To the Editor:
In “Beijing 1947” [July], Michael Loewe mentions the raging inflation under the Nationalist government of Chiang Kai-shek in the years following World War II. Seeing this inflation firsthand, as I had occasion to do in April 1948, was a sobering experience. When a nation’s currency becomes worthless, it is more than an economic disaster: civil and moral structures also break down.
From 1946 to 1948 I served with the 11th Airborne Division and saved up a month’s leave to spend in China. In the course of my trip to Shanghai and Beijing, I discovered it was a dangerous time indeed. American military personnel were frequently assaulted and killed in Shanghai, and we were warned to keep to well-lighted streets. Vice was rampant, and desperate refugee women from all over postwar Europe and Asia Minor were available everywhere.
But the monetary debacle is what remains most vividly in my mind. In that month of April, the official rate of exchange was 470,000 Chinese dollars to one American dollar and it rose hourly. The black market was so widespread that only a fool would exchange money at the official rate. The money came in stacks of ten 1,000-dollar notes. My room boy at the hotel would get money for me at 100,000 Chinese dollars—and higher—over the official rate. My first week’s bill at the hotel was over 35 million dollars, and it took two trips to the cashier with a full suitcase to pay it. Although it was against the law for merchants to accept other currency, this rule was flouted in virtually every shop. After checking for the presence of police, shopkeepers would snatch American dollars to add to their hoard, and One could get sensational bargains. Eventually, after I left, the exchange rate went to over a million to one, and the money was finally recalled. It cost more to print than it was worth.
When I was there, Beijing was much as Mr. Loewe describes it. Mao’s Communist army was only 50 miles away and gunfire could be heard in the distance. Those were exciting times in and around the Forbidden City, the Temple of Heaven, the summer and winter palaces, the Jade Buddha. I thank Michael Loewe for recapturing them for me.
Stanley P. Kessel