Memorandum, State Department Summary of Telegrams

DEPARTMENT OF STATE OFFICE OF THE SECRETARY WASHINGTON November 15, 1948 T SUMMARY OF TELEGRAMS CHINA Ambassador Stuart reports that, while Chiang Kai-shek remains determined to defend Nanking against the Com- munists, law and order in that city are gradually breaking down. The principal military forces remaining to the National government will soon be engaged between Nanking and Hsuchou -- important rail center northwest of the capital --m and Stuart expects that these forces will be destroyed within two weeks. When this occurs, Chiang's government will either disintegrate or flee southward. There will be no orderly transfer of power to the Communists, and as a consequence Stuart anticipates a "high incidence of unrest" and hazards to foreigners in China. In the light of this prospect, Stuart believes that the time has come to institute emer- gency evacuation procedures for practically all of China. RUHR We are informing Secretary Marshall in Paris that the unfavorable French reaction to the US-UK military gov- ernment trusteeship law, which provided that the pattern of Ruhr owner- ship be decided by the future German government, is symptomatic of a larger French misunderstanding of our policy in Germany. In view of the French statement that France may have to reconsider its German policy because "German recovery is being pushed too fast," we suggest to the Secretary that he and Bevin might undertake to review with French Foreign Minister Schuman our common future policy toward Germany, spelling out clearly that the only real solution of the German problem, insofar as French security is concerned, lies within the framework of a stronger poli- tical and economic organization of western Europe, in which Germany must play an important part. We cannot, while we are contributing to France's recovery, increase our burden with respect to Germany. With specific relation to the Ruhr, French security, we feel, lies not with internat- ionalization but with: 1) our commitment on German disarmament and our support of a north Atlantic security system; 2) the establishment of a Ruhr authority to determine coal and steel allocations; and 3) our inten- tion to see that foreign interests in Germany are afforded non-discriminatory treatment. VATICAN CITY The Pope's views on Palestine, conveyed to our repre- sentative to the Vatican, include approval of the inter- nationalization of Jerusalem as the most appropriate means of insuring DECLASSIFIED E.O. 12065, Sec. 3-402 State Dept. Guideline, June 12, 1979 By NLT- He NARS, Date 11-13-to