Foreign Relations of the United States, 1969–1976, Volume VI, Vietnam, January 1969–July 1970

295. Memorandum From the President’s Assistant for National Security Affairs (Kissinger) to President Nixon¹

Washington, undated.

SUBJECT

• Your Appointment with Ambassador Bunker

Ambassador Ellsworth Bunker will call on you at noon on May 19, just before returning to Saigon. He has been in the United States to receive the Sylvanus Thayer Award at West Point and has conferred with State and Defense and saw you on May 9.²

Ambassador Bunker will probably want to discuss the following topics:

Political Developments in South Vietnam

Background: The political atmosphere in Saigon has been heating up for some months, with indications of potentially increasing tension. The following particular problems have arisen:

• —President Thieu has been accused of becoming more isolated from prevailing political currents and more dependent on a small group of controversial advisers. He has taken a number of steps which have led to charges of dictatorship, such as the imprisonment of opposition deputy Tran Ngoc Chau, the use of the law on political parties to stifle the formation of new political groupings, as well as inconsistent and undemocratic handling of student and religious opposition elements.
• —The growing economic problem has contributed to the sense of political uncertainty and has led to a restive mood among the civil servants and in the army. There are some signs that President Thieu considers us partly responsible for some of these problems because we have not responded as quickly as he hoped to his appeals for help. This may lead to political tensions between ourselves and Saigon.
• —The elections for the Senate which will be held in August or September may lead to charges that the GVN is attempting to suppress the opposition and rig elections.

I suggest you:

• —Ask the Ambassador for his views on the political situation, on Thieu’s prospects for weathering the storm, and on the GVN prospects in the Senate elections.
• —Discuss with the Ambassador the interaction between GVN political methods and U.S. domestic criticism of the regime.

The South Vietnamese Economy

Background: Growing economic problems constitute a severe challenge to the GVN. There are two specific problems:

• —The economy, which has been booming for many years under highly artificial conditions created by the large American presence, is now running at an unacceptable inflationary rate of about 30 percent or more a year.
• —At the same time, paradoxically, the beginning of U.S. withdrawals has led to recessionary influences, which will become much more severe as more of our forces withdraw and many of the artificial financial devices by which their presence has boosted the economy diminish. The immediate problem is to keep inflation in bounds and then to stabilize the recession which could well develop during the remainder of the Vietnamization period.

The GVN has asked us for help, and its request is now being staffed through the bureaucracy. But we have been holding back on any commitment of aid to the GVN until it takes some further steps to put its own house in order. The GVN’s ability to do this is limited by disputes over the relative powers of the legislature and President Thieu in this field and by memories of the bitter political controversy and economic dislocations produced by President Thieu’s unilateral proclamation of austerity taxes last fall (at our suggestion).

I suggest you:

• —Ask the Ambassador for his views and recommendations on the economic situation and how he believes we should play our cards to press Thieu into needed reforms without creating intolerable political risks for the GVN.
• —Indicate that we want to be helpful and will try to provide whatever assistance is needed if we can be assured that it will be properly used.
• —Ask the Ambassador his views on the desirability of augmenting our Embassy staff at the Deputy level with a highly qualified and well-known economist who can cut through the issues and deal at the highest levels with the Thieu regime.

Cambodia

Background: The GVN has been cementing relations with the Lon Nol regime. The ARVN has performed well against the Communist border sanctuaries. Thieu and Ky have indicated that they don’t feel that future operations by the ARVN in Cambodia need be constrained by the same limits we have placed on U.S. actions.

I suggest you:

• —Ask the Ambassador what he believes the GVN can and will do for Cambodia and whether he thinks it will be tempted to act independently of our actions.
• —Ask the Ambassador’s views on the risks that traditional Vietnamese-Khmer rivalry may pose to GVN–GOC cooperation.

Vietnamization and Pacification

Background: At present these appear to be less urgent problems than the political and economic issues. Pacification and Vietnamization are both going relatively well, despite questions about the future pace of Vietnamization, doubts about the solidity of our progress in some areas, and concern about the slackening of the rate of pacification. The land reform bill may help provide further peasant support for the government.

I suggest you:

• —Express satisfaction at the passage of the Land Reform bill and ask the Ambassador’s views on the program’s implementation.
• —Ask the Ambassador for his recommendations on whether we should boost pacification forward again at an accelerated pace or should continue consolidation for some time.
• —Ask the Ambassador for his recommendations on the pace of U.S. troop withdrawals.

Negotiations

Background: The prospects in Paris remain bleak, although Hanoi’s one-week postponement was a relatively mild reaction to our Cambodian operations. Your April 20 remarks³ about the principles of a political settlement generated some doubts within the GVN below the level of President Thieu.

I suggest that you ask the Ambassador’s views on how we can best influence Hanoi to move toward a settlement and for his assessment of the Saigon attitude toward Paris.

Corruption

Background: This subject has come up again because a South Vietnamese Senator has accused several leading generals of corruption.

I suggest that you ask Bunker for a report on this problem and emphasize our desire for progress against corruption.

1. Source: National Archives, Nixon Presidential Materials, NSC Files, Box 146, Vietnam Country Files, Vietnam, May 1, 1970. Secret; Sensitive. Sent for information. Bunker met with the President and Kissinger from 12:20 to 12:56 p.m. on May 19. (Ibid., White House Central Files, Daily Diary) No memorandum of conversation of their meeting has been found.
2. The President’s Diary has no record of Nixon meeting Bunker May 9–12. (Ibid.) A similar uninitialed May 8 memorandum from Kissinger to the President indicates that Nixon was scheduled to meet with Bunker on May 11 or 12 “depending on your precise schedule.” (Ibid., NSC Files, Box 146, Vietnam Country Files, Vietnam, May 1, 1970)
3. Reference is to the President’s Address to the Nation on “Progress Toward Peace in Vietnam”; see Public Papers: Nixon, 1970, pp. 373–377.