K. C. WU ARTICLE IN LOOK MAGAZINE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80R01731R000900110045-6
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 10
• Document Creation Date: December 14, 2016
• Document Release Date: January 24, 2003
• Sequence Number: 45
• Publication Date: August 6, 1954
• Content Type: LETTER

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July 21, 195+
MEMORP.WDUM FOR THE DIRECTOR OF CENTRAL INTELLIGENCE
While overseas, I read in LOOK MAGAZINE the
attached article by K. C. Wu, former Governor
of Formosa, on "Your Money has built a police
state in Formosa". It was shocking readings
To what extent can reliance be placed on
Mr. Wu? One is aware of the internecine wax-
fares in all foreign count_cies. Yet, the charges
made in this article, if partly valid, are very
disturbing: the police state; Chiang's son with
a Moscow background, etc.
Are you concerned by this?
ROBERT CUTLER
Special Assistant
to the President
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 Approved For Release 2003/04/25 : CIA-RDP80R01731 R000900110045-6
Your money, has built
a police state in
A former top associate of Chiang Kai-shek says the Gimo
has abdicated his powers to his oldest son,
who is turning Formosa into a communist-type state
T HE true situatiofl in Formosa today is a trz
story few Americans have been told.
It is a story I know, because for three ye
as its governor, I fought to make Formosa de
ocratic-and lost.
You, the American people, should know
story, because you are supplying three four
of the money spent by the Chinese Nationa
Government on Formosa. I owe it to you as v
as to my own countrymen to speak out ab
what has happened.
Americans have been assured that a den
cratic way of life has been established on
beautiful and strategic island of Formosa.
have been told that an army of half a million
more men is not only eager to attack but alsi
serving as a threat on the flank of Commur
China, should she commit her huge armies
an invasion of Southeast Asia. You have bE
led to believe that Formosa today is the inspi:
tion, the hope and the spiritual home of f]
Chinese all over the world, a strong link in chain of your Pacific defenses and a stalw
base from which a counter-assault may so:
contim.
M01 731 R000900110045-6
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VfFOHMOSA
PHILIPPINE
Chiang Kai-shek - Chiang Ching-kuo
roan who seems to rule and the man who actually does
-:a.lissimo Chiang Kai-shek, the author says, has delegated most of
wers to his 45-year-old son, Chiang Ching-kuo. The young Chiang
r Tied to a Communist Russian and lived 14 years in the Soviet,
he "received thorough instruction in the Communist state. He has
.:l to be a dangerously adept. student." Today, Wu asserts, Ching-
as control over the army, the Kuomintang and the secret police.
Off Red?eeld mainland, Formosa could launch only a "suicidal"
The fighting forces on Formosa today simply are not effective. Unleashinj
day be launched to free the Chinese mainland from its Communist
oppressors.
How I wish I could tell you that all these assertions are true.
But they are not. The sad part of the story is that at one time in the
past they were actually becoming true, and at some time in the fu-
ture, if proper action is taken, they may yet become true. But just
now they are not.
For Formosa has been perverted into a police state, not unlike
that of Red China, its professed adversary. Though Generalissimo
Chiang Kai-shek is still the supreme ruler of the land, he has made
his son, Chiang Ching-lcuo, his heir and successor and has delegated
most of his powers to him.
This first-born son, a man of 45, the child, not of Madame Soong
Chiang, but of the Generalissimo's first wife, is married to a Com-
munist Russian woman. He himself spent 14 of his adult years before
World War II in the U.S.S.R., and there received thorough instruc-
tion in the organization and administration of the Communist state.
He has proved to be a dangerously adept student. Today, he has vir-
tual control over the ruling Kuomintang party; he has complete
control over the army and seeks to make it entirely a personal instru-
ment of power; as head of the secret police, he is fast building up a
regime that in many ways follows exactly the pattern of a Commu-
nist government; he has even organized a Youth Corps modeled
after the Hitler Youth and the Communist Youth.
Even when I was in Formosa, many people expressed doubt as to
where his real affiliations lay-with the Communists or with the free
nations. Personally, I am inclined to believe that he is only propelled
by his own overweening ambition and that he has pursued the Com-
munist ways of government because he knows no better. Bu
who can be sure? Who can guarantee that, in the event of th4
of the Gi no, Chiang Kai-shek, and an attractive offer from I
he may a of turn Formosa into a rich province of Red China?
Who ,ever may eventually happen, what is happening t(
Formosa cannot be condoned as you may condone Tito or l
In those cases, you made the decision to get along with the your ey( open. Formosa is different. You are being deceiv
supplyi1 300 million of the 400 million dollars (U. S.) in the
Formosa budget to create a totalitarian state. It is not even e
ent to de so. For the fighting forces on Formosa today simply
effective Unleashing them to attack Red China would not
a gambl+,, it might be suicide on our part. It might destroy :
any hops of liberating the mainland.
U. S. Should Seek Reforms on Formosa
The realization of this was what finally caused me to bm
Chiang>ai-shek's regime. That does not mean that I have
tentions Lo wreck his government. Lonly want it to adopt the 1
that it s6 sorely needs.
No do I think that it is in the interest of the American
to with~i raw your support of Formosa. I only want you to s
that it i used to a good purpose and that Formosa is forge(
truly efl ctive weapon against communism.
The situation that prevails in Formosa in the meantime
me keen' y and personally, for it developed while I was there. I
hard agr: inst it, but I lost.
It : as on December 21, 1949, at the most critical hour
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 ~ or l tea `; 04 3/44/2 : CIA
soldiers of Chinese Nationalist army look happy. But author says troops have been "demoralized" by commissar system Chiang Kai-shek's son has set up.
k Red China might destroy forever any hopes of liberating the mainland"
when the Communists were overrunning the last Nationalist
-on the mainland, that I was appointed governor of Formosa.
=_n until October, 1950, when the Chinese Communists en-
Korean War, I had practically a free hand in carrying out
to bring democracy to the island. The only order Chiang
gave me in that period was to raise 42 million Taiwan
V. S. $8,400,000) every month to pay the troops, and the
!ft entirely to me.
cask was not easy. A Communist invasion of Formosa ap-
imminent that my wife and I bought cyanide capsules to
or any eventuality. There was also widespread discontent
land. The Formosans, who are Chinese by race, had been
a by Japanese rule for 50 years when the mainlanders took
-x World War II. The new rulers got a joyful welcome. But
_iang Kai-shek's first military governor, General Chen Yi,
Mme did not last long. Corruption, tyranny and, finally, in
rrible massacre left the Formosans stunned and estranged.
arnors who succeeded Chen Yi did little to heal the breach.
e was hardly any American aid to speak of. The local note
_ increased 14-fold in the previous seven months, so that
was almost beyond control. Hordes of refugees from the
_ were streaming over and had to be resettled. The number
swollen by evacuated forces, rose from 30,000 to 450,000
_y to 600,000-on an island of 8 million people. The unjust
:ure was bleeding some sections of the population and leav-
-s almost untouched; the government's income was des-
inadequate.
3 to get things done rapidly if the government was to sur-
vive. First of all, we needed money for government expenditures
and to meet the payment of the troops.
To raise funds, I ordered the quick sale of some 20,000 confis-
cated Japanese houses at about 70 per cent of their assessed value.
Another move was the sale of "Liberty Bonds" for the rich and
small-denomination savings for the poor. The houses sold quickly,
and, to dispose of the bonds, never exactly popular with the Chinese,
I used a firmly persuasive approach instead of compulsion. With
those measures, we moved toward immediate solvency.
I also adopted a long-range plan to carry out basic tax reforms.
When I arrived, 70 per cent of all taxes were coming from the farm-
ers; when I left, they were paying only 8 per cent of the total reve-
nue. Tax returns for 1950 were 600 per cent greater than 1949.
Generals Would Pad Troops' Payroll
With the revenue we got, I paid the soldiers promptly and regu-
larly twice each month-a procedure unknown to the Chinese armies
on the mainland. The troops had been demoralized on the mainland
because the generals had had the habit of padding their payrolls and
failing to pay the soldiers.
But most of all my heart was set on the fundamental reforms I
thought were so necessary to make Formosa the rallying point of
all the enlightened forces of China in the hopes of liberating the
mainland from the Communists. I aimed to heal the breach between
the Formosans and the mainlanders in order to forge them into a
solid unit against communism. What I planned to do was to give
our government truly popular support.
With that purpose, I reorganized the cabinet of the provincial
continued
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41
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y democratic measures were
by Chiang as bait to get U. S. moi
government, appointing Formosans to 17 of the 23 cabinet
carried c it land reforms, started by my immediate predecess
went on to provide ownership by tenant farmers. I also se
system oi security insurance for labor.
Bela les taking those steps, I laid special emphasis on two
--the Tula ? of law and democratic government through free el(
We have always had a secret police operating under the
I knew that we had to do everything to prevent and dig oul
munist iiifiltration. But I also knew the abuses of our secret
They we c id arrest people employed in the island's Departn
Finance rithout warrants and without even the finance comm
er's know, ledge. They did not even make sure on every occasic
they had the right man. They would enter an office, revolt
hand, sa', to a frightened man behind a desk, "Are you Wang
drag hint away. I used to get such prisoners released, and by t
of 1950 1 even got an order from the Gimo that arrests of ci
must be made only with warrants from my civil police.
I alw introduced and got a law providing for free elect:
mayors a,id magistrates and of city and district"councils. We c
the elect: ins into three stages, first the east coast, then the
area and last the west coast.
brands again! It's the new
leaf, the young leaf, the
flavor leaf that does it. Pick
the Bright Red Box with the
Smiling Cups-Tender Leaf
Brand Tea. Loose or in tea
bags-it makes the richest
iced tea you ever tasted !
Approved For Release 2003/04/25 :
! FORMO,t A continued
so refreshing, so wonderfully
satisfying-you'll never switch
Morale Rises, Then Gets a Jolt
The i first free elections in all Chinese history were held is
1.950, on he east coast of Formosa. Anyone who was an eye--
to those t:iections must have shed his last suspicion that Orient
pies were not fit for democracy and did not care for it. Over
cent of tl,e people enthusiastically went to the polls.
As iiorale in the army and among the civilian populatio
the risk 0'a Communist invasion diminished. United States c
and oth visitors were .ii prg cd and pleased, and more An
aid came Although I knew that the old-line politicians were
I believer i I had the full support of Chiang Kai-shek, and th(
I was too confident and too busy to worry.
Thai The, in October 1950, the Chinese Reds intervened in ti
rean WA), and the atmosphere began to change. Until that tir
Gimo's t hjective, I now sadly perceive, had been to secure An
money ar.d American support. I was used as a facade, and my
ures for , .emocratization were mere bait. When he came to 1
that by force of circumstances he had become indispensable
United States, he began to listen more and more to the perst
of his sorj.. with the sole purpose of perpetuating his, or their,
The `first signs of trouble came when the elections in the
area of the island were about to take place. Elections were
the genet a1 supervision of my commissioner of civil affairs, at
pendent > `ormosan not connected with the Kuomintang part
leading t indidates for mayor in two principal cities also we
depender t Formosans. It looked as though the Kuomintan
didates were going to be defeated. The party therefore appe;
the Gimt, to intervene, and he sent me a secret written order
me to dismiss my commissioner and to coerce the independer
rnosans i0to retiring from the :race. I had to offer Chiang Ka
my resignation before he would rescind his order.
This cleared the decks for a free election that time, bu
that time on the party perfected its machinery of manipulation
the secre police as its instrument of execution. The later elc
on the we A. coast, I must confess, were far from free.
But continued to try to remedy this evil. I recommends
the party cease to be financed by government funds. I urged t
oppositio be allowed, even encouraged, or at least, as in T
that the tine official party be perm=tted to split into two partic
the Girrt_ would not agree. When the Seventh Kuomintang
ference ~c,invened in the summer of 1952, he himself hand
all the deegates, three quarters of them his son's stooges. And
election of the party's Central Executive Committee, he I
 51! DP80R z31 R00~1T 5-6
t
STUMPED
WkQNI.
lliam F. Knowland gets in a huddle with Chiang's officers on visit
?sa. Author says VIP's get idea "everything is sweetness and light."
out a list of candidates and even required all of the ballots
fined!
was in the fall of 1950, too, that I became aware that the
son, Chiang Ching-kuo, was the real head of the secret po-
to that time, I had thought he was officially only the head
olitical Department of the Ministry of Defense, appointed by
er in March, 1950. But I did not know, as I learned later, that
dquarters of the secret police is in the President's office-and
-to, of course, is the President. The man who really ran the
.ras, and is, Chiang Ching-kuo. Usually he stayed behind the
-the hatchet man he generally employed during my time was
Meng-chi, deputy commander of the Peace Preservation
Chus the tentacles of Chiang Ching-kuo's control spread and
z~d over all of the government.
Chiang's Son Reveals His True Role
Rang Ching-kuo moved personally into my field of vision in
of the Taiwan Match Company. The chairman of the board
Dwn to have financed a movie, Forty Years of China, in which
-io was presented in a light something less than effulgent.
ions were made against the chairman that he had made a
th the Communists. After the evacuation of the mainland,
s, he had gone to the British colony of Hong Kong; the next
ZI the company, who was in Formosa, was the general mana-
honest businessman with no political affiliations, who had
een in Hong Kong since the mainland was evacuated. Never-
I heard one day that he had been jailed.
-er I ordered him released for lack of evidence against him,
Ching-kuo himself came to my office frankly in his position as
head of the secret police. He was accompanied by his hatchet
mg Meng-chi. All subterfuges were tossed to the winds. Even
ice to the rule of law was ignored. Chiang Ching-kuo said
was the Gimo's wish that the manager be shot and the rich
Match Company confiscated.
men I could not agree to that, the case was transferred to a
court. I then wrote the Gimo himself, protesting the ille-
ztd injustice of the arrest. I got no direct reply, but the Gimo
secretary to me to say that the general manager would not
but merely sentenced to seven years' imprisonment.
-re and more arrests and convictions of that kind took place,
sufficient evidence and without semblance of a fair trial.
sure to which I had made the Gimo agree before-no arrest
a warrant from my civil police-I found inadequate to cope
continued
Approved For Release 2003/04/2
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 A-RgT131 R0009d00110045-6
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Formosa children learn how to
-ead. write. Educational program
flourished, author says. until Red-
type Youth Corps was established.
Nationalist troops like these
putting on a training show. K. C.
Wu writes, "hate the commissars.
and feel helpless against them."
with the situation. It only kept me posted on the arrests tt
been male. But I had no say about the trials. As Formosa ha
declared under a state of siege, all cases of any nature were
military courts for trial. These courts always met in secret,
counsel was allowed defendants. So. finally, in January, 1952,
to the G rmo to complain about the outrages of the secret pol
the mockery of the military courts. I proposed that all criminz
except t?aose involving communism and espionage be sent I
courts, n..at military courts, for trial, and that counsel for deft
allowed ~n the military courts.
The (;imo showed reluctance to accept the proposals. I
offered my resignation. I had never yet complained directly
about hi son, but now I decided I must. I said:
"If ou love your son, do not have him as head of the
police. H' will become the target of the people's hatred."
r11tt:)ugh I spoke quietly and earnestly, the Gimo was
aback. Bo walked over to the mantelpiece and rested his hi
his hand "Don't talk to me like that," he said, "I have a head
I ne-: er had to come to grips with the Gimo's son in his in
ing cont:t,.>i of the army, for that was out of my bailiwick. I cot
fail to know what was going on, however, because I had been i
the troops. That task was taken away from me in 1951, but m
tact with the army, as it was quartered in my province, was int
Moreover?, my outspoken advocacy of democratic methods wa.,
known. +o everywhere I went, officers and enlisted men of botl
and navy would pour out their hearts to me in private.
Thei'olitical Department of the Ministry of Defense, whi
young Cl=iang headed, was originally set up to instill anticomm
and uplift . the troops' morale. But as soon as Chiang Ching-ku
office, he began to develop it into a system of political comn
after that of the Soviet. The result has been that there are tv
of officer,--ordinary service officers and political officers, seps
trained and controlled. This is demoralizing and confusing en
wor'kingagainst the sound principle of "the direct chain of
rnand." Ta make matters worse*, all promotions are by the Gim
on the rt,commendation of Ching-kuo. I know many cases
commanuers were demoted, discharged and even imprison(
cause thy could not get along with Ching-kuo's agents.
Troops' Feelings Don't Match Show
The =outward appearance of the troops is good enough. I
visitor who sees them once or twice, they seem well fed, well c
and read to go. VIP's always get a big show, with live bullets,
is very impressive. It is always more or less the same, but r
seems to compare notes. But the troops' feelings don't mate
show. They hate the politicalcommissars and feel helpless a
them. Tha:>y seem to be a splendid body without a soul.
Soren of the middle-class officers, intelligent, patriotic an
terly anti-Communist, even went so far as to tell me separate
in almost identical words, "If fight we must one day, we shal
to kill the political agents first!"
Only real insiders know this because Chiang Ching-kuo
litical Department has devised slick and practically foolproof
ods of cry ating the illusion that all is sweetness and light.
The ,lictatorial moves to establish a secret police and c
the army, to rig elections and corrupt legal processes were a
start. Toteay, a program is underway to control the minds and
of youth and suppress freedom of speech and of the press.
Our.