The Time the CIA Ran an Airline in China
In the 1930s, as China battled Japan in the Second Sino - Japanese War, the United States sympathized with the Chinese, and imposed sanctions on Japan, including an embargo on oil and steel from Japanese companies. During World War Two, the US and China became formal allies in the fight against the Japanese regime following the attacks on Pearl Harbor. President Franklin D. Roosevelt decided to keep his presidency’s relationship with Chiang Kai-shek’s administration strictly tactical, as a good portion of the American public criticized Chiang’s leadership and corruption within the Nationalist government.
After Japan’s defeat in 1945, the Chinese Civil War between the Nationalists (Kuomintang, or KMT) and the Communists, led by Mao Zedong, resumed. The U.S. supported the Nationalists, providing military and economic aid, but was reluctant to become too deeply involved, due to pressure from the American public to stay neutral.
In 1949, the Communists emerged victorious, leading to the establishment of the People’s Republic of China (PRC) on October 1, 1949. The U.S. refused to recognize the PRC, continuing to support the Nationalist government, which had retreated to Taiwan. This was during the Cold War, when America was totally freaked out by anything Communist. They saw the new Communist state to be a huge threat to democracy across the region, much like they did Cuba and the Soviet Union.
Relations between the U.S. and Communist China worsened with the outbreak of the Korean War in 1950. China intervened in the war on the side of North Korea, fighting directly against U.S.-led United Nations forces. This solidified America’s viewpoint on China as the enemy. The US blocked the People’s Republic of China into the United Nations, and China became more and more secretive. At the same time, the newly minted hermit nation began its nuclear program, which put the United States on high alert.
As the West began to grow increasingly suspicious of China, they wanted to know what the heck they were doing over there. Many countries, but none more than the US, sent intelligence agents (spies) into China, often disguised as businessmen. The Chinese weren’t stupid - they knew this. They were on high alert for espionage, and spies were punished harshly. Anyone arriving by air, sea, or rail were put under deep scrutiny for any ties with the West. It was not easy to spy there, but the US was determined.
With a fleet of DC-4s and DC-6s, and later Convair 880s and 727s, CAT flew passengers across China, the Korean Peninsula, and Japan. They operated like a normal airline - they had good food and fine wines in first class, top tier crews, and well trained pilots. Only a few top executives knew the true nature and ownership of the company. The purpose of the CIA’s ownership was to secretly pull the operational strings to make it easier for undercover American spies and other “diplomats” to travel within China, facing less scrutiny then Chinese state owned airlines.
While the exact numbers aren’t known, it’s estimated that thousands of spies flew CAT over the years, and the CIA claims none of them were ever ousted by the Chinese government during their travels.
As the 1960s came to a close, the American government felt that the CAT was just not valuable enough for them to maintain. Never once did it turn a profit, and so it was completely kept afloat by America’s tax money. In February of 1968, just weeks before they planned to cease operations, their sole remaining aircraft (a B727) crashed in Northern Taiwan while flying between Hong Kong and Taipei. The airline officially closed the following day and the CIA dissolved the shell company. Shortly thereafter, the operation was declassified.
