Washington, 13 December 1950

1115. Secret Immediate

Korea

As I had not been in touch with Rusk² since last Friday I arranged to see Rusk today to discuss the situation in general. In the course of the conversation I was able to get some reaction to the two points raised in your telegram No. 693,³ viz. Formosa and the de–recognition of Chiang Kai–Shek.

2. With regard to the strategic value of Formosa Rusk said that if the island were in enemy hands it would enable the Chinese Communists to carry out air attacks on the Philippines. At present the Chinese Communists did not have aircraft of sufficient range to attack the Philippines from the Chinese mainland. Formosa was also important to the allies in that fighter aircraft could be flown to Japan via the Philippines. This would not be possible if Formosa were not in our hands. He also said that Formosa had material resources and trained Chinese manpower including both technicians and military personnel which should be denied to Communist China, and in general took the position that, pending a clarification of the intentions of the Moscow–Peking axis in Asia, the status quo in Formosa should be preserved. As for the disposition of Formosa he said that the views of the 8,000,000 Formosans would have to be taken into account before any thought were given to handing the territory to Communist China.

3. Rusk said that the question of de–recognition of Chiang Kai–Shek had been considered by the Department from time to time and made the following comments:

a. Legal difficulties would arise in the event of de–recognition of Chiang Kai–Shek in that American courts would regard property in Formosa as belonging to Chinese Communist Government.

b. The continuation of the recognition of Chiang as the representative of China was somewhat of a fiction. It was similarly a fiction to regard Peking as exercising full control over the mainland of China. Peking's control over China was 'spotty'; for instance there was still guerilla resistance in parts of China, and Manchuria was in fact being administered by the U.S.S.R. and not Peking.

c. In any event Rusk suggested that the time might come when the people of China might make a 'choice from disgust' and again elect to be ruled by Chiang Kai–Shek in preference to the Chinese Communists. In the present situation he felt that it would not be a wise move to throw Chiang over since he was at least friendly to the allied cause and had a force of 500,000 troops at his disposal. Rusk hinted that to withdraw recognition from Chiang KaiShek would present considerable political difficulties in the United States.

4. As for the military situation the Tenth Corps numbering some 60 to 70,000 troops was now concentrated in Hungnam and in process of being evacuated by sea. The Eighth Army was occupying a position near the 38th parallel. He did not state whether north or south of the parallel but other State Department sources have informed us that the Eighth Army is still slightly north of the parallel in the centre of the peninsula. Rusk said that the only contact between the Eighth Army and the enemy was with North Korean forces. The significance of this was not clear. It might be that the Chinese Communists were using the North Koreans for counter–intelligence or that they might be providing cover whilst the Chinese Communist forces re–grouped for a further advance.

[matter omitted]

[NAA: A1838, 3107/40/38, i]

1 The cable was addressed to Spender from Norman Makin, the Australian Ambassador to the United States.

2 Dean Rusk, US Assistant Secretary of State for Far Eastern Affairs.

3 Document 22.