The enclosed views from the Department of Defense and the Bureau of the
Budget with respect to the letter on the subject from Ambassador
Lodge which was transmitted
by the reference memorandum of June 1 are circulated herewith for the
information of the National Security Council in connection with its
consideration of Ambassador Lodge’s letter at its meeting on Thursday, June 18.
[Enclosure 1]
Memorandum by the Assistant Secretary of Defense
for International Security Affairs (Nash) to the Secretary of Defense
(Wilson)
top secret
Washington, June 11, 1953.
Subject:
- United States Government Policy With Regard to the Acceptance
of Offers for Military Assistance in Korea
United States Government policy with regard to the acceptance of
offers for assistance in Korea from the very beginning has involved
not only the question of logistic support, but also the
consideration of military effectiveness of the unit. In particular,
a homogeneous unit of appropriate size capable of operating under
the flag of the nation concerned, has been regarded as militarily
acceptable. On the other hand, the thought that the United States
should attempt to organize, train and equip units composed of
unorganized volunteers from foreign nations has been consistently
opposed on the grounds of the command difficulties involved and the
fact that such action would give credence to possible charges of the
use of mercenary troops by the United States. With
[Page 1178]
regard to the principle of
reimbursement, the United States position has been that
participating nations should provide manpower, materiel and the
financial costs of their participation in the United Nations action
in Korea insofar as possible, not only because of the principle of
equity involved, but also because of the precedent-setting
implications as to the financing of possible future United Nations
collective action. This policy has included recognition of valid
practical aspects by providing that where participating nations
cannot provide materiel support, the United States would do so with
the understanding that an obligation for payment was recognized by
the country concerned, the mode and time of settlement to become the
subject of later discussions between official governmental
representatives. It was further recognized that in properly
justified cases, the President could exercise his emergency powers
to eliminate the requirement for an obligation on the part of an
individual country.
U.S. policy and procedure concerning reimbursement, referred to
above, were established after consultation between the Departments
of State, Defense, and Treasury, and approved by the President. On
the basis of this action, the Department of Defense issued a
directive dated 1 September 1950, which provided that “the military
departments of the United States will make available necessary
supplies or services on a basis of immediate reimbursement in United
States dollars. To the extent that the foreign government cannot
make prompt reimbursement in United States dollars, the United
States Government and the foreign government will negotiate the
terms of settlement.” In other words, we have been operating under a
procedure whereby the recognition of an obligation to reimburse the
United States has constituted adequate grounds for the furnishing of
logistic support, leaving the details of reimbursement for
negotiation at a later date, and we have, in fact, been providing
logistic support to all the United Nations forces participating in
the Korean war. In each case, with the exception of India, which was
specifically exempted by executive action, the nation receiving
logistic support recognized an obligation to reimburse the United
States. This obligation was usually referred to in an exchange of
notes with the foreign government. The extent of the obligation was
not spelled out at the time, details being left for further
discussions. The usual procedure has been to approach each of the
countries concerned some time after their troops arrived in Korea
and submit for their consideration a draft agreement calling for
reimbursement on a quarterly basis. A few nations have signed such
agreements. Two have been making current payments without agreement,
and some have not been approached with a proposal for reimbursement
at all. Most nations, however, have neither accepted the agreements
nor made counter proposals. As of 31 December 1952, we had advanced
the equivalent of approximately two hundred
[Page 1179]
million dollars in logistic support to
foreign nations in Korea and had been reimbursed in the neighborhood
of only forty million dollars.
At the time that the existing policy was approved, it was recognized
that it did not represent the final answer and was regarded only as
an interim emergency measure. Consequently, the problem has been
under almost continuous review by various agencies of the
Government. These studies have invariably ended on the horns of a
dilemma between the possibility of generating increased
participation and the probable future long-term consequences to the
United States and the principles of collective security if the
reimbursement requirement were withdrawn. As recently as 8 April
1953, the National Security Council addressed itself to this problem
in its consideration of NSC 147 and
decided that the current practice regarding reimbursement for
logistic support of United Nations forces in Korea should be
continued for the time being. This action notwithstanding, the
National Security Council now has under consideration a letter dated
19 May 1953 on this subject, addressed by Ambassador Lodge to the President.5 This
letter contains the proposal that the United States should initiate
a renewed and vigorous campaign for increased participation in Korea
and as a step to enable the achievement of this goal, the United
States should revise the reimbursement policy now in force. In the
course of NSC consideration of this
letter the entire problem, as outlined above, will again be subject
to re-examination.
It is possible that some nations not now having troops in Korea could
be induced to send troop increments, and some nations with units in
the theater might possibly increase the size of their present
commitments were they informed that the United States would not
require reimbursement for logistic support furnished these units.
However, consideration of such a policy involves two distinct
questions. On the one hand, there is the consideration of
willingness to participate and assume responsibility in United
Nations collective action, and on the other hand, ability to pay. To
waive completely the reimbursement obligation would encourage
nations with the ability to reimburse not to do so, and would at the
same time, undermine the growth of the United Nations as an
effective mechanism for collective action since the spirit of full
collective responsibility would be lacking. In those cases where a
nation’s participation is dependent upon receiving financial
assistance, the problem can be solved through procedures such as
deferred or other settlement and possibly economic aid, or military
assistance. Also, in justifiable cases, the President can waive the
reimbursement obligation as he has done in the case of India.
[Enclosure 2]
Memorandum by the Chief, International Division,
Bureau of the Budget (Macy) to
the Special Assistant to the President for National Security
Affairs (Cutler)
secret
Washington, June 8, 1953.
Subject:
- Additional UN Forces in Korea
The above subject was discussed at the Planning Board session of June
3 and it was agreed that agencies wishing to submit comments for
Council consideration should do so by June 10.
The Bureau of the Budget addresses its comments only to that portion
of Mr. Lodge’s proposal
which concerns the policy of securing reimbursement for logistic
support furnished by this country to UN forces engaged in Korea.
In our view the action of the Council on April 8 was a correct one
and should not now be reconsidered. To have the United States accept
the full responsibility for the costs of the Korean war would be to
establish a precedent, the ultimate implications of which have not
been sufficiently analyzed either as respects Korea itself nor,
possible of greater import, future areas of UN activity.
The U.S. has been receiving repayment in full from a number of
countries. We should not voluntarily release those countries able
and willing to pay from the obligation they have to do so as UN
members.
To date we have borne the costs only of supplementary logistic
support. Under a policy in which we relieved the other UN countries
of responsibility for the logistic support of their troops, the
costs merely of maintaining the present level would be considerably
greater. It has not been shown that these additional expenditures if
applied to ROK forces would not in
fact make a greater contribution toward the desired objective.
