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Against Disaffection. The Nationalists' 300-plane air force, commanded by amiable General Chou Chih-jou, could be Formosa's most effective defense (so far, the
Reds have fought without planes), but until recently Chou was plagued with disaffection among his airmen. Last week in Taipeh, Chou opened a lengthy "self-examination" meeting where airmen could talk over their personal worries with top brass. He is also promoting better housing for their families, now thinks that the morale problem is on the way to being solved.
Disaffection has also considerably weakened the Nationalist navy. Following the lead of turncoat airmen, sailors, have surrendered at least twelve ships (including the navy's only cruiser, the Chungking, formerly the British Aurora) to the Communists. To combat disloyalty, chubby Admiral Kwei Yung-ching has clamped several senior captains in irons. He has also promoted relatively liberal pay raises, hopes that what is left of his navy is loyal.
Crucial Front. Beyond its shaky defenses, the specter that haunts Formosa is economic collapse. If Nationalist military expenditures cannot be held within the limits of Formosa's productive capabilities, the Communists might just as well be invited to come on over unopposed. As General Sun says: "If prices double, we get just half the food we need for our men. What do you think will happen if we can't feed our men and their families?"
The commander on the economic front is indefatigable, Princeton-trained Governor K. C. Wu, former mayor of Shanghai. To set a good example, Chain-Smoker Wu gave up cigarettes because "cigarettes are smuggled into Formosa, and represent, therefore, a drain on our financial structure." Since he became Formosa's governor last December, Wu has stopped speculation with government payrolls by military and civilian bureaucrats. He has tried resolutely to tap wealth. Automobiles have been classed as luxuries, and their owners must now buy a certain amount of war bonds; residents applying for passports must purchase bonds equal to the amount of their transportation costs; taxes on restaurant meals and motion pictures have been upped from 20% to 60%.
The real key to a stable economy is industrial expansion. In this field, Wu is pressing as hard as he can with the limited means at his disposal. Formosa's power plants have reached the peak levels of production achieved under the Japanese. Cement production has surpassed the best Japanese mark. The island's meager foreign exchange has been reinvested in irrigation projects for richer crops. But even the most enthusiastic Nationalist admits that all of this will eventually come to naught unless Formosa receives more financial and technical aid from the U.S.
Like other Nationalist leaders, honest Governor Wu is conscious that the U.S. Government, to put it kindly, is impatient with Nationalist shortcomings. He answers: "When your heart is for reform, you must sometimes be patient." And if the Reds take Formosa as they have taken China, what price reform?