Oftentimes the greatest foreign policy struggles are not with the host government but rather with the government bureaucracy back home. Such was the case with China in the 1940’s in a fight that would define geopolitics for a generation and would ultimately ruin the careers of those diplomats who were on the losing side.
After the death of China’s last post-emperor autocratic ruler in 1916, China was left without any recognized central authority and fragmented into a nation of competing warlords. Sun Yat-sen united the early Kuomintang (KMT) parties in 1919. The KMT gradually increased its influence from its base in Guangzhou, but was unable to control all of China. With Sun Yat-sen’s death in 1925, Chiang Kai-shek became the leader of the KMT. The fledgling Communist Party of China joined the KMT in the United Front, which allowed the KMT to seize power throughout most of China by 1927. Chiang then purged the Communists from government. A civil war between the two sides lasted until the Second United Front was formed in 1936 to fight the Japanese.
Initially, the Communist-Kuomintang split was overshadowed by the Japanese occupation of Manchuria, but it soon became too big to ignore. Although the U.S. backed the Kuomintang from the very beginning, it was the Communists who eventually won. This in turn led to criticism of the State Department’s “China hands” for “losing China.” And as with any big loss, somebody would ultimately have to pay the price.
John S. Service was an American Foreign Service Officer who was born in China of missionary parents and who served in China before and during World War II. As one of the State Department’s “China Hands,” he correctly predicted that the Communists would defeat the Nationalists in a civil war, but he and others were blamed for the “loss” of China following the 1949 Communist triumph. In 1950 Senator Joseph McCarthy launched an attack against Service; Secretary of State Dean Acheson fired Service, but in 1957 the U.S. Supreme Court ordered his reinstatement in a unanimous decision.
In these excerpts from his lengthy oral history, John Service explains the bureaucratic resistance he encountered when he tried to explain to Washington what was really happening in China and the strong opposition to his belief that the Communists would eventually win. He was interviewed by Rosemary Levenson in 1977. Read Part II.
“Things were headed for trouble in the Far East”
SERVICE: In the United Front period, which was ’37, ’38, perhaps the end of ’38, most of us felt that the Communist party was willing to accept the leadership of the Kuomintang, work in the United Front, that the Kuomintang itself had liberalized itself and was able to take in or accept other views. I don’t think I thought that the Communists were an important threat to the Kuomintang or an imminent rival. We generally tended to accept Chiang as being what he seemed to be, a leader of China. I don’t think most people really gave very much thought as to how he managed to maintain his leadership and control. Internal groups within the Kuomintang, the factions, were not particularly well understood.
By 1940, it began to be obvious that things were headed for trouble in the Far East, particularly after the European war really came to life in April 1940. As soon as France fell, Japan moved into the northern part of Indochina. This was a sort of a weather vane of what was going to happen. Japan was going to move in and take over the colonies, Dutch East Indies, French, British, and so on, the Far East if she could. This really is what changed American policy. It wasn’t so much sympathy for China as it was our concern about Europe, what we began to think of more and more by this time as our allies.
Early in ’41 — I forget just how I did it–I got myself transferred to Chungking[…] which was then the temporary capital of China….At this time, there was no [American] debate going on in China about China policy. There was no real disagreement among people serving the government about our attitude toward the Chiang Kai-shek regime. We were pretty much all of one mind.
I came in just on the tag end of Nelson T. Johnson. Johnson was very easygoing. We referred to him as a sort of Taoist. He was fairly inactive and passive. At that time we were neutral in the Chinese war….We were isolated, and he was quite content to let a very active and very able naval attaché named McHugh maintain close contacts with Mme. Chiang, the Generalissimo, important people. Johnson regarded Chungking as a temporary office and made no attempt to build up the embassy….
At any rate, soon after I got there the Generalissimo gave a farewell dinner for Johnson and I was included simply because I was on the staff of the embassy. Officers were all included[…] The Generalissimo — and I think that this would be my original impression — was very tense and very taut, no relaxation, very stiff. [Mme. Chiang] was obviously very charming, in a rather heavily made up way, very heavily made up for a Chinese, and I thought somewhat artificial[…]
“The facts were just so plain”
After I got to Chungking it was quite obvious — to me at any rate — that the big problem in the future, the political issue, was going to be the Kuomintang-Communist thing….I can’t say that this was immediately apparent. It became apparent over a period of time.…
A chance had come to make this trip to the northwest provinces. I left on that in July  ostensibly to attend a China Society of Engineers conference in Lanchow province, in Gansu….I was with a party of about 20 government engineers working for some of the government departments, mainly the Ministry of Resources, some engineering professors in Chinese universities. There were three Chinese newspaper people and myself. I was the only foreigner. They were all critical of the Kuomintang. The intellectuals were almost unanimously critical of the Kuomintang. You had a variation among these people, of course, as to how outspoken they would be and how much they felt the Kuomintang should be blamed. Some people felt, well, you know, after all, there’s a war on and there are a lot of difficulties. There were some people who would be government apologists. But no one tried to cover up the facts. The facts were just so plain. No one made any attempt to apologize or ignore the shortcomings. There were differences of opinion. Some of them just weren’t much interested in politics.
Along the way, of course, I made a point, every chance I had, every town we stopped at, of going to see the missionary. If there was a missionary in town — I didn’t try to stay with them. I stayed with my own gang. Missionaries, of course, were glad to see anybody. They were isolated much more than normal. They were all anxious for news, anxious to talk to somebody from the outside. I would simply pick their brains as much as I could, as much as was decent and they were willing, on strictly local conditions. I didn’t try to get them onto what might be embarrassing political subjects, what they thought of the government. There was a lot you could ask just on purely local matters, which they were very often thoroughly informed about, through their own church members.
They very often had quite thorough details about the taxation picture. Various Kuomintang officials made private estimates that between a third and a fourth of what was actually collected from the people reached the government. These people knew from their own church members a lot of what went on — bribes, entertainment, efforts made to get your land classified in lower categories so your tax rate would be lower. And conscription. They had had experience with their own people. When I got in a place like Sian where they had large schools, they knew a good deal about secret police activity against the students, political repression, thought reform camps, or schools. But I didn’t usually ask people what they thought about the government. I just asked what was happening locally, what did they know about this and that.
“I felt rather pessimistic about our attachment to the Kuomintang”
By this time it was October. I had been in China by this time for four years. So, I was ordered to the Department for consultation, and I left Chungking in early December, 1942. Then in mid-January  I guess it was, I went to Washington for my consultation. It turned out that I was the first man to reach Washington from Chungking since Pearl Harbor — certainly the first man who’d done any political reporting. All the research analysis units and all the various agencies were eager for news of China, particularly first hand.
I was asked to call on Lauchlin Currie, one of President Roosevelt’s several special assistants. He was the White House man on China, you might say. He had been, I think, very favorably impressed with China when he first arrived. Then later on, in China, as he knew more about China, his views had changed. He wanted to get my impressions and drew me out. So I started to tell him my reactions to my trip to the Northwest. As I had seen a good deal of the grassroots in China, I felt rather pessimistic about the Kuomintang and about our attachment to the Kuomintang, our unquestioning support of it. I expected that the situation in China was eventually going to blow up. He was much interested in this and indicated that he generally agreed with my views. He also let me get the impression that “the man across the street” shared his thinking. This meant the White House….
Currie referred to the fact that Mme. Chiang was in Washington creating a terrific furor — furor of propaganda favorable to the Kuomintang — and said that it was a real problem and something had to be done to “build a backfire” — the phrase he used — against this publicity. She was appealing over the head of the President by going directly to Congress, stirring up a lot of sympathy for aid to China, really attacking the whole strategy of the war, which was Germany first and the Far East second. This strategy was something that a lot of the Republicans, [Time Magazine publisher Henry] Luce and the China group, never accepted. I remember [chuckling] in the Department at that period somebody on the White House staff called over and wanted to be instructed on how to pronounce the name “Chiang.” I gave him a telephone lesson on how to say Chiang.
Currie wanted me to talk to [well-known columnist] Drew Pearson particularly. His office arranged a meeting. Drew was of course a hell of a good newspaperman. He had an interest in China. He’d been out in China, as a lot of newspaper people had. He was not terribly fussy or meticulous about details. But, of course, he became a tremendously important journalistic force because a lot of people fed him information. People that knew of scandal or corruption or misdoings, a lot of them would get the word to Drew. So, he did pick up an awful lot of dirt. I think he was probably the most influential newsman in America during that period. But that was only one thing.
Currie wanted me to talk to other people, spread the word that things in China were not the rosy picture that the press was spreading. He said that he would try to make arrangements and encourage journalists to go to China, because China was such a minor field that not many first rate news people were going out there. If they came out, I was to feel that it would be helpful if I would give them the true picture, because one problem, as I mentioned before, was that the Kuomintang always tried to smother these people, keep them away from American contacts. Also, he wanted me to write him letters from the field. What he was particularly anxious for was that if I wrote a report or knew of a report that would be especially interesting to him, to alert him to its existence. A great difficulty for him was that, working in the White House, he had no reporting staff. He felt that the State Department and other agencies weren’t really keeping him informed.
Currie had other responsibilities, I’m sure, besides simply China. He was involved in Lend-Lease, and I think most of these assistants had changing responsibilities. But one of his standing assignments was China. I would guess, but I really have no way of knowing, that in the overall world picture China ranked relatively low. Sometimes it was more important and a hotter issue than at other times. It was certainly an important issue at the particular moment when I was there because of Mme. Chiang’s arrival….
“My memo caused a lot of waves”
[M]y memorandum [to the State Department] of January 23, 1944 emphasized the probability of eventual civil war. I didn’t come out and say, “The Communists are going to win,” but I said that civil war would be a disaster for the peace, stability, development of China, and that the Communists might be extremely difficult to defeat. I urged that we should try to find out something about the Communists by sending people up there, sending officers up there. John Davies [FSO, China Hand, and later Medal of Freedom recipient] was coming to the same conclusion at about the same time. But somehow my memorandum upset the established powers a great deal, mainly [at left, Stanley] Hornbeck, who had been in the Department for a long, long time, and was long away from any sort of direct contact with China. He was called adviser to the Secretary of State [Cordell Hull]. He didn’t have any direct administrative role. The head of the Far Eastern section was a man named Max Hamilton. But he was completely dominated by Hornbeck, who was a very overbearing, dictatorial type of person.
My memo, as I say, caused a lot of waves. Hornbeck’s first reactions were apparently vitriolic. He wrote on the margins “ridiculous,” “preposterous,” “scandalous,” and various other characterizations. I was then asked to rewrite the memorandum, in a less personal way, using embassy dispatches where possible. The embassy had said some of the same things in less dramatic or direct ways. Meanwhile, the Department sent off a telegram…to the embassy in Chungking — without mentioning my name — and grossly distorting my conclusions.
The embassy came back and quite rightly wouldn’t buy, wouldn’t go all the way for the rather distorted questions. But, they did say that, “Liquidation of the Communists by the present Kuomintang leadership is a question of when rather than whether” (which, of course, was pretty strong substantiation of what I said), and that most people assumed that there would be a civil war, probably not during the war against Japan. I spent most of the month writing and rewriting this silly memo, based on the Chungking reply.
[Max] Hamilton’s attitude was very odd. I had lunch with Hamilton, and certainly in the beginning our relations were quite friendly. He was commenting, sort of in a despairing way, about the distorted American impressions of China, how someday there was going to be a rude awakening and this was going to be very bad when Americans found out things weren’t as rosy as they’d thought. I said, “Well, after all, we’ve got some responsibilities. There’s censorship in China. It’s very hard for the true story to get out,” and that we should be doing something. I argued that we should be taking an active role in informing the American public. [lowering voice and paraphrasing Hamilton] “Oh, we could never do that, could never do that. It would be very embarrassing and very difficult. If it became known that we were taking an active role in news, it would be very embarrassing.”His whole attitude was a dithering, milquetoasty sort of business. Hamilton was an unusually cautious, conservative type of person, I think. I don’t know. There was another comment, I remember, by a fellow Foreign Service officer who survived what came later. He read my report, said it was very interesting, and it would be a terrific assignment, this business of going to Yenan. I suggested sending some Foreign Service officers to Yenan to observe. But, he wasn’t sure that he would want the job because, he said, “Oh, the KMT government would be awfully down on that person.” [laughing] “It might not be a very good idea.”
The State Department was concerned. What they were really concerned about was the fact that I was talking to other people. This was why they went to these absurd lengths to try to rebut it, because, of course, they knew that I was talking to Currie, and they knew that OSS [Office of Strategic Services, the precursor to the CIA] was interested. I was being called to go to all sorts of debriefing sessions at OSS and the army MIS [Military Intelligence Section], and Navy ONI [Office of Naval Intelligence].
When they got their reply from Chungking, they circularized to all the head offices of the Department their message to Chungking and Chungking’s reply without sending them my memo. So, this was all sent in, and then Hornbeck put out a memo in reply to mine which is very amusing.
The State Department historian’s footnote, it says, “is commenting on a memorandum by John S. Service, dated January 23.” I think it’s worth reading a little bit of it here: “We should I think maintain an attitude of intelligent skepticism with regard to reports emphasizing the strength of the (quote) “Communist” (end quote) forces in China and expressing apprehensiveness that civil war in China may be imminent.”
Of course, I didn’t say in my thing it was imminent. That was circulated to try to offset my memo.