Report on Formosa

"Desperation," said the new governor of Formosa last week, "is the mother of reform . . . We've got to try new men and new ideas." Shrewd, capable K. C. Wu, onetime mayor of Shanghai and longtime friend of Generalissimo Chiang Kaishek, was talking about plans for the administration and defense of his new domain, the rich, 250-mile-long island of Formosa, which had become the last refuge of China's Nationalist government.

As Governor Wu spoke, the last Nationalist troops on the mainland were streaming across the border into Indo-China, and the Chinese Communists held uncontested control of the Asian coastline from the Gulf of Tonkin almost to Vladivostok. Only the remnants of the Nationalist armies stood against the certainty that China's Communists would try to take Formosa, thus driving a dangerous wedge between strategic U.S. positions in Japan and Okinawa to the north, and in the Philippines to the south.

Red Rout. For the time being, the Nationalists were safe on Formosa. Last October, the Communists had launched the beginning of an invasion when they tried to storm the tiny island of Chin Men, just off the mainland from Amoy and 130 miles across the Strait of Formosa. The attack was a bloody failure. Nationalist troops commanded by trim, V.M.I.-trained General Sun Li-jen, who four months ago was placed in charge of Formosa's defense, routed a Communist assault force of 20,000, returned to Formosa with 7,000 prisoners. Most of the Reds have since been reorganized into Sun's forces.

On Formosa, General Sun commands 300,000 troops, is supported by Nationalist China's air force and navy. In numbers, the force seems imposing, but to TIME Correspondent Wilson Fielder last week General Sun frankly conceded that he has a tough job of reorganization ahead of him. Only about half of Sun's troops will take his orders; the others feel themselves bound to generals who reject Sun's authority. Actually, Sun would prefer a smaller, more compact army than he now commands. Unreliable generals have been sacked right & left without regard to traditional face-saving niceties. Sun is now busy re-establishing their units under generals of his own choosing.

Idle or disaffected Nationalist soldiers, whose unruly behavior had outraged Formosans in the past, have been disarmed and put to work preparing defenses on the shallow, sandy beaches that face the mainland; others have been sent to Sun's U.S.-style training camps in the south. The Formosans, who spent 50 years before World War II under Japanese rule, are getting used to the Chinese soldiery. "A country must have soldiers to have peace," said one farmer. "The ones in our village seldom bother us any more."

The most important of the island's defenses is the air force. On the airfields which dot Formosa's western coast, some 300 operable aircraft--fighters, bombers, transports--are ready to fly. But most military observers doubt that the air force can remain in operational condition longer than six months without U.S. spare parts and technical advisers.

Signs of Maturity. Protected by the 100-mile-wide Strait of Formosa, separating them from the Communists on the mainland, the Nationalists seem to have a good chance of successfully defending their island redoubt against an assault--providing Formosa's native population does not rise against them. While General Sun is licking Formosa's military defenses into shape, Governor Wu is busy trying to win the loyalty of Formosa's 6,500,000 people, most of whom dislike the Chinese, Nationalist or Communist. To win friends among Formosa's hard-working peasants, Wu is pressing for further land reform. Wu's predecessor, General Chen Cheng, started a good reform program; tenant farmers who used to pay as much as 70% of their crops in rent now pay a maximum of 37-5%-Even the landlords who at first bitterly opposed the reforms now seem to be pleased because contented tenants deliver their rents regularly.

Gradually, the reforms born of Nationalist China's last desperate stand were showing signs of maturity. From Formosa's verdant plains and lushly terraced mountains, farmers had reaped their biggest harvest since the war. Lightning raids by government police were keeping currency black-marketeers in check.

Formosa's modern, Japanese-built power plants, badly battered by U.S. wartime bombing and in dire need of spare parts and trained personnel, are doing their best to supply the island's rich and potentially profitable industries (sugar, aluminum, cement and coal). But Formosa's industries are painfully short of capital. Many Formosan businessmen blame many of their financial troubles on SCAP, whose red-taped regulations prevent virtually all trade between Japan and Formosa.

Intelligent Formosans still fear that China's badly shaken Nationalist leaders may fail or collapse; they nevertheless see a chance of fairly sound government for Formosa in the months ahead.

Waiting for Spring. Across the choppy Strait of Formosa, the armies of Communist China were waiting for spring to bring them calmer waters. Then, the Nationalists believe, they will try another invasion of Formosa.

Few Nationalist military men on Formosa last week thought the island could resist the Reds indefinitely without outside help. The only possible source of such help was the U.S. which, if it wanted to, could deny Formosa to the Communists at little risk to itself. By helping the Nationalists hold Formosa, the U.S. could help thwart further Communist expansion in Asia, at the same time acquire an important base in its Pacific security system. But as of last week, the U.S. did not seem interested.

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