Foreign Relations of the United States, 1961–1963, Volume XXIV, Laos Crisis

263. Memorandum From Secretary of State Rusk to President Kennedy⁰

Washington, January 6, 1962.

SUBJECT

• Laos Settlement

Problem

To determine the courses of action we should follow to induce the present Lao Government (Boun Oum-Phoumi) to negotiate in good faith with Souvanna for a national unity government leading to an acceptable Lao settlement.

Boun Oum and Phoumi have so far negotiated grudgingly and probably not in good faith. They now have again interrupted the negotiations despite the strongest pressures by the United States and other interested governments. The sticking point is their determination to retain the posts of Defense and Interior which Souvanna has reserved to the center.

Background

Only two choices have appeared available to us in the settlement of the Lao crisis. The first would have been military intervention in Laos by the United States with or without SEATO. Aside from the uncertain chances of success there would be the risk of Chinese Communist intervention with the dangers of a full scale confrontation between ourselves and the Communist Bloc.

Instead we chose to seek a peaceful settlement at Geneva. We are close to achieving an acceptable agreement, one of whose best features is that it makes the Soviet co-chairman responsible for policing observance of the agreement by the Communist signatories. This is especially pertinent to the undertaking of the signatories that Laos would not be a corridor or base for bloc intervention in South Viet-Nam or elsewhere. Pushkin informed Harriman that the Soviet Government attaches the highest importance to working out a peaceful Lao settlement and said this would favorably influence other negotiations.

The final settlement now awaits the formation by Souvanna of a government of national union. While many points remain to be worked out, Souvanna has given evidence that the cabinet distribution he is willing to accept and the policies he is prepared to adopt provide a negotiable formula for a solution acceptable to us and in accord with the tripartite Paris Agreements of August 7.¹ He has proposed a cabinet of 19 with a balance of 4–5–5–4 plus himself (four each to Pathet Lao and RLG, five each to Vientiane neutrals and Xieng Khouang neutrals). Souvanna intends to keep the Defense Ministry for himself and give the Interior Ministry to one of his supporters. He appears ready to keep the Pathet Lao out of sensitive positions and give some responsible ministries to the Boun Oum-Phoumi group. The exact distribution of portfolios is still very much open, including such key ministries as Finance and Foreign Affairs as well as posts of Secretaries of State (Deputy Ministers). The present impasse results from the stubborn insistence of Boun Oum and Phoumi to retain Defense and Interior.

Negotiations between the parties to form the government have been in progress for several months. While there has been little coop-eration from Communist Prince Souphanouvong who has continued to exasperate Boun Oum and Phoumi by unnecessary harsh statements, nevertheless, the United States is receiving most of the blame for the actions of Boun Oum and Phoumi which have been clumsy and ill-advised and gave the impression to many observers that they have made no real effort to negotiate in good faith.

We have now reached the point where their intransigence in direct defiance of our advice requires us to decide on our next steps.

Courses of Action

The Department considers that having chosen to attempt a peaceful settlement at Geneva and having made such great progress toward achieving it, it would now be dangerous to abandon this course because of the resistance of Phoumi and Boun Oum. The alternative would be the course of military intervention which was discarded when we undertook to go to Geneva. Thus, we must try to force Phoumi and Boun Oum into the settlement we seek.

Ambassador Brown has recommended that we invoke graduated sanctions in terms of cutting off financial aid and military supplies to the extent this is necessary to achieve our objectives. He has already held up the payment of a dollar cash grant payable early this month. This action has caused the Lao Central Bank to suspend convertibility of the kip.

The most recent development is the invitation of the Geneva co-chairmen to the three Princes to come to Geneva to negotiate their differences. We have supported this invitation. Brown has indicated that Boun Oum is likely to accept the invitation but that Phoumi probably will not go. We believe we should insist that Boun Oum go and also try to persuade Phoumi to accompany him.

The effects of sanctions against the RLG are not entirely predictable in terms of the political, economic or military stability of the country. There are definite indications that Phoumi intends to attack the Pathet Lao in an effort to draw in the United States, or might go to the South leaving Vientiane weakened or undefended. We, therefore, feel that we should endeavor to obtain Soviet assurances through Pushkin in Geneva that they will not permit the Pathet Lao to attack or take advantage of the difficulties caused by our efforts to induce Boun Oum and Phoumi to negotiate.

We should also try to clarify our understandings with Souvanna as to his intentions regarding his proposed government particularly to avoid his taking undue negotiating advantage of any disruption of the Boun Oum-Phoumi group.

Certain additional efforts in the covert field to obtain Phoumi’s compliance also may prove useful and desirable. A separate proposal on this subject will be presented.²

Alternatives and Their Consequences

There are risks in pursuing the above courses of action. The exercise of sanctions could cause desperate and foolish actions by Phoumi that would weaken the military and political structure of the RLG. He might initiate provocative attacks on the other side. The Soviets-PL or Souvanna himself might try to take advantage of such developments to obtain unacceptable concessions.

The negotiations could be so long and complicated that Souvanna might, as he has often threatened, quit in disgust and decide to live in France on his apparently ample means. This would create a new and complex situation which in essence could mean that the Pathet Lao and the anti-Communist forces of the RLG would confront each other in an uneasy truce or possible open conflict.

However, this course offers the opportunity of achieving an acceptable negotiated solution.

The alternative to carrying on with this course is to face a breakdown of the negotiations and a resumption of fighting in Laos which would require United States military intervention with or without SEATO.

Decisions Required

1. Whether or not to authorize Ambassador Brown to impose the sanctions of stopping military deliveries.

2. Authorization to take certain covert actions designed to obtain Phoumi’s cooperation.

3. Authorization to negotiate with Souvanna and Pushkin as outlined above.

Dean Rusk

0. Source: Kennedy Library, National Security Files, Countries Series, Laos: General, 1/1/62–1/15/62. Secret. The Department of State copy indicates it was drafted by Cleveland on January 5 and cleared by Cross, Harriman, and Usher. (Department of State, Central Files, 751J.00/1–662)
1. See Document 154.
2. See Document 260.