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  Accidental State

  CHIANG KAI-SHEK, THE UNITED STATES, AND THE MAKING OF TAIWAN

  Hsiao-ting Lin

  Cambridge, Massachusetts

  London, England

  2016

  Copyright © 2016 by the President and Fellows of Harvard College

  All rights reserved

  Cover art: Courtesy of the KMT Party History Institute

  Cover design: Lisa Roberts

  978-0-674-65981-0 (cloth)

  978-0-674-96962-9 (EPUB)

  978-0-674-96963-6 (MOBI)

  The Library of Congress has cataloged the printed edition as follows:

  Lin, Hsiao-ting, author.

  Accidental state : Chiang Kai-shek, the United States, and the making of Taiwan / Hsiao-ting Lin.

  pages cm

  Includes bibliographical references and index.

  1. Taiwan—History. 2. Taiwan—Politics and government—1945–1975. 3. Chiang, Kai-shek, 1887–1975. 4. United States—Foreign relations—1945–1953. 5. Taiwan—Foreign relations—1945– 6. China—Foreign relations. I. Title.

  DS799.816.L55 2016

  951.24905—dc23

  2015026007

  Contents

  Acronyms and Abbreviations

  Introduction

  1. Taiwan in the Balance

  2. A Troubled Beginning

  3. Reformulating U.S. Policy toward Taiwan

  4. Chiang Kai-shek in Eclipse

  5. Last Gasp on the Mainland

  6. Floating State, Divided Strategy

  7. U.S. Military and Security Policy Goes Underground

  8. The Island Redoubt Reinvigorated

  9. Between Mainland and Maritime Strategies

  10. The Making of an Island State

  Conclusion

  GLOSSARY OF NAMES AND TERMS

  NOTES

  BIBLIOGRAPHY

  ACKNOWLEDGMENTS

  INDEX

  Acronyms and Abbreviations

  CCP

  Chinese Communist Party

  CIC

  Commerce International China, Inc. (New York)

  CINCPAC

  Commander in Chief, Pacific Command (United States)

  CRC

  Central Reform Committee (KMT)

  ECA

  Economic Cooperation Administration

  ESB

  Economic Stabilization Board (Nationalist government)

  FLR

  Formosa League for Re-emancipation

  KMT

  Kuomintang (The Chinese Nationalist Party)

  MAAG

  Military Assistance Advisory Group (Taipei)

  MAP

  Military Assistance Program

  NATO

  North Atlantic Treaty Organization

  NSC

  National Security Council

  OSS

  Office of Strategic Services

  PLA

  People’s Liberation Army

  PRC

  People’s Republic of China

  ROC

  Republic of China

  SCAP

  Supreme Commander of the Allied Power, Japan

  STP

  Special Technician Program (Charles M. Cook’s initiative in Taiwan)

  UNRRA

  United Nations Relief and Rehabilitation Administration

  Introduction

  THIS BOOK EXPLORES the historical formation of a de facto state on Taiwan separate from the de facto state ruling the Chinese mainland in the late 1940s and early 1950s. Too often we have tended to view the existence of the two political entities across the Taiwan Strait as a logical and most likely consequence of the Chinese civil war, fought bitterly after World War II between the Chinese Nationalist Party (Kuomintang; KMT) under Chiang Kai-shek and the Chinese Communist Party (CCP) led by Mao Zedong. Indeed, by 1949, as the KMT was losing control over the mainland, its leaders sought to turn Taiwan into a strong territorial base, where they were safeguarded against possible invasion by physical barrier of the Taiwan Strait, and were subsequently under the protective shield of the United States after the outbreak of the Korean War in 1950. Because the Chinese Communists lacked naval and air capabilities to invade Taiwan in those early years, Chiang Kai-shek and his staunch followers were able to retreat to their island base, where they could nurture hopes of launching a military campaign to recover the Chinese mainland in the decades that followed.1

  The story told here, however, is much more nuanced and richer than the above simplistic view would suggest. Based on both English and Chinese archival materials, notably newly released Republic of China (ROC) official files, KMT records, and the personal papers of top leaders, including Chiang Kai-shek and T. V. Soong, this book seeks to draw a different picture and retell the story. It argues that the formation of a Nationalist state in Taiwan was a far more complicated and intriguing process than the conventional wisdom has depicted. It argues that the making of the separate Taiwan state was not the result of deliberate forethought and planning either by the United States, the KMT, or the CCP. Rather, it was the outcome of many ad hoc, individualistic factors and decisions related to war or alliance maintenance, or even serendipity. It demonstrates the complex and critical role of the U.S. government and various American individuals, as well as the U.S. policy, as consistent determining forces in shaping this accidental island state. In a broader sense, the book analyzes the overall collapse of the Nationalist regime under Chiang Kai-shek following the end of World War II in the context of the looming Cold War. In addition to showcasing the various internal political struggles within the Nationalist camp as its downfall began, this research illuminates how these struggles intersected with the wider geostrategic concerns of other powers, particularly the United States.

  Strictly speaking, this book is not a study of the conflict between the Chinese Nationalists and the Chinese Communists or why the Communists were victorious in 1949. Rather, it shifts away from the common focus on explaining the Communist triumph on the mainland, toward looking at how Taiwan was positioned within the greater framework of East Asian international politics and China’s domestic landscape surrounding Japan’s surrender in 1945. It begins with Taiwan as a Japanese colony, then examines the island as a frontier province newly returned to postwar ROC. As civil war ravaged all of mainland China, the island eventually became the seat of the Nationalist Chinese state, a historical phenomenon that, in retrospect, was hardly intended either by the Chinese Nationalists or the Americans.

  Located in the western Pacific, just off the Chinese mainland’s southeastern coast, the island of Taiwan now comprises most of the land area of the state known officially as the Republic of China—also called Nationalist China, Free China, and more recently, the Republic of China on Taiwan. Communist Chinese leaders in Beijing regard Taiwan not as a sovereign state but rather an outstanding territory belonging to the People’s Republic of China (PRC). In the past several decades, the ROC government in Taipei under the KMT likewise formally espoused a one-China policy and, until 1991, claimed sovereignty over all of China. However, its main opponent on the island, the Democratic Progressive Party (DPP), the ruling party of Taiwan between 2000 and 2008, contended that the island was not a part of China and should instead be treated as a separate, independent, and fully sovereign nation-state. The issue divides the island’s population and society. In any case, no one will deny that Taiwan’s relationship with mainland China has been, and will continue to be, of critical importance in any discussion or study of the future of Taiwan.

  Today, the Cairo Conference of 1943 and the resultant joint communiqué by Franklin D. Roosevelt, Chiang Kai-shek, and Winston Churchill has generally been viewed as an important watershed leading to the eventual ret
urn of Taiwan and the Pescadores (also known as Penghu) from the Japanese to China. Before China formally declared war with Japan on December 9, 1941, the Nationalist government was in no legal position to reclaim the territories officially ceded to the Japanese by the Qing court. At the Cairo Conference, with the support of the United States, Chiang secured promises from his wartime allies that his government could take over the island when World War II came to an end. However, behind this seemingly unanimous agreement lay a much more complicated landscape. Within Nationalist China’s governing circles, even in the final stages of World War II, questions concerning Taiwan’s future political and administrative status, as well as its relationship with the mainland, remained pending and controversial. In the United States, in the months surrounding the summit in Cairo, Washington’s planning circles were roiled by sharp debates and divergent policy formulations as to how Taiwan could best serve America’s postwar diplomatic and geostrategic interests in the Far East while supporting Nationalist China’s recovery of that island.

  Those wartime internal policy debates over Taiwan within Washington’s military and diplomatic quarters never quite overturned the ultimate decision that the island should be occupied by Nationalist China in the immediate aftermath of the Japanese surrender. Nevertheless, some apparently trivial policy drafts and proposals on the part of the United States before and after V-J Day turned out to have critical influence on the fate of Taiwan. One such instance was the sudden withdrawal of American involvement in the Allied takeover of the Japanese properties on the island, a decision made just shortly after the Japanese surrendered. Without a greater American role in the Allies’ overseeing or moderating the takeover operations, the Nationalist provincial authorities under Chen Yi went their own way, allowing local Taiwanese islanders’ bitter resentment to grow rapidly, leading to the February 1947 bloodshed in Taiwan.

  As the overall situation increasingly worsened in postwar China during the final years of the 1940s, U.S. wartime hypothesizing, which had no real chance to be implemented, gradually served as a new basis for Washington’s shifting stance toward the Taiwan issue. The theory that Taiwan should be placed under an Allied trusteeship instead of being handed over to China, a highly theoretical idea forged first by planning-level officials like George H. Kerr during the war years, was one salient example. After the February 28 massacre, when more Taiwanese thought that they were not, in any case, that kind of Chinese and began advocating the island’s autonomy or independence from China, Kerr’s unimplemented theory quietly became one crucial option vis-à-vis Taiwan for Washington’s top authorities. And its political repercussions, as well as its impact on the U.S.-Nationalist Chinese relationship, lingered on into the early 1950s and beyond.

  The role the Americans played in the February 28 incident also deserves further scrutiny. Chiang Kai-shek’s officials acridly blamed George Kerr, then serving as the American vice consul in Taipei, for instigating the islanders’ rebellion against the Chinese rule, leading to Kerr’s disgraceful recall. Yet in an oblique fashion, Kerr’s personal suggestions regarding how Taiwan might be best governed found its way to top Nationalist leaders. After the tragedy, Chiang appointed a civilian official to replace the much-hated governor Chen Yi, and more local Taiwanese were recruited into the new provincial authorities. More significantly, with the reform of the island’s commercial and industrial infrastructure after the massacre, more freedom was allowed, and private enterprise boomed in Taiwan. In hindsight, this marked the beginning of a gradual shift of Taiwan’s economic policy, and a salient departure from Chen Yi’s command economic philosophy on the island. The preliminary reforms undertaken in the aftermath of the February 28 incident were originally intended both to pacify the native Taiwanese and to fulfill the goal of making the island a role model for the mainland Chinese provinces. It therefore was a historical accident when those post-traumatic measures inadvertently laid the foundation for the subsequent formation of a Nationalist island state. Notably, George Kerr played a role in injecting into State Department policy debates in May 1947 the idea of American involvement in shaping the evolution of a more benevolent, liberal political situation in Taiwan. U.S. policy thereby moved toward creating a certain kind of political-economic setup on that island, even though very few imagined at this juncture that this new policy direction would also lead to an unintended state after 1949.

  Trusteeship for Taiwan gradually became a popular idea not only among the pro-independence Taiwanese, but also among some of Washington’s military and political chiefs as a result of the islanders’ escalating discontent with Nationalist governance. Worse still for the Chinese Nationalists, as their civil war with the Communists went from bad to worse, a deeply pessimistic view of their capabilities led policy designers in Washington to start moving to wash their hands of the KMT, even going so far by the end of 1949 as being willing to sacrifice Taiwan to the newly inaugurated PRC as part of the effort to court “Chinese Titoism,” a reference to Yugoslav dictator Broz Tito’s Cold War international politics. On the other hand, many in the Truman administration who did not wish to see Taiwan fall into Communist hands came around to the view that China’s sovereignty over Taiwan had not been established, and that the island should be legally acquired by the Chinese government only after a formal peace treaty with Japan was concluded.

  This study goes one step further by underscoring a previously unnoticed factor adding to the American belief that Taiwan should be treated as separate from the Chinese mainland. As the Chinese civil war intensified during the last months of 1947, a prevailing perception among foreign observers, including American diplomats and their British counterparts, was that a war-burdened China would inevitably return to a condition of regionalism similar to the early Chinese Republic warlord era. Toward mid-1948, overall developments in China led American officials, both civil and military, to agree that a gradual territorial division, coupled with the emergence of new regional regimes, was the most likely scenario in trouble-ridden China.

  It was within this larger strategic conceptual framework of the inevitability of a disintegrated and regionalized China that a new Taiwan formula began to take shape within the Truman administration. After Chiang Kai-shek stepped down as the ROC president in early 1949, the United States found it both imperative and politically plausible to search for suitable candidates to lead Taiwan’s political and military structure. Chen Cheng, Sun Liren, and K. C. Wu (Wu Guozhen) were at the top of the lists of individuals for which Washington had much hope. This American endeavor to find whoever was capable of handling situations was totally unacceptable to a “retired” Chiang Kai-shek, who was still trying to rule from behind the scene and to search for a strategy for survival. During the first half of 1949, Chiang’s idea was to create a strategic territorial triangle in Southeast China, encompassing Taiwan, Zhejiang, and Fujian provinces. But at this stage, the greatest challenge confronting his political enterprise was not so much from the Chinese Communists as from his increasingly unbridled (former) Nationalist military subordinates. As Chiang lost support from the Truman administration, his relationship with key Nationalist military leaders understandably became much more difficult.

  Chen Cheng, whom Chiang Kai-shek had handpicked as Taiwan provincial governor just before he stepped down, played a rather weighty role in determining the island’s future. Contrary to a conventional view portraying Chen merely as a loyal protégé of Chiang, this study aims to tell a different story. In mid-1949, when Chiang no longer headed the Nationalist central government, Chen found it necessary to court the Guangxi Clique and Acting President Li Zongren so as to strengthen Taiwan’s position vis-à-vis the precarious, soon-to-become Communist mainland. Several measures taken by Chen at this juncture later proved to be vital to the future of Taiwan; in hindsight, Chen’s ostensible defiance of Chiang’s wish and his going to meet Li Zongren in Guangzhou in May 1949 turned out to be one critical turning point in Taiwan’s fate. Actions taken by Chen proved to be cru
cial. Meanwhile, with the likelihood that the United States would exploit Taiwan’s inconclusive legal status to prevent the island from falling to the Communists, Chiang found that his returning to the mainland to seek a possible territorial citadel had become an unavoidable choice.

  The fall of Nanjing and Shanghai to the Chinese Communists in the spring of 1949 brought further chaos and uneasiness within the diminishing Nationalist-held domain south of the Yangtze River. Toward the end of 1949, both Chiang Kai-shek and Li Zongren targeted the southwest Chinese provinces as an ideal place where a lasting anti-Communist redoubt might be established. Again, U.S. policy formulation played an influential part in determining the outcome of the collapsing Nationalist state’s eleventh hour. As potential aid from America to China were becoming “regionalized,” meaning that future resources to China would very likely be given to regional leaders or local regimes carrying anti-Communist resistance, rather than to a rapidly disintegrating central authority, a veiled struggle between Chiang and his Guangxi Clique rivals intensified over Southwest China. A hitherto untold story of the abortive Yunnan independence movement fully elucidates the intrigue in the political and diplomatic landscape at a regional level, with America involved in the final stage of the Nationalist rule on the mainland. In early December 1949, when Washington turned down the request from Lu Han, the Nationalist governor of Yunnan province, that it support his declaration of independence, the governor decided to hand the province over to the Communists. This turn of events dimmed Chiang Kai-shek’s and his Nationalist followers’ last hope to establish their final territorial base on the mainland, and their flight to the island of Taiwan became the unavoidable and only option.