Next | ToC | Prev
Copies of NSAMs 263 and 273,
and Some Primary Supporting Documents
Contained herein are copies of National Security Action Memorandum Number 263 (10/11/63), Number 273 (11/26/63), and some of their primary supporting documents. These representations are taken from Foreign Relations of the United States, Volume IV, Vietnam August-December 1963 (Dept. of State Publication 9857), published in 1991 by the U.S. Government Printing Office, Washington, D.C. 20402.
Fletcher describes his participation as one of General Krulak's principal writers for the text that became NSAM 263 beginning on page 70, JFK Prepares To Get Out Of Vietnam: The Taylor/McNamara Trip Report of October 1963 and NSAM 263. As explained in the first paragraph of the Preface of FRUS, vol IV:
The publication Foreign Relations of the United States constitutes the official record of the foreign policy of the United States. The volumes in the series include, subject to necessary security considerations, all documents needed to give a comprehensive record of the major foreign policy decisions of the United States together with appropriate materials concerning the facts that contributed to the formulation of policies.
In early 1992, after learning about the existence of this new publication from Fletcher, I obtained a copy and studied portions of it. We were discussing the prevalence of journalists and university professors who themselves are not acquainted with such historically precise information. Fletcher summed up the situation in this way:
I was doing a TV show to Australia, live, night before last. And there was a man from Los Angeles talking about the subject [JFK and Vietnam], and, my word he hadn't even read this book. At the end of the show the man from Australia -- the host of the show -- asked me, "What do think is going to be the value of opening the files with respect to the Kennedy murder?" I replied, "I can't see it being worth a darn. Here we are listening to people who haven't even cracked the books that are opened, and if they have, they don't understand what's in them. I don't see that this will make a damn bit of difference. If people aren't going to read books that are available, why talk about reading books that aren't available?"
This is the key to this subject. If people don't read material like this -- where one can see that 263 is completely spelled out. All of the meetings that were held -- there were over 50 meetings held before NSAM 263 was published. And here are these uninformed people that are professors in college, important writers in big magazines, and they haven't even read this primary source material.
Signed by President Johnson four days after President Kennedy's murder, NSAM 273 was extraordinarily significant given the fact that for the first time the stated goal of the U.S. was altered to be that of helping the South Vietnamese government win the war:
It remains the central object of the United States in South Vietnam to assist the people and Government of that country to win their contest against the externally directed and supported Communist conspiracy.
This sort of wording was something President Kennedy had steadfastly vetoed when it had been proposed by some of his military advisors a number of times in the past. Thus NSAM 273 explicitly delineated the beginning of the reversal of JFK's policy that had begun to take explicit shape with the signing of NSAM 263. This despite the fact that one of LBJ's most common phrases after the assassination and during his 1964 campaign was "let us continue." This breach was further obfuscated by such statements as "It remains the central object of the United States in South Vietnam . . . " Such declarations indicated the discontinuity with events that were unfolding and being directed by President Kennedy prior to November 22, 1963.
The following is an outline of the documents included in this Appendix. Each is listed by the number they appear as in the Foreign Relations of the United States, Volume IV, Vietnam August-December 1963:
This recorded JFK's approval of withdrawing 1,000 U.S. military personnel by the end of 1963, as well as other recommendations from the Taylor/McNamara Memo (doc. 167) which included withdrawal of "the bulk of U.S. personnel by . . . the end of 1965."
167. Memorandum From the Chairman of the Joint Chiefs of Staff
(Taylor) and the Secretary of Defense (McNamara) to the President
169. Summary Record of the 519th Meeting of the National Security
Council, White House, Washington, October 2, 1963, 6 p.m.
170. Record of Action No. 2472, Taken at the 519th Meeting of the
National Security Council, Washington, October 2, 1963
179. Memorandum for the Files of a Conference With the President,
White House, Washington, October 5, 1963, 9:30 a.m.
181. Telegram From the Department of State to the Embassy in Vietnam
331. National Security Action Memorandum No. 273
321. Memorandum of Discussion at the Special Meeting on Vietnam,
Honolulu, November 20, 1963
NSAM No. 263
194. National Security Action Memorandum No. 263 
At a meeting on October 5, 1963, the President considered the recommendations contained in the report of Secretary McNamara and General Taylor on their mission to South Vietnam.
The President approved the military recommendations contained in Section I B (1-3) of the report, but directed that no formal announcement be made of the implementation of plans to withdraw 1,000 U.S. military personnel by the end of 1963.
After discussion of the remaining recommendations of the report, the President approved an instruction to Ambassador Lodge which is set forth in State Department telegram No. 534 to Saigon.
- Source: Department of State, S/S-NSC Files: Lot 72 D 316, NSAMs. Top Secret; Eyes Only. The Director of Central Intelligence and the Administrator of AID also received copies. Also printed in United States-Vietnam Relations, 1945-1967, Book 12, p. 578.
- See Document 179.
- Document 181.
167. Memorandum From the Chairman of the Joint Chiefs of Staff
(Taylor) and the Secretary of Defense (McNamara) to
the President 
Your memorandum of 21 September 1963  directed that General Taylor and Secretary McNamara proceed to South Vietnam to appraise the military and para-military effort to defeat the Viet Cong and to consider, in consultation with Ambassador Lodge, related political and social questions. You further directed that, if the prognosis in our judgment was not hopeful, we should present our views of what action must be taken by the South Vietnam Government and what steps our Government should take to lead the Vietnamese to that action.
Accompanied by representatives of the State Department, CIA, and your Staff, we have conducted an intensive program of visits to key operational areas, supplemented by discussions with U.S. officials in all major U.S. Agencies as well as officials of the GVN and third countries.
I. CONCLUSIONS AND RECOMMENDATIONS
4. Although some, and perhaps an increasing number, of GVN military officers are becoming hostile to the government, they are more hostile to the Viet Cong than to the government and at least for the near future they will continue to perform their military duties.
5. Further repressive actions by Diem and Nhu could change the present favorable military trends. On the other hand, a return to more moderate methods of control and administration, unlikely though it may be, would substantially mitigate the political crisis.
6. It is not clear that pressures exerted by the U.S. will move Diem and Nhu toward moderation. Indeed, pressures may increase their obduracy. But unless such pressures are exerted, they are almost certain to continue past patterns of behavior.
1. General Harkins review with Diem the military changes necessary to complete the military campaign in the Northern and Central areas (I, II, and III Corps) by the end of 1964, and in the Delta (IV Corps) by the end of 1965. This review would consider the need for such changes as:
f. A consolidation of the strategic hamlet program, especially in the Delta, and action to insure that future strategic hamlets are not built until they can be protected, and until civic action programs can be introduced.
2. A program be established to train Vietnamese so that essential functions now performed by U.S. military personnel can be carried out by Vietnamese by the end of 1965. It should be possible to withdraw the bulk of U.S. personnel by that time.
3. In accordance with the program to train progressively Vietnamese to take over military functions, the Defense Department should announce in the very near future presently prepared plans to withdraw 1000 U.S. military personnel by the end of 1963. This action should be explained in low key as an initial step in a long-term program to replace U.S. personnel with trained Vietnamese without impairment of the war effort.
a. Continue to withhold commitment of funds in the commodity import program, but avoid a formal announcement. The potential significance of the withholding of commitments for the 1964 military budget should be brought home to the top military officers in working level contacts between USOM and MACV and the Joint General Staff; up to now we have stated $95 million may be used by the Vietnamese as a planning level for the commodity import program for 1964. Henceforth we could make clear that this is uncertain both because of lack of final appropriation action by the Congress and because of executive policy.
c. Advise Diem that MAP and CIA support for designated units, now under Colonel Tung's control (mostly held in or near the Saigon area for political reasons) will be cut off unless these units are promptly assigned to the full authority of the Joint General Staff and transferred to the field.
d. Maintain the present purely "correct" relations with the top GVN, and specifically between the Ambassador and Diem. Contact between General Harkins and Diem and Defense Secretary Thuan on military matters should not, however, be suspended, as this remains an important channel of advice. USOM and USIA should also seek to maintain contacts where these are needed to push forward programs in support of the effort in the field, while taking care not to cut across the basic picture of U.S. disapproval and uncertainty of U.S. aid intentions. We should work with the Diem government but not support it.
As we pursue these courses of action, the situation must be closely watched to see what steps Diem is taking to reduce repressive practices and to improve the effectiveness of the military effort. We should set no fixed criteria, but recognize that we would have to decide in 2-4 months whether to move to more drastic action or try to carry on with Diem even if he had not taken significant steps.
5. At this time, no initiative should be taken to encourage actively a change in government. Our policy should be to seek urgently to identify and build contacts with an alternative leadership if and when it appears.
6. The following statement be approved as current U.S. policy toward South Vietnam and constitute the substance of the government position to be presented both in Congressional testimony and in public statements.
a. The security of South Vietnam remains vital to United States security. For this reason, we adhere to the overriding objective of denying this country to Communism and of suppressing the Viet Cong insurgency as promptly as possible. (By suppressing the insurgency we mean reducing it to proportions manageable by the national security forces of the GVN, unassisted by the presence of U.S. military forces.) We believe the U.S. part of the task can be completed by the end of 1965, the terminal date which we are taking as the time objective of our counterinsurgency programs.
c. The political situation in Vietnam remains deeply serious. It has not yet significantly affected the military effort, but could do so at some time in the future. If the result is a GVN ineffective in the conduct of the war, the U.S. will review its attitude toward support for the government. Although we are deeply concerned by repressive practices, effective performance in the conduct of the war should be the determining factor in our relations with the GVN.
d. The U.S. has expressed its disapproval of certain actions of the Diem-Nhu regime and will do so again if required. Our policy is to seek to bring about the abandonment of repression because of its effect on the popular will to resist. Our means consist of expressions of disapproval and the withholding of support from GVN activities that are not clearly contributing to the war effort. We will use these means as required to assure an effective military program.
VI. OVERALL EVALUATION
From the above analysis it is clear that the situation requires a constant effort by the U.S. to obtain a reduction of political tensions and improved performance by the Vietnamese Government. We cannot say with assurance whether the effort against the Viet Cong will ultimately fail in the absence of major political improvements. However, it does seem clear that after another period of repressive action progress may be reduced and indeed reversed. Although the present momentum might conceivably continue to carry the effort forward even if Diem remains in power and political tensions continue, any significant slowing in the rate of progress would surely have a serious effect on U.S. popular support for the U.S. effort.
VII. U.S. LEVERAGES TO OBTAIN DESIRED CHANGES IN THE
U.S. personnel in Saigon might adopt an attitude of coolness toward their Vietnamese counterparts, maintaining only those contacts and communications which are necessary for the actual conduct of operations in the field. To some extent this is the attitude already adopted by the Ambassador himself, but it could be extended to the civilian and military agencies located in Saigon. The effect of such action would be largely psychological.
Together, USOM's Commodity Import Program (CIP) and the PL 480 program account for between 60 and 70 percent of imports into Vietnam. The commitment of funds under the CIP has already been suspended. CIP deliveries result in the generation of piastres, most of which go to the support of the defense budget. It is estimated that CIP pipelines will remain relatively large for some five or six months, and within this time period there would not be a serious material effect. Even within this period, however, the flow of piastres to support the defense budget will gradually begin to decline and the GVN will be forced to draw down its foreign exchange reserves or curtail its military expenditures.
Within the domestic economy the existing large pipelines would mean that there would be no material reason for inflation to begin in the short term period. However, the psychological effect of growing realization that the CIP program has been suspended might be substantial in 2-4 months. Saigon has a large number of speculative traders, and although there is considerable police effort to control prices, this might not be able to contain a general trend of speculation and hoarding. Once inflation did develop, it could have a serious effect on the GVN budget and the conduct of the war.
Apart from CIP, two major AID projects are up for final approval -- the Saigon-Cholon Waterworks ($9 million) and the Saigon Electric Power Project ($4 million). Suspension of these projects would be a possible means of demonstrating to Congress and the world that we disapprove of GVN policies and are not providing additional aid not directly essential to the war effort.
(1) USOM assistance to the Combat Police and USOM and USIS assistance to the Director General of Information and the ARVN PsyWar Program could be suspended. These projects involve a relatively small amount of local currency but their suspension, particularly in the case of USIS, might adversely affect programs which the U.S. wishes to see progress.
(2) However, there would be merit in a gesture aimed at Colonel Tung, the Special Forces Commander, whose forces in or near Saigon played a conspicuous part in the pagoda affair and are a continuing support for Diem. Colonel Tung commands a mixed complex of forces, some of which are supported by MAP and others presently through CIA. All of those now in or near Saigon were trained either for combat missions or for special operations into North Vietnam and Laos. Purely on grounds of their not being used for their proper missions, the U.S. could inform Diem that we would cut off MAP and CIA support unless they were placed directly under Joint General Staff and were committed to field operations.
The practical effect of the cut-off would probably be small. The equipment cannot be taken out of the hands of the units, and the pay provided to some units could be made up from the GVN budget. Psychologically, however, the significance of the gesture might be greater. At the least it would remove one target of press criticism of the U.S., and would probably also be welcomed by the high military officers in Vietnam, and certainly by the disaffected groups in Saigon.
We have weighed this cut-off action carefully. It runs a risk that Colonel Tung would refuse to carry out external operations against the Lao corridor and North Vietnam. It might also limit CIA's access to the military. However, U.S. liaison with high military officers could probably be fully maintained through the U.S. military advisors. On balance, we conclude that these possible disadvantages are outweighed by the gains implicit in this action.
(3) Consideration has been given both by USOM and the military (principally the JCS in Washington) to the possibility of redirecting economic and military assistance in such a fashion as to bypass the central government in Saigon. Military studies have shown the technical feasibility, though with great difficulty and cost, of supplying the war effort in the countryside over lines of communications which do not involve Saigon, and it is assumed that the same conclusions would apply to USOM deliveries to the filed under the rural strategic hamlet program. However, there is a consensus among U.S. agencies in Saigon that such an effort is not practical in the face of determined opposition by the GVN unless, of course, a situation had developed where the central government was no longer in control of some areas of the country. Nor is it at all clear that such diversion would operate to build up the position of the military or to cut down Nhu's position.
Although the capability of USIS to support the United States campaign of pressure against the regime would be small, the Ambassador believes consideration must be given to the content and timing of the United States pronouncements outside the country. He has already suggested the use of the Voice of America in stimulating, in its broadcasts to Vietnamese, discussions of democratic political philosophies. This medium could be used to exploit a wide range of ascending political pressure. In addition, a phased program of United States official pronouncements could be developed for use in conjunction with the other leverages as they are applied. We must recognize the possibility that such actions may incite Diem to strong countermeasures.
Coupled with all the above there is the implicit leverage embodied in our constantly making it plain to Diem and other that the long term continuation of military aid is conditioned upon the Vietnamese Government demonstrating a satisfactory level of progress toward defeat of the insurgency.
A program of limited pressures, such as the CIP suspension, will not have large material effects on the GVN or the war effort, at least for 2-4 months. The psychological effects could be greater, and there is some evidence that the suspension is already causing concern to Diem. However, the effect of pressures that can be carried out over an extended period without detriment to the war effort is probably limited with respect to the possibility of Diem making necessary changes.
We have not analyzed with care what the effect might be of a far more intensive level of pressure such as cessation of MAP deliveries or long continued suspension of the commodity import program. If the Diem government should fail to make major improvements, serious consideration would have to be given to this possible course of action, but we believe its effect on the war effort would be so serious -- in psychological if not in immediate material terms -- that it should not be undertaken at the present time.
VIII. COUP POSSIBILITIES
The prospects of an early spontaneous replacement of the Diem Regime are not high. The two principal sources of such an attempt, the senior military officers and the students, have both been neutralized by a combination of their own inability and the regime's effective countermeasures of control. The student organizations have been emasculated. The students themselves have displayed more emotion than determination and they are apparently being handled with sufficient police sophistication to avoid an explosion.
Diem/Nhu are keenly aware of the capability of the generals to take over the country, utilizing the tremendous power now vested in the military forces. They, therefore, concentrate their manipulative talent on the general officers, by transfers, and by controls over key units and their locations. They are aware that these actions may reduce efficiency, but they tolerate it rather than risk the prospect that they be overthrown and their social revolution frustrated. They have established a praetorian guard to guarantee considerable bloodshed if any attack is made. The generals have seen slim hope of surmounting these difficulties without prohibitive risk to themselves, the unity of the Army and the Establishment itself.
Despite these unfavorable prospects for action in the short term, new factors could quickly arise, such as the death of Diem or an unpredictable and even irrational attack launched by a junior officer group, which would call urgently for U.S. support or counteraction. In such a case, the best alternative would appear to be the support of constitutional continuity in the person of the Vice President, behind whom arrangements could be developed for a more permanent replacement after a transitional period.
The prospects that a replacement regime would be an improvement appear to be about 50-50. Initially, only a strongly authoritarian regime would be able to pull the government together and maintain order. In view of the pre-eminent role of the military in Vietnam today, it is probable that this role would be filled by a military officer, perhaps taking power after the selective process of a junta dispute. Such an authoritarian military regime, perhaps after an initial period of euphoria at the departure of Diem/Nhu, would be apt to entail a resumption of the repression at least of Diem, the corruption of the Vietnamese Establishment before Diem, and an emphasis on conventional military rather than social, economic and political considerations, with at least an equivalent degree of xenophobic nationalism.
Obviously, clear and explicit U.S. support could make a great difference to the chances of a coup. However, at the present time we lack a clear picture of what acceptable individuals might be brought to the point of action, or what kind of government might emerge. We therefore need an intensive clandestine effort, under the Ambassador's direction, to establish necessary contacts to allow the U.S. to continuously appraise coup prospects.
If and when we have a better picture, the choice will still remain difficult whether we would prefer to take our chances on a spontaneous coup (assuming some action by Diem and Nhu would trigger it) or to risk U.S. prestige and having the U.S. hand show with a coup group which appeared likely to be a better alternative government. Any regime that was identified from the outset as a U.S. "puppet" would have disadvantages both within South Vietnam and in significant areas of the world, including other underdeveloped nations where the U.S. has a major role.
In any case, whether or not it proves to be wise to promote a coup at a later time, we must be ready for the possibility of a spontaneous coup, and this too requires clandestine contacts on an intensive basis.
IX. ANALYSIS OF ALTERNATIVE POLICIES
1. Return to avowed support of the Diem regime and attempt to obtain the necessary improvements through persuasion from a posture of "reconciliation." This would not mean any expression of approval of the repressive actions of the regime, but simply that we would go back in practice to business as usual.
2. Follow a policy of selective pressures: "purely correct" relationships at the top official level, continuing to withhold further actions in the commodity import program, and making clear our disapproval of the regime. A further element in this policy is letting the present impression stand that the U.S. would not be averse to a change of Government -- although we would not take any immediate actions to initiate a coup.
3. Start immediately to promote a coup by high ranking military officers. This policy might involve more extended suspensions of aid and sharp denunciations of the regime's actions so timed as to fit with coup prospects and planning.
We believe that this course of action would be ineffective from the standpoint of events in South Vietnam alone, and would also greatly increase our difficulties in justifying the present U.S. support effort both to the Congress and generally to significant third nations. We are most unlikely, after recent events, to get Diem to make the necessary changes; on the contrary, he would almost certainly regard our reconciliation as an evidence that the U.S. would sit still for just about anything he did. The result would probably be not only a continuation of the destructive elements in the Regime's policies but a return to larger scale repressions as and when Diem and Nhu thought they were necessary. The result would probably be sharp deterioration in the military situation in a fairly short period.
We have examined numerous possibilities of applying pressures to Diem in order to incline him to the direction of our policies. The most powerful instrument at our disposal is the control of military and economic aid but any consideration of its use reveals the double-edged nature of its effects. Any long-term reduction of aid cannot but have an eventual adverse effect on the military campaign since both the military and the economic programs have been consciously designed and justified in terms of their contribution to the war effort. Hence, immediate reductions must be selected carefully and be left in effect only for short periods.
We believe that the present level of pressures is causing, and will cause, Diem some concern, while at the same time not significantly impairing the military effort. We are not hopeful that this level (or indeed any level) of pressure will actually induce Diem to remove Nhu from the picture completely. However, there is a better chance that Diem will at least be deterred from resuming large scale oppressions.
At the same time, there are various factors that set a time limit to pursuing this course of action in its present form. Within 2-4 months we have to make critical decisions with the GVN about its 1964 budget and our economic support level. In addition, there is a significant and growing possibility that even the present limited actions in the economic field -- more for psychological than for economic reasons -- would start a wave of speculation and inflation that would be difficult to control or bring back into proper shape. As to when we would reverse our present course, the resumption of the full program of economic and military aid should be tied to the actions of the Diem government.
As a foundation for the development of our long-term economic and military aid programs, we believe it may be possible to develop specific military objectives to be achieved on an agreed schedule. The extent to which such objectives are met, in conjunction with an evaluation of the regime's political performance, would determine the level of aid for the following period.
On balance we consider that the most promising course of action to adopt at this time is an application of selective short-term pressures, principally economic, and the conditioning of long-term aid on the satisfactory performance by the Diem government in meeting military and political objectives which in the aggregate equate to the requirements of final victory. The specific actions recommended in Section I of this report are consistent with this policy.
Secretary of Defense 
- Source: Kennedy Library, National Security Files, Vietnam Country Series, Memos and Miscellaneous. Top Secret. Also printed in United States-Vietnam Relations, 1945-1967, Book 12, pp. 554-573.
- Document 142.
- Mr. Colby believes that the official "correct" relationship should be supplemented by selected and restricted unofficial and personal relationships with individuals in the GVN, approved by the Ambassador, where persuasion could be fruitful without derogation of the official U.S. posture. [Footnote in the source text.]
- Mr. Sullivan (State) believes that a replacement regime which does not suffer from the overriding danger of Nhu's ambition to establish a totalitarian state (the control of which he might easily lose to the Communists in the course of his flirtations) would be inevitably better than the current regime even if the former did have the deficiencies described. [Footnote in the source text.]
- The source text bears no signatures.
169. Summary Record of the 519th Meeting of the National
Security Council, White House, Washington, October 2,
1963, 6 p.m. 
The President opened the meeting by summarizing where we now stand on U.S. policy toward Vietnam. Most of the officials involved are in agreement. We are not papering over our differences. We are agreed to try to find effective means of changing the political atmosphere in Saigon. We are agreed that we should not cut off all U.S. aid to Vietnam, but are agreed on the necessity of trying to improve the situation in Vietnam by bringing about changes there. Reports of disagreements do not help the war effort in Vietnam and do no good to the government as a whole. We must all sign on and with good heart set out to implement the actions decided upon. Here and in Saigon we must get ahead by carrying out the agreed policy. Because we are agreed, we should convey our agreement to our subordinates. There are no differences between Washington and Ambassador Lodge or among the State and Defense Departments and the CIA. Ambassador Lodge has full authority to pull into line all U.S. government representatives in Saigon.
The President then turned to consideration of the draft public statement (copy attached). He said that attacks on the Diem regime in public statements are less effective than actions which we plan to take. He preferred to base our policy on the harm which Diem's political actions are causing to the effort against the Viet Cong rather than on our moral opposition to the kind of government Diem is running.
Mr. Ball said that he and Secretary Rusk felt that there should be stress on the moral issues involved because of the beneficial effect which such emphasis produced in world public opinion, especially among UN delegates. The President replied that the major problem was with U.S. public opinion and he believed we should stress the harm Diem's policies are doing to the war effort against the Communists.
Mr. Bundy said Secretary McNamara and General Taylor wanted to emphasize the objective of winning the war. State Department officials wanted something more than an objective of merely winning the war. Mr. Harriman commented that he was prepared to accept the language as proposed.
The President objected to the phrase "by the end of this year" in the sentence "The U.S. program for training Vietnamese should have progressed to the point where 1000 U.S. military personnel assigned to South Vietnam could be withdrawn." He believed that if we were not able to take this action by the end of this year, we would be accused of being over optimistic.
Secretary McNamara said he saw great value in this sentence in order to meet the view of Senator Fulbright and others that we are bogged down forever in Vietnam. He said the sentence reveals that we have a withdrawal plan. Furthermore, it commits us to emphasize the training of Vietnamese, which is something we must do in order to replace U.S. personnel with Vietnamese.
The draft announcement was changed to make both of the time predictions included in paragraph 3 a part of the McNamara-Taylor report rather than as predictions of the President.
Mr. Bundy raised the question as to Ambassador Lodge's view of the proposed draft policy statement. He said Ambassador Lodge could be told that because of the time pressure it had not been possible to clear the statement with him, but that it was felt here it would meet his requirements.
The President then asked about the measures which we would take to bring pressure on Diem. Secretary McNamara replied that a working group would propose recommendations for the President's decision at a later date.
The President directed that no one discuss with the press any measures which he may decide to undertake on the basis of the recommendations to be made to him. He said we should not talk about such measures until they are agreed. The selected cuts in U.S. assistance should be discussed only in the Cabinet Room until all of them were finally agreed upon.
In response to a question by Administrator Bell, the President said he should reply to inquiring Congressmen that we are continuing our present aid schedule. After a further exchange, the President made clear that what he thought we should tell the Congressmen should be limited to saying that aid which we are now extending would be continued. He recognized that aid we are now extending is not that we had been extending prior to the August disturbances.
Secretary McNamara felt that Mr. Bell should say nothing. The group would return to the President by Friday with specific recommendations.
The President then asked what we should say about the news story attacking CIA which appeared in today's "Washington Daily News." He read a draft paragraph for inclusion in the public statement but rejected it as being too fluffy. He felt no one would believe a statement saying that there were no differences of view among the various U.S agencies represented in Saigon. He thought that we should say that now we had a positive policy endorsed by the National Security Council and that such policy would be carried out by all concerned.
Mr. Bundy suggested the President direct everyone present not to discuss the paper. Now that a policy decision had been made, we should be absolutely certain that no one continues to talk to the press about differences among U.S agencies.
After the President left the meeting, there was a discussion as to how to put into final form the recommendations for the President. It was decided that a sub-group would make more precise the recommendations contained in paragraph 4, and that the group of principals would meet the following day in the absence of the President in order to prepare a paper for him to consider on Friday.
The only substantive point that came out in this discussion was Secretary McNamara's belief that economic pressures against Diem should be undertaken over a longer period of time rather than a short period which would produce critical reactions in Saigon.
- Source: Kennedy Library, National Security Files, Meetings and Memoranda Series, NSC Meeting No. 519. Top Secret. This meeting took place in the Cabinet Room and lasted until 6:30 p.m., according to the President's Log. (Ibid.)
- Not attached, but see infra.
- Document 167.
- October 4.
- See footnote 3, Document 174.
170. Record of Action No. 2472, Taken at the 519th Meeting of
the National Security Council, Washington, October 2, 1963 
McNAMARA-TAYLOR REPORT ON VIETNAM 
b. Noted the President's approval of the following statement of U.S. policy which was later released to the press: 
"1. The security of South Viet Nam is a major interest of the United States as other free nations. We will adhere to our policy of working with the people and Government of South Viet Nam to deny this country to Communism and to suppress the externally stimulated and supported insurgency of the Viet Cong as promptly as possible. Effective performance in this undertaking is the central objective of our policy in South Viet Nam.
"3. Major U.S. assistance in support of this military effort is needed only until the insurgency has been suppressed or until the national security forces of the Government of South Viet Nam are capable of suppressing it.
"Secretary McNamara and General Taylor reported their judgment that the major part of the U.S. military task can be completed by the end of 1965, although there may be a continuing requirement for a limited number of U.S. training personnel. They reported that by the end of this year, the U.S. program for training Vietnamese should have progressed to the point where 1,000 U.S. military personnel assigned to South Viet Nam can be withdrawn.
"4. The political situation in South Viet Nam remains deeply serious. The United States has made clear its continuing opposition to any repressive actions in South Viet Nam. While such actions have not yet significantly affected the military effort, they could do so in the future.
"5. It remains the policy of the United States, in South Viet Nam as in other parts of the world, to support the efforts of the people of that country to defeat aggression and to build a peaceful and free society."
- Source: Department of State, S/S-NSC Files: Lot 70 D 265, NSC Meetings. Secret.
- Document 167.
- Printed in Public Papers of the Presidents of the United States: John F. Kennedy, 1963, pp. 759-760. McGeorge Bundy sent Lodge the following telegram explaining this statement:
"Statement issued after NSC meeting today represents President's own judgment of common purpose and policy established by you and McNamara mission and is designed to strengthen your hand in next phase.
"Urgency of immediate public proof of unity here prevented prior reference to you but President asked me to insure that if you need any adjustment or modification you let us know." (CAP 63556, October 3; Kennedy Library, National Security File, Vietnam Country Series, State Cables)
Lodge responded in telegram 624 from Saigon: "The statement is excellent in substance and well-tempered in tone. I am proud to be associated with it." (Ibid.)
179. Memorandum for the Files of a Conference With the
President, White House, Washington, October 5, 1963,
9:30 a.m. 
A conference on South Vietnam was held in the Cabinet Room at 9:30 a.m., October 5, 1963. Present were the Vice President, Secretary Rusk, Secretary McNamara, Under Secretary Harriman, General Taylor, Mr. McCone, Administrator Bell, Mr. Bundy and Mr. Forrestal.
The President asked what would be the impact of a suspension of the Commodity Import Program. Mr. Bell replied that the Commodity Import Program accounted for approximately 40 percent of South Vietnam's imports. He emphasized that the real effect of a suspension would be an interruption of the flow of commodities into the country. A suspension would not necessarily have an impact upon the government budget. A continued suspension, however, would have a serious effect on the economy.
Mr. McCone said that he believed that the principal effect of a suspension would be to cause an economic crisis in the Saigon business community. This would be more pronounced than the political effects such a suspension might have upon Diem and Nhu.
Mr. Bell replied that a suspension of these projects would not have an effect upon the economy or upon the military effort. But, he pointed out, both projects were already started and near their final stages of completion. The water project was complete except for the construction of a filtration plant; and the power station needed only a building to house the turbines, which had already been ordered. The President suggested that the contractors in each case simply be told that a decision on the final stages of the two projects would be delayed for policy reasons for an indefinite, but not necessarily long, period of time. Our public posture should be that the two projects were being suspended for further review.
The President noted that the recommendations with respect to the PL 480 program were tantamount to taking no substantive action at this time. In this connection he suggested that, for the present, we say only that we were not in a position to make forward decisions.
The discussion then turned to recommendations concerning a suspension of assistance to those forces under Colonel Tung which were located in Saigon rather than in the field. The President emphasized that we should make clear the basis upon which we were suspending aid to these forces, i.e. that they were not directly contributing to the war effort and therefore we could not support them.
The President asked Secretary McNamara for his opinion on the nature of the controversy between the Buddhists and the Government. Secretary McNamara replied that in his opinion the controversy was now more political than it was religious.
After a discussion with General Taylor, the President observed that the military improvements which we wished to press upon Diem be taken up as soon as possible by General Harkins rather than by Ambassador Lodge. It would be preferable if discussions of political improvements and possible U.S. pressure actions were undertaken by Ambassador Lodge. The President also said that we should not consider the political recommendations to be in the nature of a hard and fast list of demands, and that this point should be made more clear in the draft instructions. The most likely and desirable result of any U.S. pressures would be to bring Diem to talk seriously to Lodge about the whole range of issues between us.
The Secretary of State agreed that the military matters should be pressed and that they stood the best chance of being accepted by the GVN. Nevertheless, he felt that we should not forget the importance of obtaining an improvement in the political climate in Saigon.
The President said that no formal or public statement should be made at the conclusion of the meeting. Instead he felt that the Secretaries of State and Defense in executive session before Congressional committees next week should confine themselves to saying that U.S. programs were under continuing review in light of the President's previously announced policy that we supported those things which furthered the war effort and would not support those things which do not.
It was agreed that Section 5 of the McNamara/Taylor Report be approved and that appropriate instructions implementing the recommendation in this section be transmitted via CAS channels. Mr. McCone said that any such activity should be carried on under the tightest security under the direction of the CAS station chief. The President agreed, but added that these activities should be subject to the Ambassador's general guidance.
The President also said that our decision to remove 1,000 U.S. advisors by December of this year should not be raised formally with Diem. Instead the action should be carried out routinely as part of our general posture of withdrawing people when they are no longer needed.
There is attached to this memorandum a copy of the McNamara/Taylor report and the final telegraphic instructions to Ambassador Lodge.
- Source: Kennedy Library, National Security Files, Meetings and Memoranda Series, Meetings on Vietnam. Top Secret. Drafted by Forrestal on October 7. Forrestal sent this memorandum to Bromley Smith under cover of a memorandum of October 8 which reads in part as follows:
"I also attach a draft NSAM together with a memorandum to Secretary McNamara. If the NSAM looks okay to you, will you shoot it off to McNamara for his clearance?
"Should copies of the NSAM go to anybody else (Secretary Dillon, the Attorney General, the Vice President)? I should think perhaps not."
Smith indicated on the memorandum that he had obtained McNamara's clearance and agreed with Forrestal that no copies should be sent to any one else. The draft NSAM referred to comprised a draft report to the NSC, October 4 (see footnote 3, Document 174), an annex to the report (Document 175), and a draft of telegram 534 to Saigon (Document 181), which was essentially the draft report to the NSC in cable form.
- The changes made in the draft at the instruction of President are explained in the footnotes to Document 181. See also infra.
- Neither attached, but see Documents 167 and 181.
181. Telegram From the Department of State to the Embassy in
1. Following is overall instruction resulting from NSC consideration of McNamara/Taylor report and recommendations together with those you have submitted in recent weeks. These instructions have the President's personal approval. At any time you feel it is necessary you may state to GVN that you are acting under the specific instructions of the President as recommended by the National Security Council.
2. Actions are designed to indicate to Diem Government our displeasure at its political policies and activities and to create significant uncertainty in that government and in key Vietnamese groups as to future intentions of United States. At same time, actions are designed to have at most slight impact on military or counterinsurgency effort against Viet Cong, at least in short term.
3. The recommendations on negotiations are concerned with what US is after, i.e., GVN action to increase effectiveness of its military effort; to ensure popular support to win war; and to eliminate strains on US Government and public confidence. The negotiating posture is designed not to lay down specific hard and fast demands or to set a deadline, but to produce movement in Vietnamese Government along these lines. In this way we can test and probe effectiveness of any actions the GVN actually takes and, at same time, maintain sufficient flexibility to permit US to resume full support of Diem regime at any time US Government deems it appropriate.
4. We recognize that recommended actions cannot be continued more than a limited period -- tentatively estimated at two to four months -- before they begin to have substantial impact on counterinsurgency effort. Even within this period, they will require careful and constant evaluation. As they begin to have substantial impact on war effort, further major decisions will be needed.
5. It is not possible to specify with precision the criteria that we should use in determining whether this proposed course of action has brought about adequate changes in performance of Diem Government and should, therefore, be modified or withdrawn, or whether on contrary response of the Diem Government is clearly inadequate so that more drastic action should be considered. The desired GVN measures in this report are grouped under three headings: (1) military actions, (2) political actions, and (3) actions with respect to US itself. Test of adequacy of these actions should be whether, in combination, they improve effectiveness of GVN effort to point where we can carry on in confident expectation that war effort will progress satisfactorily. Since we cannot now foresee interlocking impact of possible actions both in GVN and here, we obviously do not expect that GVN will or even can perform on entire list and for this reason this is in no sense a package of demands. While general view here is that some action in each of three areas will be necessary, we do not now wish to prejudge question of balance or quantity of actions which may justify resumption of full cooperation with GVN.
6. AID Commodity Import Program. Existing suspension of new commitments will be maintained, and under this policy the presently due second-quarter allocation of $20-25 million will be withheld. You should make this continued suspension clear in an appropriate manner to the GVN.
No public announcement will be made. In addition, US working levels should inform Vietnamese military that commodity import assumptions being used for budget planning purposes must now be considered uncertain not only from previously stated standpoint of Congressional uncertainty, but because of executive review of program.
7. PL 480. Presently pending supplementary agreement for $2.9 million worth of condensed milk (5-months' requirement) will be handled by making month-to-month agreements for appropriate portions of this amount until further notice, but outright suspension will not be undertaken. Action on other pending items in PL 480 account will become due with respect to wheat flour ($6 million annually) and raw cotton ($12 million annually) approximately 1 November, and these items will then be submitted for action by Washington. Remainder of presently planned PL 480 for FY 1964, comprising tobacco ($2.5 million) and miscellaneous items ($2.5 million), does not require any action in next 60 days. Discussions with GVN on PL 480, especially with respect to food, should take note of fact that no deliveries are being held up or negative decisions made; we are simply not able to make forward decisions in October.
8. AID Project Loans. Presently pending balance of loan projects for Saigon-Cholon Waterworks ($10 million) and Saigon electric power project ($4 million) will be "suspended for review," and you should inform GVN in appropriate manner to this effect without making public announcement. If this becomes publicly known here or in field, explanation will be limited strictly to bare statement of suspension for review.
9. Assistance to Forces Commanded by Colonel Tung in or near Saigon. You should inform GVN, through whatever channel you deem appropriate, that US can no longer furnish support to these forces unless they are placed under effective operational control of Joint General Staff and committed to field operations. (This applies to MAP [less than 1 line not declassified] support for certain airborne ranger, Civil Guard, and "civilian airborne ranger" units.) Again no public announcement will be made, but if action becomes known explanation here and in field will be that we cannot assist forces that are not contributing to the war effort. Notion that action is a reprisal for political use of these forces should be discouraged.
Your policy toward the GVN of cool correctness in order to make Diem come to you is correct. You should continue it. However, we realize it may not work and that at some later time you may have to go to Diem to ensure he understands over-all US policy. Decision of when this becomes imperative rests with you, in light of your assessment of situation.
12. If, as we hope, Diem seeks clarification of US policies and actions, you should present an exposition of how our actions are related to our fundamental objective of victory. There are three issues at root of strained relations between GVN and US and of our judgment that victory may be jeopardized. The first concerns military effort; GVN must take steps to make this more effective. The second is crisis of confidence among Vietnamese people which is eroding popular support for GVN that is vital for victory. The third is crisis of confidence on the part of the American public and Government. Heart of problem is form of government that has been evolving in Viet-Nam. Diem's regime has trappings of democracy, but in reality it has been evolving into authoritarian government maintained by police terrorist methods. What GVN must do is to reverse this process of evolution.
13. To preserve flexibility and provide an opportunity for testing and probing on effectiveness of measures GVN actually takes, you should avoid laying down specific demands, but consider actions listed below as illustrative examples of general proposition outlined above, picking and choosing particular items as situation warrants.
15. Specific military actions listed below are probably most acceptable to Diem, but serve as a test of his commitment to furthering war effort. They should increase effectiveness of war effort and this in turn should feed back to improve political climate. We believe that burden of pressure for military actions should be assumed by General Harkins in direct conversation with Diem and others under your general guidance and that these conversations should not await initiative by Diem, since our continuing posture of cooperative consultation on military matters should not be broken. Conversely, Harkins should not be channel of a discussion on relation between improvements by GVN and resumption of full US support.
16. Political actions are not arranged in order of importance. First of political actions, i.e., entering into negotiations to normalize university life, etc., should set stage for later political actions, such as broadening government.
17. If, in fact, GVN does begin to move along lines we desire, an opportunity will be provided to test and probe effectiveness of the actions in improving war effort, ensuring popular support, and easing strain in GVN/US relations. Paramount need, however, is for GVN to set a psychological tone and image that will make specific actions both real and credible. Although we cannot at this time in complete confidence predict the exact point in this complex of actions at which we will be sure war effort will proceed to successful conclusion, it seems probable its achievement will require some restriction of role of Nhus. As practical matter, we would expect that Diem would not take such action at outset, but only after he had proceeded a considerable distance down the path we desire.
f. Consolidation of strategic hamlet program, especially in the Delta, and action to insure that future strategic hamlets are not built until they can be protected, and until civil action programs can be introduced.
a. Resumption of normal university life. Detained students should be released; school and university classes should be universally resumed. Diem should sit down with rector and faculty of Saigon University to work out conditions of normalization of university life. Since students are fearful of arrests and inclined to riots, this will involve significant negotiations on a variety of police-terrorist techniques, including secret arrests, torture, beatings, etc. For this reason, it is an excellent technique to get Diem to focus on the core issues. Similar action should be taken in regard to Hue University, including reinstatement of ex-rector. In both universities, at least some faculty members who have resigned, been fired or jailed should be reinstated.
b. Specific concessions should be made to Buddhists. Those still jailed should be processed for release with all possible speed. Repair of pagodas should be facilitated with government sponsorship. GVN-sponsored "Union Committee for Pure Buddhism" should be expanded and genuinely representative Buddhist leaders given responsible positions. Assembly action should eliminate laws which deny equal status to Buddhism.
c. Renewed activity in land reform program. This was an early Diem achievement but stopped short of completion. It could be revitalized and attract rural support for the GVN and improve its international image.
d. Joint re-emphasis on political aspects of strategic hamlet program. Phasing and security aspects of strategic hamlet program are dealt with under section 1 above. Following is concerned with aspects of strategic hamlet program affecting popular attitudes. This would require an effort to gain more support from peasants through increasing payments to them for their labor and other services and through weeding out graft by local officials. In addition, particularly in Delta, redesigning the program to avoid unnecessary relocation of population and increased emphasis on social and economic programs that are likely to elicit peasant support.
e. Police techniques. GVN should abandon its present practices of controlling populace by instilling fear through night-time arrests, brutal interrogation (including women) and other police-terrorist methods which contribute to growing resentment and unrest and diminishing acceptance of regime.
f. Civil liberties should be restored. Arbitrary arrests should cease and those arrested speedily released or given fair public trial. Religious freedom should be implemented as guaranteed by constitution. Public gatherings should be permitted and controlled only to insure safety of life and property.
g. Refurbishing GVN image. Government should be broadened so as to include respected individuals, including some within Viet- Nam who have not participated in government and some, such as Vu Van Mau, who have departed. It should be pointed out that these respected individuals are not likely to participate in government or return to Viet-Nam until changes such as those described above convince them that GVN has in fact reversed trend towards authoritarian government. Their willingness to accept posts in government or return to Viet-Nam will in turn be convincing evidence to mass of population that changes are, in fact, meaningful.
h. "Changes in personnel." Specific "reforms" described above are apt to have little impact without dramatic symbolic move which convinces Vietnamese that reforms are real. As practical matter this can only be achieved by some feasible reduction in influence of Nhus, who are -- justifiably or not -- a symbol of authoritarianism. Future role of Nhus in government is therefore of paramount importance. At this point it is impossible to tell whether Nhu must be permanently removed or merely confined to well-defined and limited role. In either case, some device must be found both to restrict his activities and to symbolize this restriction by his absence from power center in Saigon. In addition, similar devices must be found for those individuals, such as Colonel Tung, who are most closely associated with Nhu and his authoritarianism.
i. Public and official statement by Diem before National Assembly which would set new tone for government by pointing to steps being taken to respond to popular sentiment, and by making a call for total mobilization of effort on part of officials and people equally.
c. Cease undercover efforts to discredit the US and weaken the will of US individuals to give their full support to programs, e.g. "mendacious briefings" of GVN troops and rumors of physical danger to US families and other personnel.
22. At President's next press conference, he expects to repeat his basic statement that what furthers the war effort we support, and what interferes with the war effort we oppose. If questioned on actions US may take, he expects to say only that US programs are being reviewed to insure consistency with this policy.
23. Similar responses will be given if information about any US actions leads to detailed inquiries. If detailed inquiries pinpointing specific actions are made, they will be dealt with as indicated in each paragraph of A., above.
24. On Tuesday and Wednesday in meetings with Congressional committees in executive session, Rusk, McNamara and Bell will follow same line. They will explain our three-fold concern as outlined in para 5, above, but they will avoid as you should any listing of desired actions which could be construed as a package of US demands. We believe it of great importance that there should be no public impression of a package of sanctions and a package of demands. We are seeking necessary but limited improvements from a government very difficult to move, and we do not wish to encourage unjustified sense of optimism or of triumph from those who wish this situation was easier than it is. In particular, we would prefer press to consider us inactive than to trumpet a posture of "major sanctions" and "sweeping demands." (You should follow same line in briefing Zablocki Codel.)
25. Separate cables to Harkins and Brent lay out their areas of these instructions in detail. You should, of course, coordinate all actions by country team representatives. Suggest you pass this cable to them individually.
- Source: Department of State, Central Files, POL 15 S VIET. Top Secret; Immediate. Prepared by Hilsman with clearances of Harriman and Bundy. Cleared in draft with Rusk and McNamara. Regarding the drafting of this cable, see Document 179. Repeated to CINCPAC for POLAD exclusive for Felt.
- The last sentence in paragraph 5 was in neither the Draft Report to the NSC of October 4 nor the attached cable. Its inclusion reflects the President's concern as expressed at the 9:30 a.m. meeting of October 5; see Document 179. The changes noted in footnotes 3-6 below also reflect the President's concern.
- The last sentence in paragraph 8 is in neither the Draft Report to the NSC nor the draft cable.
- The last two sentences in paragraph 9 replace the following sentence in the Draft Report to the NSC and the draft cable: "Concurrently MACV should assume operational relationships with border surveillance and mountain scout forces [less than 1 line not declassified] commanded by Colonel Tung."
- The last two sentences of paragraph 15 were neither in the Draft Report to the NSC nor the draft cable.
- The draft of telegram 534 to Saigon expanded President Kennedy's statement: "that in line with this policy Secretary McNamara and General Taylor have recommended that certain programs be reviewed; and that, on your additional recommendation, a small number of programs have been held up in order to permit review to determine their consistency with policy he has enunciated. He will say all other programs are being continued, in line with US policy of supporting war effort against the Communist aggression."
The draft continues:
"In the meantime, you will have informed GVN through appropriate channels, as outlined in the section concerning actions above, of the steps US is taking."
"If, as a result of your actions, inquiries are made about the programs under review, by either GVN or press, replies will state that certain programs have been held up, on your recommendation, to permit review for consistency with policy President has enunciated of supporting what furthers war effort and opposing what interferes with it; and that the bulk of the programs, which clearly further war effort, are being continued.
"At some point, after you have appropriately informed GVN, and after the President has made the statements described above, inquiries concerning Tung's forces should be made with statement that, in line with its policy, United States has terminated support to certain military units which are not contributing to the prosecution of the war."
- October 8-9.
- Congressman Clement J. Zablocki chaired a special study mission to Southeast Asia, composed of members of the House Foreign Affairs Committee, which traveled to Laos, Malaysia, and Vietnam October 3-19. Also on the mission were Congressmen Harris B. McDowell, Jr., Ronald Brooks Cameron, William T. Murphy, William S. Broomfield, J. Irving Whalley, Vernon W. Thomson, and Peter H.B. Frelinghuysen. See Document 222.
- The Joint Chiefs of Staff sent Harkins and Felt these instructions in JCS 2792, October 5. The cable was substantively the same as the first three numbered paragraphs of section B of the Taylor-McNamara Report,Document 167. (Department of State, Central Files, POL 26 S VIET)
The instructions to Brent were in Aidto 915, October 5, and were essentially a reiteration of AID-related actions and tactics. (Ibid., AID (US) S VIET)
NSAM No. 273
331. National Security Action Memorandum No. 273 
The Secretary of State
The Secretary of Defense
The Director of Central Intelligence
The Administrator, AID
The Director, USIA
The President has reviewed the discussions of South Vietnam which occurred in Honolulu, and has discussed the matter further with Ambassador Lodge. He directs that the following guidance be issued to all concerned:
1. It remains the central object of the United States in South Vietnam to assist the people and Government of that country to win their contest against the externally directed and supported Communist conspiracy. The test of all U.S. decisions and actions in this area should be the effectiveness of their contribution to this purpose.
2. The objectives of the United States with respect to the withdrawal of U.S. military personnel remain as stated in the White House statement of October 2, 1963.
3. It is a major interest of the United States Government that the present provisional government of South Vietnam should be assisted in consolidating itself and in holding and developing increased public support. All U.S. officers should conduct themselves with this objective in view.
4. The President expects that all senior officers of the Government will move energetically to insure the full unity of support for established U.S policy in South Vietnam. Both in Washington and in the field, it is essential that the Government be unified. It is of particular importance that express or implied criticism of officers of other branches be scrupulously avoided in all contacts with the Vietnamese Government and with the press. More specifically, the President approves the following lines of action developed in the discussions of the Honolulu meeting of November 20. The offices of the Government to which central responsibility is assigned are indicated in each case.
5. We should concentrate our own efforts, and insofar as possible we should persuade the Government of South Vietnam to concentrate its efforts, on the critical situation in the Mekong Delta. This concentration should include not only military but political, economic, social, educational and informational effort. We should seek to turn the tide not only of battle but of belief, and we should seek to increase not only the control of hamlets but the productivity of this area, especially where the proceeds can be held for the advantage of anti-Communist forces.
6. Programs of military and economic assistance should be maintained at such levels that their magnitude and effectiveness in the eyes of the Vietnamese Government do not fall below the levels sustained by the United States in the time of the Diem Government. This does not exclude arrangements for economy on the MAP account with respect to accounting for ammunition, or any other readjustments which are possible as between MAP and other U.S. defense resources. Special attention should be given to the expansion of the import, distribution, and effective use of fertilizer for the Delta.
8. With respect to Laos, a plan should be developed and submitted for approval by higher authority for military operations up to a line up to 50 kilometers inside Laos, together with political plans for minimizing the international hazards of such an enterprise. Since it is agreed that operational responsibility for such undertakings should pass from CAS to MACV, this plan should include a redefined method of political guidance for such operations, since their timing and character can have an intimate relation to the fluctuating situation in Laos.
9. It was agreed in Honolulu that the situation in Cambodia is of the first importance for South Vietnam, and it is therefore urgent that we should lose no opportunity to exercise a favorable influence upon that country. In particular a plan should be developed using all available evidence and methods of persuasion for showing the Cambodians that the recent charges against us are groundless.
10. In connection with paragraphs 7 and 8 above, it is desired that we should develop as strong and persuasive a case as possible to demonstrate to the world the degree to which the Viet Cong is controlled, sustained and supplied from Hanoi, through Laos and other channels. In short, we need a more contemporary version of the Jorden Report, as powerful and complete as possible.
- Source: Johnson Library, National Security File, NSAM's. Top Secret. NSAM 273 grew out of the discussion at the November 20 Honolulu Conference. McGeorge Bundy wrote the ?rst draft and sent copies to Hilsman and William Bundy, asking for their opinions. In fact, Bundy's draft was almost identical to the ?nal paper. The major exception was paragraph 7 of the Bundy draft which reads as follows: "7. With respect to action against North Vietnam, there should be a detailed plan for the development of additional Government of Vietnam resources, especially for sea-going activity, and such planning should indicate the time and investment necessary to achieve a wholly new level of effectiveness in this ?eld of action. (Action: DOD and CIA)" (Kennedy Library, National Security Files, Vietnam Country Series, Memos and Miscellaneous) Bundy thought that President Kennedy and Lodge might want to discuss this paper during their planned meeting on November 24. Hilsman responded on November 23 in a memorandum to McGeorge Bundy that he thought the draft was "?ne" and he had made only minor changes. No record of Hilsman's changes have been found. (Ibid., Hilsman Papers, Country Series-Vietnam) Hilsman also sent a copy to Rusk under cover of a memorandum of November 23 and suggested the Secretary might ?nd it of use at the Cabinet meeting scheduled for that afternoon. (Department of State, Cabinet Meeting Files: Lot 68 D 350) At the November 23 Cabinet meeting, Vietnam was not discussed.
- See supra.
- Document 170.
- The Jorden report, entitled "A Threat to the Peace, North Viet-Nam's Effort To Conquer South Viet-Nam," was released by the Department of State on December 8, 1961. For documentation on the preparation and release, see vol. 1, pp. 282 ff.
321. Memorandum of Discussion at the Special Meeting on
Vietnam, Honolulu, November 20, 1963 
Ambassador Lodge described the outlook for the immediate future of Vietnam as hopeful. The Generals appear to be united and determined to step up the war effort. They profess to be keenly aware that the struggle with the Viet Cong is not only a military problem, but is also political and psychological. They attach great importance to a social and economic program as an aid to winning the war. The Generals believe that:
(2) The Strategic Hamlet Program has been pushed too rapidly and at too great a cost in human effort. More emphasis must be placed on the sociological aspects of the program. Existing strategic hamlets must be consolidated and improved. Any further wholesale expansion of the program should be deferred.
As far as political institutions are concerned, the Generals talk of facilitating the growth of political parties and of creating more courts and judges, but much of this seems theoretical. Western-educated urban elements expect progress in political liberalization and perhaps the Council of Sages will be able to do something to fulfill this need for political expression.
Ambassador Lodge doubted the wisdom of the U.S. making sweeping demands for democratization or for early elections at this time. He believed that in Vietnam the technique of changing governments by violent means is not yet ready to be displaced in favor of changing governments by election. He emphasized that if we can get through the next six months without a serious falling out among the Generals we will be lucky. However, the leading members of the Generals' group are modern-minded men who are at least aware of conditions in the modern world other than in the strictly military field. They evince a desire to react intelligently to the social, economic and political factors, and their performance to date in this sphere has been good. Americans -- whether in government or in the press -- should not seek to guide them at every turn nor try to get them to act as though they were made in our image. As long as they follow the course they have set for themselves, we should not push them too hard for several months. Since coming to power, the new leaders of Vietnam have acted with restraint. They have held down on arrests, have been willing to correct errors, and have avoided any wholesale purges throughout the governmental administration. Their handling of press and public relations generally is a great improvement. They are trying to please the public -- a rather new departure in Vietnam. Although the question of where the true power and influence lies will not become clear until the pulling and hauling of various personalities has made itself felt, the Generals appear to have really tried to have a big civilian element in the government.
In conclusion, Ambassador Lodge remarked that what we are really trying to do in Vietnam is to win the minds of the people. This includes not only the Generals and people who are currently living under RVN control, but also the Viet Cong. The problem is to convince the young VC soldier that if he continues to fight he will surely be killed, but that if he stops he will find that he and his family have an opportunity for a good life in peace and security. Problem thus is not only military, but economic, social and political as well.
For the first time in years the central government has the enthusiastic support of the urban population. However, in the final analysis the war will be won or lost in the country-side and to date the rural population is still apathetic.
The changed situation requires us to rethink our programs, civil and military. We must see whether and how our programs need changing. For example, with regard to our military programs, the question arises whether -- with a real chain of command, an improved fighting spirit, the commitment of troops to fight the VC instead of to static non-military missions -- present and proposed force levels are appropriate.
To take another example, in our economic programs aimed at the rural areas, we have developed procedures to deal directly with Province Chiefs. This was done largely because of the lassitude of the central bureaucracy and its apparent lack of interest in what happened in the countryside. Perhaps it is still wise to continue to by-pass Saigon so far as possible, but it would be well to review the question. We may be about to get a "new look" in the Saigon bureaucracy.
Finally, as regards all U.S. programs -- military, economic, psychological -- we should continue to keep before us the goal of setting dates for phasing out U.S. activities and turning them over to the Vietnamese; and these dates, too, should be looked at again in the light of the new political situation. The date mentioned in the McNamara-Taylor statement of October 2 on U.S. military withdrawal had -- and is still having -- a tonic effect. We should set dates for USOM and USIS programs, too. We can always grant last-minute extensions if we think it wise to do so.
Ambassador Lodge said all this is submitted in the belief that an American presence will be wanted -- and needed -- in Vietnam for some time in the future. But it should perhaps be a different kind of presence from what exists -- and is needed -- in Vietnam today.
Secretary Rusk asked whether we could expect to encourage the new government to move closer toward a true democracy without thereby reducing the main effort against the VC. Ambassador Lodge replied that as an example forced labor could be reduced although not entirely. He went on to say that while we can expect some progress toward democratic processes at the local village and hamlet level it is hard for him to imagine a sophisticated Western democracy emerging in Vietnam for some time to come.
Secretary Rusk asked if there was any way the U.S. could hope to prevent a future internal split between the Generals. Ambassador Lodge replied that this can best be accomplished by making sure that they understand what the U.S. considers would be best for their country. He noted that the Generals recognized the advantages of sticking together. In addition to other actions, the Ambassador said if we make it clear, for example, that we have confidence in General Minh it will materially help his position among his colleagues and probably will serve to retain him in his present position of authority. From his own conversation with Generals Minh, Don, and Kim, Ambassador Lodge is confident that they want to avoid any internal disputes among the members of the Military Revolutionary Council. These three key Generals believe that they can keep General Dinh under control. However, Ambassador Lodge is not too sure this is the case, as General Dinh, in addition to being Minister of Security, also commands the troops of III Corps.
General Taylor asked what were the present intentions of the military leaders with repect [sic] to the ultimate shape of the government. Ambassador Lodge replied that he believes that General Minh is sincere when he says that the Military Revolutionary Council is merely a provisional government. However, there is no political leadership emerging from the scene thus far and he doubts that it will come from any of the civilians who are now in the Cabinet. Ambassador Lodge re-emphasized his earlier recommendation that the U.S. not press the Generals too hard on political reforms and early elections. He would instead urge that the U.S. be patient and give the Generals a chance to get on with the war. Ambassador Lodge believes that they are sincere, that they have the good of their country at heart, and that they have a basically sound program.
General Harkins began by pointing out that despite what has appeared in the press, there is no difference of opinion between Ambassador Lodge and himself on the situation in Vietnam or on the conduct of the war against the VC. Ambassador Lodge expressed his complete agreement.
Turning to the military situation in Vietnam, General Harkins emphasized that the problem is one of people, not statistics. The problem is to win the people over to the full support of the war effort. Until the new government gets out in the field and talks to the people and learns their problems and true feelings, they can never hope to really win the war.
As for the statistics, after the coup VC incidents shot up to 300-400% of what they were before. However, after 6 November they dropped down to normal and have remained that way ever since. Similarly, the numbers of returnees under the Chieu Hoi program fell off markedly since early October. However, just this past week over 350 members of the Hoa Hao Sect have rallied to the government, as have a number of Cao Dais. At the same time, the Montagnard tribes are continuing to come out of the hills to seek the protection of the government. (About 220,000 had rallied to the government before the coup as a result of such programs as the CIDG. At present a total of about 400,000 Montagnards are under RVN control.)
The change of government has had a definite impact at the province level, where everything focuses on the Province Chief. These 42 key individuals have the real job of winning the people over to the support of the government. Perhaps even more important than the Province Chief is the District Chief, of whom there are over 253 throughout the country. As these officials are definitely associated with the old government insofar as the villager is concerned, we must expect that the new regime will probably want to reassign nearly all of them to emphasize the complete break with past policy.
As to the situation within the officer ranks generally, there is still much to be done. There remain a lot of deserving officers who should be promoted. General Minh is well aware of this point. The role of Generals Khanh and Tri in the II and I Corps, respectively, is still not clear although they have associated themselves with the objectives of the coup. General Minh intends to establish a more direct chain of command and insure that military orders will be carried out when received. This will be quite a change for the good as in the past a military order was seldom implemented until the responsible commander had checked it out through political channels back to the Palace.
The principal problems the new government faces are: first, the appointment of new Province and District Chiefs will inevitably complicate matters until these new officials are able to become acquainted with their areas of reponsibility [sic] and get on top of the local situation; second, the establishment of a straightforward military chain of command will, of course, involve some high level negotiations among the Generals themselves; third, the people in the rural areas still remain apathetic to the government; fourth, the support of the man in the village and hamlet will depend on whether the government can assure him security and do something to improve his current marginal existence.
Secretary Rusk asked how Province and District Chiefs were selected -- were they natives of the area to which they were assigned? General Harkins stated that the selection of these key officials was done by Generals Minh and Don in consultation with the Corps Commander concerned. He emphasized that those Province Chiefs who were being relieved would not be wasted; they would be reassigned to other positions where they could make use of their experience.
General Harkins emphasized again that we must expect that it will take a little time for things to settle down again after this change of administration. The new government is discovering a lot of things that it did not know. For example, some 50 tons of ammunition were found stored in the Presidential Guard barracks. Another problem the new government is considering, for example, is what to do with the gendarmérie. The question arises as to whether it is better to have these outstanding NCOs engaged in police functions primarily within the Capitol area, or whether they could better serve the nation by being reintegrated into the Army and sent out to fight the VC.
Mr. Brent took the lead on this item, noting the difficulties experienced with the Diem regime in its latter days and pointing out the opportunity which now existed for more effective collaboration between the U.S. and RVN under the new regime. The Generals are seeking means to improve government administration, to get the most out of U.S. aid, and to win the war as soon as possible.
Initial U.S. efforts in the economic field are directed toward encouraging the RVN to establish a central ministry for economic policy and planning, including all aspects of foreign aid. This idea has been well received by the Prime Minister and working level officials. The fact that the Prime Minister has already assumed direct responsibility for supervision of the Ministry of Finance and National Economy is a first step in this direction. The Prime Minister is well informed on the economic problems of his country. In an informal session with him on 7 November 1963, agreement in principle was reached on the following points, details to be worked out as circumstances permit:
c. A mixed U.S.-Vietnamese group can be established to study the economic situation, isolate problems, and recommend solutions. The RVN team would include Dean Thuc; the Minister of Rural Affairs, Mr. Quang; and the Director General of Planning, Mr. Diem.
Areas of priority attention would be taxation; exploitation of farmers, fishermen, and small artisans by middlemen; inefficient government procedures; use of foreign aid; joint U.S.-RVN budgeting; and marketing policies for rice, fish, and fertilizer.
The total requirements for U.S. aid remain large. Defense expenditures (including MAP) equal nearly 1/4 of the country's national income and substantially exceed the entire fiscal revenue of the central government. The Country Team recognizes the limitations on foreign aid funds imposed by Congress, but recommends maintenance of the FY 63 level in FY 64 and 65. Beside the economic rationale, it appears politically and psychologically necessary to extend at least the same measure of support to the new regime as was extended to Diem.
Upon U.S. recognition of the new RVN on 8 November, a commercial import and PL 480, Title I program were resumed to cover urgently required materials and items. An amendment to the PL 480, Title I program was negotiated to provide 4.3 million dollars worth of wheat flour and sweetened condensed milk.
Since the pipeline for essential commodities is refilled, our present posture is to carefully review specific requests of the RVN. Our intention is to maintain leverage and avoid the impression of giving a blank check. We are hopeful that a few months experience will allow negotiation of a more substantial installment of aid in return for RVN cooperation along lines desired by the U.S.
Two additional facts of the commercial import program should be mentioned. First, it was undoubtedly the realization that the U.S. could not be bluffed into restoring import financing that finally provided the spark that set off the coup. Second, there is no indication that the Vietnamese economy was harmed by the suspension in any fundamental respect. Prices of indigenously produced commodities pursued the usual seasonal patterns and price increases in imported commodities were anticipated with the notable exception of condensed milk and flour. Local production apparently was not seriously affected.
On the social side there are a number of encouraging signs. The new Minister of Security and the new Chief of Police both recognize that there must be an end to fear and hatred of the government. The police must be restrained and re-educated. This same concern for popular feeling has also been expressed by the new Minister of Information, the new Minister of Education, and by the new Minister of Labor. During Mr. Brent's calls upon six of the new Ministers, all have been unanimous in expressing their beliefs that the future of Vietnam must be determined by the people of Vietnam themselves.
As for the students and the Buddhists, both groups feel that as originators of events that led to the coup, they deserve special treatment. The Buddhist associations are being listened to by the new government and are exerting a calming influence. The students on the other hand, except in Hue, are demanding dismissals of governmental and educational officials and a number of other changes. They are organizing into associations with definite political objectives and may continue to be a problem. The new government hopes that they can be developed as a constructive force. In this connection, General Minh is working with a group of students for the establishment of a Vietnamese Peace Corps so that the younger generation can channel their energies into worthwhile civic action type activities.
Mr. Brent concluded that there is an entirely new spirit in Vietnam; that the new government is confident, but not overconfident; that it is warmly disposed toward the U.S., and, that we have opportunities to exploit that we never had before. The Vietnamese are soberly aware that if this present experiment fails there will probably be no second chance.
Secretary Rusk asked if the former Secretary of State at the Presidency, Mr. Thuan, was usable in the new government. Ambassador Lodge stated that Thuan would probably prefer some post outside of the country, and that Generals Minh and Don may well use him later as an Ambassador.
Secretary Rusk then asked to what extent the U.S. officials shared offices with Vietnamese compatriots. Mr. Brent replied that at the province level they do, but very little at the government level. Secretary Rusk stated that this might be desirable if the Vietnamese would agree.
Mr. William P. Bundy asked if the RVN had purchased milk and flour from France following the suspension of the CIP. Mr. Brent replied they had since U.S. supplies were not available for delivery in time to meet the government's requirements and since France was prepared to divert a ship for the purpose. However, after conversations with the Prime Minister, the RVN agreed to reduce these orders by 50% since the U.S. can now supply these commodities on the desired schedule.
Secretary McNamara then inquired as to the estimated size of the rice crop, to which Mr. Brent replied that they hope to have a 300,000 ton export this year, and that due to improved seed and fertilizer it could be approximately 30% more by next year. Secretary McNamara said it would be worth considering the diversion of a substantial amount of U.S. aid to provide more fertilizer and thereby increase rice production. For a relatively small dollar outlay for fertilizer we could raise the RVN's income from its rice exports appreciably. As it will probably not be possible for the new government to raise taxes, the only solution to its economic problem is to increase its exports. This means an increased requirement for fertilizer and seed. He asked the Group 1 subcommittee to look into this further. Mr Bell then asked if the new government would have to relax economic controls, or if it could take steps to raise additional taxes or to improve tax collection. Ambassador Lodge replied that it was too early to give an answer to this and Minister Trueheart added that while the RVN can improve tax collection, it would not be feasible to increase direct taxes on items in heavy demand such as milk, for example. Admiral Felt stated that there were some cases where the people were subjected to double taxation by both the government and the VC. Perhaps as the areas of VC control were reduced, the government might be able to increase its tax collections. Secretary McNamara said that we must be realistic. The new government cannot be expected to establish a standard of austerity too soon, nor can it count on much increased revenue from improved tax collection procedures. The only solution seems to be greater emphasis on increasing productivity in the export sector of the economy.
[Here follows discussion of agenda item A4, "Review of the Situation (Province Summaries)," given by Harkins. Harkins stated that while the Country Team considered all provinces critical, they singled out 13 which were "particularly critical because of their current problems." Those provinces were Quang Ngai, Binh Dinh, Phuoc Thanh, Binh Duong, Tay Ninh, Hau Nghia, Long An, Kien Tuong, Dinh Tuong, Kien Hoa, Chuong Thien, and An Xuyen. The state of this last province on the Ca Mau peninsula occasioned the more general discussion printed below.]
An Xuyen, on the extreme tip of the Ca Mau peninsula is safe in the cities, but the VC really own the province. They have been in control since the early forties. There is considerable production of rice and of charcoal, amounting to some $10 million a year. Much of this revenue is siphoned off by the VC. Some of the produce goes to Thailand and some to Singapore as well as to Saigon. MACV is investigating the feasibility of a combined naval-economic blockade to cut off the flow of revenue to the VC.
General Harkins emphasized the need for the RVN to get trained intelligence personnel into the strategic hamlets to identify the VC and keep them from forming Communist cells. Security of the informer is the key to the problem. Thus far there have not been sufficient military forces at the village level to make it safe for people to report on the VC. Secretary McNamara asked if the reason that so many strategic hamlets were not considered successful in the Delta was for security, economic, or political reasons, or all three. Mr. Fraleigh stated that they were unsuccessful in all three. However, in the northern areas of Vietnam 60% of the hamlets were considered successful.
Secretary McNamara said that he believed there were three things to do in the Delta: first, get the Chieu Hoi Program moving; second, get the fertilizer program going to increase output of rice; and third, and most important, improve the security of the strategic hamlets by arming the trained militia and increasing the number of militia.
General Taylor remarked that this discussion points up the fact that the war is different in each province. Perhaps we need joint U.S.-Vietnam province teams to attack the problem at the province level. He asked if the criticality of the thirteen provinces was based purely on military assessment. General
Item B 1 -- Prospects and measures proposed by Country Team for improved prosecution of the war under the new government (Political, including possibility of improved relations with neighboring States)
Item B 2 -- Prospects and measures proposed by Country Team for improved prosecution of the war under the new government (Military, including a report on progress in accomplishment of tasks assigned as a result of the McNamara-Taylor Mission, and outlining plans for control of infiltration and special requirements for the Delta Campaign)
[Here follows Harkins' presentation, including slides, of the actions that the Republic of Vietnam's Armed Forces were taking to increase pressure on the Viet Cong. This presentation led to a more general discussion printed below.]
Secretary McNamara stated he assumed that the first effort would be made to protect the hamlets that have already been built. General Harkins said the whole Strategic Hamlet Program was under intensive review. Secretary McNamara asked how long this would take. Minister Trueheart estimated that it would be two to three months before the revised program could get under way. General Taylor recommended that any new plans that are prepared should establish firm target dates for various phases, so that tangible check points on RVN progress would be available.
Mr. Silver reviewed the economic situation in South Vietnam noting that the RVN expenditures have risen about 60% in the period 1960-1964 while U.S. aid, which amounts to about 40% of the central government's revenue, has declined somewhat. This increase in expenditures is nearly entirely attributable to an increase in defense expenditures, a 100% increase from 1960 to 1964. In addition, the increase for civil expenditures included non-military costs for counterinsurgency, and as a major item, support for the strategic hamlet program.
Turning to the 1964 budget, the Diem government estimated the total budget deficit in 1964 at approximately 9.0 billion piasters. After adjustments to his figures, USOM believes that the deficit will more likely be in the order of 7.0 billion piasters. This 7.0 billion piasters represent about one third of the total money supply; about 8% of the GNP; and an equivalent deficit in the U.S. budget of close to $50.0 billion.
South Vietnam is primarily agricultural, with a small industrial base. This is significant since the economy does not have the capacity to expand and meet the increasing demand for goods. Although prices have not gone up appreciably despite increased defense expenditures during the past years, it is not believed this situation will continue through 1964 unless the projected deficit is neutralized.
A previous backlog of U.S. economic aid and a pump-priming operation to get the strategic hamlet program started has had the effect of reducing central government expenditures in the past. In addition, the RVN has reduced its foreign exchange holdings from about $200.0 million in 1961 to about $155.0 million in 1962. Fortunately, these holdings have been rising in recent months because of stepped-up rice exports.
USOM's proposal is that U.S. and RVN personnel should sit down together and discuss these problems with a view toward developing agreed joint solutions. In general, USOM's recommendations would be to improve the efficiency of tax collections, increase taxes on selected items (e.g., gasoline), reduce the civil budget by 1.0 billion piasters, maintain the 1964 military expenditures at the 1963 level if this is consistent with the war effort, and introduce attractive savings programs, including increased use of the national lottery, rural banks, war bonds, etc. Also, USOM believes that the economy can stand an increase in money supply of 1.0 to 1.5 billion piasters without serious effects.
All of this leaves the RVN about 2.0 billion piasters short in their budget. USOM would recommend that this be met by drawing down on their foreign exchange reserves which amount to about $170.0 million at present.
Secretary Rusk then asked for comments on the export/import status. Mr. Silver said that in 1960 the foreign exchange earnings were $88.0 million. In 1961 it dropped to $70.0 million due to a drop in price of rice and rubber on the world market. In 1962 earnings dropped further to $47.0 million due to floods which wiped out the usual rice exports. The estimate for this year comes to about $80.0 million with the projection for 1965 hopefully at $95.0 million. Present imports are about $250.0 million. This figure does not include MAP or strategic hamlet inputs, but does include CIP. In response to a question from Mr. Bell, Mr. Silver pointed out that this analysis only relates to government and not to the private sector.
Mr. William P. Bundy asked why a 2.0 billion piaster deficit in 1964 was considered important when there had been 3.0 to 4.0 billion piaster deficits in 1962 and 1963. Mr. Silver replied that prices have risen 15% in the last three years and this, plus cumulative deficits of this magnitude could well become serious.
Secretary McNamara stated that one of the charts showed a 20% increase in the money supply during the first part of this year and asked how this was to be absorbed. Mr. Silver said apparently much of this money was cash hoardings. There were also reports that quantities of cash were being held by the VC as a precaution against the day when the strategic hamlet program would cut them off from their current sources of revenue from the countryside.
Secretary McNamara expressed concern that this huge increase in money supply in combination with a deficit of 7.0 billion piasters could lead to price increases which in turn could create such serious political problems that the present government might not be able to survive. It will be hard enough for the new government to consolidate its position as it is. It is absolutely essential that we help it maintain economic stability over the next 12 to 18 months. Under the best of circumstances the hoped for transfer of power from the military to some form of civilian government will be a very difficult political operation. Under conditions of economic instability it will be almost impossible.
Secretary McNamara stated he was of the opinion the U.S. should lean over backwards to help the Generals avoid economic unrest. With a tremendous deficit lying ahead, this is going to be very difficult. The United States should not try to push this new government too far to raise taxes, tighten up administration, reduce budgets, and so forth. Economic stability is really the foundation of military security in the long run. He would be prepared, therefore, to take a calculated risk and cut some of our safety factors on the military side if this were necessary to insure economic stability.
Mr. Bell agreed that the RVN was facing a very difficult and dangerous economic siutation [sic] which could be extremely serious to the whole war effort. Our first objective should be to get together with the Vietnamese to be sure we understand one another. Toward this end, plans are being made to send out a prominent figure in the economic field as head of a U.S. economic mission which would tackle these problems jointly with the best Vietnamese economists. This is clearly what must be undertaken in the next couple of months.
Mr. Janow then commented further on the import level. He said that in 1962 imports were about $280 million. This year the estimate (including our aid) is about $238 million and for 1964 the planning figure is about $255 million. If this commercial import level is compared with their exports of about $100 million, there is a gap of about $150 million. This deficit does not include such costs as MAP, the counter insurgency program which the US is supporting, or capital investment. If these are added the figure is increased by another $250 million. A gap of this kind, built into the RVN economy is obviously against their best interest.
Major General Timmes then spoke about the military budget. Using charts he showed that the RVN regular forces would require about 11.2 billion piasters. 75% of this would go to military pay, allowance, and subsistence. General Timmes emphasized that this is the Vietnam piaster budget. The MAP budget amounts to about $175 million. He then showed a comparison of this year and last year's RVN military budget. This showed that the current budget is only 358 million piasters larger than last year's and the forces are much larger. MAAG believes that this budget has been reduced to the minimum figure.
General Timmes showed the figures for the Civil Guard and SDC. He pointed out that 86% of the Civil Guard and 95% of the Self Defense Force budgets were for pay and allowances. His final chart showed how the total defense cost of 14.5 billion piasters for CY 64 was made up. He noted that perhaps this figure could be reduced by 100 to 200 million piasters as a result of force reorganizations which might take place under the new government.
Secretary McNamara pointed out that the difference between these figures and Mr. Silver's program came to 750 million piasters. Secretary Rusk then asked how much of a limiting factor was money as far as finishing the war at an early date. Secretary McNamara said that in his opinion the RVN is going to be right on the ragged edge of running out of the money needed to win the war. The situation in the Delta and strategic hamlet program itself are both serious, immediate problems. Furthermore, we must improve the output of the country. This means more fertilizers, additional expenditures to raise the economic base and increase productivity. He stated that all this requires money. The RVN has this tremendous deficit; the new government is sitting on top of a keg of political dynamite. Secretary McNamara doubts that enough money has been budgeted under AID and MAP to handle the situation. This is very serious problem which must be watched extremely carefully.
Mr. Bell shared Secretary McNamara's concern. More money may be required to finance what ought to be the heaviest action year of the war. If things move successfully, it might be possible to taper off after the next 12 to 15 months. However, we must be careful not to give the RVN any more of a "fiscal hangover" from the war than necessary. He agreed with Secretary McNamara that it is a serious problem which could blow up on us if we are not careful in the next six months. But, we must also keep the RVN's feet to the fire, keep their resources fully committed, and not let them saddle themselves with an economy and military establishment that is larger than circumstances require.
Mr. Fraleigh then discussed the advantages of increased use of fertilizer on rice production. Vietnam uses very little fertilizer on rice as compared to other countries. As a result, its per hectare yield of rice is 1/2 that of Taiwan or Japan. Mr. Fraleigh recommends that we think in terms of doubling the use of fertilizer in 1964. For every $70 spent on a ton of fertilizer delivered in Vietnam, $110 worth of additional milled rice is produced for export. Mr. Bell wondered what was holding it back. Mr. Fraleigh replied it was the credit system, since fertilizer is handled commercially. Secretary McNamara observed that unless an adequate credit system is devised to improve the distribution of fertilizer, the productivity will not rise and this productivity is needed to build political stability. Ambassador Lodge remarked that South Vietnam could be one of the richest rice producing areas of the world.
Secretary McNamara said he was afraid a certain euphoria had settled over us since the coup. True, the Generals are friendly to us, but the situation in Cambodia is deteriorating and the VC showed they have a tremendous reserve capability by trebling their rate of incidents week before last. He wondered if current U.S. programs put enough power behind our objectives.
Secretary McNamara summarized the present situation as follows. South Vietnam is under tremendous pressure from the VC. The VC are as numerous today as they were a year or two years ago. The surrounding area is weaker. The Cambodian situation is potentially very serious to the RVN. The input of arms from Cambodia before the recent developments was very worrisome in the Delta. The Generals head a very fragile government. The United States should not try to cut the corners too fine. We must be prepared to devote enough resources to this job of winning the war to be certain of accomplishing it instead of just hoping to accomplish it.
Exploratory discussions would be held with the Japanese government to determine if a mutually advantageous rice-fertilizer barter arrangement could be worked out between Japan and the RVN. (Action: State.)
Minister Trueheart led the discussion. He stated that the Strategic Hamlet Program is sound. It separates the VC from supplies, intelligence information, and from the general population. In the longer term, the program holds out prospects for social and economic changes throughout the country.
However, under the Diem regime implementation of the program has been faulty, particularly in the Delta region, primarily due to overextension. The Strategic Hamlet Program represents a large dollar investment by the U.S. Government and a large labor investment by the Vietnamese people. Minister Trueheart believes the new government in RVN will continue the program since they cannot default on what was promised the people under this program by their predecessors. The Generals will seek to disassociate themselves from past errors by providing for closer military and civil cooperation, reduced forced labor, relocation of poorly placed hamlets and improved training and arming of the militia. Most importantly, they must, sooner or later, establish meaningful priorities. Primary emphasis on hamlets must be in the Delta area and progress reporting should focus on this strategic region as well as on the thirteen critical provinces discussed earlier by General Harkins.
In the future additional hamlets will be required, maybe as many as one thousand, and some poor hamlets will need relocation. This will be expensive. Seventy percent of the hamlets in the Delta are not up to the standard required to make them truly effective. Economic and political progress must be made to improve the people's standard of living. New educational facilities are required and distribution of fertilizer to the inhabitants of the strategic hamlets is needed. The new government has established an inter-ministerial committee to supervise the Strategic Hamlet Program. Minister Trueheart stated that as far as the Country Team could determine, the one billion piasters already budgeted by the RVN for support of strategic hamlets will cover current costs. No additional MAP funds are foreseen.
Secretary Rusk asked how much medical contact did the people in the hamlets have? He was answered that this varies, USOM has one group that dispenses some medical assistance and the U.S. Army has an on-the-job medical training program. General Harkins added that there are only 700 doctors in RVN, 450 of whom are in the armed forces.
Mr. McGeorge Bundy asked where does the responsibility for the Strategic Hamlet Program now fall? Minister Trueheart replied that there was no change on the U.S. side, and that the inter-ministerial committee is responsible on the RVN side. Mr. Bundy then asked how do we communicate our recommendations concerning this program to RVN now that Mr. Nhu is dead. Minister Trueheart replied that we utilize all available means of communication through MAAG, USOM, MACV, etc.
Admiral Felt stated we are dealing with development of a new campaign plan with priority emphasized on areas south and southwest of Saigon. General Harkins replied the first priority of effort would be in this part of the country although attention would also be given to the problem areas in the north.
Mr. McGeorge Bundy then asked to whom the province chiefs report. Minister Trueheart replied that this varies between Corps, but in most cases to Corps Commanders. Admiral Felt then asked if this put the division commanders on the same level as the province chiefs. Mr. Colby replied in the affirmative, but noted that the division is an operational command subject to movement to any part of the country.
Mr. McGeorge Bundy asked how the strategic hamlets are financed. Minister Trueheart replied that they were originally financed through an emergency purchase of ten million dollars worth of piasters by the U.S. Government. Now they are being financed by the Vietnamese Government, although some $35 million of U.S. assistance has gone into the hamlet program this year. Minister Trueheart stated that there is an advantage to the village inhabitants contributing reasonable amounts of labor to the hamlets as it serves thereby to identify the peasants with their own hamlets and with the program as a whole.
Minister Trueheart emphasized that when he said 70% of the hamlets in the Delta were not considered up to standard, he did not mean that they are under VC control. General Taylor asked if there are any hamlets under control of the VC. General Harkins responded that although some hamlets have been over run and some subverted by the VC, he did not know of any that were actually under the control of the VC.
[Here follows discussion of Item C 1, "Revision of Military Comprehensive Plan;" Item C 2, "Status Report on FY 64 MAP;" Item D, "Outline in terms of forces, timing and numbers involved, the projected program for reduction U.S. military forces by end FY65;" and Item E, "Country Team suggestions for revision of current reports to develop a consolidated country team reporting system."]
- Source: Department of State, S/S-NSC Files: Lot 72 D 316, NSAMs. Top Secret; Eyes Only. The Director of Central Intelligence and the Administrator of AID also received copies. Also printed in United States-Vietnam Relations, 1945-1967, Book 12, p. 578.
- See Document 179.
- Document 181.
- Group 1 was the subcommittee dealing with economic problems. It included as members Janow, Brent, Trueheart, Forrestal, Stoneman, William Bundy, Major General Timmes, Silver, and others.