So far as action is concerned, the althogether significant part is item 9 on page 559, which gives Chiang Kai-shek's views on June 24, 1944, as to how Roosevelt could help him.

Senator FERGUSON. Could I just inquire now, Mr. Wallace, as to whether or not you know how that particular memorandum in relation to your conversation while you were with the Generalissimo alone, and which you handed to the President, got into the white paper, and your report did not?

Mr. WALLACE. The white paper reported all the conversations I had with Chiang Kai-shek. I dictated, I presume to Owen Lattimore, anyhow I put in Owen Lattimore's hands-I don't mean Owen Lattimore; I mean John Carter Vincent's hands-as quickly as I could after this ride to the airport exactly what took place on the ride to the airport so he could include it in the report which he would later make to the State Department.

Senator FERGUSON. If you were reporting that kind of conversation to the State Department, then why didn't you file a copy of your report to the President with the State Department?

Mr. WALLACE. They were two altogether separate things. The report to the President was a summary of the trip, and this was a series of conversations with Chiang Kai-shek on the diplomatic level, which were properly the property of the State Department. I suppose you could quibble and say this was in a little different category than the other diplomatic conversations, but all I can say is that I did not so regard it at the time, and I immediately, as fast as I could, passed it on to John Carter Vincent to include it in the other conversations. Chiang Kai-shek wanted a contact man with the President who could handle both political and military matters. He criticized Stilwell and praised Chennault, as he had before.

With these thoughts in mind I went on to Kunming, where John Carter Vincent and I were the guests of General Chennault. General Chennault's simple outline of the dangers and threats of the Japanese offensive in east China further drove home the critical nature of the situation.

I resolved, therefore, to send an immediate message to the President, briefly reporting on my talks with the Generalissimo, describing the crisis in China, and suggesting corrective action. The best corrective I could think of was to provide the Generalissimo with an American commander in China who would really work with and support him. Hence it seemed to me necessary to recommend the relief of General Stilwell.

On June 26 at General Chennault's house I went over the whole problem with John Carter Vincent and Joseph Alsop, whom General Chennault had assigned to act as my escort. In the course of a long evening of discussion the three of us batted the whole problem back and forth. With the wholehearted concurrence of both Alsop and Vincent, I decided upon a cable to the President suggesting that General Stilwell be replaced in command in China.

Also, with their concurrence I decided that the new commander in China ought to be given political authority as the President's personal representative. The Generalissimo had asked for this, and it seemed to me that the American commander must have this direct authority from the President in order to obtain Chiang's full confidence. Vincent went along with this view.

Senator FERGUSON. Might I discuss with you this last paragraph? Did you ask Vincent for his suggestions on other matters; for instance, in relation to your report to the President?

Mr. WALLACE. I don't remember whether I did or not. It is quite possible I might have asked for suggestions. I would think I would, but I don't remember.

Senator FERGUSON. Did you discuss with Mr. Alsop any of the other problems besides the removal of General Stilwell?

Mr. WALLACE. With Alsop I discussed fully and completely the whole military situation in the area for which General Chennault was responsible. I had very extended conversations with Mr. Alsop. Senator FERGUSON. Mr. Alsop was assigned as an escort?

Mr. WALLACE. Yes.

Senator FERGUSON. What was his rank at the time?

Mr. WALLACE. The committee asked that before, and I didn't remember. I have inquired since, and I find he was a lieutenant.

Senator FERGUSON. You felt free to discuss with a lieutenant, Mr. Alsop, this important problem of the removal of a general from the theater in China?

Mr. WALLACE. I have never been a stickler for rank, sir. His rank. so far as I was concerned, was as an escort assigned to me by General Chennault, and it appeared-and this is the altogether important thing that he had the complete confidence of General Chennault. Senator FERGUSON. Did you consult with General Chennault as to the removal of General Stilwell?

Mr. WALLACE. I don't think I did.

Senator FERGUSON. Did you consult any other general?

Mr. WALLACE. I am sure I didn't consult any other general. This was too delicate a matter to consult with generals.

Senator FERGUSON. I was wondering on this delicate matter why you consulted with a lieutenant. I should like to have an explanation of it.

Mr. WALLACE. The explanation is very simple. I had known Alsop before. He was the escort assigned by General Chennault. He enjoyed the complete confidence of General Chennault, and his presentation was succinct and made sense to me. That was what I wanted. Obviously this was the kind of thing you just simply couldn't talk about outside the smallest possible circle, and I did not.

Now Mr. Alsop may have passed the information on to General Chennault, but to the best of my knowledge I didn't say a word to General Chennault about it, and to the best of my recollection General Chennault said nothing in any way impugning or discrediting General Stilwell.

Senator FERGUSON. Do I understand then that the only military man consulted and the only State Department man consulted outside of the Chinese were Mr. Alsop and Mr. Vincent?

Mr. WALLACE. That is correct.

Senator FERGUSON. You did consider this a very important matter? Mr. WALLACE. I considered it a top-secret matter.

Senator FERGUSON. Did you consult with Mr. Owen Lattimore about it?

Mr. WALLACE. No; to the best of my knowledge he never knew about this until it was released in the press this September.

Senator FERGUSON. Was it your conversation with the Generalissimo in the car alone that led you to the conclusion you should look into this matter about the removal of General Stilwell?

Mr. WALLACE. That was the completely dominating factor, rein. forced by the increasing seriousness of the military situation which 1 found when I came to Kunming.

First was the very human need of the Generalissimo, as expressed on the way to the airport, as I described it in the last memorandum in the white paper and, second, was the fact that the military situation was even more serious than I thought, as developed by General Chennault at Kunming.

So I felt that there was no time to lose, and I moved into action as fast as I could.

Senator FERGUSON. Did Mr. Vincent and Mr. Alsop agree on what should be done about General Stilwell?

Mr. WALLACE. I think you were absent when we went over all of this this morning.

Senator FERGUSON. I do not want to cover it if you did.

Mr. WALLACE. I think we went over all of it this morning. I indicated we batted it back and forth and arrived at a unanimity of opinion, and I remember no exception which either one of them took to the proposals.

Senator FERGUSON. I just want the record to show that I had a conference with the House this morning and was unable to be present. Mr. SOURWINE. There was testimony this morning by Mr. Wallace, in response to questioning, that there was nothing in this cable that Mr. Vincent objected to in any way, that whenever there was an objection they would talk it out and square it up, and it did not go in if there was any objection to it.

Senator FERGUSON. I will read the record.

Mr. WALLACE. I was reluctant, however, to suggest the replacement of Stilwell without offering someone who could fill his place. My first notion was to recommend General Chennault, in view of the Generalissimo's avowed confidence in him and the impression he had made on me.

Vincent raised no objection to this proposal. It was Alsop, a member of Chennault's staff, who spoke against it. As I recall he offered two main reasons for not recommending Chennault: (1) Chennault could not be spared from his job in Kunming of directing the air effort which was then the sole support of the hard-pressed Chinese armies, and, (2) the name of Chennault, who was unpopular in the Pentagon, would never be approved by the Army staff and would only raise prejudice against my recommendation to replace Stilwell. These seemed sound objections.

Finally, I decided to suggest General Wedemeyer as a man for whom the Generalissimo had expressed admiration, and as a logical candidate in view of his record and position as deputy commander in the Southeast Asia theater.

Senator FERGUSON. Did Mr. Alsop explain what the Pentagon's objection was?

Mr. WALLACE. He probably didn't use any phraseology of that kind. I can't recall any phraseology. It was just merely probably some such phrase as "It would raise hell in Washington" or something to that effect. This is what it meant.

Senator FERGUSON. This was the substance?

Mr. WALLACE. This would be what it would mean.

Senator FERGUSON. Did it impress you that this would be a valid objection?

Mr. WALLACE. Yes; it did impress me that it would be a valid objection.

Senator FERGUSON. In other words, if the Pentagon did not want him

Mr.WALLACE. It just simply was not the wise thing to do.

Senator O'CONOR. May I interrupt to ask you there if the suggestion as to General Wedemeyer's availability and desirability was first made by you?

Mr. WALLACE. No; I don't think it was made by me. I found out from someone that he was agreeable to Chiang Kai-shek. As I have previously testified-I don't know whether it was Chiang Kai-shek himself, whether it was T. V. Soong, whether it was Joe Alsop-but all I remember is that somebody told me, and I think it appears in the cable, that he was persona grata to Chiang Kai-shek. From whom I obtained the information I can't say.

Mr. Alsop may have some recollection on that. I don't think I have asked him on that particular point, but he may have some recollection.

Senator O'CONOR. I knew you had previously expressed some doubt, but I thought you had possibly refreshed your recollection on it.

Mr. WALLACE. No; I don't know. It could quite possibly be Mr. Alsop. I knew it couldn't get outside of this circle because of the delicacy of the situation. That circle would be the Generalissimo, T. V. Soong, Madame Chiang, and Joseph Alsop. It couldn't have been outside of that circle. I don't believe it could.

I might possibly include Clarence Gauss in that circle, also, with whom I had a very confidential relationship, but I can't say as to that, and this is just merely reasoning in retrospect and not on the basis of memory.

My cable was sent from Kunming that evening, and relayed from New Delhi to Washington on June 28. It was not shown to, or discussed with, anyone except Vincent and Alsop.

This is the story of the Kunming cable which comprised my main action recommendations to the President. It is significant that Budenz in commenting on my June 26 cable, has studiously refrained from referring to what was by far the most important recommendation of that cable-the removal of General Stilwell from command in China.

That recommendation was made, as I have shown, almost wholly on the basis of a complaint by Gen. Chiang Kai-shek. The recommendation that Stilwell's successor be a personal representative of the President was specifically in response to the Generalissimo's request.

If my recommendation for the removal of General Stilwell, made as a result of the Generalissimo's request, was following the Communist line, then the Generalissimo was himself following the Communist line in making that request. This illustrates the utter absurdity of the testimony which Budenz has given.

Budenz has testified that "the Communists were very much opposed to General Chennault and didn't want him in the picture at all."

However, as I have shown, I initially proposed to recommend the appointment of General Chennault as General Stilwell's assistant and this proposal was concurred in by John Carter Vincent who, Budenz implied, was influencing me to follow a Communist line. It was only after considering the advice of a member of General Chennault's own staff, Mr. Alsop, that I eliminated the Chennault proposal.

I think anyone who reads both of my reports must conclude that I was interested only in winning the war and that I felt the Generalissimo must be supported in order to accomplish this. My second report, dated July 10, 1944, was made to the President on my return to the United States. To the best of my recollection I consulted no one in the course of its preparation although I did study various memoranda which had accumulated on my trip.

In that report I emphasized specifically not only the views of Ambassador Gauss, but the views expressed to me by T. V. Soong. Soong, as this committee knows, was always a great friend of the United States, and was subsequently Premier of China under the Generalissimo; he was certainly not in any way pro-Communist.

In my report I stated that Soong was "quite outspoken, saying that it was essential that something 'dramatic' be done to save the situation in China, that it was 5 minutes to midnight' for the Chungking Government." Without being specific he spoke of "need for greatly increased United States Army air activity in China and for reformation of the Chungking Government." He said that "Chiang was bewildered and that there were already signs of disintegration of his authority."

Budenz has testified that my criticism of the Generalissimo's government was in accord with the objectives of the Communists. He implies that the sending of any indication to Washington that the Generalissimo "was incapable of controlling the situation for a long period of time" was one of the central objectives of the Communists, who wanted to use this as an opening wedge for a coalition government. Budenz suggests that anyone who criticized the Generalissimo's government to Washington was thereby furthering the Communists' ends. This is nonsense. Anyone who knew anything about China at that time and this included General Chennault-was aware that if the Generalissimo's government were to be saved from ultimate and total collapse that government had to be reformed drastically and without delay. The best way to insure its ultimate collapse and a Communist take-over, was to let it continue in its state of physical and spiritual anemia.

It was in recognition of this convinction, which I shared with almost anyone who knew anything about China at that time, whether American or Chinese, that I set forth at the end of my July 10 report a "possible policy line relative to liberal elements in China."

As a part of that line of policy I advocated support of Chiang combined with support of a new and more liberal coalition to which I hoped Chiang would then swing over in the best interests of the Chinese people, as well as the best national interest of the United States.

The political coalition which I recommended that we foster in China was not a coalition with the Chinese Communists, but a coali