Marshall Mission Files, Lot 54–D270
Minutes of Meeting Between General Marshall and Dr. T. V. Soong at No. 5 Ning Hai Road, Nanking, January 7, 1947, 5 p.m.
| Also present: | Colonel Underwood |
General Marshall apologized for events which caused Dr. Soong to return from Shanghai. He had wished to see Dr. Soong as a matter of courtesy but had not wanted Dr. Soong to change plans on his behalf. Dr. Soong replied that he had not been inconvenienced and that he appreciated the opportunity to talk with General Marshall prior to his departure.
Dr. Soong stated that at present Chinese imports and exports were not in balance, but that by intensive measures now planned for increase in the tobacco, rice and cotton crops in China he hoped to bring imports and exports into balance during the next year. With respect to cotton in particular, he mentioned that at present three-fourths of China’s raw cotton needs were being met by imports. However, he hoped by next year to reduce imports to one-fourth of China’s total need. Accordingly, he regarded the present unfavorable import and export position as temporary only and hoped that General Marshall would represent this view in the United States.
General Marshall asked if Dr. Soong knew the significance of the recent Government action in closing the ports of Tsingtao and Chinwangtao to foreign ships. Dr. Soong stated that the Chinese Army was responsible for this move since they had convinced the Generalissimo that closing of the ports was necessary to maintain appropriate relations with Russia. General Marshall was glad to hear that the closing of the ports was not connected with a business deal to funnel all imports through Shanghai.
Dr. Soong stated that military expenditures were the big financial problem at present. Confidentially, however, he hoped to meet these expenditures by drastic revisions in the tax collection system. This revision primarily would result in placing a larger and more appropriate share of the tax burden on the wealthy. Although military expenditures were taking up fifty percent of the budget, this was a smaller percentage than in recent years. He believed that he could save the economic situation in China, although it was a back-breaking job.
General Marshall told Dr. Soong that he would soon make a statement on China. Now that he was being recalled, he could not remain silent. Although it was a disagreeable business for which he had no appetite, he would have to speak frankly. He was certain that his frank statement would arouse bitterness and anger, particularly among radicals, reactionaries and irreconcilables. However, that could not be helped. He had exerted every effort in his statement [Page 690] to create an opportunity for the better elements in China to rise to the top. He hoped his statement would make possible the organization of a patriotic, liberal group under the indirect sponsorship of the Generalissimo. Such action was imperative from the standpoint of the Generalissimo, since he needed a respectable opposition party in order to prove to the world his sincerity in establishing a democratic form of government in China. Such an opposition party would be a strong force for good. The Generalissimo could use it to wipe out graft, corruption and incompetence in the government and in the Kuomintang. Furthermore, it would be an effective check on the present dictatorial control of military leaders. Without a respectable opposition party, China would not be given credit before the world for having established a democratic government. General Marshall again expressed his regret for having to issue such a brutally frank statement. The military leaders in particular would be furious. However, it was his hope that the statement would also be helpful in creating opportunities for improvement in the political situation. Dr. Soong evinced great interest in General Marshall’s comments, stating his belief that the military group could be smashed.
General Marshall said that he had been receiving depressing reports on the military situation in the field. National Government losses were heavy, the troops were becoming apathetic, and poor leadership was evident everywhere. He wondered just how much the Generalissimo knew of the real situation existing in the field. General Marshall was greatly disturbed over these reports. He had warned the Generalissimo all along that the estimates of his military leaders were very faulty, but he did not expect to see his words proven so rapidly. Unfortunately, he feared that most Chinese lacked the courage to speak the truth to the Generalissimo. He asked Dr. Soong how frank he was with the Generalissimo. Dr. Soong replied that he was brutally frank. He added that the Generalissimo always acted on the side of the right and wisdom when the merits of a case were presented to him. The trouble lay with the military leaders who clouded facts to prove their point.
Dr. Soong stated that he could speak frankly with the Generalissimo because, although few people knew it, the Generalissimo actually had more need of him than he had of the Generalissimo. General Marshall stated that he had always been vastly impressed that he himself could speak so frankly to the Generalissimo, and yet the Generalissimo remained courteous, composed and cordial. It took a really big man to so conduct himself. Dr. Soong replied that the Generalissimo acted as he did with General Marshall because he truly believed that although General Marshall did not understand the whole situation, he was speaking honestly for the good of the Generalissimo and the good of China, as he saw it.