72. Editorial Note
In a letter to Diem, May 8, 1961 (see Document 48), President Kennedy offered to send a special group of economic and fiscal experts to Viet-Nam to work out a financial plan on which to base United States-Vietnamese joint efforts. Following Diem’s agreement to this proposal, the Department of State began to look for a prominent American economist to head the mission. Personal commitments prevented Neil Jacoby, Head of the UCLA Business School, from taking on the assignment, and Eugene A. Staley, Research Director of the Stanford Research Institute, subsequently accepted the appointment. Colonel Black, William Diehl (Department of the Treasury), Paul Geren and Warren Green (Department of State), and Herman Kleine (ICA) completed the group.
On June 1, the Embassy in Saigon transmitted the terms of reference for the group:
“Purpose of Special Financial Group (SFG) is to provide expert economic and financial advice to assist Ambassador in reaching agreement with GVN on a financial plan, based on appraisal of present resources that may be available to the GVN including contributions from abroad. Plan should be designed to use resources to finance:
- “1) appropriate level-military and security forces
- “2) continuing social programs now underway, and their expansions where necessary;
- “3) continuing economic development.” (Telegram 1828; Department of State, Central Files, 751K.5-MSP/6-161)
Staley had “a rather thorough initial discussion on Saturday afternoon [May 27] with Sterling Cottrell”. (Staley letter to Bowles, May 29; Yale University, Bowles Papers, Box 292, Folder 0421 Staley) The Staley Group held its first meeting on May 31 and met again on June 5. Two days later Staley discussed Viet-Nam with Lansdale. On June 14, he talked with senior Defense Department officials, and on the following day, with Vice President Johnson before departing for Saigon on June 16. Staley’s shorthand notes on the conversations with Lansdale and the Vice President and his appointment book showing the schedule of meetings are in his personal papers. No records of the other discussions have been found.