Discussion of ways and means began at once but came up against a barrier of caution in Secretary Stimson who thought the idea “rather half-baked” and more representative of Chinese strategy than American. When the requisitions were submitted to General Marshall he declared the whole 500-plane program including the heavy bombers to be “impractical” because aircraft and trained men were simply not available. All that could be scraped together for China was 100 P-40 fighters taken from the number designated for Britain, which they released in the hope of deterring attack on Singapore. With these and with the President’s and armed services’ backing, the nucleus of Chennault’s program went forward.
T. V. Soong and a group of American associates borrowed from the Government organized China Defense Supplies Inc. to conduct all matters of purchase and finance for the hired air force. Regarded by the President as a means of helping a beleaguered democracy, the group had his help and blessing. One of his two closest assistants, Tom Corcoran, was released to the private practice of law and immediately retained by Soong as counsel for China Defense Supplies and contact man with the White House. At the President’s suggestion the purchasing group was headed by another Government lawyer, William Youngman, released from the Federal Power Commission. Recruitment of 100 pilots from the Army and Navy air forces was encouraged by the attraction of salaries up to $750 a month and a bonus of $500 for every Japanese plane shot down. Release of the pilots for enlistment as mercenaries in the service of China was authorized by Executive Order in April 1941. Despite official support progress was slowed by difficulties, delays and shortages. The American Volunteer Group (AVG) did not reach Burma to begin Chennault’s rigorous course of training until November 1941, too late to deter, though not to fight.
The move that opened the faucet of real aid to China was passage of the Lend-Lease Act in March 1941. Thereafter the flow of aid became an investment, and the need to protect the investment increased the flow until it became a silver cord attaching America to the Nationalist Government. There is no more entangling alliance than aid to indigent friends.
To compensate for the drain on British credit Roosevelt had asked Congress for a program to lend or lease arms and matériel to “the government of any country whose defense the President deems vital to the United States.” Since the plan gave promise of keeping the war away from American shores by financing and supplying others to fight while Americans remained nonbelligerent, it had attractions for the isolationists. Providing $700 million worth of war material to begin with, the bill passed by the comfortable margin of 317–71 in the House. China was at once declared eligible. Thereafter Lend-Lease became the core and foundation and, from the Chinese point of view, the most important aspect of the Sino-American relationship. They no longer had to beg; it was now America’s obligation to supply their needs. Their appetite swelled to the colossal. Demands for everything an army could use—rifles, howitzers, trench mortars, machine guns, field guns, antitank guns, tanks, ammunition, vehicles and loans to pay for them—poured in. The problem was the same that Stilwell had met in the case of Feng Yu-hsiang: amounts and types of weapons were unrealistic. Thirteen-ton tanks too heavy for Chinese bridges and other unusable weapons appeared on the lists.
The business generated by Lend-Lease through China Defense Supplies was even more lucrative than most military procurement operations. It made the fortunes of the Americans involved in the group and added to Soong’s, which through his previous tenure as Minister of Finance and chairman of the Bank of China was already considerable. Soong went in and out of the revolving door of Chiang Kai-shek’s favor in rivalry with his other brother-in-law, H. H. Kung, who currently enjoyed the Ministry of Finance owing to the backing of the sisters, Mme. Kung and Mme. Chiang, who made common cause. Though temporarily out of the favored spot, Soong was never out of influence. Endowed with business and political acumen equal to his patriotism, he built up for China Defense Supplies a staff of ability and contacts and access to the right doors, especially to Harry Hopkins and to the Lend-Lease Administrator for China, Lauchlin Currie.
The American aim which had its own element of unreality was “Chinese military self-sufficiency” based on the assumption that the Chinese armies, given arms and equipment and reorganization and training under American advisers, could move to the offensive and cause enough diversion to deter the Japanese from other adventures. A program for arming 30 Chinese divisions (out of an approximate total of 300) with full equipment of divisional weapons was submitted by T. V. Soong. When supplied with artillery and other weapons and trained in their use by American officers, the selected 30 were to become special assault divisions, if and when the Generalissimo and National Military Council could agree on which divisions to designate. Since a division or higher unit was a commander’s property and since the whole structure of Chinese politics depended on the relationships of those who disposed of military strength and on the intricate balance the G–mo could maintain among them, this question was to remain one of extreme and continuing difficulty. To carry out the Thirty Division and AVG programs, as well as to organize and supervise the whole Lend-Lease operation, an American Military Mission to China (AMMISCA) was appointed under General John Magruder, who had been both predecessor and successor to Stilwell as Military Attaché. Staffed by a number of former language officers, AMMISCA was also to serve in the event of war as liaison for strategic planning and cooperation and in general to shore up the morale of the Chinese Government.
The program was not philanthropy but intended as a means of enabling the Chinese to keep the Japanese occupied. Through all changing circumstances and conditions in the coming period this remained the purpose of American aid and it retained the original flaw: the American purpose was not the Chinese purpose. China’s primary interest was not to keep the Japanese actively occupied burning and terrorizing in China in order to keep them off American backs. The Nationalist Government wanted American money and arms mainly in order to strengthen itself. Unlike Britain which had only a foreign foe, Chungking could always hear at its back the internal enemy hurrying near. Pure acquisitiveness was also a factor. Possession of arms even without use gave the reassurance of power.
This became clear as soon as the AMMISCA officers went to work beginning in October 1941. The mission’s artillery expert, Colonel George Sliney, confirmed after an inspection tour what Stilwell had reported as Attaché, that the will to fight an aggressive action “does not yet exist in the Chinese army.” Their demand for war material was not “for the purpose of pressing the war against Japan but was to make the Central Government safe against insurrection” after other nations had forced Japan out of China. “The general idea in the U.S. that China has fought Japan to a standstill and has had many glorious victories,” he discovered, “is a delusion.”
The central idea of American policy, which was essentially to empower Chinese to fight Japanese, was founded on this delusion, though not without warnings. Reading a statement by Senator Austin of Vermont urging the United States to redouble efforts to send arms to China as the quickest means of striking the Axis, the Naval Attaché in Chungking, Captain R. E. Schuirmann, was moved to write that the many such statements made lately by prominent people showed a widespread belief in the potentiality of China as an active military factor in defeating Japan. “If such conception is seriously held by those controlling high strategy,” he warned, “it is fatally defective.”
Once ingrained, however, and fostered by China’s friends and propagandists, the delusion was difficult to eradicate. The press assisted the delusion by its tendency to print what it decided the public wanted to hear about China. One free-lance correspondent tried in vain to make clear how damaging to China was the closing of the railway to Hanoi. Every time she wrote a story pointing out that, no matter how magnificent was the human endeavor that made the Burma Road, nevertheless the loss of the railway was critical, her story, after treatment by editors, would emerge as a eulogy of the Road.
 
; A report on the Burma Road by Daniel Arnstein, a transport expert and taxi-fleet owner, disturbed some illusions. The President’s all-purpose agent Harry Hopkins had sent Arnstein to investigate why “not a god damn thing was moving over the Burma Road.” Goods shipped under Lend-Lease were piling up on the docks of Rangoon and at Lashio, terminus of the railway that connected with the Road. At the current rate of transport it would take eight months to move the back-log. Arnstein discovered corruption, inefficiency and incompetence amounting to an “impossible situation” which could not be improved, in his opinion, unless management was taken out of the hands of the Government and given to someone competent, “with authority” to correct conditions.
The situation on the nine-foot-wide single-lane highway, 715 miles from Kunming to Lashio, was “appalling.” At Kunming, the starting point in China, truck drivers had to pass through eight Customs desks, which sometimes occupied the whole day, before obtaining permission to proceed. At a dozen more checkpoints along the way provincial officials took their toll for permits to pass. At Wanting on the China-Burma border 250 trucks were waiting anywhere from 24 hours to two weeks for customs clearance. The use of grease being apparently unknown or too costly, hundreds of burned-out trucks were stranded along the way. Stolen spare parts were a regular item on the black market. Fifteen official agencies, transport companies and control boards representing—and passing on squeeze to—various ministries of the Government operated on the Road. Six thousand tons per month were limping through when the total should have been 30,000.
Arnstein wrote a report recommending obvious measures which could bring the traffic to 8,000 trucks operating at a time. Presented to the G–mo in Chinese and indexed, it elicited his delight and a prompt invitation to Arnstein and his two assistants to take over management of the Road as a private concession at so much percentage per truck. This being declined, authority was reshuffled among more commissions and control boards. Though little was changed at the top, traffic was lubricated by an American Technical Group of 46 civilian mechanics despatched by Lend-Lease who set up motor pools and maintenance shops along the way and trained the Chinese in the art of greasing.
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The world and the war were suddenly heaved out of balance by the German invasion of Russia in June 1941. Like that startling anomaly, the Nazi-Soviet Pact of 1939, the new reversal changed everything, inserting Germany by choice into a two-front war, the situation that had defeated her the last time, and aligning Russia, now Communist instead of Czarist but still a cuckoo in the nest, with the democracies. The strategic advantage was not appreciated at the time. On the contrary the vaunted German armies were expected to defeat the Russians, as Marshall and Stimson and the brains of the War Department agreed, “in a minimum of one month and a maximum of three months.” Elsewhere the outlook was no less dark. Germany had smashed resistance in Greece and Yugoslavia, U-boat “wolf packs” were attacking British shipping in the Atlantic, and Rommel launched a counteroffensive in North Africa. The trend galvanized Japan to take the fateful decision to move south with southern Indochina as the target. On July 24 under legal cover of agreement with the Vichy regime which was in no position to refuse, Japan acquired use of eight airfields and a naval base at Camranh Bay and Saigon, putting her within striking distance of Malaya, the Indies and the Philippines. The agreement included unlimited access for Japanese troops which were to be used, as the United States learned through its breaking of the Japanese code, for penetration of Siam.
The time for oil embargo—the last deterrent available—had come. Stimson believed it would deter rather than provoke on the theory that the Japanese, however wicked, would have the good sense not to commit suicide in a war with the United States. The freezing of Japanese assets in America, amounting in effect to oil embargo, was ordered on July 26 on the ground that Japan’s move into Indochina constituted notice of intent “to pursue a policy of force and conquest” and a step prior to “the seizure of additional territories.”
Simultaneously a new possibility opened for American strategy. General MacArthur who had been serving in the Philippines for the past five years recommended in July putting in enough force to defend and hold the Islands, hitherto considered indefensible. The B-17s made the difference. From a base in the Philippines the Flying Fortresses could attack Japanese naval operations. To gain time to equip the base and to build and bring in enough of the big bombers it was now vital to postpone conflict until the last possible minute. The Army and Navy insisted on delay. Talks between Secretary Hull and Ambassador Nomura of Japan in search of terms for a basic settlement had been opened some months before and these were kept going more as “rearguard diplomatic action,” in Hull’s words, than in real hope of a solution. The stumbling block, as it had always been, was China. Japan could not consent to a settlement that did not recognize her colonial control of China; the United States would not consent to one that did. At bottom there was no area of bargaining.
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With October and the end of the one-year draft approaching, the Army faced the loss of men and Reserve officers on whom a year’s training had been spent. To create a combat-ready force from men newly trained each year was impossible, and though the President was extremely reluctant to test the temper of Congress, Marshall and Stimson insisted on extension of the Draft. Once more the great debate thundered on Capitol Hill. Against charges of “militarism” and “warmongering” only Marshall’s careful, tactful but relentless pressure coaxed the bill through Congress by the margin of a single vote in the House, 203–202. So thin was the victory that it revealed the strength of opposition to the idea that the war was America’s affair.
While Congress was debating, the Army in the summer of 1941 held nation-wide maneuvers with over half a million troops of each of the four armies successively engaged over a period of four months. The first to begin was the Fourth Army on the West coast which included Stilwell’s 7th Division, now “California’s Own.” He took the part as usual of the enemy Red force. Supported by other units of the IIIrd Corps, the 7th Division attacked northward from a Los Angeles base against two divisions of the IXth Corps representing the Blues who were defending San Francisco. The “Battle of California” was fought out for five weeks from the end of May through June at the Hunter Liggett military reservation in the area of the Hearst ranch 120 miles south of Monterey.
Stilwell planned a blitzkrieg attack by mechanized battalions up the San Antonio valley with an even chance to break through and capture the Blue headquarters, leaving the way to San Francisco open. He gained surprise by a night start, but the Blues, outnumbering him two to one, simultaneously launched attack on both Red flanks and were able to roll back his offensive. Nevertheless as the maneuvers continued Stilwell clinched his reputation. He toured the entire front making personally sure that everyone knew his duties, observed every emplacement, slept on the ground three hours a night and outwalked his staff, of whom one complained, “My God, the Old Man is all over the place like a herd of sheep!” The 7th became imbued with such fighting spirit that some troops threw away their blank-cartridge rifles and fought with fists. At the end one unit, the 32nd Infantry, in order to be the first to reach camp, still had the vigor to strike out on an unscheduled 17-mile hike in which Stilwell joined for the last eight miles.
The Blues won the war which ended in an armistice on June 30 but the performance of the Red 7th earned Stilwell promotion to command of the IIIrd Corps. The promotion was part of a thorough shake-up affecting 20 generals which Marshall put into effect in the effort to revitalize the high command and replace older by younger generals. Stilwell was now rated by the outgoing head of the IIIrd Corps, Major General Walter K. Wilson, as No. 1 of the 47 major generals in the United States Army.
He was not content with laurels. “I was impressed by the air of calm confidence on the part of our officers,” Stilwell said in his critique of the war games. “Nobody was worried which means that everybody was sitting on his fanny.?
?? Calm confidence, he suggested, “comes either from ignorance or long experience and in this case I leave it to you to decide which.” He ordered the troops back into the field for four more days of exercises to correct deficiencies. In August at Fort Lewis in Washington he commanded the IIIrd Corps against the IXth in renewed maneuvers designed to test the handling of large units and the functioning of the high command in meeting tactical problems set by the umpires. Both the Chief of Staff and the Secretary of War came to observe and Stilwell met Stimson on this occasion, although without recorded comment.
By now the Administration had to face the truth that the country was not going to escape from war. The Joint Board headed by General Marshall and Admiral Stark gave its official opinion in September that Germany could not be defeated by the present coalition against her without the participation of the United States and that the British and Dutch “probably could not successfully withstand” a Japanese attack on Malaya or the Indies without active American military aid. Therefore the United States faced war “simultaneously against Germany and Japan” and must organize a production program to match the problem. The Board reaffirmed the strategic decision to defeat Germany first while maintaining a strong defense against Japan. The main element of this defense should be material support for “Chinese offensives against Japanese forces of occupation.”
The formulation of strategy was shared by Britain but not China. Owing to a reputation for leaks China was not included in the military discussions nor, much to the resentment of Chiang Kai-shek, in the top-level Atlantic Conference held by Roosevelt and Churchill in August. After his long wait for the foreign powers Chiang found himself not made an ally by any of the belligerents—Britain, Holland or Russia—not invited to the ABDA staff talks at Singapore and not, as he could sense from the feel of things, occupying first place in American strategy. To improve his access to Washington he had asked at the beginning of Lend-Lease for the traditional political “adviser.” Roosevelt, anxious to do the best for China in at least this respect, sent him the man most highly recommended, Owen Lattimore, who had been active in China as businessman, newspaperman, traveler and scholar since 1920 and was the author of books on Mongolia, Manchuria and China’s outer provinces. Admiral Yarnell described him as “the greatest authority in America on China and Manchuria” which was the right qualification from the point of view of the sponsor if not the client: when the Chinese asked for an “adviser” what they wanted was advice on America, not China. Lattimore reported at the time of the Atlantic Conference that the Chinese felt politically isolated with growing apprehension that after the war they would not be given “equal status and fair treatment.” He urged a formal alliance to encourage them but neither he nor anyone could solve the essential difficulty: that equal status is achieved only by the exercise of equal weight.