Foreign Relations of the United States, 1952–1954, Indochina, Volume XIII, Part 1

751G.5 MSP/11–1852: Telegram

The Ambassador at Saigon (Heath) to the Department of State

secret

Saigon, November 13, 1952—2 p.m.

983. Following are joint comments MAAG, STEM, Embassy, on numbered paragraphs of Deptel 2609 to Paris November 4, repeated Saigon 949.¹

1. It is to be noted that for IC it is likely that the FY 54 MDAP program will be less than the FY 53 program of $191 million which was less than the FY 52 program exceeding $20 million. In addition there will be a milit support program forecast at $35 million for FY 54 as compared with $30.5 million for FY 53. Econ aid is being tentatively programmed at $30 million for FY 54 compared with $25 million for FY 53. The milit estimates may be revised upward if the French increase the recruiting rate of milit forces of 3 Associated States. It is to be noted that the present Fr program for FY 53 adds only 10,000 troops to the Franco-Viet forces now combating with Viet Minh. Ideally, more troops should be put in the field against the Viet Minh if war is to be shortened. A limiting factor has been the inability of the Fr to provide officers and non-coms or to accelerate the selection and training of Viet officers.

2. We believe it desirable from all points of view that other western bloc powers contribute money or goods to the Fr-Associated States effort in IC. Such contributions could be made directly to the Associated States, of course with the approval and control of the Fr High Command. It is suggested that the contributions be financial to defray the maintenance of the increasing natl armies.

3. We agree that it is important not to solicit contributions at least at the start, from colonial powers with interests in the Far East, like the Dutch. It is further suggested that Australia and New Zealand may be willing to contribute, since New Zealand has already indicated interest in supporting war effort in Associated States by contribution of arms (see Deptel 598 Sept 19).².

4. As regards nature of Canadian contribution, it is to be recalled that certain items currently used in MDAP program are manufactured in Canada. We think it better for Canadian and Belgian contributions to be in cash since financing maintenance of the increasing national armies is greater problem than that of finding equipment which is now being furnished by MDAP and Fr.

5. We agree with statements in para 5.³

In regard to our suggestion contributions be in cash, it would seem that Congressional objections to deficit financing could not apply to countries like Fr and the Associated States which are engaged in a shooting war vs Communism. Fr is financing a large share of the cost of the Associated States armies by direct cash grants and according to the Lisbon experts is not in a position to increase the Fr milit budget at this time.

Fr and the US who are paying the lion’s share of the cost of milit operations here should insist on higher tax rates and collections and govt economies by the AS. But with all the pressure we can muster and assuming the most earnest effort by the AS Govts it is unlikely that these states can, within the next year, develop local revenues or effect sufficient administrative economies to the point of defraying, without outside help, any large increase in the milit effort.

Heath

1. The telegram under reference is described in footnote 1, p. 278.
2. In telegram 598 to Saigon, Sept. 19, the Department of State discussed aspects of a transfer of small arms and ammunition by New Zealand to France for use in Indochina. (751G.5614/9–1952)
3. In paragraph 5 of the reference telegram, the Department of State stated that any initiative in this area would have to be taken by France; that the present seemed an inopportune time to explore the subject; and that it was soliciting views of Paris, Brussels, and Ottawa so that it would be possible to move promptly if the situation so dictated. (740.5/11–552)