POLICY PROBLEMS IN KOREA
1. Present Situation. The military balance on the Peninsula is reasonably satisfactory. Both Koreas have powerful military machines, but it is unlikely that the somewhat better equipped North could conquer the South as long as the South receives U.S. materiel support. Hostility between the two Koreas remains as strong as ever and, despite intermittent direct talks commencing in 1972, shows no signs of abating. While both countries have dynamic economies, we think the long term edge is with the South. Given the virulent nature of North-South hostility and the heavy degree of armaments, we believe that our force presence has been an essential element in avoiding misperceptions and preserving the peace. As long as that presence continues, we do not think the North Koreans will initiate full scale hostilities. The lack of support for North Korean military adventures by the PRC and USSR reinforces such a judgment.
2. The Offshore Islands. While general hostilities are unlikely, we remain concerned about the possibility of military probes by the North Koreans, particularly in an election year and in an atmosphere where there is public doubt about the constancy of U.S. policy. Where we are most exposed and the obvious place for a probe are the five small islands in the Yellow Sea. Assigned under the 1953 armistice agreement to the jurisdiction of the UN Commander, they are regarded by the U.S. and the ROK as part of South Korea. The islands, however, lie well within the claimed territorial waters of North Korea (map attached at Tab B). President Park will never agree to abandon the islands peacefully. While not strategically or tactically important, their military loss would be severely damaging psychologically to the nation as a whole, erode President Park's personal stature, and, in turn, discredit the U.S.-South Korean relationship.
An attempt by Pyongyang to attack one or more of the islands would present us with a major crisis. Because of their location, the islands are exceedingly difficult to defend against a determined attack from North Korea. Given these difficulties and the ambiguous legal status of the islands, we are concerned that any military response to a North Korean effort would be met with less than wholehearted support in the Congress and the U.S. public at large. Faced with this possibility, we believe there is no choice but to encourage Seoul to defend the islands vigorously and by doing so hope to purchase enough time to determine how the USG wishes to respond. General Stilwell has worked with the Koreans over the past year to formulate plans for defense of the islands and has encouraged the ROKs to improve the islands' physical defenses in order to make any North Korea effort exceedingly costly. Simultaneously, we have taken steps to increase our intelligence alert so that we can have maximum prior warning of a Northern attempt.
3. Declining Public and Congressional Support. Our Korean policy and our defense presence on the Peninsula appear to be losing support of both the U.S. public and the Congress. In part, this is due to the backlash of Vietnam and the fear of another military venture in East Asia. In part, it is due to the increasingly repressive nature of the Park government which has caught the attention of the Hill and certain articulate elements of the American public including the churches. As a result, we have witnessed Congressional efforts to remove our troops from Korea and to pressure Park to liberalize his administration by denying aid and threatening a U.S. withdrawal. There is also Congressional concern both among liberals and conservatives, that our current troop posture — a U.S. division in reserve but north of Seoul — would automatically involve us in hostilities should the North invade the ROK and that, at a minimum, the division should be moved south of Seoul.
While we cannot be certain, we doubt that Congress would try to remove troops from Korea in an election year. On the other hand, there is no doubt that increasing dissatisfaction with Park will lead to continued questioning of various aspects of our Korean policy and to more legislative efforts to limit or decrease our involvement in Korea. We shall have to counter these efforts as best we can. It would be dangerous, particularly in an election year, to take any steps which North Korea might interpret as a sign of weakness. Therefore, moving the division south at this time would be ill advised. The North would most likely view such a step as a weakening of our resolve, reducing the deterrent value of our presence. At the same time, it is unlikely that merely moving the division south of Seoul would significantly reduce the likelihood of the U.S. becoming involved in a contingency.
4. The United Nations Command. The support for our traditional position on Korea in the General Assembly has also eroded with the change in the composition of the UN. For the first time two resolutions on the Korean question — one friendly, one hostile — were passed by the General Assembly last year. Our resolution called for dissolution of the UN Command, provided that adequate assurances were given for maintaining the armistice arrangements. The hostile resolution linked the presence of U.S. troops to the United Nations Command and called for the dissolution of the UNC. This development is indicative of the growing pressure on us, even from our allies, to unilaterally abolish the UNC.
The UNC, however, has provided a mechanism through which the ROK, without losing face, can place its forces under the operational control (OPCON) of an American commander. Elimination of the UNC would require new command arrangements if we are to retain OPCON. General Stilwell has been discussing with the Koreans the establishment of a combined command, at the insistence of the South Koreans, with the commander being an American and reporting to both national command authorities. There are a number of conflicting views about the exact nature of this prospective organization and the forces which should be committed to it. From ISA's perspective, we see great Congressional problems with a combined command because of the Park regime's repressive character. We would have to explain the new command arrangements and Congress could well reject the suggestion that an American commander also report to President Park or, as our presence decreases, a Korean would command U.S. Forces. Permitting this issue to precipitate a major debate on U.S. policy toward Korea strikes us as completely counterproductive. We are searching for appropriate command arrangements and for the moment should not acquiesce in the dissolution of the UNC until acceptable arrangements have been developed.
5. Military Assistance. The fantastic growth of the Korean economy has led to the ROK's now assuming 90% of the financing of its military expenditures (the U.S. used to pay 90%). Recent defense taxes will increase the portion of Korean resources devoted to GNP from 4.5% to 6.5%, a truly impressive measure. South Korea is basically now able to do without grant aid. The ROK has developed a new five year program of modernization — the Force Improvement Program — which should bring their forces into rough parity with North Korea's. Except for a few items, we believe their plans are sound. The Koreans project expenditures of some $3B in foreign exchange, hoping for half of it in credits from the U.S. over a five year period. We have assured the ROK that we support their objectives and will do our best to provide credit as required. It is not intended, however, to commit the U.S. Government to any total amount of support or any annual level of aid, as under the previous Modernization Program. The Congress should be generally sympathetic to an effort to make the ROK self-sufficient and we should do our best to obtain Congressional support. Congress will, however, probably relate future aid commitments to the U.S. force presence in Korea. We should attempt to insure that Congressional perceptions of our presence are tied to increases in South Korean capabilities rather than U.S. security assistance levels per se.
6. ROK Nuclear Weapons Efforts. President Park's fears of isolation and the possible withdrawal of U.S. forces have led him to embark on a secret program to develop nuclear weapons and a long range surface-to-surface missile to deliver the weapons. Korea could probably achieve this capability within 5-10 years. We plan to send in April or May a high level team consisting of missile experts to discuss the ROK requirement for missiles and other conventional advanced technology weapons systems in an effort to demonstrate to Park that it is both uneconomical and unnecessary for him to utilize his resources in that manner. The ROK has been negotiating an agreement with France to purchase a nuclear fuel reprocessing plant to produce enriched plutonium which, in turn, could be utilized to build fission weapons. We think the acquisition by the ROK of a nuclear capability would be completely destabilizing in Northeast Asia and undermine public support for Korea in the U.S. We have strongly indicated to the Koreans that we will not support this effort and that acquisition of such a plant could affect our fundamental relationship. We have told the ROKs in the firmest terms that we will withdraw U.S. support for their nuclear energy programs if they continue ahead with plans to acquire the reprocessing plant. There are signs that the Koreans will change their position. It is essential to persist.
7. Reassurances to the ROK. The Koreans are somewhat paranoid, but not without reason. Their security situation is precarious. Two of the major powers of the area, the USSR and the PRC, have contiguous borders with the North and are allied with Kim Il-sung. On the other hand, South Korea's only reliable ally, the U.S., is 10,000 miles away and increasing Korean doubts about our constancy are reinforced by the continuing debates within the U.S. over our foreign policy and Korean policy in particular. It is therefore necessary to hold their hands frequently. We believe you should find an early occasion to publicly express your support for our commitment to South Korea and for South Korea's impressive self-defense efforts. Such a statement will also be a helpful reminder to the North Koreans.