The Atlantic Report on the World Today: China

THE final triumph of the Chinese Communists was part of a vast shift of world power. The hurried visit of the Joint Chiefs of Staff to Japan, the fact-finding voyage of Ambassador-at-Large Philip C. Jessup and his conference with American diplomats at Bankok, the British Commonwealth conferences at Singapore and in Ceylon, and the French decision to play Bao Dai as a last card in Indo-China — all of these activities are part of an attempt to salvage fragments of an old structure of power.

When the Chinese Communists won, Russia won too; but the two victories are not identical. The fall of Chiang Kai-shek made the world encirclement of Russia an unworkable policy. China and Russia are so huge in extent, resources, and population that any “encirclement" of the two of them together can only be an illusion. Russia had to make practically no capital expenditure in order to acquire an invaluable new asset. For Russia, poor in capital resources, the problem is rather how to exploit the new asset while continuing to refrain from heavy investment.

The Russo-Chinese alliance is in fact a merger of two holding companies, in which each party wants to get full advantage out of unification of policy, while getting involved as little as possible with the other party’s operating company. The chief problem of confusion between the holding-company level and the operating-company level lies in Manchuria. China, through Manchuria, can contribute raw materials and food to Russia s operating company; but Russia, short of capital, wants to invest only cautiously in China’s operating company.

The economic structure of Manchuria is peculiar. In all its modern history, its chief exports have not been to China but to foreign countries, especially by sea — and China is short of shipping. Even rail transport into China, for moving food grains, is a bottleneck, compared with rail lines to Siberia and to Dairen and other ports.

Manchuria’s industrial potential

In fifteen years of intense activity, from 1931 to 1946, the Japanese developed the mining, industrial, and hydroelectric facilities of Manchuria as a planned complex subordinate to the heavy industry and war industry of Japan. A number of key operations were withheld from Manchuria and kept within Japan. In this way no insurrection could seize a complete and powerful industry; neither could Japan’s own headstrong army officers in Manchuria hope to dictate to the home government by capturing Manchurian industry. After the war, Manchurian industry, already incapable of true technological independence, was further crippled by Russian removals of machinery.

Neither Russian nor Chinese propaganda nor American news reporters have ever laid bare this hard core of the problem. Regardless of their form of government, the Chinese never could have hoped to obtain in Manchuria an industrial nucleus independently capable of energizing further industrialization in the rest of China. If Chiang had won, he would have had to rely on the United States to make good the gaps in Manchuria’s industrial structure. Now that the Communists have won, they can fill in the gaps only if Russia comes to their aid.

A joint Chinese-Russian program in Manchuria is a necessity for Russia, in order to build up a seaair-land position definitely superior to the American outpost in Japan. But it is also a necessity for China, in order to unlock the latent energy of Manchurian industry and make it able to render the service to China that it formerly rendered to Japan. One top expert estimates that the Russians could restore Manchurian hydroelectric output to 90 per cent of capacity simply by bringing back the turbines they “preventively” looted. These turbines had been “tailored” for the particular installations from which the Russians removed them, and would work at far less efficiency if relocated somewhere in Siberia.

on China

The Russians, however, cannot round out and complete the industrial equipment of Manchuria out of surplus, as America could have done. Russia is a deficiency country and can supply capital equipment to Manchuria only by adding to the strain on her own forced-speed economic planning. China, also a deficiency country, will have to take up part of the strain by large shipments of food and raw materials to Siberia.

The Communists, in presenting this inevitable program to their countrymen, whose nationalism is exceedingly thin-skinned, face the psychological danger that people in Shanghai and Canton may suspect that Russian interests are being given a priority over Chinese interests. The Russians, by arbitrary demands and callous behavior, could easily turn suspicion into conviction. If so, the Voice of America will have wonderful ammunition for psychological warfare. In the advance planning of policy, this possibility should not be overlooked. To take it as a certainty that Russian stupidity will give Washington this kind of cold-war opening would, however, be mere gambling.

The Communists tackle the food problem

China’s other basic problem is food. The solution lies not in long-distance importation of grain either from Manchuria or from Southeast Asia, but in improved local granary storage and short-distance transport. In typical Chinese famines, people starve to death within a hundred miles of food, partly because grain-eating animals haul the carts that carry grain for relief, but even more because speculators and corrupt officials are more interested in making a profit out of the shortage than in relieving it.

The Communists have already shown that they can handle this kind of problem. Their prevention methods— local storage and honest administration — are good, and they have never had a serious famine. They have had a bad winter in North China, because of being hit by flood and drought in the same year; but unless they have both flood and drought every year, it is useless to count on their being starved into docility.

Basically, the Chinese are in a stronger position now than the Russians were in from 1917 to 1925. They are not in danger of being invaded by powerful modern armies, as the Russians were, and therefore need not mechanize in such desperate haste as the Russians did. They are not vulnerable to foreign trade shortages. They can handle their food problem. Through gradual rehabilitation of Manchuria, Tientsin, Shanghai, Canton, Hankow, and the small but important industrial complex of Shansi Province, and with a small but probably increasing supply of capital goods from Russia, they can improve their all-round economic condition.

united front in Indo-China

In foreign policy the combination of China and Russia opens up possibilities that are really grim to contemplate. The joint move in recognizing Ho Chi Minh, the Communist leader of Indo-Chinese nationalism, shows what to expect. Armed expansion will not be essential. The technique will be one of political action that is no drain on resources and produces shock effects.

It cost the Chinese and the Russians not a cent or a rifle or a soldier to recognize No Chi Minh. The Labor Covernment in London and the Denioeraiic administration in Washington, both of them afraid, in an election year, of being called irresolute in the face of Communist expansion, fell into the booby trap and recognized Bao Dai.

In Bao Dai the Russians have the perfect issue. They have been wailing for a chance to coordinate policy in Asia and in Europe. It may he possible to persuade British and American taxpayers that Indo-China is an emergency problem like that of Greece, in which one kind of foreign intervention must be met with another kind. It will be much harder to persuade the French electorate.

Indo-China contributed little that was vital to the French economy. The colony has always been chiefly the concern of a few army and financial interests. To millions of Frenchmen who are not Communists the war in Indo-China is la sale guerre. It is not a war of either necessity or honor.

In spite of considerable rehabilitation under the Marshall Plan, and in spile of successful exclusion of the communists from French coalition governmerits for several years, between a quarter and a third of the French electoral still votes Communist. Now, in the widespread dislike of the Indo-China war, and in the accusation that Frenchmen will be asked to make continuing sacrifices for the sake of Anglo-American power polities in a part of Asia that is neither strategically nor economically vital to France, the Communists have an issue on which they will be able to vote m a united front.

Puppet Bao Dai

While Indo-China thus gives the Russian-line Communists a re-entry into Western Furope, it gives the Chinese-line Comniunisls a magnificent boost in Asia. In the field of ideology, Bao Dai is sleazy, shopworn, and much inferior to Cliiang Kai-shek. Originally he was a French puppet. During the war he tagged along with the Japanese. Then he went over, briefly, to Ho Chi Minh, but soon fled to Hong Kong. Now he is back on the French payroll.

Anglo-American support of French support of so unheroic a puppet degrades the cause of democracy. In Asian terms, it is a gross insult.

On the field of war, the cause of Bao Dai and French imperialism is no more hopeful. What 130,000 French, Foreign Legion, and African troops have not been able to do in four years, mere American and British recognition will not do. France’s concessions to Bao Dai were not even made with the hope of winning Indo-Chinese support, but for the purpose of allowing the Cnited States and Britain to try what they could do with money and exhortation.

What puts Ho Chi Minh in a class apart from the Greek guerrillas is the fact that he has up to this point fought his own cause in both war and politics singlehanded, and he has steadily improved his position with no support from either China or Russia. If the French should now be given American and British aid, and if Ho Chi Minli should then turn to China for support, the rest of Asia will accuse America and Britain of aggressive intervention and the Chinese only of defensive counterintervention — a counterintervention that will have the sympathy of most of Asia.

The hard facts

As a kind of psychological alibi for the failure to keep Chiang Kai-shek’s China safely under American protection, we have been urged to believe that the Chinese Communists are hound to quarrel with the Russian Communists, and that a Chinese Titoism will eventually help to solve our problems. It is also argued that the Chinese Communists, in order to avoid economic disaster, will have to have American trade and will in time offer reasonable terms to gel it.

There is no solid evidence to support any of these hopes and assumptions. It is regrettable that popular yearning for some kind of statement that would justify wishful thinking forced Secretary of State Acheson, in his Press Club speech, into unwise exaggeration. In describing the “detachment” of northern territories from China and their “attachment” to Russia he gave the impression of a vast, menacing sweep, beginning only after the defeat of Chiang Kai-shek, that might lead to a startling break between China and Russia.

As a matter of fact Outer Mongolia has been “detached ” from China ever since 1911, and Mongol independence was acknowledged bv Chiang Kaishek, in rat her cordial terms, in 1945. Sinkiang, where only 5 to 10 per cent of the population is Chinese, has had a turbulent pro-Russian movement for years. Inner Mongolia is under a regime that turns its back on Outer Mongolia and looks to Peking.

There remains Manchuria, where the Communist-dominated Chinese government, faced by a blank American hostility, is forced to concentrate its coöperation with Russia. The truth about Manchuria is that a quarrel between the Chinese and Russian Communists is one of the possibilities of the future, but it is not inevitable.

It is time to throw wishful thinking overboard and to recognize in their full, grim reality the enormous advantages now held by the Russians and the various Asian Communists. Quarrels between Communists there will be, but they will not be enough to solve the problems of the United States and its European allies.