in the splitting of the U.S.-led coalition.

48. The United States and the West also have considerable capabilities for countering possible future Chinese Communist aggression against areas not now occupied by Chinese Communist forces. The U.S. and its Allies have already demonstrated in Korea the capacity of the West to stop a full scale Chinese Communist military thrust. U.S. offensive capabilities described above could be exerted against the areas of Communist China, and the U.S. and the West have capabilities for putting ground forces and tactical air into any locality which the Chinese Communists might attack.

49. It is probable that the United States and the West do have the military capabilities to force the Chinese Communists to cease and desist from any particular aggression which the Chinese Communists might undertake outside their present areas of control. The cost would probably be high. But it is possible that actions against Communist China which might be taken in such a contingency, provided they were obviously directed solely toward forcing the Chinese to halt aggression, would not result in formal USSR military intervention or general war, even though it is probable that the USSR would lend the Chinese important military assistance. Such an action would not necessarily weaken, and might in fact strengthen, the U.S.-led coalition.

50. The U.S. and the West also have the military capabilities to defeat Communist armed forces presently operating in areas in Asia outside of Chinese Communist control. The only major problem in this category is in Indochina. The French, if their present political concessions to the Associated States attract the willing support of the indigenous population, do have the capability, in conjunction with the indigenous armies of the Associated States, to defeat the organized forces of the Vietminh, provided the French put in major reinforcements. It remains to be seen, however, whether the French will have the political will to undertake such a [Page 304]course of action. It appears highly possible that, barring substantially increased U.S. absorption of the economic costs of the war, or even intervention by U.S. forces, the French will not have the will to carry the war to a successful conclusion. U.S. military intervention could achieve the defeat of the Vietminh.

51. There is a possibility, although no certainty, that threatened defeat of the Vietminh by the French and Vietnamese or the intervention of U.S. forces in Indochina, would result in Chinese Communist intervention on the Korean pattern. On the other hand the Chinese Communists might well be unwilling to take on the costs and losses which would follow such an intervention. If the Chinese Communists did intervene the U.S. and Western capabilities and the probable outcome would be similar to those described in the case of U.S. and Western reaction to further Chinese Communist aggression outside their present areas of control, (para. 48)

52. For reasons arising out of the nature of the Chinese Soviet connection, and because the present conflicts of Chinese Communist interest with the West so greatly exceed the conflicts of interest between the Chinese Communists and the Russians, the United States and the West, short of inflicting decisive military defeat on Communist China, probably do not have the capacity of breaking the Sino-Soviet Alliance. The Chinese Communists and the Russians may eventually come into conflict, or at least cease to act as a unit, and the U.S. and the West may be able to capitalize on specific tensions and conflicts within the partnership. But in the last analysis a fracture of the alliance, if it comes, will stem primarily from the internal relationships of the partners and only secondarily from either the pressures or inducements of the West.

53. The United States and the West, provided they act in concert, do have the capability of imposing difficulty and some delay on Chinese Communist attempts at large scale industrialization. The Soviet Union and the European satellites will find it difficult to provide the capital goods which the Chinese Communists will require. The United States, Japan and the West are the only other important potential sources of such capital goods. Western capacity to affect the Chinese economy, even if the West acts in concert, does, however, have limits. The Chinese Communists have weathered the present level of economic controls without apparent direct effect on a major military effort, and without major effects on their progress in rehabilitating their economy. Continuation of U.S. and Western controls might be expected to increase Chinese Communist difficulties in achieving anything approaching a rapid industrialization, and to intensify the difficulties which the Chinese Communist regime will in any case encounter in capital formation. But [Page 305]Western controls will not of themselves prevent substantial Chinese Communist economic development.

54. The United States and the West, again provided they act in concert, also have the capability of denying the Chinese Communist regime full status in the international community. The West can withhold or withdraw recognition, and if it acts in concert, exclude the Chinese Communists from the United Nations. Membership in the UN would place Peiping in a better position to support USSR propaganda efforts, improve Peiping’s international position, and add to Peiping’s prestige by endowing it with symbolic recognition of its prestige and permanence. Thus far the Communists do not appear to have regarded diplomatic relations or UN membership as important enough to cause them to abstain from efforts to eliminate Western influence from mainland China, Korea, and Southeast Asia; it is possible however that they will regard UN membership as important enough to warrant material concessions.

55. The United States and the West have the capability of assisting in the creation of strength in non-Communist Asia, which will assist in the restoration of the Far Eastern structure of power, and reduce the relative strength of the Chinese Communists. The United States and the West have the opportunities of directly and importantly assisting the development of economic and military strength in Japan, and to some degree India. The United States and the West have the opportunity of importantly affecting the balance of power in the Far East by fostering and strengthening independent non-Communist states in Indochina. The United States and the West can continue to assist development of military and economic strength in Korea, Formosa, and the Philippines and the remainder of Southeast Asia. By political moves which lessen the “colonial” aspects of Western actions in Southeast Asia, the United States and the West have the opportunity of increasing the possibilities of eventual regional organization in the Far East.

the relationship of u.s. china policy to the free world coalition

56. It is all too evident that the Free World will not act as a unit toward Communist China. And the divisions of the Free World over attitudes toward Communist China tend to engender emotional heat of an intensity similar to that engendered by the China issue in domestic U.S. opinion. India, under Nehru’s leadership, continues to believe that the best approach to the problem is to attempt to wean Mao’s regime away from Russia by extensive promotion of non-Communist contacts with Communist China; Indian fears of Communist China, and Indian desires for a strong, third force, Asian bloc add emotional intensity to this belief. Other [Page 306]Southeast Asian states, impelled by fear of Communist China, by desires to expand trade, and by desires to prevent or avoid involvement in a general Asian war, tend to share Indian beliefs. Partly because of their desire to keep in step with India, partly from their fears about Hong Kong, and partly because of the important place which the idea of the China market occupies in British thought and politics, the U.K. leans towards the thesis that the Chinese Communists should be accorded conciliatory treatment and has some support in Commonwealth opinion. The Japanese for their part have overweening expectations of what trade with the mainland might achieve for the Japanese economy, and also fancy themselves as possible mediators between Communist China and the West. The French grope for ways in which their difficulties in Indochina might somehow be settled by arrangements with Peiping. On the other side of the fence, the South Koreans and Chinese Nationalists are fearful that any accommodation with Communist China might quash their particular ambitions.

57. U.S. policy toward China must take account of the welter of variant, opposing, and emotionally supported views which are held by the other countries of the Free World. Because of the variety of these views no U.S. policy toward Communist China will meet support from all of the Free World. Because of the intensity of emotional and national feelings on the subject of Communist China, any U.S. policy toward Communist China will encounter strenuous and vocal objections from at least some of the countries of the Free World. Because of both the variety and emotional intensity of these views, U.S. attempts to impose on other countries adoption of its own program toward Communist China, whatever that program may be, will have dangerously divisive effects on the Free World coalition. This last point is perhaps the most important. The United States must obviously adopt some policy towards Communist China, and it obviously cannot please everybody. But the United States can avoid the most dangerously divisive potentials of the Chinese Communist issue, by refraining from excessive pressure on its friends to follow American policies with respect to Communist China.

  1. A covering note of Nov. 6 from Lay to the National Security Council stated that the President had that day approved the statement of policy, which superseded paragraphs 6–a and 8 of NSC 48/5 (see footnote 5, Document 86). It also stated that an NSC staff study (see enclosure, below) was enclosed for the Council’s information.
  2. A note in the source text indicates that parenthetical references are to paragraphs of the staff study.
  3. President of the Democratic Republic of Vietnam.
  4. The Treaty of Peace with Japan, signed at San Francisco, Sept. 8, 1951; for text, see TIAS 2490 or 3 UST (pt. 3) 3169.