China 1945: Mao's Revolution and America's Fateful Choice (44 page)

A chance encounter
at the airport gave Patrick J. Hurley further proof, as he saw it, that the China hands weren’t just wrong but treasonous. He was leaving Washington in early April on his return journey to Chungking when he ran into OSS director Wild Bill Donovan. Donovan gave
Hurley some astonishing information about John Carter Vincent, head of the State Department’s China desk, whom Hurley had encountered during his unpleasant appearance a couple of weeks earlier before the Far Eastern division, the one at which he’d faced “a full array of the pro-Communists of the State Department as my judges and questioners.” Donovan told him that Vincent was “
overly friendly with the Reds,” and moreover that there was an investigation going on about leaks of official government documents to a pro-Communist magazine called
Amerasia.
This news no doubt was all the confirmation Hurley needed that the China hands were actively undermining his and the United States government’s official policy of support to Chiang Kai-shek, and they were doing so because they wanted the Communists to win.

Shortly afterward, on June 6, 1945, John Stewart Service, a close ally of Vincent and, as we’ve seen, one of the brightest of the State Department China hands—the person who had met with Mao in Yenan more often and on more intimate terms than any other Foreign Service officer, and the leader, with John Davies, of the group attempting to “politically capture” the Chinese Communists—was arrested by the FBI and charged with espionage.

“FBI SEIZES SIX AS SPIES, TWO IN STATE DEPARTMENT” read the alarming headline in
The New York Times.

“After almost three months of shadowing and snooping,”
Time
informed its millions of readers, “
the FBI’s quiet supersleuths in New York and Washington last week arrested five men and a woman on charges of conspiracy to violate the espionage laws. Promptly, the U.S. had its biggest State-secrets case of the war.”

It is a noteworthy coincidence that the other big news event receiving front-page treatment on the same day was a disclosure of the Soviet
intention to occupy one-third of soon-to-be-defeated Germany, an early first step in what was to become the
Cold War. The war in Europe had just ended, on May 8, and already a new conflict was brewing with the Soviet Union, which was quickly becoming an ex-ally. Meanwhile, victory in Asia still seemed a long and costly way away. Three weeks after V-E Day, on June 1,
President
Truman told Congress that twice as many troops as were needed to defeat Germany, a total of seven million altogether, would be sent to Asia to finish off Japan. Casualties would mount. Sacrifice was still in order.

It was, in other words, not the moment for a diplomat to be accused of leaking documents to a left-wing magazine suspected of sympathizing with the Communists. Only a few weeks before, Hurley had removed Service from his post in China. After the China hands sent their dissenting telegram to the State Department in February, Hurley had declared of its author, Service, “
I’ll get that son of a bitch if it’s the last thing I do.” And now the fates had intervened. Service was spending the night in prison, accused of disloyalty to the United States when the country was still at war. Hurley must have felt vindication, while Service, as he later told a friend, was “overwhelmed with disgrace and shame.” “I remember some guy in another cell, booked for car theft or rape, or whatever, asking, ‘What are
you
in for?’ ” Service recalled. “I said, ‘Conspiracy to violate the Espionage Act,’ and he said, ‘I don’t know what that is, but it sounds like
something real big!’ ”

As it turned out, Service was brought before a grand jury in August and the government’s case against him fell apart. The grand jury vote against an indictment of Service was twenty to zero. Three of the others were indicted. In the end, nobody went to prison, and after Service was exonerated, he was welcomed back to the State Department and sent to Japan to serve on the staff of Douglas MacArthur during the occupation.

What has come to be called the Amerasia Affair was the first public episode of the bitter aftermath of the American wartime entanglement in China. It was to be followed for years by an irrational and mean-spirited hunt for saboteurs in the American midst, a hunt that profoundly affected the futures of Service, Davies, and several of the other China hands. In the immediate instance, the sensational arrests of the six alleged spies reflected the maneuvering over China policy taking place inside the American government just as the struggles over the postwar world were looming. Like all such maneuvering before and
since, it involved efforts by proponents of one side or another in the debate to influence public opinion by releasing selective information to the press.

Service had been indiscreet in this matter. He’d arrived in Washington and was at loose ends while awaiting his next assignment. He had an office in the Far Eastern division, but he didn’t have much to do there. His wife and two children were in California, and he was lonely, especially in the evenings. To help him pass the time, he accepted social invitations, and it was at one of these that he met reporters and editors who were interested in what this deeply informed man who had spent months in both Chungking and Yenan had to say about China.

In February, while still in China, Service had met with
Joseph Alsop, FDR’s distant cousin and a senior member of Chennault’s staff and, like Chennault himself, ardently supportive of Chiang Kai-shek.
Alsop had told him that it was “idiotic” not to see the Chinese Communists as pawns of the Soviet Union, and foolish not to understand the necessity for Chiang to focus his attention on the Communist threat, rather than on the Japanese. A few years later, Alsop, who became an influential Washington columnist, summed it up in an article in the
Saturday Evening Post.
In demanding political reform of Chiang, pressing him to make a deal with the Communists, and insisting that the central government use its troops to fight Japan rather than Yenan, the United States had fatally weakened him, and helped to bring the Communists, whose anti-American hostility had been glossed over by the China hands, to power. Alsop’s argument was that it would have been better for the United States to dispose of Japan by itself and to let Chiang take care of the Communists.

Service saw things differently. He didn’t believe that Chiang’s weakness was due to the policies of the United States. Rather, it was his own limitations that doomed him. Like Davies, Service knew it was likely that the Communists would fall under the Soviet sway, and it was exactly to give them an option that he favored building ties with them. As for Chiang, pressing him for political reform was the only way to preserve him—assuming there was any way to preserve him at all—while to coddle him was to prop up what Mao had called a “rotten shell.” It was then, and it remains now, fanciful to imagine that anything short of another full-scale war involving hundreds of thousands of American troops could have maintained the KMT in power in all of China, or
even in just the southern half of the country. Service, believing that, wanted to prevent the United States from making a drastic mistake.

And he got encouragement from higher-ups, including from
Lauchlin Currie, formerly FDR’s administrator of Lend-Lease, and from Vincent, who urged Service to provide selective leaks to the press advancing their collective point of view and discrediting that of Hurley. Service had done this sort of thing when he was still in China, meeting with journalists and providing background information, including the views that he was sending in his reports to Washington. “I was Lauchlin Currie’s
designated leaker,” he later told
E. J. Kahn. Among his contacts was
Drew Pearson, the influential columnist, whose opinions were decidedly unfavorable to Hurley, to Hurley’s rage. As we’ve seen, Hurley had complained to the State Department about what he called a campaign to smear his reputation.

One of Service’s contacts was
Philip Jaffe, the editor of
Amerasia.
Jaffe was a naturalized immigrant from Ukraine who had made money in the greeting card business. He was a friend of
Earl Browder, the chairman of the
American Communist Party, and clearly a leftist, though there’s no indication he was a Communist himself—and in any case Browder was under attack from Moscow for reasons having to do with the sectarian quarrels that often took place in the international Communist movement.
Amerasia
had a point of view similar on the subject of the Chinese revolution to that of Edgar Snow or any of the others enchanted with the Communist movement in China and disillusioned with the national government. But it was a serious magazine, not a piece of propaganda, and it was not under the control of Moscow or any other foreign power.

Jaffe was active and enterprising, and he managed to obtain copies of government documents, provided to him by several sources, one of whom was Service, who gave him copies of some of the classified reports he had written during his days in China. Jaffe had been under FBI surveillance since the end of January, when
Kenneth Wills of the OSS had reported to the FBI that
Amerasia
had published almost verbatim his classified report on British
policy in Southeast Asia. FBI agents were stationed outside the
Amerasia
office, which was in a building at 225 Fifth Avenue in Manhattan, and in March, seeing that the office was empty, a five-man team, which did not have a warrant, broke into the magazine’s office and
found what appeared to be powerful and abundant evidence of a criminal conspiracy.

They discovered that the magazine was equipped with a darkroom even though it didn’t publish photographs. They found photocopies of many government documents, some of them marked “Top Secret.” There were locked suitcases crammed with materials from army and navy intelligence, from the State Department, and from the OSS. From that point on, a team of seventy-five FBI agents was assigned to keep watch on Jaffe and his associates, tapping their phones, listening in on their conversations.

In such a way did Service come to be overheard by the FBI. Jaffe had cultivated him, invited him to dinner in Washington, introduced him to some of his contributors, and established common ground with him on the general subject of China and on the particular subject of Hurley. Once Service visited Jaffe in his room at the Statler Hotel in Washington, and with the FBI’s tape machines turning, he talked about what he called something “
very secret”—evidently the initiatives taken the previous fall by Donovan and McClure, and carried out by Bird and Barrett, to broach a plan for military cooperation with the Communists. It was the most indiscreet comment that Service made to Jaffe, but was it an act of criminal disloyalty to the United States?

The grand jury didn’t think so, and neither did some of the wiser American commentators. Liberals like Pearson,
Walter Winchell, and
Max Lerner produced
columns early on denouncing the FBI arrests as efforts to stifle the press and to suppress dissent inside the State Department. Pearson called it “America’s Dreyfus case,” after the Jewish captain in the French army falsely accused of espionage. Others recognized the case for what it was, simply an instance of some leaking of the sort that government officials of all persuasions had always done. Even though the case was to disappear from public attention pretty soon, the aftertaste produced by the initial, sometimes lurid coverage was long-lasting. The appeal of a good story, of espionage, hidden dangers, secret and sinister forces, was just too much to resist. The
New York Journal American
warned that the case of the six provided “
sensational proof that Communist organizers had access to highly confidential files of vital government agencies.” A headline in the
New York Herald Tribune
asserted, with no evidence, “WAR SECRETS LEAKS WIDESPREAD, SIX ARRESTS MAY BE ONLY A START.”
The Scripps-Howard chain of newspapers, whose motto was “Give light and the people will find their own way,” and whose Ernie Pyle was probably the most famous war correspondent of the time, reported without any truthful evidence
that Service had engineered what the paper alleged to be an American turn away from Chiang and toward the Communists.

The Chinese Communists themselves, perhaps confused about the waywardness of American China policy, were paying attention. For them, the arrests represented proof of the unchangeable nature of imperialist countries. Three weeks after those sensational headlines in American newspapers, the Communists’
Liberation Daily
provided a full analysis of the event, and while the analysis was couched in Marxist-Leninist terms, it wasn’t wrong. The ordeal of Service et al., the newspaper said, wasn’t really about “confidential information,” as the American press had it; it was about the deeper battle in the United States over China policy, which, in turn, was really about the ability of big capitalism and imperialism to endure in the postwar world. “
The arrest of the six people is the emergence of the heated debate on the two roads of American policies toward China,” the newspaper said, one of which “acknowledges the Chinese people’s great democratic force,” namely “the
Eighth Route Army and the
New Fourth Route Army.” And then there is the other force, the one “that does not acknowledge the great power of the Chinese people but only the anti-democratic KMT government along with the reactionary elements and the murderous devil Chiang Kai-shek.”

The newspaper struck some themes that would remain constants of the Communists’ propaganda, even as it became shriller over the following years. The enemy was not the “American people” or “the American friends who support the Chinese people’s cause.” The enemy was American imperialists, “Hurley and his ilk,” as the common phrase had it, because their aim was “exactly the same as that of the autocrat and traitor who drinks blood from the bodies of the Chinese people”—meaning, Chiang Kai-shek. From now on, the CCP’s broadsides against the United States—with occasional periods of remission—would become both more bitter and more formulaic, with the phrase “the Hurley-Chiang double act” becoming the standard reference to the American ambassador and his support of the KMT, along with the boilerplate assurance that both Hurley and Chiang would inevitably be defeated. The Communist commentators increasingly referred to Hurley’s press conference of April 2 as a watershed event, the moment when American policy shifted in favor of “the goal of victimizing the Chinese people.” Hurley became the first of several Americans over the years to be held up as a Great Enemy even as the United States came
more and more to be described as a “capitalist dictatorship” seeking to gain “hegemony” in China. The American ambassador became “Master Hurley,” the puppeteer without whom Chiang would never have dared to attempt to uphold his dictatorship. And with this denunciation of the United States and its “imperialist bureaucrats” came countervailing praise of the Soviet Union as “a real democracy of the laborers” that is “
a hundred times more democratic” than “the American democracy under its capitalist dictators.”