794A.5/3–2351
The Under Secretary of State (Webb) to the Director of the Bureau of the Budget (Lawton)
My Dear Mr. Lawton: I present herewith answers to the various questions contained in your letter of March 23, 1951. The replies bear the same numbering as the questions contained in your letter, and they have been prepared in collaboration with the Department of Defense and the Economic Cooperation Administration in so far as the questions touched on subjects affecting their interest.
1. Question: “What are immediate U.S. objectives with respect to Formosa?”
Answer: The immediate and overriding United States objective with respect to Formosa is to deny its control to hostile hands. Prior to June 27, 1950, this objective was sought by political and economic means. On June 27 the President ordered the U.S. 7th Fleet to prevent any attack on Formosa and called upon the Chinese National Government to cease all air and sea operations against the mainland. Directly from this decision flows the necessity of bringing the defensive capability of the forces on Formosa to a state such that they could, in conjunction with the 7th Fleet, repel any assault from the mainland. This decision further imposes a necessity of continuing and expanding the U.S. program of economic assistance not only to assist in maintaining political stability but also to help Formosa develop an economy capable of supporting these modernized forces [Page 1632] through rehabilitation and modest expansion of key industrial, transport, communications, and power facilities.
2. Question: “In light of recent and prospective political and military developments, can we continue to assume that accomplishment of these objectives is consistent with efforts to achieve a settlement in Korea?”
Answer: The Department of State believes that it can and should be assumed that the accomplishment of our objectives with respect to Formosa are consistent with efforts to achieve a settlement in Korea. Our action in Korea has been in response to our obligations under the United Nations Charter to resist and discourage aggression. The United States Government has, however, no intention of modifying its objectives with regard to Formosa in return for a settlement in Korea. If Formosa fell, a military settlement in Korea could be impeded because the hazard to our operations would be increased by the presence of unfriendly forces in this advanced position.
3. Question: “To what extent would a settlement in Korea be likely to affect the amount, form, and timing of U.S. aid to the Chinese Nationalist Government?”
Answer: It is difficult to forecast what effect a settlement in Korea would have on the amount, form, and timing of United States aid to the Chinese National Government. At one extreme, a settlement in Korea accompanied by what the President described as “the restoration of security in the Pacific”, might well reduce the need for United States economic and military assistance to Formosa. At the other extreme, a settlement in Korea imposed upon the United Nations by superior force, might indeed require an increase in United States assistance to Formosa. I believe the safest assumption is that the United States Government should proceed with its present programs and plans for assistance to Formosa without regard to the hypothetical effect that an unpredictable settlement in Korea would produce.
4. Question: “In what respect is the future of Formosa involved in the proposed pending treaty of peace with Japan?”
Answer: The present tentative draft peace treaty with Japan,1 prepared by this Government does not seek to determine the disposition of Formosa and merely formalizes Japanese relinquishment of sovereignty over Formosa and the Pescadores. There is no policy or requirement which necessitates the resolution of the problem through the medium of a peace treaty with Japan. You will recall that the President stated on June 27, 1950 that “The determination of the future status of Formosa must await the restoration of security in the Pacific, a peace settlement with Japan, or consideration by the United Nations”.
[Page 1633]5. Question: “What is the long-term U.S. objective in Formosa?”
Answer: The long-term United States objective with respect to Formosa can be stated as the achievement of a solution of the problem by international agreement and not by force, and the avoidance of Formosa’s falling into hands which would exploit its strategic location and facilities to the detriment of our national security interests. The President has stated that we have no territorial ambitions for ourselves with respect to Formosa and that the present policy of “neutralization” is without prejudice to political questions affecting the Island.2 The long-term economic objective of the United States with respect to Formosa is to contribute to a situation of economic self-support, thereby removing the need for grant aid.
a. Question: “How are political and economic interests in the area balanced against military objectives in arriving at this policy?”
Answer: The political and economic interests of the United States, as well as military objectives, are taken into account in the determination of this policy. At the present time it can be considered that the strategic or military interest in denying Formosa to hostile hands constitutes the overriding element in present policy.
b. Question: “Is it anticipated that U.S. objectives can be achieved through United Nations action?”
Answer: Under conditions whereby our own security interests were protected, it is the hope and expectation of this Government that the peaceful disposition of Formosa’s political status can be achieved by international agreement, either United Nations action or with its approval.
6. Question: “How are present and projected U.S. programs related to these objectives given in (1) and (5) above?”
Answer: Present and projected United States programs are directly related to the objectives defined in the answers to questions (1) and (5). These programs are designed to support the attainment of these objectives.
a. Question: “Is the mission of the armed forces purely defensive?”
Answer: According to policy expressed in the President’s statement of 27 June 1950, the mission of the Chinese Nationalist Armed Forces is purely defensive.
b. Question: “How large a military establishment is required?”
Answer: It has been determined by the Military Survey Mission that in order to successfully defend Formosa, assuming support by the [Page 1634] 7th Fleet, there should be a ground force the equivalent of 31 divisions, plus headquarters organizations for 10 Army headquarters, 5 area defense headquarters, headquarters Taiwan Defense Command, and the Ministry of National Defense; an Air Force of 4 fighter groups and one light bombardment squadron; and a Navy of approximately 60 vessels. Without support of the 7th Fleet, the Ground and Air Force requirements remain the same but the Navy requirement would be considerably greater, and the Chinese Navy is unable to absorb the total number of ships required. It is believed that the Chinese Navy at the present time can absorb about 12 additional ships and about 12 in the following year. About 4 Destroyer Escorts and 20 Sub-Chasers, or Motor Gunboats, is considered to be a realistic number. Even with these additional vessels it is not considered that their fleet would be capable of repelling a large invasion armada. None of these vessels have been programmed because of limitations of funds, assumption of continued 7th Fleet support, and the feeling that before such a program is undertaken, United States technicians and advisors should be sent to Formosa to develop training methods, operational procedures and shipboard maintenance.
c. Question: “What are its matériel deficiencies?”
Answer: The matériel deficiencies which exist were determined by the Fox Survey and are contained in the Fox Report. These deficiencies exist in the following major categories:
Army—electronics and signal equipment; ordnance equipment and supplies, including tanks and transport vehicles; engineering equipment and supplies; quartermaster equipment and supplies, and publications.
Navy—vessel equipment and supplies; ordnance equipment and supplies; engineering equipment and supplies.
Air Force—aircraft; spare parts; aeronautical equipment and supplies; electronics and signal equipment; ordnance equipment and supplies; engineering equipment and supplies.
The detailed items making up these major categories of existing deficiencies are contained in the Form DD 318s for Formosa, which have been previously submitted to the Bureau of the Budget.
d. Question: “What are its training and morale deficiencies?”
Answer: Training Deficiency—Ground Forces.—Training methods in the Ground Forces are based on methods used in United States military schools. Training observed was conducted and accepted with enthusiasm. It is believed that the training methods are generally sound, although qualified instructors are largely unavailable except in the schools. Training has been hampered by lack of funds, equipment, transportation, ammunition, and maneuver areas; unit, field [Page 1635] and combined training has likewise been inadequate. These deficiencies have been recognized by the Commanding General, Ground Forces, and with proper military aid the deficiencies should eventually be corrected.
Morale Deficiency—Ground Forces.—Morale of the troops during the visit of the Survey Team was good. It is considered that morale is high at the present time and is bolstered up by receipt of current U.S. economic and military aid, hope of future military aid, encouraging news from Korea, and growing fear of Communism.
Training Deficiency—Air Force.—The state of training of air crews is poor by comparison with USAF units of similar type. There are two primary reasons for this condition: First, air crews have had very little air-to-air combat experience since few of them have ever fought against a first-rate air power; second, the Chinese Nationalist Air Force has always been handicapped by a shortage of aircraft and supplies with the result that it has been unable to carry on a continual air crew training program. At the present time air crews receive virtually no training over and above that gained in performance of essential defense patrols and reconnaissance missions. Maintenance personnel are considered about 60% qualified as compared to USAF standards. Of the total maintenance personnel assigned to the Chinese Nationalist Air Force, approximately 524 officers and 247 enlisted men have been trained in the United States, while 2,296 officers and 10,531 enlisted men have received some training in the Chinese Air Force Technical Schools. Many of the above enlisted personnel are qualified to perform only the most elementary maintenance duties. The picture is somewhat brighter in the more technical maintenance fields such as machinists, metalsmiths, dope and fabric, and wood workers, due to the fact that there is a considerable pool of these technicians available to the 4th and 5th echelon maintenance depots.
Morale Deficiency—Air Force.—Same as Morale Deficiency, Ground Forces (above).
Training Deficiency—Navy.—In personnel, the officer corps of the Chinese Navy is lacking in sea experience and the senior officers generally do not have the professional qualifications or background for top-level planning and administrative duties. Enlisted personnel suffer from inadequate training. Levels of training are unsatisfactory and training methods are either non-existent or are worked out on paper but not carried out in practice.
Morale Deficiency—Navy.—In comparison with the average Oriental, the sailor’s life is orderly and his food, although simple, is regular; pay is inadequate but sufficient to meet ordinary needs. The morale among enlisted personnel is good, although low by U.S. standards. [Page 1636] Officers and enlisted morale are considered subject to the same comments as those made with respect to the Air Force and Ground Force.
e. Question: “What degree of U.S. supervision of the Nationalist forces will be required to make military assistance effective?”
Answer: It is considered that U.S. supervision will have to be exercised to a considerable degree to make military assistance effective. To this end a Military Assistance Advisory Group is being established in the near future and an initial increment of approximately 46 officers and 68 enlisted men will be ordered to Formosa. It is impossible at this time to determine the ultimate size of the Military Assistance Advisory Group. It can only be determined after the interim organization has been operating for a period of time and submits recommendations for increased complement; however, it is presently estimated that the initial increment will be increased by the addition of between 400 and 500 personnel.
f. Question: “What priority in relation to other mutual assistance programs will be accorded to deliveries of military equipment to Formosa in fiscal year 1951 and fiscal year 1952?”
Answer: Deliveries of military equipment to Formosa in fiscal year 1951 and fiscal year 1952 will be accorded a priority, in relation to other Mutual Defense Assistance programs, immediately following Indochina and equal with NATO countries. In this connection, it is pointed out that Indochina has been assigned the highest shipment priority of all Mutual Defense Assistance programs.
g. Question: “What provision will be required to absorb the additional impact of an expanded military end-item program on the economy of Formosa?”
Answer: The provision currently requested of the Bureau of the Budget, on the basis of an interdepartmental decision, is $8 million additional funds for the fiscal year 1952 Economic Cooperation Administration program for the importation of supplies required to make the projected military assistance items effective. The Department of Defense has provided the Bureau of the Budget with additional information as to the basis for this $8 million figure.
The ECA Mission on Formosa, together with the Embassy and Attaché group, is in the process of refining impact cost figures on the basis of more detailed information as to the composition of the military assistance program, and its estimates will be submitted to the Bureau of the Budget when received. Indications are that new estimates of impact costs, in terms of both dollars and local currency, may be higher than those already submitted to the Bureau.
h. Question: “What level of general economic aid is required to achieve our objectives?”
Answer: The Economic Cooperation Administration is requesting [Page 1637] $65 million for fiscal year 1952, aside from funds to absorb the military assistance impact. Between one-fourth and one-third of this amount is for rehabilitation and expansion of industrial, power and transportation facilities, with most of the remainder for consumer goods and industrial raw materials. It is expected that after two or three years of aid at this level, economic assistance can be tapered off, as rehabilitation and expansion of industrial, power and transportation facilities begin to pay off in terms of increased local production and exports and reduced imports of certain items, particularly fertilizer, until eventually economic aid can be confined to technical assistance projects. This direct relation of the power and transport projects to the military aid program is of course obvious.
i. Question: “Are projects for long-term economic development essential to attainment of presently known U.S. objectives?”
Answer: Projects for long-term economic development, as actually visualized in proposed Economic Cooperation Administration programs, include largely the repair and replacement of worn-out equipment, as well as some expansion in power and added equipment in certain industrial plants. These projects are definitely essential to the attainment of United States economic objectives as defined in (1) and (5) above. Without them, it will be impossible for Formosa ever to attain a self-supporting status. Moreover, the railway and highway reconditioning which is being undertaken is essential for military movements.
You may be sure that the Department will continue its efforts to expedite action by the National Security Council on the draft now before the Senior Staff on general policy in Asia.
Sincerely yours,
- For text of the U.S. draft treaty of March 23, 1951, see vol. vi, Part 1, p. 944.↩
- President Truman made these statements in a special message to Congress on July 19, 1950, and restated them in a letter to Ambassador Warren R. Austin on August 27, 1950; for the texts, see Public Papers of the Presidents of the United States: Harry S. Truman, 1950 (Washington, Government Printing Office, 1965), pp. 527–537 and 599–600.↩
- The source text is unsigned, but a typed copy indicates that the signature was Webb’s (S/ISA Files: Lot 52–51).↩