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Declassified per Executive Order 13526. Section 3.3 
NND Project Number: NND 633 16. By: NWD Date: 201 1 

IV.C Evolution of the War (26 Vols.) 

Direct Action: The Johnson Commitments, 1964-1968 

(16 Vols.) 

9. U.S.-GVN Relations (2 Vols.) 

b. Volume 2: July 1965 - December 1967 

Declassified per Executive Order 13526. Section 3,3 
NND Project Number: NND 633 16. By: NWD Date: 201 1 



1945 - 1967 




Declassified per Executive Order 13526. Section 3.3 
NND Project Number: NND 633 16. By: NWD Date: 201 1 

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iv. c. 9. (t,) 

US /GVJ! Rela tio ns; 1963 -_ 1967 

TOP S ECRET -.Sensitive 


Sec t». »-— M-SLSLK- 

Declassified per Executive Order 13526. Section 3.3 
NND Project Number: NND 633 16. By: NWD Date: 201 1 

Declassified per Executive Order 13526. Section 3,3 
NND Project Number: NND 633 16. By: NWD Date: 201 1 

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By the summer of 1965, the war in Vietnam had dramatically changed 
its complexion from the previous two years. More and more, with U.S. 
combat forces pouring into SVN and Rolling Thunder underway, it l°°ked 
like the U.S. against the DRV. The war was no longer being fought with 
U S advice and aid alone; there was now a massive U.S. presence. While 
official documents still repeated the credo that it was, in the last 
analysis, a struggle for the GVN to win or lose the focus of U.S con- 
cern shifted. As the U.S. role increased and then predominated, the 
need for GVN effectiveness in the now and short-run received less attention.. 
^e U S would take care of the war now-defeat the enemy mam forces and 
destroy Hanoi's will to persist-then, the GVN C0 ^ d + an ^ ^r£hTcVN 
resuscitate itself. Only after the immediate security threat to the GVN 
vas blunted and forced to subside did we expect our South Vietnamese ally 
to improve its performance on all fronts. Until then and m order to get 
to that point, the U.S. would concentrate on what it could do. 

This view— a massive U.S. effort in the short-run leading to and 
enabling a GVN effort in the long-run-set the tone and content of U.S.- 
GVN relations. In policy terms, it meant caution in the use of U.S 
leverage. There seemed to be no compelling requirement to be tough ptn 
Saigon; it would only prematurely rock the boat. To press for efficiency 
would he likely, it was reasoned, to generate instability, air objective 
became simple: if we could not expect more GVN efficiency, we could at 
least get a more stable and legitimate GVN. Nation-buildmg was the key 
Phrase This required a constitution and free elections. Moreover, if we 
could not have the reality, we would start with appearances. U.S influ- 
ence was successfully directed at developing a democratic GVN in form. 
Banning in September 1966, a series of free elections were held, first 
?of a Constituent Assembly and later for village officials, the Presidency, 
House and Senate. 

U S -GVN relations from June of 1965 to 1968, then, have to be under- 
stood in'terms of the new parameters of the war. Before this date, our 
overriding objective had to be and was governmental stability. After the 
Sem coup? the GVN underwent six changes in leadership in _ the space of 
It and a half years. From June 1965 on, there was relative stability. 
SJ and Thieu, while challenged, proved strong enough to keep their power 
2d position' In putting down the Struggle Movement (following General 
Si'! dismissal by Ky) in the first half of 1 9 66, and then delivering on 
Jhe September, 1966 election, GVN effectively discredited the militant 
Buddhist leadership and for the time being ended its threat to political 
stability. Concern about possible neutralism or anarchy, which had been 

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important in U.S. thinking in 1964 and early 1965? subsided accordingly. 
The uneasy agreement between Thieu and Ky to run on the same ticket, 
resulting partly from U.S. pressure for military unity, and the subsequent 
transition to legitimacy, gave the U.S. a sense of relief and satisfaction, 
although no one suggested that GVN had yet built a broad political base 
or had solved its effectiveness problems. This GVN stability made possible 
the increased attention to pacification and nation-building. 

The pacification parameter had changed as well. From 1961 to June of 
1965, the U.S. flooded SVN with the advisory resources of men and money 
to keep the GVN afloat and RVNAF fighting. This input lacked a clear plan. 
After June 1965, we made a concerted effort to organize pacification. 
We exacted an agreement from the GVN in the fall of 1966 to shift half of 
its ground forces into pacification— although U.S. forces carried a share 
of this burden and attempted to show RVNAF how to do it. We tried to 
centralize pacification programs by creating a new GVN structure to control .' 
and allocate resources. This was made manifest by the establishment of a 
separate Ministry for Revolutionary Development. U.S. moves by stages to 
the unified civil-military CORDS organization in Vietnam paralleled this 
super-ministry for pacification. And, pacification statistics showed steady 
increase of GVN control in the "countryside, reversing the downward trend 
of previous years— but, U.S. dissatisfaction with GVN performance also 
increased nonetheless . 

Beyond and more important than all this were the U.S. efforts them- 
selves. By the close of 1965, 170,000 U.S. combat forces were in SVN- By 
the end of 1967, this figure was almost half a million. By mid-1965, U.S. 
air strikes against. North Vietnam had extended in geographic coverage up 
to 20°30', and approved targets had widened beyond LOC's. Total sorties 
rose to about 900 per week. By 1968, we were bombing throughout the North, 
with very few though important targets still being prohibited. Total sorties 
per week reached about 4,000. 

It was in this context that U.S. -GVN relations took shape. 

Leverag e 

Having suffered several backfires in the attempts to require or encourage 
GVN effectiveness in 1964, the Embassy and Washington generally preferred to 
let well enough alone in 1965 through 1967. The U.S. limited itself to only 
a few demands, and usually avoided direct confrontations at the top levels 
of government-to-government contact. 

The U.S. had one repetition of its old backfire problem following the 
Honolulu Conference of February 1966. President Johnson embraced Ky pub- 
licly and endorsed his government; Ky then felt strong enough to move against 
General Thi, who had been making trouble generally and was almost openly 
waiting for his chance to take over the GVN. Ky eventually succeeded in 
removing Thi and getting him out of the country, but at the cost of returning 

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to a degree of chaos in May that was in some ways worse tnan any suffered 
in 1Q614- under Khanh. At the height of the crisis, the U.S. went so far 
as to use force and the threat of force against both sides to keep the 
confrontation between GVN and the Struggle Movement within bounds. There 
was no sign of ill effects from our boldness in this instance. 

Whatever interest there was in putting pressure on the top levels of 
GVN was stronger in Washington than in the Embassy, and stronger in the 
Embassy than in MACV, as it had been in the past. But the past failures 
of such pressures made everyone gunshy. At one point, Washington felt so 
strongly about the high GVN dollar balances that it sent out its own 
representative to negotiate with GVN, and he freely threatened to cut down 
U S dollar aid. However, neither Washington nor the Embassy suggested 
doing anything so drastic as holding up aid payments and pro D ects until 
a satisfactory agreement could be reached. Confident that the threats _. 
were empty, GVN dug in its heels and gave us nothing but more promises. . 

Although the U.S. played down pressure or leverage on the top level 
of GVN, the idea of leverage at lower levels enjoyed a resurgence. Interest 
in the subject reached a low point in June 1965, when we abandoned the • 
"troika signoff," which had given U.S. province representatives veto control 
over the use of AID direct- support commodities. For four months starting 
October 1, 1965, MACV experimented with giving its sector advisors a petty 
cash fund for urgent projects; however, MACV then dropped the idea. In 
April 1966, Lodge urged restoration of these types of leverage, and the idea 
kept coming up thereafter. Two major studies, one in Saigon in l°o6 and one 
in Washington in 1967, came down strongly for regular procedures to use our 
material support to put pressure on lower echelons of GVN. They P aroicular3y 
emphasized signoff systems and the like, including U.S. distribution of MAP 
support within Vietnam. But the fear that such methods would prove counter- 
productive, either by provoking resistance or by making Vietnamese officials 
more dependent on our people and less able to perform on their own, pre- 
vented adoption of the proposals. 

In at least three instances, AID cut off its support to a province in 
order to pressure the province chief. In September 1965, AID accused the 
province chief of Binh Tuy of misuse of AID funds, and had to withdraw Its 
Personnel from the province and cut off support to it after threats on their 
lives. The incident got into the papers and embarrassed both GVN and the 
Embassy; after several weeks GVN moved the accused officer uo another job, 
and AID resumed its program in the province. In June 1966, AID cut off 
shipments to Kontum province for four days to force the province chief to 
account for the end uses of AID commodities. In August 1967, CORDS cut 
off shipments to Bien Hoa province for eleven weeks for similar reasons. 

In contrast, MACV scrupulously avoided withholding MAP support from 
military units, regardless of circumstances. The single case of record of 

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taking away MAP support involved two fishing boats owned by the Vietnam 
Navy that were found ineligible for such support. In his reaction to 
the PROVN Report in May 1966, in his directives to advisers around the 
time of the Chinh-Hunnicutt affair in the fall of 1966, and in his reaction 
to Washington inquiries in May 1967, COMUSMACV consistently brushed aside 
criticism of ARVN and told both his superiors and his subordinates to lay 
off. Whatever interest in leverage there was at lower levels in the field 
received no backing from COMUSMACV. In March 1966, a decision to transfer 
MAP for Vietnam to service funding had no effect on leverage because MACV 
continued to put material support in Vietnamese hands as soon as it entered 
the country. 

Although AID tried some leverage in this period, and although the 
Ambassador, the Mission, and officials tuned to U.S. domestic pressures 
urged U.S. leverage for GVN reforms, there is still no documented study 
of GVN's failures, of the reasons for it, and of the ways that leverage 
of different types might help improve GVN permanently. The basic problem 
of concern is GVN's overall failure to do its civil and military jobs. 
Leverage in the hands of U.S. personnel might assure that GVN would do 
particular things we want; but we have no information on what kind of 
leverage, if any, would reform GVN. From I96U onwards, high U.S. officials, 
including McGeorge Bundy and Secretary McNamara, have said at one time and 
another than thorough reform of GVN is necessary; but no one has found or 
even seriously proposed a way to do it. Encadrement proposals, prominent 
before June 1965, still received occasional mention; but these proposed to 
make up for GVN's deficiencies by substituting U.S. control for GVN control, 
and do not purport to reform GVN itself. If this problem has a solution, 
we have yet to find it. 

The Embassy's Lack of Political Contact 

The turbulent events of 196k and early 1965 had shown that the Embassy 
had no effective system, either through overt or covert contacts, for finding 
out what was going on. Nothing was done subsequently to correct this prob- 
lem. CAS people talked to a few official contacts, who told them things the 
Vietnamese wanted the U.S. to believe; but CIA had and has no mandate or 
mission to perform systematic intelligence and espionage in friendly countries, 
and so lacks the resources to gather and evaluate the large amounts of informa- 
tion required on political forces, corruption, connections, and so on. 

General Thi began sounding out his U.S. contacts on whether the U.S. 
appreciated his superior qualities as a potential leader of Vietnam as early 
as August 1965: and in other ways we had plenty of warning that there would 
be trouble. However, we showed no feel for cause and effect. President 
Johnson's embrace of Ky at Honolulu in February, 1966, could only have had 
a divisive effect when Ky commanded so little solid support within his own 
country. On the one hand, civilians and the military had flouted U.S. wishes 
so often in the past that express U.S. support scarcely counted for much; but 
on the other hand, Ky's weakness and Thi's known ambitions tempted Ky to get 
whatever mileage he could out of our support. In the subsequent turbulence, 


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all parties again flouted U.S. wishes freely, stopping short only when 
the U.S. used force and the credible threat of force to oppose them. The 
maneuverings of the various political groups seemed to surprise the Embassy 
repeatedly. The same problems arose in the GVI'T cabinet split and crisis 
just before the Manila Conference in October 1966. The blandly naive 
language of the "Blueprint for Vietnam" in late 1967, unmodified by any 
back channel elaboration, offered no hope of any foreseeable improvement. 

The MACV Role 

The MACV organization played an important, mostly hidden, role in 
U.S.-GVN relations. At every level from Saigon to the districts, the 
advisory structure was the most pervasive instrument of intergovernmental 
contact. ARVN officers were accustomed to being spoon-fed military advice; 
so" when military dominance of GVN brought these same officers to high posi- 
tions in government, the advisor relationship conferred a latent diplomatic 
role upon MACV. Advisors were used as channels of communications on political 
and pacification matters. (On occasions such as the attempts to get Thi to 
meet Ky or to leave the country, senior MACV officers openly became diplo- 
matic emissaries . ) 

We have less record than we would like of COMUSMACV's influence. He 
reported regularly to his military seniors only on strictly military matters. 
Detailed reports of his routine, daily dealings with counterparts were not 
required of MACV as they were of the Embassy. 

From time to time, COMUSMACV revealed his own independent objectives. 
He sought protection of the ARVN officer corps from unfavorable press stories 
in order to preserve their solidarity and morale; he pressed zealously for 
the rapid build-up of U.S. ground forces; he opposed encadrement and combined 
command with ARVN; he rejected sanctions against ARVN; he objected to the 
initial constraints on the use of American forces and wanted to be free to 
operate independently of ARVN. 

General Westmoreland's strong position usually assured that his view 
prevailed. Extension of advisors, increased MAP resources, and the build- 
up of U.S. ground forces enhanced his relative position. By October 1966, 
MACV had numerical superiority of forces over Regular RVNAF; by late 1967, 
MACV had over kOO square miles of bases . His freedom from detailed reporting 
of daily contacts was itself an element of strength. When he received un- 
wanted advice and directives, he set up studies, and, after a time, proceeded 
as usual. This tendency was most notable in the case of leverage, already 
noted, and combined command. Likewise, MACV successfully resisted taking 
over the bulk of Saigon Port operations, despite pressure from Washington, 
and delayed for about a year the move to take division commanders out of the 
pacification chain of command. Another instance of MACV independence showed 
up when Rusk and Lodge wanted to keep U.S. men and equipment out of the 
confrontation between GVN and the Struggle Movement in I Corps, but they 
failed to tell MACV about it. On April 5 3 MACV went ahead and airlifted 
two battalions of Vietnamese Rangers to Danang; after that Lodge put a stop 
to it. 

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Vietnamese Non-Performance and Sensitivity 

Although population control statistics began to improve in 1966 and 
continued to do so in the first half of 1967, and although this seemed 
partly associated with the creation of the Ministry of Revolutionary Develop- 
ment and with the emphasis on its programs, few suggested that this progress 
could be held if U.S. forces withdrew. The drumbeat of criticism from field 
personnel, and the documented cases of non-performance on high-level matters, 
made it clear that there was no real improvement in GVN performance. Corrup- 
tion and inaction showed no signs of improvement; province chiefs and mili- 
tary commanders singled out by U.S. advisers as urgently needing removal 
were simply shuffled around, if moved at all, and often promoted. Increasing 
traffic in the Port of Saigon led to acute congestion problems, which GVN 
failed to clear up or materially improve. 

Moreover, on issues purportedly relating to sovereignty or "face," the 
Vietnamese continued to be quite sensitive, and the U.S. was afraid to inflame 
this sensitivity. Both sides avoided many delicate topics. A prime example 
is the lack of a bilateral treaty. The U.S. presence has always been based 
on the Pentalateral Protocol of I95O, signed by France, the Bao Dai govern- • 
ment, Laos, Cambodia and the U.S., which gave U.S. advisers and officials 
virtual diplomatic status--an arrangement reasonable back when there were 
less than two hundred of them in all Indochina, but of dubious applicability 
to the hundreds of thousands now there. This matter has cropped up from 
time to time, as in the case of American civilians being tried for currency 
violations in Vietnamese courts, where they were subject to extortion. Both 
governments cooperated in smoothing things over after a momentary disagree- 
ment over jurisdiction, and have avoided stirring things up. 

Shared sensitivity (and legitimate concern for an independent RVNAF 
role), closely related to the lack of a bilateral treaty, prevented any move 
toward joint command and U.S. control of all military operations in Vietnam. 
Both Westmoreland and the Vietnamese preferred to operate either separately 
or in loosely coordinated joint operations. The Embassy looked the other 
way from repressive police measures and political arrests unless these led 
to embarrassing press stories; and when the Ambassador would raise this type 
of issue with the GVN, it proved always to be touchy. Especially under Lodge, 
the Embassy tried to protect GVN from the press and to help it build a 
favorable image. 

Vietnamese sensitivity sometimes led to open displays of ant i -Americanism. 
These displays reached a climax in the Struggle Movement crisis in the first 
half of 1966, when the Buddhists openly accused the U.S. of helping GVN crush 
them, and they sacked and burned the U.S. Consulate in Hue. Moreover, news- 
papers reflecting officials views would occasionally publish stories expressing 
fear of a U.S. sellout in negotiations, anger at U.S. intervention in Viet- 
namese affairs (as happened during the Chinh-Kunnicutt affair), and other 
anti-American themes. 

vi T OP SECRET - Sensitive 

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Vietnamese Compliance More in Form Than in Substance 

The Vietnamese, nevertheless, showed a ready willingness to declare 
new policies, sign decrees, and engage in joint studies at our request. 
But as noted, that scarcely means that we got what we wanted on such matters. 
Ky was always willing to issue decrees purporting to clear up the port 
problem, and to make public declarations against corruption. On economic 
policy, Ky and Hanh gave us one agreement after another promising to control 
inflation and to run down their dollar balances. The relations of their 
military with MA.CV showed the same pattern. 

The Vietnamese military, on whom the U.S. counted most heavily, con- 
tinued as in earlier periods to have far more enthusiasm for external adven- 
tures than they did for getting on with the job of effective government and 
pacification. They promised much on this latter score, but delivered little. 
Knowing that we had no one else to turn to, they continued their old habits- _ 
and often openly did what they pleased about important matters, such as the 
airlift of troops to Danang in May, 1966. 

Examples of superficial compliance are almost too numerous to mention. 
The Honolulu Conference of February 1966, produced over sixty agreed points 
between the two governments on all areas of mutual interest; getting any 
follow-up proved to be like pulling teeth, and then the follow-up we got 
was nothing more as a rule than more promises. Likewise, at the Manila 
Conference much the same thing happened, where GVN agreed to programs for 
social revolution, economic progress, and so on. However, at our insistence 
they did go ahead with the constitution and elections, and they shifted half 
of ARVN into pacification. How much substantive improvement these moves 
will produce still remains to be seen. 

GVN taste for foreign adventure showed up in small, irritating ways. 
In July 1965, Thi planned unauthorized operations in the DMZ, but we stopped 
him. In 1967, we discovered that GVN had brought in Chinese nationalists 
disguised as Nungs, to engage in operations in Laos; also, they sent a group 
to put an airfield on an island 170 miles south of Hainan, apparently with- 
out consulting MA.CV. 


Increasingly throughout 1967;. GVN legitimacy and performance became a 
domestic political issue in the U.S. as well as a source of concern for 
policy-makers. No matter what issue was raised, the central importance of 
the GVN remained. If we wanted to pacify more, we had to turn to the Viet- 
namese themselves. If we desired to push for a negotiated settlement, we 
had to seriously weigh the possibilities of SVN collapse. In the last 
analysis, it was and is a war which only GVN legitimacy and effectiveness 
. can win. 

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IV. c. 9 



22 Jun 65 

1 Jul 65 
1 Jul 65 

8 Jul 65 
20 Jul 65 

28 Jul 65 
15-26 Aug 65 

28 Aug 65 
22 Sep 65 

1 Oct 65 


Memorandum from 
Vincent Puritano 
to James P. Grant 
25 Sep 65, "Joint 
Provincial Sign- 
off Authority," 
with attachment 

SD M 1 Jul 65 
Sec 8B 

Saigon to State ik, 
2 Jul 


O80020Z Jul 

SD PM 20 Jul 
para. 8B 

Saigon to State 
266, 25 Jul 

Saigon to State 
626, 26 Aug 

Saigon to State 
671, 28 Aug 

History 19&5, 
p. 2**0 

CO IS ! .CV Command 
History 1°65, - 
p. 2^0 


Troika sign-off abandoned. 

SecDef Memorandum to the President, 
recommends more aid for Vietnam. 

Taylor writes a letter to Ky asking 
him to support constructive USOM/ 
consultations on economic matters and 
the port. 

MACV and RVTIAF agree on coordination 
and cooperation, said do not discuss 
combined command. 

SecDef Memorandum to the President 
recommends U.S. veto on major GW 
commanders and on GVTi statements 
about going I'Torth. 

USOM and GVE agree on AJJJ package with 
no leverage. 

Lodge replaces Taylor, takes charge of 
the Embassy. Ky tells Lodge the U.S. 
forces should hold strategic points so 
that RVi.AF can concentrate en pacifica- 
tion, and says that the Chieu Hoi Pro- 
gram is a waste of money. 

Thi tells Lodge he can govern better 
than Ky can. 

COMUSMACV presents proposals for re- 
vitalization of Hop Tac to USC'i. 

MACV begins four-month experiment with 
sector and subsector advisor funds. 


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3 Nov 65 

15 Dec 65 

2h Dae 65 
6-8 Feb 66 

10 Mar 66 

12 Mar 66 

16 Mar 66 
March 1966 

3 Apr 66 

5 Apr 66 


SecDef DPM 

mand History 

1965, p. ata.. 

State to Saigon 
I855 31 E 

State to Saigon 
2252 k Feb 
"Vietnam; Hono- 
lulu Conference- 
Summary of Goals 
and Status of 
Activity," 30 Mar 

Kahin end Lewis j 
The U.S. in Viet - 
nam , p. £■'& and 
passim; Saigon 
to State 32oO and 
3265 9 liar 

Kahin end Lewis, 
The U.S. in Viet - 
nam , p. 2^5; and 
Saigon 3333 
lU Mar 

Saigon to State 
338I 17 Mar 

mand History 
1966, p. 510 
2^0312Z May 

mand History 
1966, p. 82^. 


d History 
1966, p. 82U; 
DTG 051125Z, Apr'; 
Saigon to State 
2986 5 Apr 


McNamara urges more active role for 
U.S. advisors. 

JGS Directive AB lUO gives GVN 
military plan to support 1966 Rural 
Construction program. 

Beginning of 37 day bombing pause and 
peace offensive. 

Honolulu Conference to press GVN for 
action on pacification and on political 
and economic reforms. Thieu and Ky 
obligingly agreed to U.S. demands.' 
Vice-President Humphrey flies with them 
back to Saigon. 

Ky persuades military leadership to 
approve his plan to exile I Corps 
Commander, General Thi. Thi resigns. 

Annamese Buddhists and students begin 
demonstration in Danang and Hue. 

Thi permitted to return to Danang to 
quiet demonstration::. 

PROVN Stuc'iy completed. 

Ky declares Donang to be in Communist 

MACV airlifts two ARVN Ranger battalions 
to Danang. 1st ARVK Division commander 
declares for the Struggle Movement; U.S. 
advisors withdrawn. 


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8 Apr 66 

9 Apr 66 

12 Apr 66 

I*; Apr 66 

h May 66 

15 May 66 

16 May 66 

21 May 66 


mand Eistory 
1966, p. 82I+ 

mand History 
1966, p. &2k 

mand Eistory 
1966, p. 824 

mand Eistory 
1966, p. 32k } 
Kahin and Lewis 
The U.S. to Viet - 
nam, p. 2>6 ' 

mand Eistory 
1966, p. 32!;.; 
Kahin and Lewis 
The U.S. in Viet- 
nam , p. 2$6 

Kahin and Lewis 
The U.S. in Viet - 
nam, p. 2$6; 
Saigon to State 
li-368 k May and 
I1605 15 May 

State to Saigon 

3^3, 3^9, 3^50 
end 3U51 15 May 

Saigon to State 
1627 and 1*635 
16 May 

State to Saigon 
3575 21 May 


Non-essential U.S. civilians removed from 
Hue . 

GVN flies two additional Ranger battalions 
to Danang after MACV refused to do so. 

U.S. protest to Struggle Movement leaders 
induces them to pull back howitzers. Two 
hundred U.S. and third country civilians 
evacuated from Danang. 

GVN withdraws its Ranger battalions from 
Danang. Relative quiet returns. 

The Directorate promises elections for a 
constituent assembly with 3-5 months. 
Buddhists and others call off demonstra- 

Ky publicly reneges on promises to hold 
August elections, says perhaps they will 
be possible by October. Lodge absent en 
long trip to Washington. Porter follows 
State guidance closely. 

GVN airlifts troops to Danang and Hue to 
quell new disorders. U.S. witholds air- 
lift protests GVN failure to consult, 
withdraws advisors from both sides. 

USMC General Walt threatens to use U.S. 
jets to shoot down any VNAF aix'craft 
used against dissident ARVN units. The 
threat succeeds 1 . 

Lodge returns, tells Ky to be conciliatory, 
use force with restraint. He does aroxind 
Saigon pagodas, but naked force in Hue 

produces self -immolations. U.S. evacuates 
its consulate and other facilities there. 


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27 May 66 

31 May 66 

1 jun 66 

5 jun 66 
18 Jun 66 

18 Jun 66 

19 jun 66 


22 Jun 66 

8-9 jun 66 
31 jul 66 

13-lW Aug 66 , 



Saigon to State 
U837 21 May 
U8I+9 and ^878 
23 May, h9h$ 
and ^963 25 May, 
h966 26 May, 
5037 27 May, 
5073 28 May, 
5378 1 Jim, 
and 3.9^7 7 Jul; 
Kahin and Levis 
ibid . 

Saigcn to State 
5163 and 5178 
1 Jun 




Kahin and Lewis 
The U.S. in Viet- 
nam, p. 257 

Kahin and Lewis 
The U.S. in Viet- 
nam, pp. 25&59> 

Kahin and Lewie 
The U.S. in Viet- 
nam , p. 2*57. 


State to Saigon 
169^ 29 Jul 

236h 3 Aug 




Ky and Thi meet; latter offered un- 
specified ARVTI job. 

Ky meets leaders of the Buddhist Insti- 
tute, offers civilian participation 'in 
an enlarged Directorate. They appear 
conciliatory and agree to appointment 
of General Lara as Commander of I Corps. 

Student mob bums U.S. consulate and 
consular residence in Hue. Struggle 
Movement fills the streets with Buddhist 
alters . 

Electoral Law Commission presents its 

Piaster devalued to official rate of 80. 

Anniversary of Thieu-Ky government pro- 
claimed a GVN holiday; one-day general 
strike called by the Buddhists. 

Directorate schedules elections for the 
Constituent Assembly for 11 September. 

Conditions quiet in I Corps; GVH steadily 
regaining control . 

Secretary McUamara visits Honolulu for 
talks with C1UCPAC. 

Thi goes into exile. 

General Westmoreland reports to the 
President at his Texas ranch. 

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2k Aug 66 

11 Sep 66 
k Oct 66 

5 Oct 66 

6 Oct 66 

10-13 Oct 66 

Ik Oct 66 



"Roles and 
Study 2k Aug 


Saigon to State 
7ol6 k Oct, 
7732 and 7752 
5 Oct, 6ok$ 
7 Oct, 6681 

17 Oct, 87I1-9 

18 Oct, 8833 

19 Oct, 8839 

20 Oct. 

State to Saigon 
6678I l'i- Oct 
and 68339 ?.8 Oct 

mand History 
1966, p. 526 

State to Saigon 
k929h 16 Sep 
^9399 17 Sep 
Saigon to State 
6997 27 Sep 
State to Saigon 
5&092 30 Sep 
61330 6 Oct 
58280 2 Oct 


MemoreJ 1 
to the 


"Roles and Missions" Study to the 


Constituent Assembly elections. 

GVN cabinet crisis brews as six civilian 
ministers, the only Southern members 
threaten to resign. 

JC.S chairs a high level joint conference 
to develop a schedule of action to 
implement road development. 

Eanh end Komer reach vague and general 
agreement on GVN bur3get and financial 

Secretary McNamara, accompanied by newly 
appointed Under Secretary of State 
Katzenback visits Saigon. Saigon Port 
congestion grows worse. 

In m McNamara urges shift of ARVN to 

3ifiCation, change of US responsibility 
to MACV, "drastic" reform of GVN. 


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Saigon to State 
7ol6 k Oct, 
7732 and 7752 
5 Oct, 8681 

17 Oct, 87^9 

18 Oct, 8833 

19 Oct, and 
8839 20 Oct, 
State to Saigon 
6678]. Ik Oct, 
68339 18 Oct 

2*1-25 Oct 66 NYTimes Article 

Texts of Communi- 
que and Declai'ations 
Signed at Close of 
Manila Conference 
26 Oct 

1 Nov 66 

2 Nov 66 
2 Nov 66 

18 Nov 66 

21 Nov 66 

29 Nov 66 

Saigon to State 
10312 7 Nov, 
11958 29 Nov 

Saigon to State 
9963 3 Nov 

Saigon to State 
7815 6 Oct and 
8l6l 1 Oct 

Saigon to State 
112h-9 18 Nov 
11*1-31 21 Nov 
State to Saigon 
9333A 28 Nov 

50331 21 Nov 

MACV Commanders 
20 Nov 


Cabinet crisis patched up at least until 
after Manila Conference. 

Manila conference of the seven nations 
aiding South Vietnam. Basic problem, is 
still to get GVN commitment to action 
on non-military measures. 

Promised GVN National Reconciliation pro- 
clamation fails to appear; instead only- 
vague reference in a speech on other sub- 
jects. Ky promised a NR speech and 
proclamation in "early December". 

Kcmer and Porter in Saigon reach agree- 
ment with GVN on foreign exchange. 

Ky promises a tough decree on port 
management . 

General Quang, deposed IV Corps Commander, 
appointed to head the new cabinet 
portfolio "Planning end Development". 
Concern continues in Washington over AID 
diversions . 

In a policy statement, COMUSMACV tells 
advisors that deficiencies of non- 
compliance are to be resolved within 
RVNAF channels. 

Washington reminds the Mission that GVN 
has not yet delivered on its Manila 
promises about NR, pacification, and 
land reform; suggests Lodge press Ky. 


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2 Tec 66 


Saigon to State 
12321 2 Dec 

December 1966 Saigon to State 
1U009 22 Dec, 
12733 7 D-3C, 
12908 ancl 12950 

9 Dec, 130 ! t6 

10 Dec, 1U009 and 
13023 22 Dec, 
livll2 23 Dec, 
1^230 26 Dec 

8 Dec 66 

December 1966 

21 Dec 66 

2 Jan 67 
7 Jan 67 

13 Jan 67 
20 Jan 67 


Saigon to State 
15569 13 Jan 67 

1966 pp. 1*71-72 

January 1967 NYTimes Article 

Saigon to St; 
1^725 2- Jan 

NYTimes Article 

Saigon to State 
15569 13 Jen 

Saigon to State 
16037 20 Jan 


Saigon declines to suggest format 5.on of 
a joint inspectorate general to follow up 
AID diversions. 

Further C-VN-USOM negotiations on the 
dollar balance problem. 

Ceremonial singing of the 1967 Combined 
Campaign Plan by COMUSMACV end Chief, JGS. 

Saigon Port congestion grows worse during 
GVN port commander's "great barge" 
experiment. State authorizes drastic 
action which Saigon declines to use. 

Chinh-Eunnicutt affair terminated with 
transfer of the U.S. adviser outside the 
theatre and issuance of a memorandum by 
the division commander stating that the 
past must be forgotten. 

U Thant advances proposals for peace. 
PreFiile-nt premises careful evaluation. 
Ky forsees negotiations nearing. Lodge 
predicts sensational military gains in 

U.S. Mission estimates GVN inflationary 
budget gap at lH-20 billion piasters. 

Ky signs laws providing for spring 
elections in 1000 villages and HOOO ham- 

Saigon resist:-. Washington suggestion for 
complete MACV takeover of Saigon port. 

GVN issues Cy 1967 budget of 75 billion 
piasters without prior consultation with 


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Zh Jan 67 

20 Feb 67 

Zh Feb 67 

10 Mar 67 

3.7 Mar #7 

19 Mar 67 

20-21 Mar 67 



State to Saigon 
123223 21 Jan 

UYTimes Article 

Saigon to State 
185U6 22 Feb 

KYTimes Article 
State to Saigon 

11*0250 19 ^ 
Saigon to State 
I8303 18 Feb 

Saigon to State 
19902 9 Mar, 
20053 1° : ' ; ar, 
20201 13 Mar, 
State to Saigon 
153532 11 Mar 

State to Sail 
15706!+ 17 Mar 

KYTimes Article 

6 Apr 67 

EXTimes Article 
Joint Communique 
Guam Meetings 
21 Mar 

NYTimes Article 


Renewed economic negotiations forseen 
with Hanh in Washington. 

JGS Chief of Staff Vien appointed to 
replace corrupt Defense Minister Co, who 
is informed on visit to Taiwan not to 
return . 

GVN agrees to work on an interim 
memorandum of understanding tc include 
implementation of the previous November s 
foreign exchange agreements. Komer 
threatens to reduce CIP; Hanh hints at 
a' raise in the piaster rate. 

Ky postpones U .S . visit to assure free 
and fair elections. 

U.S. announces military jurisdiction over 
American civilians, thus skirts the 
problems of corrupt GVN justice and 
status of forces. 

Another "Interim Agreement" reached with 
GVH on foreign exchange* 

Constituent Assembly unanimously approves 
new consitiution. Next day it is 
unanimously approved by the military 
junta end a copy presented to President 
Johnson at Guam meetings between top level 
GVN -US leadership. 

Guam meetings between top level GVN-US 
leadership. President Johnson introduces 
the new U ,S . team in Saigon; Bunker to 
be Ambassador, Locke his deputy, Komer 
the new pacification dzar within the 
MACV framework. 

General Abrams appointed Deputy to 


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18 Apr 67 

25 Apr 67 

27 Apr 67 

7 May 67 

12 May 67 

20 Jun 67 

22 Jun 67 
29-30 Jim 67 

7-8 Jul 67 
17 Jul 67 



Saigon to State 
23376 18 Apr 

NYTimes Article 
Saigon to State 
237^9 23 Apr 

NYTimes Article 

MAC J 3*H 
1506lt to 
0710352 May 

NYTimes Article 
Saigon to State 
2555^ 12 May 

Saigon to State 
28U09 20 Jun 

State to Saigon 
213330 22 Jun 

Saigon to State 
292p8 30 Jun 

NYTimes Article 
OSD(SA) Memorandum 
25 Jul, "SecDef 
VN Trip Briefings" 

NYTimes Article 
Saigon to State 
I38I 19 Jul 
1^75 20 Jul 

2U-25 Jul 67 NYTimes Article 


GVN issues a national Reconciliation pro- 
clamation that proves to be a mirage; it 
emphasises solidarity vice reconciliation. 

Lodge completes his stint, leaves Saigon. 

General Westmoreland confers with LBJ in 
Washington, addresses Congress the next 

General. Westmoreland reports on his 
command project to improve RVNAF perfor- 
mance, offers $7800 saving in cut-off 
of MAP siipport to two VNN fishing boats 
as sign of progress. ARVN evaluation 
only partially completed. 

Premier Ky announces he will seek the 
Presidency. Thieu-Ky rivalry intensifies.. 

Thieu ana Ky invited to informal 
luncheon hosted by Bunker at which unity 
of the Armed Forces is discussed. 

Mission estimates rate of inflation in 
SVN to be ^5-5036 par year. 

The Armed Forces Council of 50-60 
officers holds two day continuous session 
from which emei'ges the Thieu-Ky ticket. 

Secretary McNaraara makes his 9th visit 
to SVN. 

CA approves Thieu-Ky ticket; rejects the 
threatening Big Minn candidacy. 

Clifford-Taylor mission receives Saigon 
briefings . 


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12 Auz 67 

26 Aug 67 

3 Sep 67 


NYTines Article 

ABiEaft) Saifron 
to SecDef j 
Blueprint for 
26 Aug 

NYTimes Article 


Amy c/s General H. K. Johnson reports 
we are winning, latest V?,000 nan troop 
increase to be the last. 

Mission completes "Blueprint for Vietnam. 1 

Elections for President and Senate. 


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— in 


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IV. C« 

US/GVK RELATIONS: 19 63 - 1-967 





1 . The Ky Government ' s Inheritance 1 

2. The Ky Government and the U.S. Start Their 

Dealings, June-July 19o5 1 

3 . Quiet Sailing Through January, 1966 h 

h. The Honolulu Conference of February 6-8, 1966.- 


OF NEGOTIATING WITH A ''iTEAK" GOV'^Y l^.T . ...... . 11 

1. The Rise of the Struggle Movement, March i960 11 

2. Ky's First Attempt to Suppress the Struggle 

Movement, April 1966 15 

3. Violence Explodes in May, 1966 17 

h. Ky Restores GVK Control in I Corps, June 1966.. 20 

5. Revolutionary Development, March- June, 1966 22 

6. Lodge Favors Decentralized Leverage 25 

7. The Military Advisory Program, March-July, 1966.... 26 

8. Economic Policy and the Port of Saigon, Apr il- June, 1966. 27 

9. Political Affairs in the Third Quarter, I966 29 

10. The Ro] es and Missions Study , 31 

11. Economic Policy and The Port, Third Quarter, 1966 33 

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1. The Manila Conference, October 1966 3^ 

2. Bargaining Begins on National Reconciliation, 
October-December 1966 35 

3- More Hard Bargaining on Economic Policy and the Port, 

October -December 1966 36 

k. Corruption Becomes an Issue at Year ' s End 38 _ 

5. Political Matters at Year ' s End, 1966 39 

6 . Pacification and the Shift of ARVH ^0 

7. Military Advisory Matters at Year's End, 1966 ^1 

8. Constitution-Writing in January, 19&7 ^3 

9. Foreign Exchange Negotiations and the GVN Budget, 
January-March 1967 hk 

10. The Saigon Port Again J i-7 

11. Minor But Prickly Problems, January-March 1967 * l 8 

12. The Other War '^9 

13. Guam Meetings , March 20 and 21, 1967 k$ 

Ik. Routine Matters, April-September, 1967 • 50 

15 . The GVN Presidential Election 52 

16. Blueprint for Vietnam, August 1967 5^- 

17. The Leverage Study 56 

18. Postlogue 58 

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JUkE 1965 -"FALL 19^7 

C hapter I - The Ky Government's Early Months; The Coup 
to the Embrace at Honolulu, February 19 66 

1, The Ky Government's In h eritance l/ 

Eguyen Cao Ky, Commander of the Vietnamese Air Force, joined with 
other "Young Turks" of the Vietnamese Armed Forces to overthrow the 
civilian government of Prime Minister Quat on June 12, 1965. Attempts 
at civilian government had limped along since October, 19^4, following 
riots in August-September that had forced the generals to withdraw 
Khanh's military-dictatorial constitution and to promise civilian rule. 
That entire period had been marked by riots, coups, and attempted coups. 
By June, when Quat and the civilian President Suu found themselves m an 
impasse, Ambassador Taylor easily acquiesced in the return to direct 
military rule. 

Pacification kept lagging, and the dark military picture forced the 
U S. to decide in June to pour U.S. troops into the country as fast as 
they could be deployed. The pattern of GVn civil and military ineffec- 
tiveness had led the U.S. Government to resolve to do it ourselves, and 
to abandon any hope of forcing or inducing C-VH to do the Job without us. 
Ml concerned knew- that the Young Turks now in open control of GVH had 
repeatedly defied Ambassador Taylor and had gotten away with it. Attanpts 
at top-level leverage on GVH had produced a virtual diplomatic rupture 
for a few days at the end of 196'+ and the beginning of 1965, and the U.S. 
•was in no mood to try it 

2. The Ky Government and the U.S. Start Their Dealing s, June-July 19&5 

With Vietnam's return to overt military government, the political 
■blocs with their private armies, perhaps exhausted, bided their time. 
Communication improved between the U.S. and GVH to a state of cool 
correctness, gradually revealing lower-level GVK's intention to go on 
coasting as it always had and higher-level GVH's intention to serve its 
own interests. 

The day after the coup, C0MUS4A.CV cabled CIHCPAC in alarm about the 
military picture, requesting authority to send U.S. troops on offensive 
missions. He recalled that ARViT had lost five infantry battalions on 
the battlefield in the last three weeks, and he stated that the only 
possible U.S. response was the aggressive employment of U.S. troops 
together with the Vietnamese general reserve forces. 

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To meet this challenge successfully, troops must be maneu- 
vered fully, deployed and redeployed as necessary. 2/ 

To demonstrate how completely the initiative changes on the subject 
of combined command, Saigon announced to Washington in mid-June its in- 
tention within the next few days to conduct a backgrounder on command 
relationships. 3/ A reply from the Secretary of Defense said, 

As basis for Washington review of proposed Westmoreland 
backgrounder on command relationships and Il/LCV organizational 
structure, please furnish draft of text he will use... kj 

In late June, General Westmoreland was authorized by Washington to • 
"commit U.S. troops to combat, independent of or in conjunction with GVTi 
forces in any situation in which use of such troops is requested by an 
apurouriate GVT; commander and when, in COMUSMkCV's judgment, their use 
is^ necessary to strengthen the relative position of GW forces. 5/ 

Premier Ky, obviously wishing to play down an issue sensitive to both 
Kovernmepts, told Ambassador Taylor he saw no particular reason for any 
drastic change from the previous practice of combat support. In any speci- 
fice situation, he said that command should be worked out in accordance 
with "good sense and sound military principles." 6/ Additional deploy- 
ments caused no problem, and indeed GVK now asked for more US/BW forces 
than could be deployed or were approved. But in response to a query, 
Taylor waved aside any hope of using deployments for leverage. Discus- 
sions of combined command avoided joining issue and left matters unchanged. 7/ 

Although Taylor's initial reaction to Ky was one of apprehension, he 
was soon impressed by Ky's aggressive performance including his 26- point 
wosram. He doubted Ky's ability to implement the program, but concluded 
that military government was less likely to abandon the war effort and 
thus should be supported. 8/ 

Earlv in 1965, AID had decided to stop buying piasters for U.S. -con- 
trolled sector funds, and in June agreed with the GVH to change the province 
procedures. Effective June 22, 1 9 65, the Vietnamese Province Chi ex would 
requisition and release AID commodities on his own authority, and all sup- 
porting funds came through regular GVTI channels. The new procedures 
included elaborate reporting steps both when the U.S. advisers concurred 
and when they nonconcured with the Province Chief's actions. In practice, 
the change reduced U.S. adviser's leverage. 9/ 

On July 1, Secretary McKamara submitted a memorandum to the President 
reviewing all aspects of -Vietnam policy. However, he naturally concen- 
trated on U.S. deployments, and had little to say on SVH's problems. In 
a section titled, "Initiatives Inside Vietnam," his only significant 

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recommendations were that we should increase our AID to GVN and that 
Chieu Hoi Program should he improved. However, in another memorandum 
to the President on July 20, following a trip to Saigon, Kcl;amara 
swested that the U.S. Government should lay down some terms for it£ 
assistance. GVi, was again pressing for more U.S. forces than were 
available. He mentioned rice policy, plus a veto on major GVh com- 
manders, statements about invading UVri, and so. 10/ 

McTTamara's overall evaluation was deeply pessimistic, making clear 
why he recommended increased U.S. forces at that time: 

Estimat e of the Situation . The situation in South Vietnam 
is worse than a year ago (wnen it was worse than a year before 
that). <Vfter a few months of stalemate, the tempo of the war 
has quickened. A hard VC push is now on to dismember the nation 
and to maul the army. The VC main and local forces, reinforced 
by militia and guerrillas, have the initiative and, with large 
attacks (some in regimental strength), are hurting APVN forces 
badly. The main VC efforts have been in southern I Corps, 
northern and central II Corps and north of Saigon. The central 
highlands could well be lost to the National Liberation Front 
during this monsoon season. Since June 1, the GVE has been 
forced to abandon six district capitals; only one has been 
retaken. U.S. combat troops deployments and US/VI:AF strikes 
against the Berth have put to rest most South Vietnamese fears 
that the United States will forsake them, and US/Vi-.AF air^ 
strikes in-country have probably shaken VC morale somewhat, 
yet the government is able to provide security to fewer and 
fewer people in less and less territory as terrorism increases. 
Cities and towns are being isolated as fewer and fewer roads 
and railroads are usable and power and communications lines are 
. cut. 

The economy is deteriorating - the war is disrupting rubber 
production, rice distribution, Dalat vegetable production and 
the coastal fishing industry, causing the loss of jobs and 
income, displacement of people and frequent breakdown or sus- 
pension of vital means of transportation and communication; 
foreign exchange earnings have fallen; end severe inflation is 
threatened. 11 / 

in Saigon Ambassador Taylor gave the GVS the first definite sign of 
n S concern about the effects of U.S. deployments on Saigon port opera- 
tions and on the Vietnamese economy. In a letter to Prime Minister Ky 
dated July 1, 1965, he said: 

your experts and ours are in constant contact on /the 
budgetary deficit/ and have always worked effectively 
together... /They/ will need your support in carrying out 
the anti-inflation measures which they may recommend from 

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time to time... The rice procurement and distribution agency 
which you have in mind is an important measure of... a program 
which should also include the further development of port 

USOM also began talking about devaluing the piaster. 12/ These matters 
were to come to a head a year later. At this time, however, the Embassy 
treated these matters routinely and applied no pressure to GViT. GVT; 
officials opened the serious bidding in their meeting with Secretary 
Mclamara on July 16, saying that their gold and foreign exchange reserves 
had suffered the alarming drop from $175 million to $100 million since 
January, 196U, and requested a big increase in AID. 13/ Ambassador 
Taylor preferred to limit our counter-demands to get quick agreement; 
he said, 

We would avoid giving the Impression of asking for new 
agreements or imposing conditions for our increase AID... 
We' do not want to raise conditions in terms likely to be 
rejected or to require prolonged debate. lU/ 

On July 28, the Embassy and GVl'I settled it. The agreement touched very 
lightly on GVN obligations and on joint economic planning. It provided 
for "joint discussions to precede policy decisions. . .for control of 
inflation," etc. 15/ 

On July 8, MA.CV reviewed its relationships with the military leader- 
ship. There was no problem; they agreed that operations involving both 
U.S. and ARW' troops would use the concepts of coordination and coopera- 
tion. They did not discuss combined command. 16/ However, a flap 
developed late in July, when General Thi was reported to be planning 
operations in the DilZ. Both Taylor and Westmoreland took it up with 
GVL ! , who reassured them; Thi got back on his leash before it was too 
late. Such operations ecnanfineed r,:ore than a year later. 17/ 
A candid subsequent statement from Saigon shows the Vietnamese desired 
to have the best of both worlds. Ambassador Lodge reported to Washington 
the disparaging reactions of ARW general officers on the JGS staff to 
the U.S. Marine victory south of Chu Lai. "I flag this small straw in 
the wind as pointing up the importance of portraying our operations here 
as combined with the GYii in nature." 18/ 

3. Quiet Sailing Through January, 1966 

In August, .Ky wanted to make a trip to Taiwan, being interested in 
getting Eationsiist Chinese troops into Vietnam. The U.S. Government 
objected both to the trip and to its objective, but failed to persuade 
him to give up the trip. Later he brought in some Chinats on the sly. 
An idea floated in Washington that he or Thieu should visit the United 
States was dropped without having been brought up -with the GW. 19/ 

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Lodge arrived around the middle of August to replace Taylor. Having 
avoided the confrontations with GW of the type that Taylor had, he came 
with a residue of good will. Because he was considered responsible for 
Diem's overthrow, the Buddhists were pleased, and the militant Catholics 
dubious. In that connection, State thought it prudent to direct the 
Embassy to assure GVF that neither Lodge nor Lansdale, whom he was bring- 
ing with him, was going to try to make changes in GVE. 20/ On August 26, 
Ky told Lodge that he thought U.S. forces should "hold strategic points . 
so' that the Vietnamese could concentrate on pacification operations. 
That is, he wanted the United States to taice. over the main force war. He 
also said he thought the Chu Hoi program was a waste of money. 21/ 

In early August, Ky established a Ministry of Rural Construction (MEC) 
and a Central Rural Construction Council (CRCC). These absorbed functions 
and personnel from predecessor groups and other ministries for the 
announced purpose of providing centralized direction to the pacification 
effort. Eguyen Tat Ung was made Minister of Rural Construction while the 
Council was chaired by General Co, Minister of War and Defense. Timing 
and circumstances give no evidence of a strong U.S. hand at work. The 
U.S. Embassy viewed the new organization as the result of political man- 
euvering, but also honed the change would promote inter-ministerial 
cooperation. The move signalled renewed emphasis of pacification by both 
GVb and the mission. In late August, Ambassador Lodge announced^ the _ 
appointment of retired General Lansdale as chairman of the U.S. Mission 
liaison group to the GVlx CRCC. 

There followed a period of shuffling and reorganization during which • 
Ung was killed in a nlane crash. Two weeks later Prime Minister Ky 
announced that General Thang would succeed to the Ministry. The appoint- 
ment was for six months only, and Thang retained his position on the JGS. 
At the same time, General Co was elevated to Deputy Prime Minister for war 
and Reconstruction in a realignment that made six ministries including 
Rural Reconstruction subordinate to him. 22/ 

On August 28, General Thi told Lodge he thought he could do a better 
-job running the government than Ky was doing. He spoke at some length on 
Ky's political weaknesses, with particular emphasis on his lack of support 
in I Corps, where Thi was strong. As was his usual practice, Lodge politely 
brushed aside this approach. (Later Thi proved harder arid harder to control 
until his dismissal in March.) 23/ 

In mid-September, Lodge went on an inspection trip to Da Hang and 
Qui Khon. On his return he waxed eloquent about the benefits of the U.S. 

All reports indicated that the American troops are having 
a very beneficial effect on VK troops, giving them greater 
confidence and courage. I am always mindful of the possibility 
that the American presence will induce the VII to slump back and 
"Let George do it." But here seems to be no sign of this. 

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I wish I could describe the feeling of hope which this great 
American presence on the ground is bringing. There can no longer 
be the slightest doubt that persistence will bring success, that 
the aggression will be warded off and that for the first tame . 
since the end of W II, the cause of free men will be on an up- 
ward spiral. 2hf 

Lode's end-of-month appraisal was that civil and political progress 
la-ped behind the military. He felt there would be a political vacuum 
thaf Jhe VC would fill if the U.S. pulled out. Therefore he was trying 
to start a program to provide security and to generate indigenous 
Political a?ti£ty at the hamlet level. He noted with pleasure that. 
L vas talcing the initiative in bringing his pacification plans to 

Lansdale, to get U.S. reactions before these plans were too firm to 

change. 25/ 

BY September, a combination of inflation, black-marketeering by U.S. 
troops and other related problems led both governments to agree on im- 
portant steps. The U.S. introduced military payment certificates, and 
STSS agreed to exchange 118 piasters to the dollar for personal use 
of troops and U.S. civilians. Official U.S. purchases of piasters con- 
tinued at the old exchange rate of 35, however. 26/ 

September brought an evaluation of the three-month three-province 
pacification experiment during which each was under the unified control 

team chief; one an embassy FSO, one a MftCT sector ad vjser a one 
an AIB province representative. CCMOSMACV judged that test only P^ally 
Successful- progress achieved was attributed to the "keen spirit of cooper- 
ation" by il? tf am members. Because he believed the results inconclusive 
and in vie, of the existing military situation General ^estmore land in- 
cluded that the team chief concept should not be implemented, ihe expen 
ment was officially ended. 

The U.S. also became deeply involved in the rice trade V ietnam 
changed over from a rice exporter in the years through 196H to a heavy 
Sporter from 1965 onwards. AID provided the imported rice unde r CIP. 
^September, 196H, Ambassador Lodge spoke of measures we are taking to 
control the price of rice; inasmuch as AID provided the imports, USO/: 
Sa say in the OVK's policies on price control, subsidization, and dis- 
tribution of rice. 2?/ 

During this ueriod a problem flared up over a corrupt^Province Chief. 
t+ colonel Chi, Province Chief of Binh Tuy, was accused of misuse of 
S^OOO ci AlD'funds. After pressure from AID had merely produced threats 
Lainst the lives of AID personnel in the province on September ,3 AID 
vlSdrew them and suspended AID to the province. Chi was a protege of 
EnerS Co, the Minister of Defense and Deputy Premier, who hamself figured 
in charges of corruption a year later. On October-5, the story got into 

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the uapers, and on the 7th Xy promised publicly to remove Chi. Lodge 
played no role in starting this episode, and told the Mission Council 
on October 7 that he did not want it repeated. After a six-weeks delay, 
Ky did remove Chi on llovember 25, and gave him a job in the Ministry of 
Defense. AID to the province resumed. 28/ 

Advisers in the field kept on complaining about the delays in the 
Vietnamese system, and pressed for restoration of some resources of 
their own. On October 1, 1965, MACV began giving its sector and sub- 
sector advisers piaster funds they could spend on urgent Projects aach 
subsector adviser had access to 50,000 piasters which could be replenished 
as necessary. Toward the end of 1 9 65 it became obvious that this method 
Ss highly successful. Consideration was given to permanent establishment 
of the revolving fund. 29/ 

However, after the trial period of about ^ur months MACV abandoned 
the plan because of strong opposition by General Thang, Mi^r_of . 

Revolutionary ^^^^ -J^^^^l^^T^ ^ T 
T^^^^T^C^l^ and subsector advisers wanted to 
Promote- letting them bypass his people would encourage the laUer to 
lapse into their old bafhabits and thwart both governments' mam objec- 
tives. 30/ 

- USOM also had second thoughts about abandoning the sign-off system. 
Parlv in October 1965, the Mission Council approved a plan to restore the 
?! olka n s?gloff procedure as it had existed prior to June After the - 
Mission had already reopened the issue with the GV,:, 31/ the Stat e 
Department objected, saying that the United States wanted ,0 make the 
Vietnamese more independent and effective. 

After a time the frustrations of the advisers began striking a 
sympathetic chord at the highest levels. In a draft «randum to the 
Resident dated November 3, 1965, Secretary Mc!:amara stated his own im 
Stience with the CVi! and urged a more active role for our advisers at 
patience vi " , ± of such high-level interest 

S5S" rxJeurarfxpre^rbrdecisiLs to extend the advisory system 
to lower levels; as just noted State objected to the restoration of 
troika sign-off on October 16, 1965. 

Some uncertainty and disagreement with respect to pacification de- 
v elo.edwiSinUniteJ States groups in Vietnam. * *"^*"j>* General 
Tnnsdele Special Assistant to the Ambassador, askea who on the U.S. side 
shoS have the executive role in dealing with the Rural Construction 
MtoXtryt Lansdale envisaged that MACV and JUSPAO would be observers only. 

' COMUSMA CV disagreed -* **>S£! ^^^^^^ 

^pSfStLr^o^ reefer cadre teams would impact directly 

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and seriously on MACV efforts to maintain RWAF strengths. Minister of 
Rural Construction was Major General Thang who also was Director of Opera- 
tions, JGS. He looked to MACV for advice and assistance on the whole 
spectrum of pacification problems. 

On December 15 in a memorandum to Major General Lansdale, the Am- 
bassador said, 

I consider the GV?: effort in this domain (apart from 
the military clearing phase) to be primarily civilian... 
Conseauently, on the American side it is preferable that 
the two civilian agencies, USAID and CAS, be the operating 
support agencies. 32/ 

The GVN military plan in support of the 1966 Rural Construction plan 
W as given in the JGS Directive AB 1^0 of December 15, 1965, which had been 
developed in coordination with MACV and the Ministry of Rural Construction. 
In November onward, portions of the 1966 GVT: defense budget prepared in 
accordance with U.S. guidelines were received by MACV. 33/ 

At the time of the Christmas truce, President Johnson launched a peace 
offensive, including a suspension of bombing in North Vietnam that lasted 
37 days. The moves were carefully cleared with GVK and with its Ambassa- 
dor in Washington, and caused no significant problems. Lodge s appraisal 
was that the "offensive" achieved all its aims, at no significant cost. 
However, trouble flared up over a plan to release 20 HVA prisoners across _ 
the DMZ; General Thi was not consulted, and said he would not permit it [xn 
his Corps). Things were smoothed over amicably by Tet. 3j+/ 

One troublesome area was GVN's hawkishness over such issues as border 
incidents. Ky keut pressing for action against Cambodian sanctuaries; 
the U.S. stood firm on the rule of self-defense in emergencies only, which 
could mean shooting across the border but not maneuvering troops across 
it. Ky wanted to encourage a Khmer Serai expedition, which would cause 
a flare-up with the Cambodian Government; State directed Lodge to keep 
him on a tight leash. 35/ 

Coup rumors started to circulate around the first of the year; L° d ge 
remarked* that just before Tet was a normal season for that. On December 29 
Kv told Lodge of an alleged assassination plot directed at Ky, Co, the 
Buddhist leader Thich Tarn Chau, and Lodge. On January 15, VKAF took to 
the air in nervous reaction to some supposedly suspicious troop movements; 
Lodge reported more rumors on January 19, and took the opportunity to spell 
out his position: 

If .corridor coup. . .caused directorate members to fall out, 
conseauences could be disastrous. . .A peaceful reshuffle within 
directorate is a continuing possibility. I would deplore it. 
tfe take all rumors and reports of government change very seri- 
ously and never miss an opportunity to make clear U.S. support 
\J f 0T) and the need for, governmental stability. 3o/ 

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Around the middle of January 19^6, Ky addressed the Armed Forces 
Convention. He announced the prospective formation, after Tet, of a 
"Democracy Building Council" to serve as a constituent assembly and 
legislature. It would write a new constitution by October, 1966, pre- 
paratory to elections in 19&7- This was the opening shot in what 
became a big issue within a few weeks. 37/ 

k . The Honolulu Conference of February 6-8, 1966 

By late January, it was clear that Lodge's policy of not pushing CVJ 
too hard may have helped keep things amicable but permitted pacification 
to keep lagging and permitted economic problems to grow serious.. 'With 
conspicuous haste that caused GVS some loss of face, the U.S. summoned 
Thieu, Ky, and other GW officials to Honolulu to express renewed and 
heightened U.S. concern. The U.S. wanted to re-emphasize pacification, 
with a corresponding shift of authority from the ARVT; line command to 
the province chiefs; and it wanted strong action to limit inflation, to 
clear the Saigon Port, and to limit the unfavorable effect of U.S. deploy- . 
ments on the U.S. balance of payments. 38 / 

For the first time in over a year, the U.S. bargained hard with GW 
on issues of these kinds. The C-vTi agreed to the main U.S. demands on 
authority for the provinces chiefs. Moreover, it promised fiscal reform, 
devaluation, port and customs reform, and the use of GW dollar balances 
to finance additional imports. The GVF also agreed that an International 
Monetary Fund team should be invited to give technical advice on these 
economic programs. Thieu and Ky promised to go ahead with a new consti- 
tution, to be drafted by an appointed Advisory Council, and then ratified 
by popular vote in -late i960; following that, they promised, the GTii 
would create an elected government rooted in the constitution. The U.S. 
promised to increase AID imports to ikOO million in 1966, plus $150 million 
in project assistance. 

Altogether the two governments exchanged over 60 agreed points and 
assurances, ranging over free world (third country) assistance, rural 
construction (pacification), refugees, political development, Montagnards, 
Chieu Hoi, health, education, agriculture, and economic and financial pro- 
grams. This package was far more specific than any previous US/GVK agree- 
ment. Their public statements after the conference emphasized social 
justice, the promise of elected government, and the U.S. lack of interest 
in bases or permanent alliance in South Vietnam. 

In a public, appearance at the conference, President Johnson embraced 
Prime Minister Ky, before photographers. Although it caused no loss of 
face directly, in the eyes of many observers this act added to the im- 
pression that Ky was tied to our apron strings. If Lodge sensed this 
effect, he said nothing about it; characteristically, he said to State 
that the Honolulu Conference was good psychologically for Vietnam. 

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Directly after the conference USQK remained seriously concerned aboufe 
the high and rising black market piaster rate for dollars which they and 
the Vietnamese business community regarded as the bellweather of Ration. 
Moreover" hesides ixs harmful psychological effect, the high r ate tested 
U.S. uersonnel into illegal transactions, causing un favora ^ P^ c ^' 
(inasmuch as GVS refused to sell dollars in the black market to push the 
fSHown, Porter requested authorization from Washington to do it on the 
sly with CAS money. 39/7 -*••• '-■ ' 

The thrust of the Honolulu Conference was clearly to stimulate non- 
military pacification efforts. Upon his return to Saigon, Lodge issued 
a memorandum reconstituting the Mission Liaison Group under Deputy 
Lha^or Porter. Though charged by the memorandum with the management 
Tl control of all U.S. civilian agency activities supporting Revolu- 
tionary Development, Porter saw his responsibility as primarily ^ coor- 
dinating effort. He said he did not intend to get into individual agency 
activities, ko/ 

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Cha.pter II - A Rebellion, A Constituent Assembly, and the 
Hardships of negotiating With a "Weak" Government 

1. The Rise of the Struggle Movement, March 1966 

General Thi, Commander of I Corps, was a thorn in Ky's side as a 
potential rival. Both private and public disagreements showed there was 
no love lost between than; and Thi had a considerable base of support in 
his connections with the Buddhist leadership, and in his identification 
with Annamese sensitivities. These factors also made the other ^ generals 
of the Military Directorate (formerly Rational Leadership Council, etc.) 
suspicious of Thi; they felt better able to cope with Ky. 1/ 

Armed with President Johnson's public support of him, Ky resolved to 
exile Thi, and he persuaded his colleagues to go along with the idea in a 
meeting on March 10. The day before he told Lodge of his intention, say- 
ing that Thi had been culpably insubordinate; Lodge replied that he should 
be sure he could prove the charges, so as to put a good public face on the 
move, and pave the way carefully. Later in the day Lodge also advised 
him to make sure he had the votes in the Directorate, saying that for him 
to lose on the issue and be replaced as Prime Minister would be catastro- 
phic. Ky was sure of himself, although he admitted he could not prove 
his charges. In a later meeting the same day, Thieu told Lodge Thi "had 
conducted himself in a way that was not suitable," and was confident Thi' 
could be dismissed without ill effects. 2/ 

On March 10, when the Directorate voted to fire him, Thi resigned. 
Ky told Lodge that Thi would go to Da I'ang the 11th for the change-of- 
command ceremony and then leave the country for four months. The same 
day, Thi told Colonel Sam Wilson that he did not want to leave the country, 
and' that he had been encouraged by the Director of Rational Police to 
stay; Wilson suggested that he go gracefully. On -the 11th, when the time 
came for Thi to fly to Da Hang, he was detained at Tan Son Khutj Ky had. 
got wind of, or suspected, his intentions. Ky then urgently requested 
Lodge to invite Thi to the United States for a physical examination. 3/ 

The Annamese Buddhists, led by Tri Quang, who had quietly bided their 
time for about a year, now entered the action. (Ky later told' Lodge that 
Tri Quang had assented to Thi's dismissal and had then double-crossed him.) 
They began demonstrations in Da Rang and Hue on March 12, joined by the 
students, and over the next several days gained control of those cities 
as the police stood aside. Again Ky used Lodge's good offices to try to 
persuade Thi to leave the country gracefully; but the l6th, Ky and the 
Directorate decided to try to use Thi to restore order, and permitted 
him to return to Da Rang, For a few days things quieted down slightly, 
but the end was not yet in sight, kj 

State offered Lodge suggestions on how to get things calmed down. 
First, he might counsel a firm attitude by GVR, saying it would meet with 

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the Buddhists but not under threats, and that it would not permit dis- 
orders. Second, GVE might steal the initiative from the Buddhists by 
making a generous public offer of elections. Whichever course they 
followed, State wanted them to be sure it would work and would avoid a 
head-on collision with the Buddhists- In reply, Lodge agreed on the 
need to avoid a head-on collision; as for the means, he, like State, 
simply hoped for the best: 

We should not settle on one solution or another. Rather it 
is possible, if not probable, that, unless uncontrollable mass 
reaction is brought about, each side will seek to arrange what 
can be looked upon as widely acceptable. 5/ 

On March 22, Lodge and Ky had a long discussion of tactics relating 
to elections and constitution-writing. Elections were scheduled to come 
up for the largely powerless but symbolic provincial councils (which 
advised the Province Chiefs on policy matters), and Ky had reportedly 
toyed with calling off these elections. He was also far behind schedule 
on the constituent assembly he had publicly promised on January 19 for 
just after Tet, and as noted had privately promised the U.S. Government 
at Honolulu. 6/ Lodge reported: 

2. ...He is eager for advice and when he received it, 

he said he agreed with it. Low it remains to be seen whether 
it will be carried out. 

3. My advice was based on careful reflection and consul- 
tation with my associates and was to this effect: 

k. The GV1 should not cancel provincial elections as I 
had heard reported. He said that this was not exactly the 
case j that there were two provincial councils, which didn't 
want elections. I said in that event these councils should 
be made to say publicly that they didn't want elections so 
that the onus of not holding these elections would not fall 
on the Government. A public announcement had been made that 
the Government was in favor of holding these provincial 
elections; the offices involved have little actual consequence 
but are of symbolic significance; Washington had been informed 
of this fact; and if there was some reason why in one or two 
provinces they should not be held, then the provinces should 
make the reason plain. 

5. I then advised that he should take the lead and influ- 
ence opinion, and not be at the mercy of events. I suggested 
that a list of names for so-called consultative assembly (which 
I suggested would be better named "preparatory commission") 
which aims to draft a constitution, should be confirmed by the 
Generals. V;hen this had been done, I suggested that then Ky 

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Sl\lra aS read it as he looks right into the lens. 

6. His statement should be written In such a way as not to 
exclude the possibility of eleetions a er on fo r a cons titu 


indefinite period. 

7 lie agreed with all tins and seemed to understand it. 
He slid tna^t night, the Generals ha, un^jg C ~id 
the names of the meters of ^.^^^ C ^Si t S' 1 t^lciay. 
announce all this as I suggested. I Wisn r.e 

8 . t suggested that impulsive unprepared statements were 
.os/dangeroS at this time Experienced po£ icians ften 

^ jSSSftSS IT. lirunpr^ar^statements always 
worry me. 

q He agreed with me that certain Buddhists were unwittingly 
taxing cL^Tst inspired advice, as were the students xn Hue 
who had attacked me . . . 

10 He was absolutely sure that the Buddhists were divided 

That in .63, the Buddh ^—/"at ft "Sdhist S^e 


n Mv advice to him was not very drastic and quite simple 
to do' and yel I believe that if he follows it conscientiously 

/^Sitiously without procrastination that there may be 
Sou^ofaTdSn^sense of National interest to start movxng 
things along in the right direction. 

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12. He thanked me more effusively and warmly than he has 
ever done before and said he was so grateful for my interest 
in his welfare, physical and political. 

13. The situation is not yet out of hand. Ky has had 
offers from Catholics and Southerners for them to enter the 
fray on his side and start throwing their weight around, which 
he so far has been able to prevent them from doing. This is 
one of the things which I have been fearing. I talked in this 
vein with the Papal delegate and the Archbishop of Saigon 
yesterday, and they agreed completely. The leadership of the 
Southerners is not, I fear, as responsible, jj 

On March 25, Ky followed Lodge's advice more or less closely, and 
announced the Constitutional Preparatory Commission and said it would 
finish its work within two months; elections might follow by the end of 
1966. However, he insisted that GVK would exclude "Vietcong or corrupt 
elements" from the elected assembly. The move failed to restore order. 
On March 26, demonstrators in Hue broke out anti-American banners 
written in English, and an ugly incident followed in which a Marine 
tore one down. (After detailed negotiations, an apology was given and 
accepted.) The radio stations at Da Hang and Hue fell under control of 
dissident elements. 

On March 29, Ky told Lodge that he and the generals wanted to move 
on Hue and. Da Hang with military forces, and said that he could show 
that an unpublicized Buddhist split had caused the uprising. Lodge 
concurred in Ky's plan to use forces, but urged him not to try to create 
an open breach among the Buddhists. 8/ 

Although Lodge had no objection to using force against the Buddhist 
movement, both he and Rusk felt that U.S. men and equipment should stay 
out of it, to avoid heightening anti-American feelings. Rusk told Lodge 
of his deep concern about Vietnamese internal bickering at a crucial 
time; he was particularly disturbed by the anti-American propaganda com- 
ing from the Hue radio, which was physically defended by the U.S. Marines 
in that general area. He went on to say, 

We face the fact that we ourselves cannot succeed except 
in support of the South Vietnamese. Unless they are able to 
mobilize reasonable solidarity, prospects are grim. I appre- 
ciate your frank and realistic reporting and am relying 
heavily upon your good judgment to exert every effort to get 
us over the present malaise. 9/ 

Lodge replied that his influence with the Catholics had kept them 
out of it, but that his talks with Tri Q.uang had been unproductive. 
He estimated that Tri Quang had used the anti-American theme to put 

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pressure on the GRH. H>/ (Through an intermediary the Embassy learned 
that General Thi said~that the United States was too committed to leave, 
this belief may have led Thi and the Buddhists to feel free to use the 
theme as a -weapon against GOT.) 

On March 29, the Catholic leaders in whom Lodge had placed his 
hopes came out against the QVB and demanded a return to civilian rule. 11/ 

2. Ky's First Attempt to Suppress the Strugg le Movement, April 1966 

Events now happened in rapid succession. Assured of Lodge's sym- 
pathy, on April 3 Ky declared that Da Hang was in the hands of Communists. 
S April 5, despite mild Questioning from State, MACV airlifted two 
battalions'of Vietnamese Rangers to Da Hang under personal command of ky, 
and tbey started to seize the city. That same day the 1st ARVH Division 
Commander declared for the Struggle Movement, with his officers backing 
him, and U.S. advisers were withdrawn from the Division. OnApril 6, 
"non-essential" U.S. civilians withdrew from Hue. On April B,the COT 
flew two more Ranger battalions to Da Lang, using its own ^lift a.ter 
MACV refused to provide any. On April 9, U.S. re preventatives pr °^ed 
to Struggle Movement leaders about Howitzers under their co ^^^ol positioned 
within range of the Da Hang airbase; the leaders agreed ^to pull them back. 
Two hundred U.S. and third country civilians evacuated Da Hang. 12/ 

Washington played little role in all this. From time to time it 
offered milfadvlce, but Lodge had a free hand. It was his ^cision to _ 
Withhold any further U.S. airlift on April 3, although after he acted 
State agreed by urging him to push GVH toward a political rather than a 
military solution: 

Accordingly we believe you should not repeat not urge 
immediate Da Hang operations at present, but rather tnao 
entire focus of your efforts at all levels should be to 
get political process started. 

(It was at this time that Lodge wrote his long cable, discussed in the 
next section below, saying that the U.S. does not have enough influence 
in Vietnam, and that it should set up a leverage system that bypasses 
Saigon and works at the Province level.) Lodge accepted .he fact of 
Buddhist power, and wanted to avoid bloodshed, but as always his sym- 
pathies were squarely with the military leadership: 

The political crisis which has been gripping VE is now 
almost one month old. The situation has deteriorated steadily 
as the Buddhist opposition has increased pressure on tne GVK. 

Buddhist demands, when stripped of hypocrisy /and J . . . 
boil down to a naked grab for power. 

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Throughout this period we have sought certain fundamental 

A. To preserve the Til nation, and thus, the present 

B. To provide for an orderly political evolution from 
military to civil government. 

C. To preserve the Armed Forces as an effective shield 
against VC. 

D. To guard and expand all our political, economic, social 
and military gains, notably those which flowed from the 
Honolulu declaration. 

E. To maintain the effectiveness of the Free World forces 
in Vu. 13/ 

On April 12, GVN found a face-saving formula and withdrew its Ranger 
battalions from Da Hang to Saigon, and the streets became relatively quiet. 
On the lUth, the Directorate gave way to the demands for elected civilian 
government by promising elections for a Constituent Assembly within three 
to five months. For the time being the Buddhists and other political 
groups, while malting additional demands, called off the demonstrations on 
condition that Ky honor his promises, ikf 

On April 23, Lodge reviewed for State all the leverage available that 
might be used to help bring the I Corps area under government authority, 
and rejected using any of it. 

Vie have considered possibility of using U.S. control over 
economic and military commodities in I Corps to foster 
re-establishment of government authority in the areas. 

The bulk of USAID- controlled commodities are scheduled 
for use in rural areas. Comparatively little anti- 
government activity is carried on by the rural popula- 

The Hue-Dal;ang area currently is relatively well stocked 
with basic commodities. There is an estimated four month 
supply .of rice on hand and the countryside is now start- 
ing the harvesting of a rice crop... 

The U.S. currently controls, through the USAID, the follow- 
ing: (A) Warehouses in the part of Daliang containing 
quantities of construction material and PL-**80 foodstuffs 
. . . (B) Three deep draft vessels and one coastal vessel now 

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in the DaRang harbor with CTP cement, rice, fertilizer, 
and miscellaneous commercial cargo... (C) Nine chartered 
coastal vessels. . .operated for USAID... 

With respect to military commodities, RVEAF maintains a 
30-60 day supply of expendable combat items while their 
rice stocks are maintained at a 30-day level. However, 
under rationing these rice stocks can be extended to 60 
days. The KVKAF items which are in short supply through- 
out Vietnam, as well as in the Kue-DalTang area, include 
vehicle batteries, brake shoes, and POL. We consider it 
unwise to interfere with the flow of supplies to RWAF at 
this time since it would limit effectiveness of operations 
against Viet Cong forces... 

Indeed any U.S. effort to withhold resources which it con- 
trols in this area may stimulate excesses by the struggle 
movement even though an attempt is made to conceal the 
U.S. role in the imposition of sanctions. 15/ 

3. Violence Explodes in May, 1966 

After promising the elections by August 15, against Lodge's public 
disagreement, Ky said in a public statement on May h that "we will try 
to hold elections by October." In Lodge's absence, on a long trip to 
Washington, Porter protested privately to Ky that once he had made a 
public commitment on election timing he was risking further disorders 
to apoear to shirk it. nevertheless, Ky added to the flames by a 
further public statement that he expected to remain in office for 
another year. New disorders broke out, and DalTang and Hue again fell 
under overt control of the Struggle Movement. Without consulting the 
Embassy, the Directorate laid plans for several days and then on ll&y 15 
airlifted troops to DalTang and then to Hue. 16/ 

State first reaction showed unrestrained fury, and sanctioned 
"rough talk" to stop the fighting: 

This may require rough talk but U.S. cannot accept this 
insane bickering. . .do your best in next few hours. In- 
tolerable that Ky should. . .move. . .against DaFang without 
consultation with us. Urgent now to insist that fighting 
stop. 17/ 

State did not, at first, sanction the threat of force; for example, it said 
Gen Walt should continue to harbor the dissident General Dinh in III MAP 
H^adouarters, and that Walt should tell C-V.: he "can't foresee the U.S. 
Government reaction" if GVK forces should break into his Headquarters. 
Its overall guidance was to use persuasion, withdrawal of advisers, and 
a public posture of non-intervention, with the following specifics: 

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Announce that the U.S. vas not consulted, gave no help. 
Ky's use of T39 routine, "not material assistance. 

2. Furnish no airlift. 

3 Withdraw all advisers from I CTZ, including from loyal GV." 
units, except for any clearly in position to fight VC Keep 
U.S. forces out, except maybe to fight VC. 

I,, inasmuch as withdrawal of civilians and military from Dallang 
in early i^pril had a sobering effect, State authorized with- 
drawing them again (including combat forces). 

5. Exeptionto 3 : Keep contacts with Thi and 1st Division, 
and make other like exceptions. (Purpose of withdrawal is 
to avoid appearance of involvement.) 

6. Use contacts to get a compromise that avoids bloodshed. 

7. Find out "soonest" the effect on election preparations. 

8. Do not throw U.S. weight behind GVK effort. 18/ 

However, the "rough talk" actually used did reach the point of a elear 
threat of force. General Walt heard of a possible « *££ » dissident 
ARW units in their compounds, and threatened to use U.S. aj*J to shoot 
down the VKAF aircraft if they did (The Pretext was that US advisers 
would be threatened if they did, and did not apply to WAF self defe se 
against dissident MW units closing on Daiiang.) If such an attack vas 
planned, the threat succeeded. 19/ 

Porter followed State's guidance closely; he .^.J**?^*^ 
««a Th-iPii that the failure to consult was unacceptable, withneld airxxri 
SLc^andwithdre, advisers from units on both sides, and obtained from 
ThSu the assurance that the election would be held as Poised He 
refused to give public backing or opposition to either side, and tried to 
meSate. State sent several more messages with guidance along the same 
Ses, and directed him to tell both sides of USG's impatience with Viet- 
namese factionalism: 

The American people are becoming fed up with the games 
they are playing while the Americans are being asked to 
sustain such major burdens. 20/ 

On May 17, a U.S. helicopter received small arms fir e from a dissi- 
dent MW unit when carrying a GVK officer to parley with them; tne 
hScoptev returned the fire, causing several casualties. In a stormy 
S the next day with Corcoran, the U.S. Consul in Hue, Tri Quang 

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accused the U.S. of joining forces with GVH in attacking his people, and 
threatened violence against U.S. forces and facilities. Corcoran stood 
firm, saying that U.S. forces would defend themselves. State's guidance 
the same day, reaffirming the previous guidance, was to limit U.S. 
assistance to administrative aircraft, and then only when GVS had none 
available, to reassure Thi and the leaders of the Struggle Movement 
about U.S. support for free elections, to bring opposite sides 
(especially Ky and Thi) to face to face discussions, and to intervene 
as needed to end the squabbling. On May 20, Tri Quang complained to 
another U.S. official about the administrative aircraft who pointed out 
to him that the U.S. also provided such aircraft to Thi and other dissi- 
dent military officers. That same day a dissident leader threatened to 
attack GVK forces at DaZ;ang, and State directed that he be reminded that 
the U.S. forces also in DaKang would have to defend themselves. State 
also authorized the threat of total U.S. withdrawal. 21/ 

On Lodge's return to Vietnam at this time, he received detailed guidance 
from State, very similar to that previously given to Porter, for his first 
meeting with Ky. The guidance re-emphasized the demand for prior consul- 
tation by GVZi before it made any important move, and directed him to urge 
GVT; to be conciliatory and to use its forces with the utmost restraint: 

1. We must have absolute candor from Ky as to his plans, 
and opportunity to comment before significant actions. 

2. Tell him to leave pagodas alone, except for surveillance 
and encirclement. 

3. Keep AEVE out of Saigon demonstrations. 
k. Elections vs military role: Sound out. 

5. Encourage election progress. 

6. Keep GVH in contact with Buddhist leaders. 

7. Help Ky meet Thi. 

8. Consider further the suggestion of withdrawal from 
DalCang and Hue. 

9. Give us "your judgment as to whether we ought to move 
forcefully and drastically to assert our power" to end 

10. Suggest broadening the Directorate with civilians. 22/ 

By this time, Ky had begun leaning over backward to consult Porter, 
and then lodge, before every move. GVH forces overpowered roadblocks 

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and controlled DalTang, out demonstrators were ope rating f ^ely from 
pa-odas in Saigon, and the Struggle Movement had absolute contiol of 
Sue where in the next few days they surrounded and blockaded the con- 
sulate . In Saigon GVK followed Lodge's advice and neutralized the 
pagoda; by surrounding them without violating them; but in the I Corps- 
he was preparing to occupy Hue forcefully as he had Dal.ang. The 
Buddhists began a series of self-immolations. Amid mounting threats 
the U.S. evacuated the consulate and its other facilities xn Hue. 23/ 

Lodge was unreservedly sympathetic to Ky, as in April, and viewed 
the Buddhists as equivalent to card-carrying Communists; but he followed 
instructions and pressed Ky to be conciliatory. When ^J^f^^ 
fire-eating statements and whittle down his pre vxous pr omxees enac- 
tions, Lodge would patiently urge him to avoxd off-the-cuxf s ^^s 
and to limit himself to prepared statements on radxo and TV. J^dge and 
Westmoreland repeatedly pressed Ky and Thi to ? t together which they 
did on May 27; Ky offered Thi and Dinh unspecifxed Army jobs. 24/ 
State was gratified, but cautious. 25/ 

k. Ky Restores GVK Control in I Corp s, June 1QS6 

One of the main subjects of Lodge's conferences in Washington was 
vhat the U.S. Government position should be on e ^ c ^JSn^S 
stituent Assembly. Having finished deliberations and ^^. f ^ d 
Lodge returned to Saigon, State cabled the principles xt thougnt should 
guide the Mission's operations on election matters: 

A. General Principles of U.S. Action 

The U S. Mission should seek to exert maximum influ- 
ence toward the achievement of the substantive objectives 
stated in B. below. At the same time, this must be done 
with recognition that a key objective is to avoxd antx- 
Americanism becoming a major issue; we shall be accused 
of interferences in any event, but it is vitally important 
not to give potential ant i -American elements (or the press 
and outside observers) any clear handle to hxt us wxth. 

B. Objectives 

1. Elections should be held as announced by GVK on 
April 15th, that is by September 15 of this year. 

2. The issue of anti-Americanism should be kept out 
of the election campaign as far as possible. 

3 The question as to whether the constitutional 
assembly will only have the role of drafting the constitu- 
tion or will have some further function should not be 
allowed to become an active pre-election issue and the 
U.S. should take no position on this question. 

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k. The elections should be conducted so as to produce a 
constitutional assembly fairly representing the various regions 
and groups within South Vietnam (except those actively partici- 
pating with the Viet Cong), including the Army, Montagnards, 
Khmer minorities, et. al. 

5- The elections should be conducted so as to gain a maxi- 
mum improvement in the image of the C-VK in the United States 
and internationally; this calls for a wide turnout, scrupulously 
correct conduct of the voting and counting process, as little 
political limitation on voter eligibility as possible and 
vigorous efforts to avoid voter intimidation from any quarter. 
Ideas to be explored are a brief election period ceasefire, ^ 
international observation of the elections, students partici- 
pating as poll watchers, etc. 

6. The emphasis in the campaign should be on the selection 
of good men to" draft the constitution; political parties are not 
expected to play a major role although the campaign may provide 
the occasion for laying foundations for future party organization. 

7. Unless new developments change our assessment, major 
efforts should be devoted not to stimulating the formation of a 
large nationalist party but rather to the adoption of the con- 
cept that these elections bring together all non-communist groups 
who are pledged, among other things, to their country's indepen- 
dence and the continuing need to defend it with American help. 
Specifically, efforts should not be made to split the Buddhists 
or isolate the militant Buddhist faction. 

8. The election process should be a vehicle for educating 

and engaging the population in the democratic process and it should 
be used to launch political and psychological initiatives with 
youth groups, students, labor, etc. 

9. Restore as far as possible the unity of the Directorate 
and promote a reconciliation between Generals Ky and Thi. How- 
ever, discourage efforts by the Directorate to form a government 
party designed purely to perpetuate the Directorate in power to 
the exclusion of other significant political groups. 2o/ 

At the end of May things seemed to settle down. McBamara sounded 
out the Embassy about a trip in early June, but Lodge talked him out of 
it on the grounds that it might tempt the Buddhists to start demonstrat- 
ing a«*sin. Xy met Buddhist Institute leaders on May 31 and offered 
civilian participation in an enlarged Directorate. He reported that the 
Buddhists* accented this along with reassurances about elections, and 
agreed with Ky's new appointment of General Lam as Commander of I Corps. 
Lodge was skeptical: 

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The above is what Ky said and it stood up to questioning. 
It sounds too good to be true, and we will await next 
steps. 27/ 

The next day, June 1, a mob of students burned the consulate and 
consular residence in Hue. When GVI-T forces prepared to move on Hue, the 
Struggle Movement filled the streets with Buddhist altars, serving as 
roadblocks the (JVM forces hesitated to disturb, while dissident AEvTi 
units deployed in the city. 28 / 

The Directorate's April lk promise of elections of a Constituent 
Assembly on August 15 had led to the creation of an Electoral Law Com- 
mission, which the Buddhists boycotted as a result of the subsequent 
disagreements. The Commission presented its proposals on June 5> and^ 
they°included several features unacceptable to the Directorate, especi- 
ally those related to the powers and tenure of the Assembly. Ky reacted 
publicly on June 7, saying that if military-civil unity proceeded 
smoothly enough over the next few months it would be possible to post- 
pone elections. Demonstrations continued in Saigon, while a combination 
of negotiations and force gradually "brought Hue under C-VK control. 29/ 

On June 15, Ky made it clear that the Assembly would not be permitted 
to continue and to legislate after drafting a constitution, and that the 
Military Directorate would continue in power until promulgation of the 
new constitution and the seating of a subsequently elected Assembly in 
1967. (Kote that Lodge backed this attitude.) The Buddhist Institute 
called a general strike, in response to the GVE declaration that June 18, 
the anniversary of the Thieu-Ky government, would be a national holiday. 
On June 19, the Directorate scheduled the elections for the Constiuuent 
Assembly for September 11, 1966. The announcement had a calming effect, 
and the disorders came under control within a few days. The approved 
electoral law gave the Directorate ample scope to exclude unwanted candi- 
dates, and prevented the Buddhists from putting their symbol, the red 
lotus, on the ballot. 30/ (Again, note Lodge's concurrence.) 

On July 31, Thi went into exile. 31/ 

5. K e volutionary Development, March - June, 1966 

To help implement the increased emphasis given pacification at 
Honolulu. President Johnson in late March appointed Robert Komer as his 
special Assistant for "peaceful reconstruction." The creation of a high 
level focal point for pacification planning and coordinating had the 
effect of supplanting the interagency Vietnam Coordinating Committee 
(created in I96U and originally headed by William Sullivan.) Though 
Vomer's charter was more limited than that of the Vi'CC, his direct access 
to the President conferred particular importance to this position. To 
his desk came the MACV and Mission reports on the progress of pacification^ 
that struck the same gloomy note month after month. 32/ The Status Report 

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of March 30 on the Honolulu agreements said: 

1. Assure that Province Chief actually retains op con 
over necessary military forces to support program in his 
Province. Status: In Long An Province two regiments of 
the 25th Division are under Province control. This is 
encouraging, hut tactical situation elsewhere makes it 
difficult. MACV plans to augment regular forces by 120 
companies in 1966-67 (approximately ^7 will go to priority 
areas.) This augmentation if successful- will be major step 
forward . 

2. Areas where the program is underway and four priority 
areas in particular should be placed under superior Pro- 
vince Chiefs who should not be removed while program is 
underway without serious cause. Status: Since Honolulu, 
eight Province Chiefs have been replaced. Most fall 
within category mentioned by General Co at Honolulu when 

he said GvU was about to make several changes to strengthen 
their ability to achieve plans. The Mission continues to 
emphasize at every level "the need for continuity, but in 
most cases it is dangerous for U.S. to go down the line in 
support of individual Province Chiefs. 33 / 

The Mission report on the status of "Revolutionary Development" for April 


PD remains behind schedule with progress slow. As reported 
in March, lack of effective leadership, military as well as 
governmental, marginal local security, and la.te availability 
RD cadre teams, continue to hamper program accomplishments. ?>h/ 

The corresponding report for May said: 

Lack of effective low-level leadership and lack of local 
security continued to have adverse effects on RD program 

progress primarily reflects consolidation of hamlets 

and population already under a lesser degree of GVTI control 
rather than direct gains from VC control. There was no 
appreciable expansion in secured area or reduction in VC- 
controlled population. 35/ 

An incident in June highlighted the frustrations of U.S. field represen- 
tatives, and showed that leverage could work, at least on procedural 
matters. In Kontum, the Province Chief flatly refused to set up any end- 
use control procedures (filling out requisitions, etc.) for USAID com- 
modities. This refusal could not be accepted, and AID suspended all 
co::imodity shipments to the Province. After four days, the Province Chief 
gave in, and AID resumed shipments. 3§/ 

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Meanwhile, the GVT: was doing nothing about its Honolulu promises in 
the areas of administration, economic reform, and dollar balances. 
There were several U.S. Government reactions to these failures and con- 
tinuing weaknesses. There was a series of studies and proposals for 
leverage, and there was rising pressure for renewed direct negotiations 
with GW. 

An example of the studies was the U.S. Army's "Program for the 
Pacification* and Long-Term Development of South Vietnam," (PBOVK) . 

The PROW! study was completed in March 1966 by a Department of the 
Army staff team and briefed on Kay 17 at CIECPAC Headquarters during a 
visit by COMJSMACV to Hawaii. His comments at that time were that most 
of the recommendations already had been acted on. He emphasized that 
particular care should be exercised to avoid conditions which would cause 
RVE officials to he branded as U.S. puppets. 37/ 

The study results were presented in the MACV conference room on 
May 21. In response to a JCS request, COMUSKACV commented in detail on 
May 27. He noted that PIWiT recommended two major initiatives: (l) crea- 
tion of an organization to integrate the total U.S. civil-military effort, 
and (2) exercise of greatly increased U.S. involvement in GVT.' activities. 

CGMUSMACV agreed with the first recommendation but felt it was 
already being accomplished. COMUSMACV agreed that immediate and substan- 
tially increased U.S. involvement in GVii activities, in the form of con- 
structive influence and manipulations was essential to achievement of 
U.S. objectives in Vietnam. He felt there was great danger that the 
involvement envisioned would become excessive and boomerang on U.S. 
interests; U.S. manipulations could become an American takeover justi- 
fied by U.S compulsion to get the job done. 

COMUSMACV saw the advantages in removing ARVN divisions from positions 
of command over provinces, and attaching some of their units to provinces, 
but this action would require a major shift of Vietnamese attitudes. 
Assignment of ARVN units to provinces in the past had had limited success 
because of restrictions on employment and command jealousies. 

Accordingly MACV recommended that PROW, reduced primarily to a con- 
ceptual document, carrying forward the main thrusts and goals of the 
study, be presented to the National Security Council for use in developing 
concepts, policies, and actions to improve effectiveness of the American 
effort in Vietnam. 38/ 

Subseouently, JCS inquired about Revolutionary Development effective- 
ness. They asked why RD objectives could not be more effectively achieved 
with the urogram under military execution. COMUSMACV 's reply repeated 
the views^of the Ambassador's December memorandum to Lansdale and said 
the program was primarily civilian. 

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6. Lodge Favors Decentralized Leverage 

Embassy officials, meanwhile, continued to press for the restoration 
of the leverage that was lost with the dropping of the troika sign-off in 
June, 1965. There is no indication that the issue of sign-off came up at 
Honolulu, very likely because of disagreement on it between State and 
Saigon. But in April, Ambassador Lodge went on the record in favor of 
the sign-off system, and against civil encadrement in the Ministries. 

Experience and study have made it apparent that the United 
States has not the influence which it should have in Viet 
Nam and also that JyeJ could be organized so as to be rela- 
tively much more immune from some of the worst effects of 
changes of government in Saigon. 

I refer to influence in the provinces, and lower units of 
government, and not to our influence at the top of the 
Government in Saigon, which is just about as good as it 
can be. The GVN in Saigon sometimes disagrees, often 
agrees, and is rarely able to get much done... 

An error was made in giving up our right to withhold funds 
from USAID projects until we have conducted a successful 
bargain with the Vietnamese in which they agreed to carry 
out certain things which we wanted... 39/ 

There are two ways of not solving this problem of contact: 
(a) One is for a US agency head with big administrative 
responsibilities to pop over to the ministry to argue 
briefly and intensely, American-fashion, with the Minister 
— a system which is almost guaranteed not to produce re- 
sults, (b) Nor do I believe the problem is solved by 
putting American offices in the Vietnamese. Ministries. 
This was the French practice, and it too does not prevent 
bureaucratic paralysis . . . 

We should always be on the lookout for Americans who have 
the sympathy with and the knack of getting along with these 
people," and we might find some good material among the 
young men who are in the provinces. 

Another idea is to bring about a situation where we are 
really economic partners of the GVN and not merely the 
people who pay for the CIP Program without effective 
participation in the use of the piaster proceeds of that 
program. At present we have very little say in the dis- 
position of such piaster funds. Somewhere along the line 
we gave up this very important leverage. In fact, we are 
now trying to recover joint authority over those funds, but 

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progress is difficult... If we had this joint GVTT/uS 
authority, ve could get at corruption, provided we also 
had advisers with the Ministries who were really persona 
grata." ko/ 

In the first week of May, Porter put the sector fund idea to Ky, who 
rebuffed, him. Lodge tried to keep the idea alive, hut without success, kl/ 

7 . The Military Advisory Program, March-Ju ly 1966 

COMUSMA.CV's concern over declining present for combat strength of 
ARVfi units resulted in a study which shoved that as of February 28, only 
6A of their authorized strength were mustered for operations. There 
were two principal reasons: (l) Division and regimental commanders had 
organized non-TOE units such as strike/recon, recon and security recruit- 
ing teems, and (2) Large numbers of deserters, long-term nospital Patients, 
ant KIA had not been removed from rolls. MACV instructed JGS to disband 
Sm-TOE units and give increased attention to improving administrative 
procedures. Senior advisers .ere told to monitor their counterparts and 
use their influence to bring present for operations strengths up to at 
least U50 men (75 c /'0 per battalion. 

At the same time, MACV had a study made to determine the need for 
reconnaissance units. When field advisers were asked, all replies were 
favorable; so JCS was asked to develop the organization for a regimental 
reconnaissance company, j+2/ 

Training was another problem. One adviser stated, ''it is more 
accurate to describe the training program as non-existent instead of 
^satisfactory." Another said, "it appears that the battalion .commander 
dTsfres the deterioration of the training status of the battalion so that 
higner authority will place the unit in a training center to be _ retrained. 
COHUSMACV wrote to the Chief JGS in March on the subject of training, wz 
training progress did not change appreciably through 1966 from the level 
recorded during the first four months. U3/ 

There was a question of what to do about units which advisers rated 
ineffective. The 'combat effectiveness of the 5th and 25th ARVK Divisions 
was the subject of a staff study completed April 19. Five courses 01 
action were considered: 

(1) Deactivate division headquarters and place subordinate 
units under province chiefs. 

(2) Exchange the divisions with two other divisions from 
different CTZ's. 

(3) Relieve the key leaders at all levels who were marginal 
or unsatisfactory. 

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(It) Relieve the divisions of their primary responsibility 
of fighting VC and leave them to pacification. 

(5) By expression of COMUSMACV' s concern, encourage inten- 
sification of adviser efforts to solve the divisions' 
underlying problems. If there were no improvement, with- 
draw all advisers. If there were still no improvement, 
withdraw, all MAP support. 

COMUSMACV vetoed the last proposal and had it removed from the study. 
His guidance was to avoid sanctions against GVR, to intensify the effort 
to associate and integrate the 5th and 2 5 th ARVK Divisions with the 1st 
and 25th U.S. Division, and to consider the possibility of greater U.S. 
participation in pacification in Hau Kghia and Binh Duong provinces, kh/ 

in April, a study based on exhaustive analysis of field adviser reports 
and interviews was presented to RWAF. It concerned itself with several 
major problem areas: Leadership, discipline, and personnel management 
RVKAF reacted positively and quickly to the recommendations by establish- 
ing a committee to develop a leadership program.U5/ 

In response to COMUSMACV guidance in May, J-5 studied courses of 
action to produce more dynamic progress in the counterinsurgency efiort 
in RVN. It recommended establishing a Deputy COMUSMACV for RW-AF matters 
as a way to influence RTOAF more. General Westmoreland said in his en- 
dorsement that this step had already been taken with the appointment of 
Brigadier General Freund as Deputy Assistant to COMUSMACV. At the same 
time, he directed J-5 to review Brigadier General Freund s Terms of 
Reference and recommend changes or extensions. The completed J-5 study 
vas forwarded to Chief of Staff Army on July 23, recommending that the 
Special Assistant to COMUSMACV not be given responsibility for any portion 
of the U.S. Advisory effort. k§J 

Low personnel strength was another critical factor in ARVH effective- 
ness. Only one of 22 battalions rated combat ineffective ormarginally 
effective in July did not report a shortage of personnel. COMUSMACV 
advised Chief JGS to form an inspection team at general officer level to 
inspect the strength situation of ARVN division. The Inspector General, 
TGS headed the team and was assisted by COMUSMACV 's personal represen- 
tative. The team began its inspection with the 25th Division, hi/ 

8. Economic Policy and the Port of Sai gon, April-June 1966 

As noted, this period saw rising presstire for renewed direct negotia- 
tions with GV:;. When the first phase of the Struggle Movement ended in 
mid-At>ril, Washington was thoroughly dissatisfied with accumulated delays 
on the economic program agreed at Honolulu. The USG had gone ahead and 
delivered on its side of the bargain, but GVH had done nothing State 
proposed the threat of sanctions; without apparently going that far, Lodge 

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persuaded GW to cooperate fully with the IMF team then on its way, to 
work out an anti-inflationary and balance-of-payments program. 48/ 

The IMF team worked through late May and at the end of the month . 
agreed with GV3S on a program, with the following main points: 

(1) The exchange rate for imports, including tariff, would be 
increased fie* 60 to 118 piasters to the dollar except for rice, whicn 
would he brought in at 80. Purchases of piasters by U.S -troops and 
civilians, and other "invisibles," would have the 118 rate in both 
directions . 

(2) A new tax on beverages would raise about 1.5 billion 
piasters in revenue. 

(3) The GVfi would sell gold to jewelers to push the price down 
closer into line with black market dollar exchange rate. 

(10 The <m would raise wages and salaries of its employees by 
2056 immediately, with a further 10* to follow in six months 
if necessary. 

The GVM asked the USG for assurance on the following points: 

(1) The GVI'T/IMF plan would substitute for the fiscal and customs 
reforms promised at Honolulu. 

(2) The USG would liberalize the Commodity Imports Program to 
cover all importers' requests. 

(3) The USG would buy all its piasters for official programs 
at the exchange rate of 80 (versus the previous 35). 

(k) All appropriated Commodity Import Funds not used up would 
be applied to economic development projects, in Vietnam. 49/ 

The USG raised no problem about points (l) and (3) of the GVH 
requests, but for obvious reasons could give only vague and non-commixtal 
assurances on the amount of AID that Congress would authorize and reprogrem. 
Heaver, it made other concessions to increase total economic aia.^/ 
The two governments reached prompt agreement on these points, and .he 
Saster 5as devalued as proposed on June 18, along with the associated 
?iscal reXrms. The QUI*, promise to hold do,™ its dollar holdings (given 
S Honolulu) remained "binding," although the generous AID package of the 

Previous July was now raising GVU's dollar balances at a rate of about 

$100 million per year. 51/ 

The^e decisions overrode a proposal from 0SD (Systems Analysis) 
to set tough with GVK and to get deeper and more enforceable reforms. 
The DASD (Economics) predicted that the GW would fail to carry out any 

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reforms other than changing the exchange rate, and proposed to force the 
GVT; to maximize its legal revenues from CIP by threatening to curtail the 
program. Without reform of the licensing, high market prices for CIP 
commodities yielded extortionate profits to those merchants who could get 
licenses, with a presumption of kickbacks to the licensing agencies. The 
proposed reform was to auction the licenses in the presence of US obser- 
vers. He also proposed direct US purchases of piasters, in a "grey" 
market. 52/ 

Upon settling the devaluation package, the Embassy immediately 
pressed for drastic changes in Saigon port management; the pile-up of 
civilian cargoes had grown so much as to add to the already serious con- 
gestion. Lodge proposed a complete MACV takeover of the port and ware- 
houses with a Vietnamese general to be appointed as figurehead port 
director. 53/ However, the Mission backed away from the idea of complete 
takeover for the time being, and settled for MACV handling of AU> direct 
assistance commodities, not including CIP. 5-y 

The agreement reached with GW at the end of June said: 

The United States Military Agency appointed by COMUSMACV 
..-.shall forthwith assume responsibility and all necessary 
authority for . . . 

A. The receipt and discharge of all ATD-financed commodi- 
ties consigned to CPA. 

B. The obtaining of customs clearances and all other clear- 
ances . . . for such commodities . 

C. The storage and warehousing of such commodities intransit 
as necessary. 

D. The transport of such commodities to such first destina- 
tions, including GVK holding areas and/or CPA/ministerial 
depots as may be designated by USAHl/CPA. 55/' 

9. Po litical Affairs in the Third Quarter, 1966 

This period was comparatively quiet, and transactions between the two 
governments were routine. Late in June, Ky had brought up with Lodge the 
idea of a cabinet reshuffle, and Lodge had advised him to go slow. In 
July, Ky agreed to put it off. In August Ky volunteered to do something 
about the most corrupt generals in the Directorate, especially Co and 
Quang. Again, Lodge, who had frankly given up on corruption in the 
highest places, cautioned him to go slow, and Ky decided to put off any 
action until after the September elections. Lodge's advice, with State 
concurrence, concentrated on making sure Ky had definitive evidence of the 
alleged corruption; Lodge was sure that following this advice would delay 
things sufficiently. 56/ Late in August, Ky received an invitation to 

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talk to a press group in Los Angeles, and Ky tentatively accepted. Both 
Lodge and State panicked, especially when the group started to set up a 
debate between Ky and Senator Fulbright; and in the upshot they talked 
Ky out of going. 57/ 

GW launched its transition to legitimate government on September 11, 
electing the long-promised Constituent Assembly. Although GVW systematically 
excluded from the elections all persons connected with the Struggle Move- 
ment, and although the Buddhists declared a boycott, the electorate turned 
out in large numbers and the results gratified the Embassy. State had 
reservations about the exclusion of Struggle Movement people, but Lodge 
unreservedly backed this exclusion, on the ground that GVN should not be 
discoiiraged from taking moderate measures to prevent elections from being 
used as a vehicle for a Communist takeover of the country. 58/ As the 
election approached. Washington and the Embassy began to think about what 
they wanted to see in the new constitution. Lodge's view listed the 
following minimum essentials for the US best interests: 

A. A strong, stable executive. 

B. Executive control of the military. 

C. Emergency powers, so that the legislature can't 
hamstring the executive during the war emergency. 

D. Appropriate provision for the people's aspirations and rights. 

E. Minority group representation. 
Lodge also listed lower priority requirements for the new constitution: 

A. Relative ease of amendment of the constitution. 

B. Removal of either the President or the Legislature should 
be very difficult. 

C. A limited term for the President. 

D. Appropriate prevision for establishment and improvement 
of the judiciary. 

E. A superior court for constitutional review of laws and decrees. 

F. Expansion of the powers of provincial councils and other 
forms of local government. 

State exn^essed broad agreement with Lodge's views, with reservations _ about 
emergency'powers and about constitutional provisions to forbid communism and 
neutralism. 59/ 

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10. The Roles and Missions Study 

In response to a May 27 directive from Deputy Ambassador Porter, 
the Director JUSPAO had named Colonel George Jacobson chairman of a 
study group to define RD strategy and the roles and missions of the 
various elements. The group submitted its report on August 2k, 1966. 

The major recommendations of Roles and Missions Study were: 

(1) The many elements and echelons charged with destroying 
VC infrastructure are confusing. The National Police 
should have the primary mission and responsibility for 
this goal. 

(2) Reforms in basic GVN attitudes are necessary. Many rural 
residents believe that the US condones corrupt practices. 
This must be changed. 

(3) ARVN forces should be encouraged to increase participation 
in pacification activities. 

(h) PF/RF should be developed into a constabulary-type organization. 

(5) PF/RF should be transferred from the Ministry of Security 
to the Ministry of Revolutionary Development. 

(6) CIDG should be stationed only in remote areas. 

(7) The Vietnamese Information Service is not effective at local 
level. It should assume supporting role to propaganda 
activities of other agencies. 

(8) A Directorate of Intelligence should be established to 
coordinate all intelligence activities. 

(9) Reinstitution of the MACV Subsector Advisor Fund is urged. 

(10) ARVN Divisions (eventually Corps as well) should be removed 
from the chain of command in RD affairs. For instance, there 
were no USAID, JUSPAO, or CAS representatives at ARVN divi- 
sion headquarters . 

(11) Because of generally bad behavior of ARVN Ranger units, they 
should be disbanded with Rangers reassigned as individuals 
throughout the Army. 

(12) The physical and attitudinal consequences of present air and 
artillery employment policies should be studied. 

(13) A logistic system which provides for US government control un- 
til delivery of material .to end users should be substituted 

• for the present MAP procedures. 

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(ik) The Provincial Committee "signoff" provision should he 
reinstated for the Revolutionary Development hudget. 

On September 7 COMUSMACV made the following comments with respect to 
the Roles and Missions Study: 

(1) Action had been taken to increase ARVN participation in 
RD, hut removal of Division from the chain of command in 

RD activities appeared illogical. If ARVN combat battalions 
were dispersed to all ^3 provinces, the Corps span of 
control would he ineffective and this arrangement would risk 
having these units defeated in detail. The proposed place- 
ment of battalions under sector commanders was feasible only 
in some areas -- to be considered on an individual basis. 
The 1967 Combined Campaign Plan would clarify the functions 
of ARVN. Other things such as the buddy system with US units 
were the realistic ways of accomplishing the goal. 

(2) The recommended disbandment of Ranger Battalions would 
seriously reduce ARVN combat strength. They should be 
retained and reorganized under new commanders. 

(3) Recruitment of PF personnel for RD would weaken hamlet 

(k) Although the study recommended giving primary responsibility 
for intelligence to the National Police, the nature of the 
problem dictated that all US and GVN military and quasi - 
military elements contribute to this important goal. 

(5) The idea of a single intelligence director seems sound 
theoretically, but it is not realistic when DIA and CIA 
are not amalgamated in Washington. 

(6) RD requires both military and civil participation. Con- 
tinued emphasis on military participation would be given 
but the major change in the MACV organization suggested 
by the study did not seem necessary. 

One of the year's changes that could have led to implementation of a 
maior recommendation of the Roles and Missions Study, but didn't, was the 
March decision in Washington to transfer the support of FWMAF and RVNAF 
from MAP funding to service funding. Studies were made by MACV on how 
"best to implement this change, which became effective in September. It 
was decided that only the logistic advisory function would be transferred 
to USARV. Programming budgeting and executing programs remained under 
MACV. 60/ Most important, MAP goods were still put into RVNAF logistic 
channels, although under the new funding they could have been held in US 
channels down to the receiving unit. 

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11. Economic Policy and The Port, Third Quarter. 3-966 

Although in political affairs there was no significant friction "be- 
tween USG and GVfc in the Third Quarter, GVN's accumulation of dollar 
"balances and its inaction on economic matters caused growing impatience -in 
USOM and in Washington. 

In late July, 1966, Komer and Ambassador Lodge laid the "basis for 
the US position, including a suggestion that from now on USOM should make 
sure it has the means to monitor and enforce GVN compliance with its 
commitments . 

Komer said: 

Devaluation, port takeover, CIP expansion, KD reorganization 
if all skillfully meshed -- could yet have early impact on 
VN public and do much in these critical weeks to refurbish 
GVN image at home and abroad. 

So far, however, GVN has failed to move aggressively enough 
with supplies in country to curb rice and port speculation; 
has been unwilling to try to develop wage restraint policy 
in private sector, has dithered on promulgating and carrying 
out promised regulations re Warehouse removals; has gone 
about moving expanded CIP goods up country on business as ■ 
usual basis; has shuffled about on RD reorganization, and 
Thang's or Ky's famous report to the nation. 61/ 

Lodge proposed specific means to monitor GVN, and wished to urge the GVN to 
fund Revolutionary Development with counterpart piasters, so that USG could 
assure that the funding was adequate. Komer agreed with these proposals. 
Porter further proposed: 

We intend using budget review process and counterpart 
releases on leverage on GVN CY 67 programs and to seek 
GVN acceptance of both overall ceiling and commitment to 
essential revolutionary development programs before we 
agree to support any part of the budget. 

Note degree our effectiveness dependent on credibility 
our leverage by GVN, which may not be great. 62/ 

But Porter opposed a complete takeover of the Saigon port, proposed by 
Komer . 63/ 

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Chapter III - A Seven Nation Conference, Legitimate Government, 
and_High Hopes for the Future, October 1966""^" September 19o7 

1. The Manila Conference, October 1966 

In the first week of October, just as planning was beginning for a' 
seven-nation conference at Manila on Southeast Asia, latent mistrust 
between Southerners and Northerners in Ky's cabinet broke into an open 
split. A Northerner persuaded Colonel Loan, the Police Director, to 
arrest one of the Southerners, and although Loan released him on Ky's 
order a few hours later, six Southerners took it as an affront to all 
of them and threatened to resign from the cabinet. While conference 
planning was going forward, the crisis simmered on for almost three 
weeks, up to the eve of the conference. Lodge tried to mediate, but the 
six proved difficult to mollify; he conjectured that they were trying to 
get all the mileage they could out of the embarrassment the crisis would 
cause Thieu and Ky if it were not resolved before the conference. It was 
patched up at the last minute, l/ 

In preparing for the conference, Lodge was particularly concerned 
that Ky or Thieu, if put in the limelight through the opening speech to 
the conference, should avoid embarrassing the USG: 

One crucial factor must be degree to which you believe 
they can be persuaded to make constructive and reason- 
able speech, avoiding talk of invasion of the North or 
any other subjects that put us openly at variance with 
each other. . .We hope that the GVN can delegate Tran Van 
Do and Bui Diem as its drafting representatives so that 
even before they arrive in Manila we would be a long 
way toward common agreement on the kinds of language 
we need. 2/ 

The USG was also concerned that GVN should announce a broad and attrac- 
tive program that would put a good face on itself and its prosecution of 
the war: 

We welcome your news that Tran Van Do and Bai Diem will 
arrive Manila October 21... 

Since this gives us at least a solid day, the 22d, to 
refine drafts, we are inclined here not repeat not to 
ask you 'to work with GVN on detailed submissions... 
Rather and absolutely vital to favorable conference 
result, we believe you should be working with Ky to get 
his concurrence on the following list of action areas 
in which we believe forthcoming statement by GVN is not 
only wise in itself, but essential to US strong and suc- 
cessful public statement from the conference. 

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A. Land Reform 

B. Constitutional Evolution 

C. National Reconciliation 

D. Economic Stabilization 

E. Im-oroved Local Government • 

F. Radically Increased Emphasis on RD/Pacxfication 

G. Postwar Planning 
H. Corruption 

I. Port Congestion 

J. GVN Reserves 

In each of above categories, basic problem is to get SVS 
commitment and willingness to state its intentions. 3/ 

Secretary MeHamara put down his views on priorities in a Memorandum 
to the Resident on October ik. He noted that the US had not yet found 
tie formula for training and inspiring the Vietnamese The main thrust 
of the memorandum concerned shifting ARVN more into pacifi ^ n ™ d 
shifting the US pacification responsibility to MACV. But in ^scussing 
gS«S weaknesses, he commented, "drastic reform is needed. He let that 
one drop without any recommendation. 

The conferees met in Manila on October 2U-25, 196 gj^jf^j? ^ 
deliberation issued a long communique on Policies for Southeast Asia 
general and South Vietnam in particular., ^^.^^^^"^^d the 
Soutb Vietnam against North Vietnamese aggression, and support d the 

Sor" outlines of US policy ^^^^l^t 
5?»£S£ 3°S3 ^JS^^S^U -eWorld forces 
under specified conditions: 

29. In particular, they declared that allied forces are 
in the Republic of Vietnam because that country is the 
object of aggression and its Government requested support 
in the resistance of its people to aggression. They shall 
be withdrawn, after close consultation, as the ooner side 
withdraws its forces to the North, ceases infiltration, 
and the level of violence thus subsides. Those forces will 
be withdrawn as soon as possible and not later than six 
months after the above conditions have been lulfiiiea. y 

2 . valuing Begi ns on National Reconci liation, October-December 1966 

The USG having chafed at the lack of action on the C hie Hoi Program, 
vented GvHo broaaen it to attract high-level defectors by offering them 
SSs comparable to their existing ones in the VC organization. This 
Sea went' down poorly with the Vietnamese. Lodge was pressing the idea 
jJS tS beginning of October, and although they were reluctant, lhieu 
ZTlil finagled on October 20 to proclaim the new program, called 

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"National Reconciliation," on November 1, a national holiday. As noted 
above, Washington wanted and got a public commitment on this subject at 
Manila. 5/ 

Then on November 1, the promised proclamation failed to appear; 
instead, there was a vague reference to it in a speech on other subjects. 
When the Embassy inquired, Ky said the speech had to be prepared very 
carefully, and that he had not had time before November 1; he P"*^* 
he would have the speech and proclamation ready in early December lodge 
found this explanation hard to swallow, but had to accept it. When early 
Somber" arrived, there was a dead silence; and the end of this exercise 
was not yet in sight. 6/ 

3. More Hard Bargaining on Economi c Policy and the Port, 
October -" December I966 

Economic policy negotiations had the same flavor as those relating 
to National Reconciliation. The USG was dissatisfied, in the tnird 
auarter 1966, as noted, on the lack of GVN follow-up on budgetary and 
foreign exchange promise in June following the IMF agreement And m the 
fall, the Saigon Port congestion problem grew serious again; the June 
agreement had not gone far enough. 

At the end of September, Governor Hanh of the RVN National Bank came 
to Washington to negotiate specifics on economic policy. During tne 
negotiations, Komer cabled Lodge: 

/We are pressing GWj hard to agree to spend rapidly grow- 
ing foreign exchange reserves on imports. Otherwise, it 
will appear and rightly so, that GVN is getting rich at US 
taxpayer's expense. It is apparent that GVN's chief reluc- 
tance on this score is that Thanh/Hanh want to squirrel 
away reserves for postwar rehabilitation in case US goes 
away and leaves them. 7/ 

in the upshot, however, they reached only a vague and general agreement, 
on October 6, the most specific item being that GVN would Imit its in- 
flationary gap to 10 billion piasters in 1967- Dollar balances were 
deferred to later negotiations. 8/ 

There was some effort to resolve disagreements on economic matters 
and tne Port just before the Manila Conference, but no progress. Komer 
Sent to Saigon after the Conference and, assisting Porter in the negoti- 
ations, reached the following agreement with GVN on Novemoer 2: 

(1) GVN will use all gold and foreign exchange available 
to it in excess of $250 million, not including commercial 
bank working balances, to finance invisibles and mports, 
including import categories now financed by the US. 

(2) GVN will piece at least $120 million of its reserves 
in US dollar instruments of at least 2 year maturity. 

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(3) During US Yi 67 USG will make available at least 
$350 million of grant aid for imports, not including 
PL U80 Title 1 Commodities. Any portion of the $350 
million not required for such imports will be used_ 
during the US FY 67 as grant assistance for economic 
development projects. 

(k) Within the balance of payments accounts, the amounts 
or categories to he financed by each of the governments 
will be determined through joint consultation on a quar- 
terly basis. 9/ 

The putting of GVN dollar reserves into US two-year or J^-term 
bonds would technically improve the US balance of P^ 8 '^*^ 
Lin would be more nominal than real. The agreement left plenty of»« 
for further problems and State recognised that each item would probably 
have to be pressed again. 10 / 

Following this agreement, the Embassy prepared to negotiate a GVIi 
budgetary ceiling and related matters. The strategy would be to seek 
agreement on a flm budget ceiling for ^^/^^itLf ® ^ 

its spending in Vietnam. But the Embassy had misgivings about tms 


...It deprives US of the monetary gap analysis as a hinge 
on which stabilization agreements can be hung. . .Note that 
Komer-Hanh memorandum signed in Washington used 10 Billion 
gap figure as objective. 

SV3S officials are anxious to resume discussions. Prime 
Minister now has on his desk proposed GVF CY 67 budget of 
100 billion piasters. The differences between that figure 
and acceptable one is much greater than the differences in 
US ceiling estimates last discussed here during McNamara s 
visit. 11/ 

State cabled its agreement that showing GVN the US plan to limit its own 
plaster spending would help get GVN to accept tight ceilings itself. 12/ 

in December, Embassy negotiators tried to pin down GVN on the means 
to limit Sraccumulation of dollar balances, talking mainly with Governor 
Hann To evade specific commitment, he repeatedly talked as though he 
coSld no? determine GVN budget policy (which he had negotiated in Washing- 
Jon two months before) and that he could not as a good banker the 
Siee^ng transactions that would be required to permit GVN to run xhem 
doS TS~ outing sports. The Embassy negotiators then turned to the idea 
o^sking^or S a GVN contribution of 8 billion piasters to the Free World 
Sorce? operating budget in Vietnam as a cost-sharing arrangement, which 
vould incidentally reduce GVN's receipts of dollars and so help ran do* 
the balances. GVN's reply was that that was impossible. After a series 

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of talks that read like haggling in an Arabian marketplace, Porter went 
to Ky about it and got the following understanding: 

The GVN accepts the principle of contributing to free 
world forces local expense and will make a contribution of 
1 billion piasters for that purpose at the end of March 1967. 
The matter of further contribution would be considered at 
that time. I would send him a letter of understanding on that 
subject. 13 / 

The story was much the same on GVN support for AID projects. lU/ 

The Saigon Port congestion problem led to discussions starting around 
the 1st of October, which produced nominal, ineffective agreements in the 
first week. When McNamara went to Saigon to discuss new major troop de- 
ployments with MAC?, he talked to Ky on October 11, Ky kept talking about 
infiltration whenever McNamara brought up the subject 01 tne Port. Finally, 
Ky said he had solved the Port problem by telling the Minister of Finance ^ 
"to write a decree to get rid of the mafia which was dominating the poro. Jgj 

That did not solve the problem; the Embassy kept pressing. On Eovem- 
b°r 2, Ky promised a tough decree on port management and a deliver-or- 
get-fired order to the General who had been put in charge of the Port after 
th= June agreement. (Accepting merely this order would permit further 
delay before any change in the system, of course.) Later on in November, 
Ky changed port charges and accepted some increase in US military personnel 
there: but both GW and MACV strongly resisted any increase in MACV re- 
sponsibility for the port. The GVN also refused to confiscate goods left 
unclaimed over 30 days in the port warehouses. Further talks in December 
got nowhere, although State authorised drastic leverage to move GVN: 

To this end you might also tell Ky that I have gone so far 
as to propose a two month moratorium on shipment of US financed 
CIP goods" beginning 1 January to permit backlog in transit 
warehouses and on barges to be removed. You could cite my view 
as being that if GVN won't clear port, why should US add to con- 
gestion by continuing to ship goods? 

I recognize that actual moratorium would be draconian measure 
and perhaps unrealistic, but citing it... might help move Ky. 16/ 

1(.. Corruption Becomes an Issue a t Year's End 

The issue of corruption came up in several ways in November and Decem- 
ber 1966- On Eovember'lO, Ky told Lodge he was now prepared to relieve 
General Quang of his command of IV Corps, following up on intentions he 
first told Lodge about in August. Lodge again urged caution, saying Ky 
should carefully avoid starting "another General Thi incident." But Lodge 
was satisfied that by this time Ky had prepared well for the move. 17/ 

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He had: on November 18, the Embassy got word that General Quang would 
head a' newly-created Ministry of Planning and Development; the Ministry 
would deal primarily with postwar planning. The command changed and 
Quang moved^up on November 23. Possibly Ky's idea of how to deal- with 
Quang came from an end-October suggestion from the Embassy for a joint 
postwar study team, to which Ky had agreed and was to announce jointly 
with the White House. (Creating the Ministry scrambled the plans for 
the study team and announcement, so the Embassy had to go to work on a 
new plan.) 18/ 


A couole of weeks later, following allegations of corruption in news 
stories, State cabled the Embassy that the President wanted accelerated 
efforts both to coue with diversions and to deflate distorted allegations. 
State was also considering sending a '-blue ribbon panel" from Washington 
to assess the problem of AID misuse. Responding to the stories and to 
the Washington concern, Ky said he planned a national campaign against 
corruption. State told the Embassy on November 25 of suggestions in 
Washington for a joint US/GW inspectorate general to follow up AID 
diversions, and asked for a reaction. After a delay due to active truce 
discussions with the VC, Saigon replied on December 2: . 

There is already an interchange. of information on the 
working level between Ky's investigative staff and our re- 
sponsible people in USAID. We doubt GVN would respond posi- 
tively to idea of joint US/GVN inspectorate to work on AID 
diversions. This would touch very sensitive areas. While 
we want to expose and cut diversions to maximum extent 
possible, we aoubt that this rather public way is best 
suited to achieve GVN cooperation. 19 / 

On December 3, Lodge and Ky had an "amiable discussion" on corruption, and 
Ky agreed to study and consider all these suggestions. 20/ 

5. Political Matters at Year's End, 1966 

Washington and the Saigon Mission watched closely as the Constituent 
Assembly did its work. Concern arose at word that GVN was providing a 
complete draft constitution either formally or through sympathetic Deputies, 
particularly because it provided that ultimate political power would be 
vested in the Armed Forces Council. 21/ 

Washington, consistent in its championing of National Reconciliation, 
urged the Mission to make the USG's views known both to GVN and to key CA 
members before the matter became a major issue. 22/ Lodge spoke with Ky 
vho said he was at that very moment about to leave to talk with Thieu on 
the matter. Lodge further encouraged Ky to state his views on the con- 
stitution to the Chairman of the Drafting Committee and reminded Ky that 
the American constitutional expert, Professor Flanz, was available to go 
to Ky at any time to give advice in complete confidence. 23/ 

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General Thieu concluded one of his regular discussions of the mili- 
tary situation with General Westmoreland by malting a few pronouncements 
on political matters. Westmoreland stressed what was to become a per- 
sistent American theme, the importance of unity in the GTO leadership. 
Unabashedly Thieu said that the key question was whether the Army would 
stay in power and what power they would retain. 2H/ 

6. Pacification and the Shift of ARVN 

Komer, in Washington, continued to prod the Mission to goad C-Vi.. 
It seemed time to remind them, he thought, of their Manila promise to 
give top priority to land reform. Lodge was asked to press Ky for 
vigorous application of existing laws. ?.pj 

Continuing emphasis on pacification and increased impatience at^the 
lack of progress brought another reorganization of the US Mission effort. 
To unify and streamline the civilian side, the Office of Civil Operations 
(000) was established in late November under Deputy Ambassador Porter. 
An 0C0 Director in Saigon and a single Director of Civil Affairs for each 
of the four corps became responsible for the Mission's civil support of 
Vietnamese Revolutionary Development. 26/ Within GTO General Thang not 
only lasted beyond the originally envisaged six months but was elevated 
to Commissioner-General for Revolutionary Development with supervision 
over the Ministries of RD, Public Works, Agriculture, and Administration 
(Interior) . 27/ These changes seemed to enhance the chances for sub- 
stantive improvements. Washington wired, 

Why not approach Thang and after telling him about your 
reorganization and new faces you plan to put in region 
and then provinces, suggest he essay a shake-up too.... 
As I recall, around Tet GVN issues a new promotion list, 
which usually also entails some joint shifts. This might 
provide a good cover. 28 / 

The reply offered now familiar themes as the reasons for inaction, 

Specifically, if we were to give Thang a list of district 
chiefs and ask that they be removed, we do not think any 
significant change would result. In the past this tactic 
has proved cumbersome, even counterproductive, and tends 
to lead either to reshuffling of positions with little or 
no positive end result or to the Asian deep freeze treat- 
ment . 

. . .At times we will have to make our views known on par- 
ticular personalities if we find sn intolerable situation 
in key leadership positions, as we have done in Long An 
and the ARVB 25th Div. Basically, however, we will seek 
to avoid too deep an immersion in Vietnamese personalities, 


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which can so easily become a quagmire from which there is no 
escaue and concentrate instead on encouraging the GW/RWAF 
to take the initiative in a situation they know best how to 
tackle in specific tactical terms. 29/ 

Meanwhile, efforts went forward to convert half of ARVK to the primary 
mission of supporting Revolutionary Development. On October 5, the Chief 
of the Central Training Agency, Major General Vy, chaired the high level 
joint conference which assigned administrative tasks and developed a 
schedule of required actions. Subsequently, a joint MACV/JGS team 
visited a few ARW division headquarters and found that personnel had 
not understood the July JGS directives and thus had not undertaken the 
actions directed. 30 / 

At about the same time, Revolutionary Development Minister Thang 
entered one of his recurring periods of pouting because he considered 
recent American criticism of slowness to imply their evaluation of the 
program as a failure. He told Ky he was ready to resign if Americans 
were so critical that they wanted to take it over and run it. Lansdale 
was able to placate Thang, but ARW reluctance continued. 31/ 

The conversion to KD was fraught with criticism on both sides, for 
the American press continued to suggest that the ARW shift to pacifica- 
tion meant Americans would bear the brunt of the fighting and take the 
bulk of the casualties. ?2/ State considered this line tendentious and 
urged Lodge and MACV to use "all leverage provided through MAP and 
advisor program" to shift ARW to RD. 33/ 

7. Military Advisory Matters at Year's End, 1966 

COMUSMACV backed out of ARW personnel selection by serving notice 
in a message to Corps Senior Advisors that only policy matters, not the 
detailed problems of failure to perform, were to be referred to ham. 

In reviewing the deficiencies discussed in the Senior 
Advisor's Monthly Reports, it is noted that many items 
are correctable in command channels at unit, division, 
or corps level; yet it is not apparent that such action 
is being taken aggressively at local and intermediate 
command levels. Deficiencies involving policy are 
referable appropriately to this headquarters; deficien- 
cies involving non-compliance with directives, apathy 
on the part of a command, etc., are to be resolved in 
RVNAF channels. 

The role of the advisor is difficult and often frustrat- 
ing. It reauires military acumen, dedication, selfless- 
ness, and oer server ance. It is desired that addressees 
channel the professional abilities of the advisory 

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apparatus into efforts designed to complement tactical 
advice with improvement in the quality, efficiency, and 
reliability of the EVNAF structure as a whole. 3_V 

Shortly afterward the Chinh-Hunnicutt affair erupted. As it unfolded 
it revealed the near impossibility of eliciting satisfactory performance 
by means of the existing advisory system. CG 25th Division published an 
order of the day accusing the Senior Advisor of trying to have the CG 
removed, of attempting to dismiss other division officers, of bypassing 
the chain of command, and of destroying the "spirit of cooperation between 
Americans and Vietnamese." 

The MACV command history describes General Chinh as extremely weak, 
afraid to command. The Senior Advisor was a dynamic, competent officer 
assigned to improve effectiveness. He pursued his objective in a firm 
manner . 

COMUSMACV felt the incident received distorted press coverage in the 
US where it was portrayed as a challenge to the entire position of the US 
advisory effort. He noted that the Vietnamese were sensitive to renl or 
imagined infringements on their sovereignty. Great care had to be exer- 
cised to avoid even the appearance of violating their pride; an officer 
who yielded too readily to US advice was regarded as a puppet. He felt 
the most effective way to work with the Vietnamese was to discuss matters 
with them and then allow them to resolve their problems. CG 25th Division 
did have redeeming qualities. He was considered honest; and for his stand 
at the coup trials in the early lS^O's, when he had accepted punishment 
while many* others were -running; he had acquired a sizeable following smong 
ARVN officers. He was, in addition, a boyhood friend of CG III Corps, 
who was said to recognize the CG's fault but felt that his hands were tied. 

Deputy COMUSMACV who enjoyed good rapport with CG 25th ARVK Division, 
visited General Chinh. In a two-hour meeting, the Vietnamese ^ spoke freely 
and o-oenly. He displayed genuine and extreme concern and admitted his 
error* in issuing the Order of the Day. He had already apologized to^ 
CG III Corps. Deputy C0MUSM&CV received the impression that the advisor 
might have been a little too aggressive with the Vietnamese general, who 
was hypersensitive. Deputy COMUSMACV suggested that a memorandum be 
published to the division which would mention that the Order of the Day 
had leaked to the press which had taken it out of context and that there 
was no intention to disparage the advisory effort. The memorandum was 
Dublished on December 21. It said the past must be forgotten and that 
"cadre of all ranks should display warm, courteous, and friendly attitudes 
toward their American counterparts. General Chinh appeared to turn over 
a new leaf. Colonel Hurmicutt was reassigned to an apparent terminal 
assignment in the United States. 35/ 

COMUSMACV addressed a letter to all advisors in December, 1966, to 
asain emohasize the importance of rapport. He said, the key to success 
or failure was the relationship achieved and maintained by the advisor 

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with his counterpart. The natural tendency of the US professional soldier 
■was toward immediate reaction. He expected the same in others, but it was 
necessary to temper counterpart relationships with patience and restraint. 

General Westmoreland affirmed this view in his remarks at a confer- 
ence of his senior subordinate commanders. 

In order for AKVN to be successful, a re-education process 
is necessary, from the generals on down... The attitude of the 
soldiers toward the people frequently is poor.... We must do all 
we can toward to change this . . . 

...In conduct of operations in support of Revolutionary 
Development, we will frequently have units buddy up with ASM 
units... A word on command relations in these combined opera- 
tions is appropriate. We have had great success with our 
cooperative efforts in the past. We should establish a proper 
relationship from a technical command standpoint. Proper type's 
of missions are general support and direct support. When con- 
ducting operations where we have the preponderance of forces 
committed. . .their association will be in direct support or 
general support of our operations. This is good military 
terminology and quite proper for us here. General Vien agrees 
in this terminology. 36/ 

Sometimes ARVK was not receptive to advice. In November, recognizing 
the validity of a recommendation from the Corps Advisor that an additional 
battalion be activated in the ARTil 23d Battalion, COMUSiACV suggested this 
to JGS. Inactivation of a marginally effective battalion in another ^ 
division was suggested as compensation. Chief JGS, for reasons of his 
own, declined to authorize the 23d Division to have an additional battalion. 

Still, the effort moved forward. Training of RD Mobile Training Teams 
from each AKW Division was conducted in December. The actual conversion 
training of divisions started in early I9S7, and a similar program for 
rf/PF was planned. In fact, planning was viewed as the surest sign of 
progress. The 1967 Combined Campaign Plan was ceremoniously signed by 
Generals Westmoreland and Vieh on December 8. Its significant innovations 
were requirements for subordinate commands to prepare supporting plans and 
for quarterly reviews to maintain the plan's viability. 37 / 

8. Constitution-Writing in January, 1967 


Progress within the Constituent Assembly and preliminary jockeying 
over the new constitution were persistent concerns during the first 
quarter of 1967. 

At times the Assembly seemed remarkably independent. It publicly 
fought against a law which gave the military junta the right to over-rule 

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«. ^.ion.. The centos, g*^*J%£ ffiE^TEK 

Z\t^Jt Z £££ inxSenee' should he disposed supporting 
Ubu- ciicxco aa » .„ nn •»■„ , TQO »-| vpp-Iv makin^ noises about 

• effort (or negotiate a peaceful settlement; j j 

..and at the same time broadly enough based to attract 
increasing local and national political strength away 
from VC . 38/ 

«assedo r w.... reply was -£ -^^^f^TS ^ 

heavily on the cohesiveness of tne military, gg 
remained his evaluation of the political situation. 

Unity of the miliary is essential to government sta- 
bility in VN. From the standpoint of stability, this is 
the Law and the Prophets. 

Movement toward a broadly based, truly popular government 
is impossible without stability. 

The military is also the chief nation-building group in 
the country. It has education, skills, experience, and 
discipline which no other group can ofier. W/ 

c + ate accuiesced in this argument but continued to hope for a government 
brfadly "Led so thaHhe VC would find avenues to conquest of 
South Vietnam effectively blocked. 

..xp our view it is less a question of any civilian can- 
didate controlling the military and more a question of 
the military being educated to accept a Bhar ^S of P^r 
and responsibility with civilians as J. nece ""L ^S 6 ^ 
political progress. This means a readiness to accept the 
oScome o/a See and open election in which the candidate 
favored by the directorate may not win. 41/ 

9 . Ji ^ign J *<^^ 

The Problem of GVH dollar balances remained a thorn. GVN did nothing 
in e Problem c , ^ aiTreement s. With scarcely concealed mpatience, 
to carry <^£° **^ cIT Ttough economic program, in a meeting in 
ffSSTiSfS !«, 1967, vith special emphasis on the dollar 
balances. Reporting on the meeting, he said: 

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We underlined many times the very high level of the US 
commitment and said that we could not make this commit- 
ment unless we had /an/ iron- clad guarantee that the GTO 
vould live up JtoJ the foreign exchange agreement. . .we 
stated that this was the minimum the US could accept. 42/ 

Hard bargaining continued, including another Hanh trip to Washington, 1©/ 
Preliminary to the Conference, Washington considered several steps which 
might he taken: 

...1. Agreement on a piaster/dollar rate of 118 for official 
US purchases. 

2. US use of all counterpart over P-30 "billion. 

3. Increase of Assistance In Kind from GVN. 

k. Possible transfer of some official purchases from the 
80 to a 118 exchange rate without changing the official 

5. Transfer of DoB contracts to the 118 rate. 

6. Tying all 80 rate dollars to US procurement . 

7. 100$ US use of PL 480 sales, hk/ 

Saigon's opinion was that for these negotiations there were two main routes: 

(1) A switch of counterpart funds from. their use to ours, and 

(2) A change in the exchange rate. 

The first seemed preferable because it was more negotiable. The second 
might be counterproductive by "simply angering Hanh without moving him. U5/ 
On February 20, GVN merely agreed to work on an "interm memorandum of 
understanding which vould include actions to implement the foreign exchange 
agreement of last November."^/ When Komer went to Saigon later in 
February to negotiate, he found it necessary to threaten specifically to 
reduce the CIP program to force down GVK's dollar balances, noting that 
once the program was cut Congress would be unlikely to restore the cuts. 
The negotiations amply demonstrated the truth of Hanh's remark that 
Orientals only act Ifter much bargaining. As Komer started to walk out 
?he"oor after a meeting, Hanh hinted at a raise in the official purchase 
Piaster rate from 80 to 118, but made no other concession. 47/ 'At no 
time did the USG threaten explicitly to buy piasters in the open market, 
^Porter and DASD (Economics) had earlier proposed, a procedure that would 
knock down GVH dollar balances to whatever extent we wanted while using 
fewer dollars to get the required piasters.) In an exchange of letters 
early in March, Hanh said he understood the US was willing to 

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establish $50 million development fund in return for their _ 
purchase of 300 thousand tons of rice on a 10(# US use hasis 
and repayment of $25 million ICA loan. k8/ 

From Komer,now tack in Washington, came this reply, 

There is in my view no douht whatever that Hanh, and for 
that matter Ky, understood full well that we did not agree 
to the $50 million GW Development Fund as part of interim 
trackage. Nor do I regard our credibility as enhanced if we 
now retreat even more on this issue. Finally, I regard the 
Development Fund as a sweetener so clearly wanted by the 
GVN that we need not give it away too cheaply. 

While in one sense we have little immediate leverage to 
use on the GVK so long as we do not choose to withhold 
aid in one form or another, in another sense we clearly 
have the GW worried. I believe that, either through a 
definitive solution this June or more likely via 
Salami tactics, we can keep GW. reserves from rising too 
far. h9j 

In mid-March Komer reached another "Interim Agreement" with GVK on 
foreign exchange. 50/ It provided that: 

(1) The United States would supply at least an addi- 
tional 100,000 tons of PL kQO rice and a further 
300,000 tons of rice under terms providing for 
100$ USG use of proceeds. 

(2) GW would make available up to $120 million of 
foreign exchange for financing commodities pre- 
viously imported under the CIP. 

(3) The United States would make available for economic 
development projects the balance of K 67 funds 
unused as a result of the reduction of the CIP pro- 
gram and would proceed to initiate and make grants 
for several interim projects. 

(k) The United States agreed to the establishment by GVK 
of a $50 million development fund for purchase of US 
goods and services, such fund to be considered as use 
of Vietnamese foreign exchange resources under the 
Kovember U, 1$6G agreement. 

(5) GW would repay US loans totalling $53 million. 51/ 

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Closely related on the economic front was the GVi': budget. Estimates 
of the CY 1967 inflationary gap grew during the quarter from lk to 20 
billion Piasters. 52/ The United States exercised only spotty influence 
on their budget, specifically on those items receiving direct American 
support: and general nersuasion was used to hold down the overall limit. 
Governor Hanh tried to transfer all US counterpart funds to the military 
budget with the explanation that only the US military could adequately 
contr-o] the South Vietnamese military, but the guessing was that this 
might also be his way of freeing GVN civilian agencies from any American 

Washington efforts to get more information on the GVK budget only 
brought educated guesses and a reminder that the Mission did not partici- 
pate In a review of the GW civil budget as was the practice for the 
military part. 53/ The CY 1967 budget of 75 billion piasters was issued 
without r-rior discussion with AID. It was unsatisfactory. USAID had the 
leveraged negotiate because of counterpart funds and PL l«80 receipts, 
but the major oroblem was how to provide AID the necessary funding 
mechanics to implement programs at levels sufficient to meet established 
requirements, jk / 

10. The Saigon Port Again 

Severe congestion continued to plague the Port of Saigon. _ A drop in 
CIP/GVH cargo discharged in December brought queries from Washington. 
Saigon replied that the drop was due to the GTO port director's abortive 
great barge experiment and listed a number of corrective steps taken. 
In fact all were peripheral to the central problem, the failure of com- 
mercial importers to remove their goods from crowded warehouses. Saigon 

Any additional actions. . .would require high-level govern- 
ment to government agreements which in our estimation 
would not be appropriate at this time. 55/ 

Highest authorities in Washington remained concerned and pressed for a 
complete military takeover or at least a comprehensive alternate plan 
which would demonstrably meet the problem. 56/ Saigon held back with 
the view that progress was being made, that Ky was persuaded of the need 
to eliminate port congestion and that he was doing his utmost to solve 
th» urobiem. 57/ A US takeover was once again viewed as neither politi- 
cally' possible~nor desirable. 58/ CINCPAC chimed in to support strongly 
the Saigon position, 59/ and at the end of the quarter Washington was 
still peppering Saigon with comment: 

We here do not take same relaxed view of barge situation 
Saigon port as Saigon. . .Highest authorities have been 
consistently concerned. 60/ 

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At the same time an overlooked aspect of the earlier extension of 
US control of the port was being bounced back and forth. MACV clearance 
of AID financed project and procured commodities was estimated to have 
made AID liable for one billion piasters for port clearance costs pre- 
viously financed by GVN. Kobody was quite certain how to approach GVK 
on the matter or how the US should pay the bill within existing dollar 
and piaster ceilings . 6l/ 

11.' Minor But Prickly Problems ? January - March 1967 

The clearance costs problem was an example of several minor matters 
which arose between the governments, problems that were often difficult 
to handle because prestige and sovereignty were involved. GVK National 
Bank Governor Hanh and the Embassy tangled over GVN issuance of instruc- 
tions to commercial banks operating facilities for US military forces. 62/ 

The Embassy became concerned because American civilians, tried and 
punished in GVK courts on the basis of American-supplied evidence, were 
subjected to extortion. The ticklish part of the problem was how to 
investigate the practice without jeopardizing those in the midst of buy- 
ing their way out. 63/ Soon there were ill-considered remarks to the 
press by Brigadier General Loan who said that GVK had sole jurisdiction 
over civilians. 6k / State instructed Saigon to keep mum on the subject. 65/ 
Finally, in March it was publicly announced that the United States would 
exercise court martial jurisdiction over civilians but "only rarely, in 
exceptional cases." The US did not question, as a matter of law, the 
existence of a basis for court martial jurisdiction over civilians and 
indicated that our policy would be to handle the problem of civilians 
in other ways. The statement was careful to reaffirm US respect for GVN 
sovereignty, so as to avoid the issue of a formal status of forces agree- 
ment. 66/ 

Whether GVK could levy requirements for reports and payments upon 
US contract airlines caused bantam-like stances on each side. 67/ GVN 
demanded that contract flights pay landing charges. Porter replied that 
was improper and offered GVN notification of flights as a sop. Ky's 
retort was a demand for copies of contracts and schedules, restrictions 
on in-country flights and limitation of loads to personnel and equipment 
strictly military. We rejected those terms and the military nature of 
the problem probably saved a contract flight from becoming the "example" 
later in January when one plane-load of Pan American passengers baked in 
tropical heat for several hours while GVN refused them permission to 
disembark at Tan Son Rhut. 

Premier Ky's implied intention in February to accept an invitation 
to speak in the United States produced an apprehensive reaction from 
Washington. Ambassador Lodge cautioned, "We have twice headed him off 
and to object a third time might create strain ." 68/ Eventually Ky was 
able to publicly postpone his visit on the grounds that his presence 
was needed to insure a free and fair election. 

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Diversion of MAP material remained a closet skeleton to be rattled 
periodically. In February, MACV performed estimative gymnastics to 
suggest that no more than 0*3$ °f MAP material had been so lost. 69/ 
CIKCPAC quickly suggested th& - o valid data did not exist and would be hard 
to compile. He said that the differences between manifests and the ma- 
terial actually received should be otherwise identified, and his thoughts 
seemed for the moment to take care of a potentially embarrassing need to 
explain a $5 million problem without even bothering GVB. 70/ 

Throughout the quarter there were periodic flurries of talks about 
negotiations with North Vietnam. U Thant was especially active and these 
maneuvers caused an uneasiness in US/GVK relations because Saigon was 
never completely certain what role it would have in such discussions. 71/ 

12. The Other War 

Top levels in Washington realized that not much progress was being 
made in Revolutionary Development and exhorted Saigon to integrated, 
detailed civil/military planning. 72/ COMUSMACV waffled once again on 
whether ARVR battalions supporting RD should actually be retained under 
the operational control of the province chief. 73/ US Army units con- 
tinued their work in the densely populated Delta provinces. On one 
occasion Premier Ky called Colonel Sam Wilson in for his view of progress 
there as well as to ask for an evaluation of the ARVN ^6th Regiment. 
Wilson was able to say plainly that the unit was poor and that its com- 
mander was ineffective and, without a doubt, corrupt. Ky explained that 
the commander in question was a close friend of the division commander 
who was a close friend of the corps commander who was a close friend of 
Ky. That seemed to explain the matter, fh/ 

The US continued to press national reconciliation upon the Saigon 
government. Unger and CAS assets worked with the Constituent Assembly 
to get KR into the constitution. The lack of enthusiasm was alleged to 
be fear of unilateral US peace action. 75/ The present GVK continued, 
as they had so often before, to agree readily in conversations with us 
to the principle of national reconciliation: yet any concrete implemen- 
tation remained illusive even through another top level meeting with the 
President. 76/ 

13. Guam Meetings, March 20 and 21, 1967 

President Johnson announced that his purpose in calling the Confer- 
ence at Guam was to introduce the newly appointed US team to the leaders 
of GVN. The shift of personnel represented the largest shake-up in US 
leadership in South Vietnam since August 1965. Ambassador Bunker was 
designated as the replacement for Lodge, and Locke took Porter's place. 
In a move to resolve the controversy over military versus civil control 
of Revolutionary Development, Robert Komer took charge with the rank of 
Ambassador under the COMUSMACV organizational structure with czar powers 
and a strong m-mdate to produce progress. 

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Most happilv, the Constituent Assembly completed its work on the 
constitution just in time to permit Premier Ky to present a copy to 
President Johnson at Guam. As had been the case on the two previous 
occasions of top US/GVK talks., the communique which resulted from the 
2-day meeting lay primary emphasis on political, economic, and social 
matters. 77/ The military picture was presumed to he so encouraging 
and improving as to need no special attention. 

ll+. Routine Matters, April - September 1967 

Most of the previous problems persisted during this period. By 
June the rate of inflation was predicted to be k5 - 50 percent per year, 
and the piaster gap was to be 17-3 billion greater than projected. 78/ 
Hanh, now GVK Economic Minister, scheduled a September trip to Washington 
and the list of expected topics read very much the same as agendas for 
many previous such meetings. 79/ Hanh could upon occasion get very 
excited, as in the case where" suit by a Greek shipping line froze the 
GVH account in a Hew York City bank; 80/ but despite repeated urging 
from Washington, nobody in Saigon could get up courage enough to approacn 
GVH on those retroactive port clearing charges. 81/ 

On Anril 18, GVH finally issued a National Reconciliation Proclama- 
tion which stated that "All citizens who rally to the national cause can 
be employed by the government in accordance with their ability, 82/ out 
the decree proved to be a mirage. It used the Vietnamese words for 
solidarity rather than those for reconciliation end the program proceeded 
in consonance with that distinction. Saigon reminded State that Premier 
Ky had recently told the Ambassador that meaningful progress on national 
reconciliation could only come after a constitutional government *as es- 
tablished. 83/ 

On the MACV side, Ambassador Kcmer was getting organized. In response 
to a Washington query on lend reform he recalled his consistent position 
but pointed out that it was not an important issue in Vietnam. Far more 
important was the matter of security in the countryside, mj 

The US continued to deliver material assistance to improve the morale 
of ARVH troops. A $2.83 million program for 913 AKVU dependent houses 
was ungraded to provide more modern structures with utilities. VoJ u f A - LU 
helped the RVKAf" commissary system for RVHAF and dependents. Althougn 
rice was eliminated to avoid lowering its open market price, GVK sougnt 
compensating increases in the meat and fish supplied. 86/ MACV programmed 
over $3 million to the RVHAF Quartermaster Corps which supplied field and 
garrison rations. 87/ v 

But there were continuing signs that ARVH as a fighting force needed 
urowing up. Sporadic efforts at encadrement appeared. The USMC Combined 
lotion Companies in I Corps were well publicized. In April, the US 25th 
Division completed studies, and transmitted to General Cmnh, still CG 

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ARW 25th Division, the Combined Lighting Concept. It brought together 
in one outpost a US squad, an ARW squad, and a PF squad. 

In response to Washington inquiries, General Westmoreland reported 
by message in May, 1967, "A command project was initiated on January 26, 
1967, to review the performance of RWAF units and to identify those 
considered Ineffective and non-productive. Units so identified are being 
evaluated with a view to withdrawal or reduction of military assistance 
support unless improvement in these units is possible. The evaluation 
will be conducted every six months resulting in a final determination each 
June and December... 

The methodology for evaluation includes: 

(1) Identification of units judged ineffective or nonproductive. 

(2) Evaluation of credibility or feasibility of present plans 
to guarantee increased effectiveness. 

(3) Study of unit performance trends during the past six months. 

(U) Determination of the availability of plans to train personnel. 

(5) Evaluation of command interest at all levels for improvement. 

Units will be classified as Improvement Probable, Improvement 

Doubtful, and Improvement Unlikely. Those in the latter two 

groups must justify continued military assistance or action 
will be initiated to reduce FY 68 support. 

Current Status: All VKAF and WMC units are effective and pro- 
ductive. Support to VHN reduced by $7800 which reflects dis- 
continuance of support for two fishing boats which are not con- 
figured to support any role assigned to WH. The evaluation of 
ARW is only partially completed." 88/ 

In July, the MACV staff briefed Secretary HcEamara in Saigon and 
touched again on the subject of encadrement. One concept considered was 
V^TUSA (Vietnamese Augmentation to US Army) whereby two or three Viet- 
namese would be assigned to each squad in US combat battalions. While 
this scheme offered the advantages of improving ARW skills and of utiliz- 
ing additional RW troops without further strains on already limited ARW 
leadership, the only real gain for the US was viewed to be a possible 
reduction in US strength. The disadvantages pointed out were the political 
climate, the language barrier, the danger to US unit security, the adminis- 
trative and disciplinary difficulties and the probable irritation between 
VATUSA and regular ARW unit, soldiers- These, it was judged, dictated 
against its adoption. 

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A second concent considered was salting AHVN forces with US leader- 

co»aSer STS «ould he required to folio* the directions of the US . 

training tears leaders. 

The conclusion reached was to continue the "salting" experiment with 
exnansx^xTview if the initial results were good. There is no ev^ence 
that anjthing became of the experiment. §9/ ^.^/^ C, ^ 

None of this seriously worried top KW ff^f 1 ^ %*££*** 

in more interesting international activities. Lin May, talks started 
between Lao and GW military staffs J The occas on was £*^ /^ 
barrier extension westward, hut Washington realized at once that there 
frlVilttle the US could do to limit the contacts to that subject. |0/ 
/In July! it "as discovered that GW was using Chinat agents dxsguxsed 
1 2 & appear to he South Vietnamese with^g ancestry ™^ w> 

pp+tle 1st end in the Crescent Croup aoout 170 miles souon oi net 
Se intention of constructing an airfield there. Because tnesexsland are 
already claimed hy Communist and Rationalist Chinas and the Philippines 
veil, MOT advised against US cooperation in the adventure. 9g/y 

IS. The G W Presidential Election 

Fre-nomination maneuvering and legitimacy of th e Pre* "-J 1 ^^ 
paign were the subjects which occupied American attent ^ g™ ^ Srii 
?S first task facing Ambassador Bunker as he arrxved on station xn April 
lf s to oversee the delicate transition of GW to a government based upon 
a^opular election recognised by the world to be fair. 

ir , ,.prxl. General inieu , recovering from an appendectomy. 93/ 

scenes until Ky formally announced his candxeacy on May 12. ^/ 

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This served only to intensify the rivalry. By Kid-June, the Thieu-Ky 
confrontation showed no signs of moving toward satisfactory resolution. 9o/ 
Basically, Ambassador Bunker believed in an indirect approach. He did 
not hesitate to approach Ky and Thieu individually on the "broader issues 
of arbitrary press censorship, questionable tactics being pursued by Ky 
supooHers six weeks "before it was legal to campaign, or unity of the 
Armed Forces. 97/ But, on the confrontation "between the two candidates, 
Bunker's ploy was to hold an informal luncheon to which the two princi- 
pals were invited. In the end they had to work out their own solution. 98/ 
They did. At the end of June the 50-60 officers of the Armed Forces Council 
met in a 2-day, continuous session at which "both Thieu and Ky performed 
histrionics. The surprising result was that Ky agreed to run for the 
Vice-Presidency on Thieu' s ticket. 99/ The Mission sighed in relief and 
agreed that Bunker's approach had worked. The Ambassador congratulated 
the candidates, and Thieu obligingly announced that if elected he would 
appoint a civilian as Premier. Ky agreed. The RVNAF chief of staff had 
earlier announced that there would be no officially endorsed military 
candidate; yet the Constituent Assembly conveniently approved a draft 
article which permitted Thieu and Ky to run without resigning from the 
Armed Forces. By mid-July, the Assembly had voted acceptance of the 
Thieu-Ky ticket while disallowing one headed by Big Minh who remained 
in nearby Bangkok as a potential threat to the younger pair . 100/ With 
only a few hitches, the campaigning proceeded so as to satisfy American 
observers that it was acceptably fair; and the resultant Thieu-Ky vic- 
tory was a surprise only in its smaller-than-expected plurality. 

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l6. Blueprint For Vietnam, August 19^7 

State suggested that completion of the election process was a proper 
occasion upon which to consider several proposals, including increased 
leverage, for advancing the total American effort in South Vietnam . 1M/ 
BunSer also mentioned this when he transmitted the paper, "Blueprint for 
Vi^t-NamV" The "Blueprint" ranged widely over all topics and struck a 
consistently optimistic note 

Progress in the war has been steady on all fronts. We can 
defeat the enemy by patient, continued, and concerted effort. 
The way to do this is for the GVN and its allies (a) to re- 
inforce and accelerate the progress already made; ^; to 
markedly improve the interdiction of infiltration of North 
Vietnamese troops and supplies ; (c) to upgrade, accelerate, 
and coordinate the pacification program in the country- 
side: and (d) to maintain political and economic stability 
and support the development of the constitutional process. 

... We still have a long way to go. Much of the country is 
still in VC hands, the enemy can still shell our bases and 
commit acts of terrorism in the securest areas, VC units still 
mount large scale attacks, most of the populace has not actively 
commited itself to the Government, and a VC intra structure 
still exists throughout the country. Nevertheless, the situa- 
tion has steadily improved since the spring of 1965 .. . 

Now, that the initiative is ours and the enemy is beginning to 
hurt, maximum pressure must be maintained on him by (aj inten- 
sifying military activity in the South; (b) developing new 
methods of interdicting infiltration; (c) bombing all targets 
in the North connected with the enemy's war effort that do not 
result in unacceptable risk of uncontrolled escalation; 
(d) accelerating the program of pacification (including better 
security more effective attacks on the infrastructure, stepped 
up National Reconciliation and Chieu Hoi programs, a greater 
involvement of the people in solving their own problems at 
the village and hamlet level); (e) encouraging reforms in the 
government structure and continued improvement in the armed 
forces; (f) attacking the problem of corruption; {&) usin S 
influence to effect a strong, freely elected government with 
political stability; and (h) taking actions necessary to the 
continued growth and stability of the economy. . . 102/ 

in a subsequent message Ambassador Bunker stated more specif ically 
that the United States should use its influence to get GVN to do the 
following: . • 

A. Seek broad based popular support. 

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(1) Appoint prominent civilians, including some leading 
opposition candidates, in new government. 

(2) Use appointments to insure association of a new govern- 
ment with various religious and polj tical groups . 

(3) Adopt a program and identify it with that of a former 
national hero, "so as to give the new government an idealistic 
appeal or philosophy which will compete with that declared "by 
the VC." Bunker suggested Nguyen Hue. 

Bo Work on a more continuous, although informal basis with US 
Mission o Bunker suggests regular weekly or semi-monthly lunches. 

Co Adopt a program to include the following: 

(1) Public recognition of the 

(a) Necessity for every Vietnamese to contribute to the 
war effort. 

(b) Need to change draft laws. 

(2) Reaffirm on-going programs relating to RVNAF, including 

(a) MACV program of ARVN improvement through merit pro- 
motions and a military inspectorate. 

(b) Elimination of corrupt, inefficient leaders. 

(c) Expansion of RF/PF and adoption of the MACV recom- 
mended system of US advisory teams operating with RF/PF 
for 6-month period. 

(d) Greater integration of US forces or joint operations. 

(e) Reorientation of the concept of the Pacification Role 
of ARVN, RF, and PF in accordance with MACV suggestions -- 
from static sxipport to mobile, area security with night 
patrolling and a system of inspection and grading to insure 

implementat ion ■> 

(3) Make the Privince Chief the "key" man in pacification — 
giving him operational control over all military and para- 
military forces engaged in pacification. He should appoint 
district chiefs. He should report to Corps commander on military 
matters and to central government on civil matters. An inspec- 
tion, training, and rates system should be established o 

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(h) Centralize all rural development efforts in non-KD hamlets 
under one coordinated control in some manner as is now done in 
the Ministry of Revolutionary Development for RD hamlets. 

(5) Construct an adequate number of processing and detention 
centers in provinces and permanent prisons on islands on priority 
basis together with passing of laws that it is a crime to be a 

VC civilian cadre. 

(6) Pay higher salaries to selected GVN officials, including the 
military, particularly those officials able to control corruption 
or in a position to be tempted by corruption. 

(7) Reaffirm National Reconciliation and Chieu Hoi programs. 

(8) Grant villages the power to enforce land rental laws. 

(9) Adopt the whole of the "operation Take-off" pacification 
program prepared by MACCOKDS. 

(10) Establish joint council procedures over expenditure of 
counterpart piasters by reinstituting sign-off by US advisoryv 
at province level. 

(11) Revitalize the veteran's program. 

(12) Increase receipts from domestic taxes and tariffs, and 
revise monetary policies. 103/ 

17. The Leverage Study 

On August 31 State transmitted a study by Hans Heymann and Col. Volney 
Warner on the subject of leverage. It reviewed the rationale for leverage 
and considered a whole array of possible techniques: 

... In anticipating the US/GVN relationship in the post-election 
period, it is generally agreed that the US should find ways to 
exercise leverage with the Vietnamese government which are more 
commensurate in degree with the importance of the US effort to 
South Vietnam's survival and which reflect the climate of grow- 
ing restiveness in the US... In its impatience to get results 
and make progress, the US has increasingly resorted to uni- 
lateral programs and action with inadequate consultation with 
the Vietnamese. On the other hand, the indiscriminate and 
careless exercise of US leverage could undermine the self- 
respect of the Vietnamese government in its own eyes and in the 
eyes of the South Vietnamese people. 

.. To be effective, US leverage must be exercised in the context 
of a relationship of mutual respect and confidence, and in ways 

56 TOP SECRET - Sensitive 

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commensurate with the objective sought. It must also be backed 
by credible sanctions. 

. . The various tools of leverage available to us are described 
below. It is not proposed that all of these tools be used at 
any given time or that some of them be used at all. However, 
they represent a selection of arrows that might be placed in the 
US Mission quiver for use as the Mission Council deems appro- 
priate. It will be particularly important to construct a 
credible and effective system of US leverage for use as neces- 
sary and appropriate in connection with the list of priority 
program objectives which we shall be seeking to achieve with 
the newly elected government in the immediate post-election 
period . 

Tools of Leverage 

.. A wide range of possible techniques and forms of influence 
is available at each level of the American presence in Vietnam. 
A few of these leverage devices are now in use, mostly at the 
initiative of individual Americans on the spot, but not as part 
of an organized framework of influence. Other devices have 
been instituted in the past, only to be subsequently abandoned 
because of fear of their misuse, actual misuse, or inadequate 
understanding of their value. 

In the following list we array a range of possible instruments 
of influence that the US might employ, with some indication of 
their applicability. 

A. Rapport... 

B. Joint Planning and Evaluation... 

C. Joint Inspection and Audit... 

D . Joint Secretariats . . . 

E. The JCRR approach: Establishing a joint, autonomous, 
dually-staffed, foundation-like organization headed by a board 
of commissioners appointed by the two heads of state, to ad- 
minister all forms of non -military AID... 

Fi Contingency Funds and Special Resources... 

G. Control Over Expenditure of Counterpart Piasters... 

H. Retention of Resources in US Channels... 


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I» Joint Personnel Management — to institute career in- 
centive, selection, and removal policies... 

J. Joint Command... 

K. Policy-level Monitoring System — to monitor the 
exercise of authority of key officials of the GVN... 

L. Withholding US Support — at levels below Saigon, 
the authority of US senior advisors to cut off or withdraw US 
civil and military support from Vietnamese activities or oper- 
ations within their area of responsibility would constitute 
powerful leverage . . . 

At the Saigon level, a range of extremely tough options is 
available, encompassing selective withdrawal of US support for 
Vietnam persuading the GW that these are in fact available 
requires the will to use them and the political ability to follow 
through if our hand is called. Options would include halting 
further troop deployments, standing down US unit operations, 
suspending CIP and MAP assistance, and so forth. 104/ 

Ambassador Komer replied on September 19. He recalled his deep interest 
in this subject and discussed at length both present and potential tech- 
niques. His views seemed considerably mitigated by his several months in 
Saigon, for "rapport" and "persuasion with implied pressure" headed the list 
of what was presently being done. He concluded by saying, "All of the above 
forms of leverage, and yet others, could be useful at the proper time and in 
an appropriate way. But they must be applied with discretion, and always m 
such manner as to keep the GVN foremost in the picture presented to its own 
people and the world at large... The exercise of leverage in a personal 
manner and hidden from the public view is likely to be most effective, ^ 
while of the more operational means establishment of combined organization 
under a JCRR-type concept, to include joint control of resources, would be 
most desirable. In sum, we're gradually applying more leverage m Facili- 
cation, but wish to do so in ways that least risk creating more trouble 
than constructive results." 105/ 

18. Postlogue 

New plans and new hopes marked the immediate post-election period. 
rphf> storv of US-GVN relations continues, but this narrative must end. 
conclusion it seems appropriate to quote from the MACC0RD3 repor- 
ing Bien Hoa province for the period ending December 31, 19° (• 

t cover- 

1. Status for the RD Plan: 

The GVN in Bien Hoa Province has not met with any measure 
of success in furthering the pacification effort during 1967- 

c;8 TOP SECRET - Sensitive 

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Those areas that do represent advances (such as road openings 
or repairs or construction, breaking up of main line VC units , 
etc.) have all been the result of unilateral US actions. It 
was perhaps naively thought that these US accomplishments 
would stand as an inspiring example to the GVN and would prompt 
them to not only continue their efforts but, further, to expand 
and intensify the fight. However, during 1967 i n Bien Hoa 
Province, this has not been the case. The GVN at all levels has 
grown weaker, become more corrupt and, today, displays even 
less vitality and will than it did one year ago... 

Advisory Leverage ; This subject has been an extremely 
sensitive aid controversial issue in both GVN and US circles. 
However, as painful as it must be to address, the harsh truth 
is that given a showdown situation or an intolerable diver- 
gence between GW and US methods, the US advisor will lose. 
CORDS, Bien Hoa has gone to extraordinary lengths in reporting 
on both corrupt and incompetent officials and practices. The 
reason for these efforts has been to illustrate clearly to 
higher US authorities, the enormity of the problems facing 
the advisor on the province/District level. CORDS Bien Hoa, 
as perhaps all other echelons of US advisors, is ultimately 
powerless to rectify or even significantly alter the GVN 
intentions and performance. The Vietnamese in the street is 
f irmly convinced that the US totally dominates the GVN and 
dictates exactly what course shall be followed. However, the 
bitter and tragic truth is that the US has been kept at such 
a distance from GVN circles and power that in joint councils 
or plans our views may be heard, some portions of our logic 
may be endorsed but with confrontations or matters that repre- 
sent any truly revolutionary departure from existing GVN 
practices etc, we are light weights and presently do not possess 
the leverage or power to carry the day. 

ARVN Performance : There are presently two ARVN battalions 
(3/43 and 2/^8 ) who are directly assigned to support RD in Bien 
Hoa. With the exception of the 1st Bn, i)Sth Regt which served 
in the Phu Hoi Campaign area earlier in the year, ARVN per- 
formance has been less than satisfactory. The units have demon- 
strated the same age-old ills that have collectively led to our 
present commitment of US forces . . . 

GVN Officials Interests ; The primary interest of GVN 
officials in Bien Hoa Province is money. The lucrative US 
presence with all the various service trades that cater to the 
soldier, have created a virtual gold mine of wealth which is 
directly or indirectly syphoned off and pocketed by the officials. 
Thus, revolutionary development with all the ultimate implica- 
tions of broadening the governing base of this society, is viewed 

59 TOP SECRET - Sensitive 

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as some sort of necessary device that needs to he propped tip 
and nominally catered to by the GVH in order to keep US and 
Free World's interest and faith intact. However, any serious 
or meaningful gesture in support of a program which ultimately 
is designed to displace the powers-to-be (or at least force 
them to become accountable or share in the power) is not forth- 
coming. Infrastructure is not attacked even though the target 
is known; budgets are not spent although the funds are avail- 
able: GVN officials steadfastly refuse to visit their districts 
or villages or hamlets although it is there that most immediate 
problems exist. The list of limpid, half-hearted efforts to 
prosecute the war is endless. 

M^r nal Cutoffs and Shortages : In August after several 
months of negotiation, CORDS, Bien Hoa was forced to cut off 
further shipment of replenishment stocks into province. The 
reasons for this action were many but could be reducea go 
sloppy, shoddy and highly questionable logistical practices 
and procedures on the part of the GVN. After eleven weeks, the 
Provincial GVN finally agreed to carry out the reforms and 
renovations as suggested by CORDS. However, that eleven-week 
gap in the flow of materials (particularly during a period most 
noted for its relatively high degree of GVN action) had a sig- 
nificant effect on curbing construction programs and causing 
even more delays. Then, as soon as this issue was resolved, 
it was learned that cement and roofing weren't in supply ana 
rationed quotas for the remainder of the year further com- 
pounded the damage caused by earlier material shortages. 

To compensate, in part, for these factors, CORDS has had to 
increasingly rely on the resources, skills and capabilities or 
resident US military units. These units have, without exception, 
effectively filled the gaps and their efforts have succeeded in 
reducing the critical road situation that has been worsening 
throughout the years. Their action in many other areas has been 
highly commendable and CORDS Bien Hoa (as well as the GVfl it- 
self) owes a great deal to these units and their commanders wno 
have unselfishly devoted themselves to furthering pacification. 
However, for all their efforts, for all the resources either 
expended or on hand, the disturbing truth in Bien Hoa is that 
it still remains for the government, with forceful and meaning- 
ful direction from above, to begin to assume the responsibility 
for prosecuting this war and the pacification effort. Thus far, 
the GVN has not done this and it is the considered opinion of _ 
CORDS Bien Hoa that unless major revisions are brought about in 
the factors raised here, there is only to be a continuation of 
the same ordeal with the accompanying frustrations, inaction, 
corruption and incompetence. A continuation of this does not 

60 TOP SECRET - Sensitive 

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connotate stability or even maintenance of the status quoj it 
spells regression and an ever widening gap of distrust, dis- 
taste and disillusionment between the people and the GVTJ. 106/ 

6l TOP SECRET - Sensitive 

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Declassified per Executive Order 13526. Section 3,3 
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TOP SECRET - Sensitive gfuJM *+* 

IVoC.9. - Chapter I FOOTNOTES 

1. Vietnam Task Force Study, US-GVN Relations 1964 -First Half 1965 

2. COMUSMACV MAC J 0020055 to CINCPAC DTG 131515Z June 

3. Saigon to State 4008 DTG 150959Z 

k. SecDef to AmEmbassy Saigon, Info MACV 003906 DTG 151547Z June 65 

5. State to Saigon 3057, June 26, 1965 

6. Saigon to State 4422, June ajj," 1965 

7. Saigon to State 4311 and 4312 June 21, 4422 June 29, 4439 June 30, 
9 July 1, and 58 July 6, State to Saigon 3079, June 30, 1965 

8. Saigon to State 4311 and 1+312, June 21, 1965 

9. Vincent Puritano memo to James P-. Grant, "Joint Provincial Sign -Off 
Authority," with attachment, 25 Sept 65. Both officials are in 
Vietnam Section of AID. 

10. 3D PM July 1, 1965, p. 5, Sec. 8B; SD PM July 20, 1965, para. 8B. 

11. SD PM July 20, 1965, para. 3 

12. Saigon to State l4, July 2, 1965 

13. Saigon to State Airgram A-66, July 27 

14. Saigon to State 266, July 25. 

15. Saigon to State 290, July 28; Saigon to State 364, August 3, 1965 

16. COMUSMACV to CINCPAC DTG 080020Z July 

17. Saigon to State 266, July 25, 1965 

18. Saigon to State 595, August 4, 1965 

19. Saigon to State 374, August 4, and 489, August 21, 1965 

20. State to Saigon 131, July 13 and 427, August l4, 1965 

21. Saigon to State 626, August 26, 1965 

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IV.C9. - Chapter I FOOTNOTES 

22. Weekly CIA Reports, The Situation in SW, August 11, l8; September 
1, 15; October 6 

23. Saigon to State 671, August 28 

2k. Saigon to State 888, September ik. See also Saigon to State 991, 
September 22 

25. Saigon to State 1100, September 30 

26. Saigon to State 7l6, September 2 

2T Saigon to State 58, July 6 and 799, September 8. See also the refer- 
f " encts in notes k 9 and 5Q, Chapter II, below 

28 New York TMes stories October 5, 7, and 8 and November 26, 1 9 65 
mssion Council action memorandum No. 15, October 7, 1965 

29. COMUSmCV Command History 1965 , P- 2 ^° 

30. Vincent Puritano memorandum, Op. cit., p. 5 

31 . State to Saigon 1039, October l6, 1965. Saigon to State 13A, 
October 18. 

32. C0MUSMACV Command History 1965, P- 2 ^ 1 

33. Ibid. 

* State to Saigon l8 5 5, December 31, 1965; Saigon to State 2 5 88, 
January 19, and 2602, January 20 

35. State to Saigon l866, January 1 

36. Saigon to State 2 3 7 , December 2 9 , 1965, and 2 59 2, January 1 9 , 1 9 66 

37. Saigon to State 2588, January 19 

a i«« oo«> February k. See also, "Vietnam: Honolulu 
38 ' S^r-T^'cfr^an Status «*W*/ ^ 30, 
1966, Tab 25 of Conference Book 50C, pp. L*-*Z 

• 39. Saigon to State 2 9 8 5 , February l6, 1 9 66; Saigon to State 3086, 
February 2h 
,0 Kahin and I**., TJ^^^V^nam, p 2te4ttj Saigon to State 
2985, February l67^nd 305S^^?y 21 

, . TOP SECRET - Sensitive 

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IV. C 9. - Chapter II FOOTNOTES 

1. Kahin and Lewis s The US in Vietnam , p. 244 and passim . 

2. Kahin and Lewis, Op. cit ., p. 24-5; Saigon to State 3260 and 3265, 
March 9 

3. Saigon to State 3286, March 10, and 3288, March 11; CAS to CIA 
121433Z March 

4. Kahin and Lewis, Op. cit ., p. 245; Saigon 3333, March l4, and 3381, 
March IT 

5. State to Saigon 2764, March l8; Saigon to State 3^19, March 19, and 
3^17, March 20 

6. Kahin and Levis, Op. cit . , pp. 94, 97 

7. Saigon to State 3463, March 23 

8. Saigon to State 3577, March 29 

9. Saigon to State 3605, March 30; State to Saigon 2884, March 30 

10. Saigon to State 3609 and 361U, March 31 

11. Kahin and Levis, Op. cit. , p. 35^ Saigon to State 3523, March 26 
and 3609, March 31 

12. Kahin and Levis, Op. cit ., p. 255; MACV Command History 1966 p. 824. 
MACV to CIECPAC DTG 051125Z April; Saigon to State 2986, April 5. 

See also Saigon to State 3577, March 29; 35^9 and 3605, March 30 and 
36lk, March 31; State to Saigon 2884 and 2893, March 30 

13. State to Saigon 3001 and 3003, April 6-7; Saigon to State 3791, April 
7; State to Saigon 3035, April ?S Saigon to State 3817, April 8 

14. MACV Command History 1966 , p. 324; Kahin and Levis, Op. cit., p. 256 

15. Saigon to State 4l60, April 23, 1966 

16. Kahin and Levis, Op. cit. , p. 256; Saigon to State 4368, May 4 and 
4605, May 15 

' 17. State to Saigon 3448, May 15, 19&6 

18. State to Saigon 3^8, 3449, 3450 and 3451, May 15 

19. Saigon to State 4627 and 4635, May 16 

q % TOP SECRET - Sensitive 

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IV.C9. - Chapter II FOOTNOTES 

20. Saigon to State 4597, 4602, 4605, and 46l3, May 15; 4636 and 4651, 
May 16, and 4694, May 17; State to Saigon 3453, 3455, and 3470, 
May 16. 

21. Saigon to State 4688, May l8 and 478^, May 20; State to Saigon 3524, 
May 18; 3536, May 19, and 35 1 *-5, May 20 and 3567, May 21 

22. State to Saigon 3575, May 21, 1966 

23. Saigon to State 4760, May 19, 4896, May 23, 4959, May 25, and 5178, 
June 1; Kahin and Lewis, Op. cit ., pp. 256-57 

2k. Saigon to State 4837, May 21, 4849 and 4878, May 23, ^3 and 4963, 
May 25, i+966, May 26, 5037, May 27, 5073, May 28, 5178, June 1, and 
19^7, July 7, 1966; Kahin and Lewis, Ibid . 

25. State to Saigon 368O, Ma 28, 1966 

26. State to Saigon 3626, May 24, 1966 

27. Saigon to State 5163 and 5178, June 1 

28. Kahin and Lewis, Op. cit ., p. 257 

29. Ibid . 

30 Saigon to State 5165, June 1, 5364, June 7, 5^03, June 17, 574l, 
June 24, 1694, July 29 and 2564, August 3. State to Saigon 3792, 
June 8. Kahin and Lewis, Op . Cit . , pp. 257-59 

31. State to Saigon 19473, August 1 

32. NSAM 280, February l4, 1964; NSAM 343, March 28, 1966 

33. "Vietnam: Honolulu Conference -Summary of Goals and Status of Activity," 
March 30, 1966, Tab 25 of Conference Book 50C 

34. Saigon to State 5121, May 30, 19^6 

35. Saigon to State 5729, June 24, 1966 

36. Saigon to State 526, July 8, 1966 

37. COMUSMACV Command History I966 , p. 510. CINCUSARPAC DTG 240312Z May 

38. JCS 1824 DTG 122138Z May; COMUSMACV 18244 ITG 271243Z May 

65 TOP SECRET - Sensitive 

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IV.C.9. - Chapter II FOOTNOTES 

39. Saigon to State 38l^, April 8, 1966 

ij-0. Saigon to State 4200, April 26 

41. Saigon to State 4435, May 7 and 55^6, June 15 

42. COMUSMACV Command History 1966 , p. 106 

k3: COMUSMACV Command History 1966 , p. ^61 

44. COMUSMACV Command History 1966 , p. 46lff . Staff Study (S) MACOC 5, 
April 19, "Staff Study on Effectiveness of 5th and 25th ARVN Divi- 
sions; DF ACofS J3,. May 4 

i+5 . COMUSMACV Command History 1966 , p. 46l 

46. Ibid, p. 7^8 

47. Ibid , p. il-60 

48. Saigon to State 3821, April 8; State to Saigon 3205, April 26 and 
3243, April 28; Saigon to State 5031, May 27; Saigon to State 2564, 
August 3 

49. Saigon to AID 84l4, June 1, I966 

50. Saigon to State 5358 and 536l, June 7. See also: State to Saigon 
3731 and 3735, June 2. Saigon to State 52^7 and 5248, June 3- State 
to- Saigon 3752 and 3756, June 4. Saigon to State 5287, June 5. 
State to Saigon 3766, June 6. Saigon to State 5357, June 7. State 
to Saigon 3808, June 8 

51. Saigon to State 526, July 8 and Saigon to State 2564, August 3, 1966; 
further traffic on dollar holdings below. 

52. Memorandum from DASD (Economics) to ASD(lSA) with attachment May 7, 

•53. Saigon to State 3821, April 8 

54. Saigon to State 5433, June 10. State to Saigon 3860, June 11. Saigon 
to State 5525, June l4. Saigon to State 5664, June 21. State to "Saigon 
3987, June 21, Saigon to State 5739, June 24 

55. Saigon to State 278, July 5, 1966. Note that the expression "com- 
modities consigned to CPA" excludes CIP ; see Saigon to State 526, 
July 8 

C6 - TOP SECRET - Sensitive 

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IV. C. 9. - Chapter II FOOTNOTES 

56. State to Saigon 3787, June 8; Saigon to State 574l, June 24, 2564, 
August 3, 3754, August l6, 3842, August 18, and 4l07, August 22; 
State to Saigon 32309, August 19 and 34662, August 24 

57. Saigon to State 4538, August 26, 59^9, September l4, 6366, September 
19 and 9678, October 29 

58. State to Saigon 14754, July 7; Saigon to State 1947, July 2$, 3129, 
August 10, and 5970, September l4; Kahin and Lewis, Op. Cit ., pp. 

59. Saigon to State 5228, September 4; State to Saigon 52877, September 23 

60. COMJSMACV Command History 1966 , p. 253 

61. State to Saigon 14857, July 25 

62. Saigon to State 3197, August 11, 1966 

63. State to Saigon 14857, July 25, Saigon to State 2134, July 28; State 
to Saigon 20383, August 3; Saigon to State 3197, August 11 and 5499, 
September 8 

67 TOP SECRET - Sensitive 

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IV. C 9. - Chapter III 

TOP SECRET - Sensitive 


1 Saigon to State 76l6, October k. 7732 and 7752, October 5, 60^3, 
' October 7, 8681, October 17, 87^9, October 18, 8833, October 19, 
and 8839, October 20, State to Saigon 66781, October lh and 
68339, October l8 

2. State to Saigon 669^6, October 15, 1966 

3. State to Saigon 67708, October 17, 1966 

k. Communique and Declarations signed at the close of the Manila Con- 
ference, October 26, 1966 

5. Saigon to State 7630, October h and 8958, October 20 

6. Saigon to State 10312, November 7; 10597, November 11 and 11958, 
November 29 

7. State to Saigon 5828O, October 2 

8. State to Saigon 4929^, September l6, State to Saigon L9399 September 
17. Saigon to State 6997, September 27. State to Saigon 5009^, 
September 30. State to Saigon 61330, October 6. State to Saigon 
58280, October 2. 

9. Saigon to State 9963, November 3 

10. Saigon to State 9068, October 21 and 99^3, November 3; State to Saigon 
9963, November 9 

11. Saigon to State 10298, November 7, 1966 

12. Saigon to State IO298, November 7; State to Saigon 91757 and 92567, 
November 26; see also Saigon to State 7332, October 1 C0MUSMACV to 
CINCPAC DTG 051330Z, October and 231303Z, November, and JCS to 
CINCPAC 1^5, November 15, 1966 

13. Saigon to State 1^009, December 22, 1966 

Ik Saigon to State 12733, December 7, 12908 and 12950, December 9, 130^6, 
' December 1 10, 1^009 and 13023, December 22, 1^112, December 23 and 
lk230, December 26 

15. Saigon to State 7815, October 6 and 8l6l, October 11 

■\C> State to Saigon 8263k, November 9 and 977 k 2, December 6; Saigon to 
1 UTtt 9068" October 21, 9842, November 1 9 , 11720, November 25, 1222 9 , 
December 1, 12591, December 6 and 1^59^ December 30, 19°6 

53 - TOP SECRET - Sensitive . 

Declassified per Executive Order 13526, Section 3.3 
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IV. C. 9. - Chapter III FOOTNOTES 

IT. Saigon to State 10597 November 11, 1966. 

18. Saigon to State 112^9 November l8 and UU31 November 21 j State 
to Saigon 9331^ November 28. 

19. State to Saigon 90587 November 23 and 91325 November 25; Saigon 
to State 12321 December 2 and 12h3h December 3. 

20. Saigon to State 12321 December 2, ±966. 

21. State to Saigon 75^12 October 29. 

22. State to Saigon 75U12 October 29. 

23. Saigon to State 10597 November 11, 1966. 
2k. Saigon to State 11^58 November 22, 1966. 

25. State to Saigon 93301 November 29, 1966. 

26. State to Saigon 95109 December 1, 1966. 

27. Saigon to State 13326 December 1^, 1966. 

28. COMUSMACV Command History 1966 , p. 256. 

29. Mission Council Action Memo #1^0 November 2k, 19 56. 

30. COMUSMACV Command History 1966 , PP- 507 pas sir- . 

31. Saigon to State 8970 October 20. 

32. State to Saigon 10^992 December 19 . 

33. State to Saigon 83699 November 12, 1966. 
3I1. COMUSMACV msg 50331 of November 21, 1966. 

35. COMUSMACV Command History 1966 , pp. Vfl-^72. 

36. MACV Commander's Conference, November 20. 

37. COMUSMACV to CINCPAC 080245Z December 1966. 

^8 State to Saigon 117709 January 12, 1967. See also NIE 53-66 
' "Problems of Political Development in SVN Over the Next Year 
or So," December 15, 1966. 

69 TOP SECRET - Sensitive 

Declassified per Executive Order 13526. Section 3,3 
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TOP SECRET - Sensitive 
39. Saigon to State l6k63 } January 25. 
kO. Saigon to State 1835 1 !- February 18. 
lH. State to Saigon 128939 January 26. 

k2. State to Saigon IU3U0 January 2; Saigon to State 1U92U January 
5, 1967. 

k3 Saigon to State 15092 January 7, 15112 January 8, 15153 January 9, 
and 15286 January 11; State to Saigon 129695 February 2. 

kk. State to Saigon 123223 January 21, 1967. 

1+5. Saigon to State 16289 January 23, 1967. 

k6. Saigon to State 18646, February 22. 

kj. Saigon to State 1861+7, February 22 and l88l4 February 2k. 

)+8. Saigon to State 193^7 and 193^8 March 2. 

2+9. State to Saigon 1^89^1 March 3- 

50. State to Saigon 157064 March 17 . 

51. Saigon to State 20705 March l8. 

52. Saigon to State 1U725 January 2, 1967. 

53. Saigon to State 205l6 March lo. 

<jk. Saigon to State 16037 January 20, 1967. 

55. Saigon to State 15 569 January 13, 19^7 . 

56. SecDef to AraEmb Saigon kGOJ of 252255Z Jan 67. State to Saigon 
130 1 +7 ! + February 1. 

57. Saigon to State 17376 February 6, 1967. 

58. Saigon to State 17155 February 3, 19^7 • 

59. CINCPAC to JCS 122053Z Feb 67. 

60. State to Saigon 167083 March 31, 1967. 

61. State to Saigon 126MH January 29. 

62. Saigon to State 15C06 January 6. 

63. Saigon to State 16UU1 January 25. 
6k. State to Saigon 139934 February l8. 

70 TOP SECRET - Sensitive 

Declassified per Executive Order 13526, Section 3.3 
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TOP SECRET - Sensitive 

65. State to Saigon 1U0897 February 21. 

66. Saigon to State 19902 March 9, 20053 March 10, 20201 March 13'. 
State to Saigon 153512 March 11. 

67. Saigon to State 15783 January 1, 1967. 

68. State to Saigon 1^0250 February 19, 19^7 . Saigon to State 
18303 February l8. 

69. COMUSMACV OklkO to CINCPAC February 2, 1967. 

70. CINCPAC to 0SD 1^03^8Z Feb 67. 

71. State Circular to Saigon 15803^ March 10. 

72. State to Saigon 125377 January 25, 1967. 

73. COMUSMACV to CINCPAC O90956Z Jan 67. 
•jk. Saigon to State 15080 January 8, 1967. 

75. Saigon to State 165^7 January 6, 20236 March 13- 

76. Saigon to State IH923 January 5, 15100 January 7, 16761 January 28, 
18722 February 23, 20060 March 10, and State to Saigon 157067 
March 17, 19°7. 

77. Joint Communique, Guam meetings March 21, 1967- 

78. State to Saigon 213380 June 22, 1967. 

79. Saigon to State 5566 September 11. 

80. Saigon to State 23281 April 17, 19^7. 

81. Saigon to State 22716 April 12, 23569 April 20, and State to 
Saigon 175060 April 13- 

82. Saigon to State 23376 April l8. 

83. Saigon to State 28^18 June 20, 1967. 
&±. Saigon to State 26276 May 20. 

• 85. COMUSMACV to CINCPAC 0207 1 l- ! + May 1967. 
86. COMUSMACV to SecDef 22115ZMay67. 

TOP SECRET - Sensitive 


Declassified per Executive Order 13526. Section 3.3 
NND Project Number: NND 633 16. By: NWD Date: 201 1 

TOP SECRET - Sensitive 

87. COMUSMACV to CINCPAC 2*H30ZJan67. 

88. COMUSMACV to CINCPAC MACJ 3*H #15064, May 7- 

89. OSD(SA) Memo "SecDef VN Trip Briefings (u)", July 25, pp. 207-209- 

90. State to Saigon 202388 May 25, 19^7 . 

91. COMUSMACV to CINCPAC 28l2^1ay67; JCS to CINCPAC 9^7 of 3 212 3 Z 
July 1967. 

92. Saigon to State 59^0 September ik, 1967. 

93. Saigon to State 23389 April l8, 1967. 
9^. Saigon to State 237^8 April 22. 

95. Saigon to State 2555^ May 12. 

96. State to Saigon 210584 June 13, 1967. 

97. Saigon to State 280 9 June ik; 28l T June 15; 282l8 June l6, 1 9 6 T . 

98. Saigon to State 28^09 June 20; 80 July 1, 19^7 • 

99. Saigon to State 29258 June 30, 1967 • 

100. Saigon to State 1381 July 19; 1^75 July 20. 

101. State to Saigon 30023, August 31, 1967- 

102. AmEmb Saigon to SecDef, Blueprint for Viet-Nam, August 26, 1967. 

103. Saigon to State U958 September 5, 1967- 
1C4. Saigon to 'State 7113 September 19, 1967- 
105. State to Saigon 30023 August 31, 1967- 

106 Province Report for Bien Hoa Province (RCS-MACCORDS-Ol-67) Period 
Ending 31 December 1967. 


TOP SECRET - Sensitive