893.796/5–1049
Memorandum by the Director of the Office of Far Eastern Affairs (Butterworth) to the Under Secretary of State (Webb)
Following the receipt of your memorandum of May 10, 1949 regarding the purposes of General Chennault’s call tomorrow, I telephoned Mr. Cleveland, Chief of ECA’s China Program Division, to inquire whether ECA had indicated to any one that it was prepared to take favorable action on the proposal to make $5,000,000 of ECA funds available for the operations of airlines into the interior Chinese provinces. Mr. Cleveland states categorically that ECA has definitely refused to approve any such proposal. This action reflects the decisions reached during a conference on the China aid program held in the Secretary’s office on March 10, 1949, at which were present the Secretary, Mr. Hoffman, Mr. Roger Lapham, Mr. Cleveland and I. A copy of a memorandum of this conversation, dated March 10, 1949,84 is attached for your information. You will note that the final sentence of paragraph No. 6 on page 2 of this memorandum states: “This decision also rules out the proposed project for assistance to Chinese airlines.”
With respect to the other proposals which General Chennault may advance, it is suggested that it be pointed out to him that the open support by the U.S. Government of continuing resistance after the Generalissimo and most of the Nationalist leaders are out of the picture, which would certinly be ineffective in the light of the appraisals of the respective military capabilities of the National Government and the Chinese Communists submitted by U.S. military representatives in China, would endanger the interests and possibly the lives of U.S. citizens resident throughout the Communist-held areas of China. You might add that the U.S. Government is obviously interested in assisting any effort to resist Communist domination that promises to be effective, but that, in the absence of evidence that such assistance would do more than delay the Communist advance, it would seem undesirable to imperil the interests and lives of our own citizens when the end result could only be further strengthening of the Communists by the inevitable possession of the aid extended by the U.S. and a further dissipation of U.S. resources.
Please also read Foreign Missions letter to Senator Connally85 attached.