263. Memorandum of Discussion at the Meeting of the Operations Coordinating Board’s Special Working Group on Indochina, Department of State, Washington, October 5, 1955, 11 a.m.1


  • State—Mr. Kenneth T. Young, Jr. [Chairman]
  • ICA—Mr. Frederick H. Bunting
  • USIA—Mr. Francis J. McCarthy
  • Treasury—Mr. Paul D. Dickens
  • Commerce—Mr. Davis A. Kerns-Preston
  • OCB—Mr. Kenneth P. Landon


  • State—Mr. Robert E. Hoey; Mr. Hoyt Price; Mr. Ellsworth R. Mosman
  • Defense—Mr. H.J. Sandri
  • USIA—Mr. James Flood
  • CIA—Mr. O. Williams
  • BOB—Mr. Austin Ivory; Mr. Ralph Dungan

1. Long-range Planning for the Associated States

The Chairman opened the discussion with a proposal for shifting our approach from a short-term crash basis to more long-range planning and development where feasible. In his opinion it is possible to assume that internal developments in each of the Associated States have reached the point where some long-term planning may be conceivable. On the political side there have been some positive developments in each of these countries which would permit us for the first time to take a longer view. We had begun our aid programs during a period of war and rapid transition circumstances which allowed us to do no more than quickly fill urgent or extraordinary needs for the best available opportunities. In the six months following the Geneva Agreement we had to readjust rapidly to new conditions on a crash basis. This is particularly true in Vietnam, for a year ago the problem was to try to hold Free Vietnam together for at least a year under circumstances which looked bleak and unpromising. Immediate action on all fronts was the insistent requirement. But now all three countries appear to be in a process of settling down to new patterns. There are still many difficulties and grave dangers facing each country and our aid programs, but the Chairman pointed out the situation in each of the Associated States, with a possible exception of Laos, appears to have stabilized enough to look into the possibility of recasting our aid programs on a longer range basis.

In reply to a question from Mr. Williams, the Chairman emphasized that the situation in all three countries is just as critical as ever but that there were perhaps greater opportunities for reaching results and for sustaining our efforts than six to twelve months ago when the FY ’55 and FY ’56 programs were readjusted to Geneva. Whereas a year ago we were working on a crash basis to enable the Associated States to survive, today these states appear reasonably established. The Chairman noted that the Diem Government in Vietnam has consolidated its power and authority against non-communist political minorities and is proceeding to reconstitute the form and structure of its government. In Cambodia elections have been held, a single party [Page 556] now commands authority, and real as well as institutional power is now merged in Prince Sihanouk. In Laos, the problem of communist control in the two northern provinces is a delicate situation, but in the rest of the countries there have been favorable developments. Consequently, the Chairman noted that the State Department has been searching for several weeks for methods of re-examining and recasting our aid programs, if the working group should agree that it would be necessary. In this connection the Chairman called the group’s attention to Senator Mansfield’s report of October 6,2 recommending a special mission to Vietnam and a careful review of all our programs in Cambodia and Laos.

In the discussion that followed there appeared to be a general consensus that a re-examination and review would be desirable in principle. It was decided that a joint telegram should be sent to Saigon, Vientiane and Phnom Penh3 outlining the group’s view as to the needs of our aid programs, asking the missions to discuss this matter with Mr. Hollister and Mr. Jones during their visit. Mr. Price of State, Mr. Bunting of ICA and Mr. Sandri of Defense were designated to work up a first draft of such a telegram.

The question was raised as to where the costing mission to Vietnam4 would fit into a re-examination of the aid programs. For his part, the Chairman stated that the costing mission was extremely important, should be sent out as soon as possible and could be considered as one element in arriving at the over-all picture. Mr. Landon pointed out that an inter-departmental study was being prepared on Pakistan which was somewhat along the line of today’s discussion. It seemed to be the consensus of the group that two studies could be developed for the Associated States. First, a costing mission should be set up to make a sixty-day survey. The findings of this mission could then be incorporated in a broader survey made by a high-level mission over a period of three to six months. The purpose of such studies would be to establish guidelines for U.S. operations in the Associated States during the next few years.

[Page 557]

Mr. Landon then made the suggestion that a plan of operations might be developed for each of the Associated States which would be an advantage over the usual outline plan of operations, which is primarily a description of what things U.S. agencies are planning to do in the immediate future. It was pointed out that an outline plan of operations for each of the Associated States might be part of the development of a longer range plan on extensive field surveys. The sort of long-range operating plans contained in PSB D–235 for Thailand might be an example.

2. Closure of the Consulate at Hanoi 6

The closure of the U.S. Consulate at Hanoi was discussed, including a proposed press release which had been drafted and was being cleared in the State Department. It was brought out that by attrition the Consulate was running out of supplies. It would be impossible to continue without having the ability to rotate personnel and to replenish supplies, and the communists had refused such permission. Consul Corcoran was authorized to work out the closure of the post and the withdrawal of the personnel.

3. Situation in Laos

Lack of progress in negotiations between the Lao and Pathet Lao was discussed and it was brought out that this subject might be discussed shortly at Geneva. The Defense Department is progressing rapidly in the selection of a military group for Laos. The chief and some of his staff have already been chosen. The total group will number about 20 and they will proceed to Laos as part of the ICA staff. The departure of the members already selected is awaiting action by Assistant Secretary Gray.

The Defense member outlined various air transportation problems for Laos, and during the discussion various alternative solutions were mentioned, recognizing that the problem remained to be solved.

4. Relations with Cambodia

The problems facing U.S. agencies doing business with the Cambodian Government were explored. It was pointed out that we have [Page 558] been going along without an economic aid agreement. The question is whether we should continue on that basis, or should press for an agreement. The possibilities of putting pressure on the Cambodian Ambassador in Washington were discussed, recognizing his personal friendship with the new Prime Minister. It was agreed that the U.S. can be expected to have a difficult time with the Cambodian Government, as the Cambodians apparently agree with difficulty to the terms of other nations. At present the Cambodians apparently want the U.S. to turn over dollar support to them, for them to use first and to account for later.

During the discussion it was brought out that the problem of force levels in Cambodia had been referred to the JCS and a decision is expected within two or three weeks. This study is in accordance with the Ambassador’s request for a review of the subject in Washington.

5. U.S. Business Interests

The Commerce member indicated that his Department was very much interested in the development of U.S. business with the Associated States; that techniques for trade need to be developed with Cambodia and Laos. He mentioned that U.S. business interests are familiar with the Saigon trade but not with other States.

A word of caution was given by one member of the working group regarding crash-basis planning versus long-range planning, pointing out that Vietnam is still in a critical situation and will be for a year or more. There seemed to be no disagreement with this observation.

Reference was made to the Progress Report on Southeast Asia (NSC 5405)7 and it was thought that a first draft might be ready for the next meeting of the working group8 which will be held in Room 5104, New State Building, Thursday, October 13, at 3:00 p.m.

Kenneth P. Landon
  1. Source: Department of State, OCB Files: Lot 62 D 430, Southeast Asia. Secret. Prepared by Kenneth P. Landon, OCB Staff Representative, on October 12.
  2. For text of Mansfield’s report of his study mission to Southeast Asia on behalf of the Senate Committee on Foreign Relations, see “Report by Senator Mike Mansfield, Viet Nam, Cambodia, and Laos”, 84th Cong., 1st sess., Committee Print (Washington, Government Printing Office, 1955).
  3. No telegram as described has been found in Department of State files.
  4. On September 9, Gordon Gray of the Department of Defense suggested sending a small interagency survey team to Saigon for a month to seek ways to reduce the cost to the United States of supporting Vietnamese armed forces. The Embassy in Saigon, the Department of State, and ICA agreed to the proposal and the team was organized and scheduled to leave at the beginning of November. (Memorandum from Young to Sebald dated October 17 with attached letter dated September 9 from Gray to Hoover; Department of State, Central Files, 751G.5–MSP/9–955)
  5. PSB D–23, “U.S. Psychological Strategy Based on Thailand”, September 14, 1953, not printed. (Ibid., 790.5/9–1453)
  6. The American Consulate in Hanoi was never officially “recognized” by DRV authorities, and after they took control of Hanoi they placed restrictions and limitations on Consulate personnel and engaged in intermittent harassment of the Consulate. On September 26, however, they ordered the Consulate to cease using its radio transmitter and receiver and took the action as described above. Until this time the Consulate had submitted monthly political and economic reports as well as other telegrams which are ibid., 751G.00 file; documentation relating to harassment and closure of the Consulate is also ibid., 122.4564 file. The Consulate closed on December 11, 1955.
  7. Dated December 21, not printed.
  8. A report of this meeting is in a memorandum of discussion by Landon, October 18. (Department of State, OCB Files: Lot 62 D 430, Southeast Asia)