Foreign Relations of the United States, 1952–1954, China and Japan, Volume XIV, Part 1

Eisenhower Library, Eisenhower papers, Whitman file

No. 455
Memorandum of Discussion at the 229th Meeting of the National Security Council, Washington, December 21, 1954¹

top secret
eyes only

Washington, December 21, 1954

[Extracts]

Present at the 229th Meeting of the National Security Council were the President of the United States, presiding; the Vice President of the United States; the Secretary of State; the Secretary of Defense; the Director, Foreign Operations Administration; and the Director, Office of Defense Mobilization. Also present were the Secretary of the Treasury; the Attorney General (for Item 2); the Secretary of Commerce (for Item 4); the Director, Bureau of the Budget; the Chairman, Atomic Energy Commission (for Item 2); Mr. Spear for the Federal Civil Defense Administrator (for Item 2); the Chairman, Council of Economic Advisers (for Item 2); the Director, U.S. Information Agency; General Twining for the Chairman, Joint Chiefs of Staff; the Director of Central Intelligence; Robert Cutler, Joseph M. Dodge and Nelson A. Rockefeller, Special Assistants to the President; the White House Staff Secretary; Robert R. Bowie, Department of State; the Executive Secretary, NSC; and the Deputy Executive Secretary, NSC.

There follows a summary of the discussion at the meeting and the main points taken.

. . . . . . .

4. Current U.S. Policy Toward the Far East (NSC 5429/4; NSC 5429/3; Memos for NSC from Executive Secretary, same subject, dated November 29 and December 20, 1954;² NSC Actions Nos. 1259 and 1275³)

After Mr. Cutler had completed a short briefing of the Council on the remaining problems in NSC 5429/4, Secretary Dulles remarked that he had not had time, in the short interval since he had returned from Paris, to give this report the requisite consideration. He would prefer, therefore, that the Council not act finally on the report at this meeting. Mr. Cutler nevertheless suggested that there were a number of comparatively undisputed points which the Council might take this occasion to settle.

. . . . . . .

The Secretary of State said that he would much prefer that the prohibition against Nationalist interference with Chinese Communist seaborne commerce be deleted. If this prohibition remained in the paper, the U.S. position would become frozen at a time when we needed flexibility. He realized that the absence of this statement did not provide CIA with the guidance it would like to have, but he preferred that such guidance continue, as in the recent past, to be provided to the CIA on a case-by-case basis through the Departments of State and Defense. It was accordingly agreed to delete this language from paragraphs 5–c and 7–d.

Secretary Humphrey commented that assisting the Chinese Nationalists to interfere with Chinese Communist commerce was just the kind of action he had referred to with distaste in the earlier discussion at the meeting. If we don’t know where we are going we will get into a lot of trouble, and he saw no reason why the United States should get itself involved in Quemoy.

The President replied to the Secretary of the Treasury that the point at issue had nothing whatever to do with Quemoy. Secretary Humphrey answered that nevertheless the general problem was bound up with our policy toward the offshore islands.

Secretary Dulles then launched on a brief defense of current U.S. policy vis-à-vis the Nationalist-held offshore islands. He again indicated that the State Department had no desire whatever to find itself committed, de facto, to defense of these offshore islands against Chinese Communist attack.

Secretary Humphrey replied that if the deletion of the language in paragraph 5–c was merely a temporary expedient while we proceeded to get out of an untenable position respecting the offshore islands and interference with Chinese Communist commerce, he would agree to the deletion of this language; but not otherwise. He repeated once again his view that the United States must not let itself get into positions which it really did not mean to defend. Secretary Dulles said he believed that in the long run our policies would lead to a stabilization of the situation in the Nationalist-held offshore islands. He repeated, however, that he did not now wish to be bound by rigid rules in the light of the recent hostile Chinese Communist words and deeds. He did agree, however, that the deletion of this language would be a temporary expedient.

. . . . . . .

Digressing for a moment from the paper, Secretary Dulles said that with respect to the UN action to stabilize the situation on the offshore islands, the National Government of China had indicated their anxiety lest the special arrangements made in the exchange of notes between the United States Government and the Chinese National Government be made public at this time. If these arrangements were made public now it might be made to seem that the Chinese Nationalists had agreed to accept limitations in order to secure favorable consideration by the UN. Accordingly, said Secretary Dulles, he had arranged with Foreign Secretary Eden, who was anxious to have the notes published, to defer UN action regarding the situation in the offshore islands until (a) the difficult situation respecting the captured American flyers quieted down, or (b) unless the U.S. came to feel, on the basis of a good intelligence estimate, that a major Chinese Communist attack on the offshore islands is in prospect.

[Here follows discussion concerning paragraphs 5–e and 5–g of NSC 5429/4.]

Mr. Cutler then asked the Council to give its attention to the more difficult split of opinion in the Planning Board with respect to restrictions on the trade of the free world with Communist China. He explained the split in paragraph 7–c on this subject, and suggested that the study called for in Annex B of NSC 5429/4, respecting policy on trade with the Communist bloc, be undertaken by the newly created Council on Foreign Economic Policy.

Secretary Dulles said that in this case, likewise, he would like the Council to defer action in order to permit him further opportunity to study this problem. The President agreed with this suggestion of the Secretary of State, going on to say that whatever Secretary Dulles decided as to what should be contained in the disputed paragraph was all right with him. To the President, the most important matter was the development of the study referred to in Annex B.

[Here follows discussion concerning programs to ensure adequate internal security forces in areas vulnerable to Communist subversion.]

At the conclusion of the discussion of this item, Mr. Cutler called on Secretary Weeks, who expressed the view that the United States was insufficiently firm in its efforts to induce its allies to maintain the same level of restrictions on trade with Communist China as did the United States itself.

The National Security Council:⁴

a. Discussed the subject on the basis of the reference report (NSC 5429/4) in the light of the views of the Joint Chiefs of Staff transmitted by the reference memorandum of December 20, 1954.

b. Agreed upon the following changes in the statement of policy contained in NSC 5429/4:

(1) Paragraphs 5–c and 7–d: Delete the words “or seaborne commerce with Communist China”.

(2) Paragraph 5–e: Add at the end: “; concerting overt actions with the other ANZUS nations.”

(3) Paragraph 10–i: Insert, after “feasible”, the words “and productive”.

c. Deferred action on paragraph 5–g pending further consideration by the Secretary of State, in consultation with the Secretary of Defense, and report at the meeting of the Council to be held January 5, 1955.

d. Deferred action on paragraph 7–c, other than the “Majority Proposal” in 7–c–(2), pending further consideration by the Secretary of State, in consultation with the Secretary of Commerce, and report at the meeting of the Council to be held January 5, 1955.

e. Requested the Council on Foreign Economic Policy to undertake the study outlined in the “Majority Proposal” in paragraph 7–c–(2) of NSC 5429/4.

Note: The President subsequently approved the statement of policy in NSC 5429/4, as amended by the NSC with the exception of paragraphs 5–g and 7–c which are subject to further consideration as indicated in c and d above. NSC 5429/4, as amended and approved by the President, excepting paragraphs 5–g and 7–c, circulated as NSC 5429/5⁵ for implementation by all appropriate executive departments and agencies of the U.S. Government, subject to review in the light of final decisions on basic national security policy; and referred to the Operations Coordinating Board as the coordinating agency designated by the President. The actions in c and d above subsequently transmitted to the Secretary of State, with copies respectively to the Secretary of Defense and the Secretary of Commerce. The action in e above, as approved by the President, subsequently transmitted to Mr. Dodge for action.

S. Everett Gleason

1. Drafted by Gleason on Dec. 22.
2. For Lay’s Nov. 29 memorandum, see footnote 4, Document 419. His Dec. 20 memorandum enclosed a memorandum of Dec. 17 from the Joint Chiefs of Staff to the Secretary of Defense; for the text of the latter, see vol. xii, Part 1, p. 1050.
3. For NSC Action No. 1259, see footnote 9, Document 375; for NSC Action No. 1275, see footnote 9, Document 419.
4. The lettered subparagraphs constitute NSC Action No. 1292. (S/S–NSC (Miscellaneous) files, lot 66 D 95, “NSC Record of Actions, 1954”)
5. For text of NSC 5429/5, “Current U.S. Policy Toward the Far East,” Dec. 22, see vol. xii, Part 1, p. 1062.