68. Telegram From the Embassy in Vietnam to the Department of State1

852. CINCPAC for POLAD. Deptel 869,2Embtel 790.3 Went to day to prod Thuan on counter-insurgency fund. Ran into what has proved to be serious trouble. Thuan first raised certain questions and objections of relatively minor nature which he said had been raised by Director of Budget and Department of Interior. Discussing these, I suggested that we get our experts together in next day or two to iron out any remaining differences so that proposed letter could be signed and matter concluded.

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Thuan then said (asking me not to report) that agreement in principle that he had previously gotten from Ngo Dinh Nhu had been withdrawn. I asked him whether President Diem had also reneged, and he said no, that Nhu was the trouble. I asked him why, and he said in effect that Nhu had been frightened off from close collaboration envisaged in this counter-insurgency proposal by the “atmosphere” now prevailing in US-GVN relations. In discussing this, Thuan repeatedly referred to the doubts and misgivings engendered by the Mansfield report, by editorial and press pressures against the GVN in America, by what appeared to Nhu to be indications of US uncertainty in continued support of GVN. In this connection he referred to Washington Post story about Nguyen Ton Hoan and upcoming visit of Warren Unna, whom he characterized as incurably prejudiced against GVN. In short, he said that Nhu particularly was disturbed about entering into a commitment of this sort (both procedural and financial) at a time when he thought he saw signs of a possible shift in US policy.

In a long discussion I attempted to disabuse him of these doubts, citing recent statements by Secretaries Rusk and Harriman and giving him my own convictions. Thuan commented that it was ironic that these tremors should be disturbing basis of our joint endeavors at very time when our team work is excellent and when real progress is being made. With this comment I heartily agreed.

I suggested that, even if Nhu had grounds for feeling as he does, the best way to get over this period is to demonstrate confidence which would in turn engender confidence; the worst way would be to give USG and Congress grounds for feeling GVN was holding back in committing themselves to an essential part of the counter-insurgency struggle. I said I would like to talk to Nhu about this. Thuan said he would see him again this afternoon and try to overcome his objections, and let me know if he needed my assistance.

Comment: We have been feeling that this kind of reaction was brewing. We can get over it but it may take awhile. I would like again to stress my conviction, particularly in connection with the GAO report,4 that the sine qua non of what we can get done here under present policies is mutual confidence. I hope Nhu’s suspicions can be overcome and that they will not rub off on President Diem and other members of the government.

  1. Source: Department of State, Central Files, AID(US) S VIET. Secret; Limit Distribution. Repeated to CINCPAC.
  2. In telegram 869 to Saigon, March 15, the Department of State asked for a status report on efforts to settle the details of CI financing. (Ibid.)
  3. In telegram 790 from Saigon, March 6, Nolting reported that Thuan had advised him that President Diem had accepted “in principle” the U.S. proposal for a joint counterinsurgency fund for 1963, “although he still needed to be filled in on details.” (Ibid.)
  4. See footnote 2, Document 62.