Foreign Relations of the United States, 1958–1960, China, Volume XIX

9. Notes of the Meeting of the Operations Coordinating Board⁰

Washington, April 16, 1958.

[Here follow notes of the discussion at the OCB luncheon on unrelated matters.]

7. Report and Operations Plan on Taiwan (Secret)¹

Mr. Ralph Clough, Office of Chinese Affairs, was present for the discussion.

The Report stated that “reasonably satisfactory progress” had been made during the past nine months toward NSC policy objectives. Governor Herter noted that a number of overseas Chinese attending school on the island was increasing and that there was some evidence of decrease in the number of those attending Red Chinese schools on the Mainland. Mr. Dulles (CIA) suggested that a special study should be undertaken of the schooling situation for overseas Chinese on the Mainland and that, if the results were favorable for U.S. propaganda, they be publicized. Mr. Clough pointed out that Taiwan educational facilities for overseas Chinese were limited. Mr. Harr, Vice Chairman, suggested that U.S. aid in expanding the facilities be considered.

General Cutler opened a broad-ranging discussion of the two papers by saying that he found the paragraphs on the Taiwan economy “insufficient”. He thought that the increase of American personnel from 9,902 on September 1, 1957 to 11,292 on March 1, 1958 “appalling” and suggested that the Report should take some note of the effect of “external happenings” on the future of Taiwan. In this latter regard he said that the possibilities were now greater that New Zealand [and?] the U.K. might support the admission of Red China to the U.N. In general, he thought that the Report failed “to show the seamy side” of the picture on Taiwan. United States policy toward Taiwan was removed from reality, yet the Report “was Pollyannaish”. The “U.S. dream” would one day “blow up in our faces, for example when the Gimo died”, and the OCB “had a responsibility to present a realistic paper to the NSC even if such a paper should be objectionable to those who pretend that all is rosy as regards Taiwan”.

Mr. Allen (USIA) said he generally supported the views of General Cutler but recognized that the problem was complicated. Mr. Harr thought that the Report presented a good general picture and said that the U.S. cannot expect to have the Chinese measure up to U.S. standards, including that of budget administration. Mr. Clough mentioned that since the Report was prepared some effective steps have been taken toward simplifying the dollar-yuan exchange rate.

Mr. Scribner of Treasury said that the GRC should be required to budget more funds for economic development and expressed some dissatisfaction with the phrasing in the Report of a few of the economic paragraphs. Governor Herter, while noting that U.S. policy would have to be reviewed at some time, said that the OCB was not the forum for the review of policy.

Mr. Smith (ICA) said that he had spent the morning testifying before a Congressional Committee and therefore wished to emphasize that no policy can be carried out without money and that the effectiveness of a policy is bounded by the amount of funds appropriated. He wondered whether Congress would continue “to pour money into Taiwan.” Mr. Allen Dulles remarked that Congress had so far authorized funds for Taiwan without reluctance. Mr. Smith then wondered whether it would be possible to put some of the 600,000 Taiwan troops to work on such productive military engineering work as road and bridge building. Governor Herter said he thought this was a matter within the jurisdiction of the Military Advisory Group.

The Board approved the Report and the Operations Plan subject to its revision by the Working Group in the light of the discussion.²

Arthur L. Richards³

0. Source: Department of State, OCB Files: Lot 62 D 430, OCB Preliminary Notes. Secret. The document is headed “Preliminary Notes of OCB Meeting, April 16, 1958.”
1. Reference is to two draft OCB documents, “Report on Taiwan” and “Operations Plan for Taiwan and the Government of the Republic of China,” prepared by an interagency working group and approved by the Board Assistants as part of the Board’s function of coordinating and overseeing the implementation of NSC policy papers. The final documents were dated April 16 and April 23, respectively. (Ibid., Taiwan, 1958–1959; see Supplement)
2. The “Report on Taiwan,” dated April 16, was forwarded to the National Security Council with a briefing note by Special Assistant to the President Karl G. Harr, Jr., and was noted by the Council without discussion at its meeting on May 29. (Memorandum of discussion dated May 29 with attached briefing note dated May 28; Eisenhower Library, Whitman File, NSC Records)
3. Printed from a copy that bears this typed signature.