407. Telegram From the Ambassador in Vietnam (Durbrow) to the Department of State1
1122. Ref: Deptel 935.2 On trip to visit refugee villages and road work with Diem 22d and in other recent conversations he has referred in strong but polite terms to his worries about substantial cuts in aid. He made strong point with Hardy Committee3 he had to have military-security forces built up because of growing Communist threat. He has continued to stress with me need for more but not too expensive roads for both strategic and economic reasons. With Communists in Lao govt he even more concerned about his security problem and fact he may be isolated as only fully free-world oriented govt this part of world.
He adds he has been carrying anti-Communist torch on various visits particularly in India where he also gave good plug for need for and defensive aspect of SEATO. He is using his revival Asian cultures theme as effective argument against materialistic atheism of Communism (which has considerable merit, in my opinion). Therefore he argues why is United States planning cut aid to VN same proportion as others and planning give loan to neutralist India. He points out neutralist countries will not think of changing their policies if it becomes clear that countries like VN which are tied to West do not get preferred treatment. I have argued not too successfully that with our curtailed resources we in his interests as well as ours, try help all countries not behind Curtain to maintain independence.
Diem is so preoccupied with military security problem due to increased internal subversion and Communist gains in nearby countries he shows little interest in basic economic development for moment. Therefore with substantial aid cut there will be little chance to induce him devote more resources to economic sector till he is assured sufficient funds maintain and build up military-security posture.
Since he is in this frame of mind I will endeavor to explain to Diem, before Haraldson leaves (ETD December 1) total aid picture along following lines.
- 1.
- Total new defense support money $175,000,000.
- 2.
- New technical assistance money $4,200,000.
- 3.
- We will also make available about 5 to 6 million dollars from previously unprogrammed pipeline funds—which makes an assured total of about $185,000,000.
- 4.
- Will tell him it may be possible to meet their request for $5,000,000 to $6,000,000 PL 480 money for tobacco (if this is to be approved as we understand, should appreciate firm instructions if possible by Nov 27 so we can proceed with negotiations).
- 5.
- Explain to Diem possibilities of development loan fund for such self-liquidating projects as Saigon thermal plant, Saigon water supply, Nong Son coal mine, etc., which if fully justified and approved could bring in 10–15 million dollars additional aid, making possible total figure close to $200,000,000.
- 6.
- Assure him through General Williams that MAAG approved military budget will permit GVN to carry on its military build up and training at same pace as last year.
- 7.
- Tell him we approve contribution for 43,500 Self Defense Corps. (This figure worked out by MAAG on basis study of needs to cover villages in sensitive areas not covered by other forces and funds are provided for this number in MAAG approved military budget—see CINCPAC message to OSD DTG 162305Z subject: Vietnam Self Defense Corps.4) This approval given on basis specific steps he must take to strengthen organizational, training and screening methods for SDC.
- 8.
- Explain global demands on reduced aid appropriations and underline necessity consider totality VN resources rather than presentation of series of additive aid requests.
- 9.
- Shall make it clear it essential despite Diem’s criticisms of our procedures that GVN officials must cooperate with us fully to work out details of acceptable projects if he wishes receive additional aid above DS figure.
He will probably react rather strongly by pleading his “special” case and his full Western orientation, but I hope by presenting picture in this way we can convince him we are giving him special treatment as a staunch ally.
Detailed reply to reftel in subsequent message.5
- Source: Department of State, Central Files, 751G.5–MSP/11–2557. Secret; Priority.↩
- Supra.↩
- Reference is to the Subcommittee on International Operations, chaired by Porter Hardy, Jr. (D.–Va.). The subcommittee was part of the House Committee on Government Operations.↩
- See footnote 7, Document 403.↩
- In telegram 1124 from Saigon, November 26. (Department of State, Central Files, 751G.5–MSP/11–2657)↩