751G.5 MSP/8–3153
Memorandum of Conversation, by the Acting Special Assistant to the Secretary of State for Mutual Security Affairs (Nolting)1
Subject:
- Additional Financing for Indochina Question of Morocco
Participants:
- M. Bonnet, French Ambassador
- General Smith, Under Secretary of State
- Mr. MacArthur, Counselor
- Mr. Nolting, S/MSA
Before departing for Paris today, Ambassador Bonnet called on General Smith concerning additional Indochina financing. The Under Secretary informed him that if the French program was satisfactory, the President has in principle decided to help France mount additional military effort in Indochina by additional US financing; that, subject to receipt by us from the French of additional information requested and subject to approval of a military plan by our military authorities, we are prepared to move rapidly to give Laniel the assurances he will need to present to the French Assembly; that the order of magnitude of additional financing is $400 million maximum, preferably less as foreign aid funds are very tight. The Under Secretary said we are not yet certain whether all of this amount can be taken from presently appropriated funds, i.e., whether a request to Congress for a supplemental appropriation may be necessary. He assured Ambassador Bonnet, however, that if a firm decision is taken by the US Government to help in a specified amount, the French can rely upon our making good on that decision.
The Under Secretary stressed the urgent need to accelerate additional effort in Indochina, both in terms of the dispatch of additional French battalions and the creation of additional native forces, in order to create a psychology of victory in France, in Indochina, and in the US. Regarding a possible visit by Premier Laniel to the United States, the Under Secretary said he realized that Laniel had many urgent problems in France and that such a visit was not essential to reaching an agreement with the French.
The French Ambassador thanked the Under Secretary for the above information and said he would convey it to Laniel immediately upon his arrival in Paris, and that he would do what he could to expedite the additional information that the US requires.
[Here follows a brief account of discussion on the question of Morocco.]
[Page 743]Reverting to the Indochina problem, General Smith told the Ambassador that the Secretary was planning to make a reference in his speech of September 2 to the American Legion which he thought would help the French Government. This reference was to the effect that the political conference on Korea, if successful in its primary purpose, might lead to a settlement of other issues, including Southeast Asia, if the Communists so desire.2 Ambassador Bonnet said that such a reference would be helpful to Laniel, in that it would cut the ground from under some of his opponents who maintain that the US is unwilling to have the French come to a settlement on any reasonable terms. He added, however, that he thought there was little possibility of arriving at an acceptable settlement of the Indochina affair until a position of military superiority had clearly been established by our side.