The Consul General in Hong Kong (Harrington) to the Department of State1
2579. Department pass London, Moscow; repeated London 227, Moscow 9. Chou En-lai proposal March 30 on repatriation of war prisoners appears on its face to be substantial concession. Whether there is catch to proposal can only be determined through resumed negotiations at Panmunjom. However, assuming Communist proposal is genuine concession, it may be useful to analyze their motives in making it only few months after flatly rejecting similar Indian proposal in UN.
There has been no discernible increase in internal pressures in China past few months. Politically, principal preoccupations are anti-bureaucratism campaign and preparations for elections. Former is being pushed methodically, not at usual frenetic pace of Chinese Communist campaigns, and does not reveal any critical weakness in political system. Preparation for elections shows Communists feel their control well enough established to be undisturbed by establishment of facade of democratic procedures. Directives on agricultural program published in People’s Daily March 29 takes cautious approach to increasing number of agricultural cooperatives and indicates no early attempt at drastic social changes in countryside. Five year plan for industrialization probably could be considerably expanded if financial drain of Korean war were ended and particularly if armistice led to expansion of trade with Japan and Western countries. However, Chinese Communists could hardly have been less aware of this at time Indian proposal was rejected than they are today. Thus, it does not seem that dramatic apparent about-face on prisoner issue could have resulted from sharp increase in internal difficulties.
More likely to have influenced Chinese Communists are evidences stronger US policy in Far East, such as deneutralization Formosa, speed-up in formation of Asian armies, joint warning to Communists on Indochina, and tightened economic control, as well as threat of offensive in Korea and eventual rearmament of Japan with US aid. Attention paid to these matters in Chinese Communist propaganda in recent weeks indicates their concern. However, it is unlikely that such threats, disturbing though they doubtless are, could in themselves have compelled Communist leaders to alter their adamant stand on repatriation.
It seems most likely that decision reached in Moscow during Chou En-lai’s visit there2 and that it may be element in Soviet “peace offensive” designed to reduce world tensions and lower guard of Western powers during critical period of consolidation Communist bloc following [Page 829] Stalin’s death. It is reasonable to suppose that steady economic drain of Korean war and its increasingly unprofitable character, plus prospect of greater future difficulties resulting from variety of US actions, caused Chinese Communists to make heavy demands for assistance from Russians if war was to continue at same time they were trying to carry out five year industrialization program. Faced by Chinese Communist demands and delicate situation following Stalin’s death, Soviet leaders may feel disadvantages of continuation Korean war now outweigh advantages and it is better to accept tactical defeat on prisoner issue than uncertainties of prolonged war.