Document type: PAPER-TEXTUAL DOCUMENT

## Page 1

1176-10036-10127

JFK ASSASSINATION SYSTEM

IDENTIFICATION FORM

AGENCY : NARA

RECORD NUMBER : 176-10036-10127

RECORD SERIES : National Security Files

AGENCY FILE NUMBER :

ORIGINATOR :

FROM :

TO :

TITLE : Phase I

DATE:

PAGES : 18

SUBJECTS :

DOCUMENT TYPE :

CLASSIFICATION :

RESTRICTIONS :

CURRENT STATUS :

DATE OF LAST REVIEW : 9/10/2000

OPENING CRITERIA

COMMENTS: National Security Files, Box 199: Vietnam,9/11/1963-9/17/63. Box 2

NH 49061

DocId: 32626060

Page

1

---

## Page 2

UH- 84-75 1 Dee 991229

ALK -9-37

• Version

cond deungredic

120

confidential

TOP SECRET--EYES ONLY

PHASE I.

Purpose

The purpose of Phase I is to attempt to persuade Diem and Nhu

separately that the Nhus should leave the country for an extended

period.. The means are continuing the Lodge-Diem conversations;

direct approaches to Nhu;

"carrot and stick"measures to separate

the Nhus from from their immediate supporters; and a carefully-

tailored public posture to supplement these efforts.

Part A, Phase I, below, describes a possible Lodge approach to

•Diem.

Part B, below,describes the actions to be taken to isolate the Nhus

from their immediate supporters, including a suggested approach to

Nhu himself.

Part C, below, describes possible Congressional action to produce

pressure on Viet-Nam.

Part D, below, describes the US Government public posture in

Phase I, including a proposed statement.

Part E is concerned with the possible evacuation of dependents as

proposed by Ambassador Lodge:

Confidential

TOE

SE

ET--EYES: ONLY

NH 49061

DocId: 32626060

Pade 2

---

## Page 3

TOP SECRET - EYES ONLY

Part A, Phase I

Lodge's Approach to Diem.

Lodge should see diem and. convey the following:

The United States Government feels, as the President

indicated in his TV interview, that Diem must take drastic

action to recapture the support of his people, repeating:

the same approach made by Ambassador Lodge in his last

meetịng, le., a long vacation for the Nhus, actions to

demonstrate a reversal of the policy of repression, and the

broadening of the Government.

However, in the meantime, the United States Government

is faced with a crisis of confidence in the Vietnamese

Government on the part of the American public and more

¿especially the American Congress.: In order to preserve

the aid program to south Viet-Nam, which the President

sincerely desires to do, it has become politically necessary

to.disassociate.ourselves from supporting those units

responsible. for the raid on the pagodas. Otherwise, the

United States Congress may cut off all aid. Therefore,

Ambassador Lodge must reluctantly notify President Diem

that assistance to Colonel Tung's programs must be terminated.

We will make an attempt to redirect what ald we can on to

programs essential to the war effort if this can be

worked

out.

If President Diem can see fit to take the dramatic actions

mentioned above promptly, we feel that we can quickly restore

confidence.:

But we must warn the President that if the

situation

TOP"SECRET-EYES: ONLY

HH 49061 DocId:32626060 Page 3

---

## Page 4

TOP. SECRET - EYES ONLY

situation continues as it has been we may have to make

: further cuts--again in order to avoid a total cut of aid.

If this becomes necessary we will endeavor to make these

in such a way as not to affect

the war effort, e.g; the

saigon water works, the saigon electric power plant,: etc

TOP SECRET EYES ONLY

N 49061

Doold: 32626060

Page 4

---

## Page 5

TOP SECRET - EYES ONLY

Part B.

Phase 1

Objective

To separate the Nhus and their immediate supporters (i.e., Tung

Fieu of the Police, Minister Ngo Trong Rieu).

2. Concept of Operations. Actions taken should fall short of seriously

damaging the war effort while at the same time indicating that the U.S. will

not tolerate the Nhus. The importance of these actions does not lie in

physical damage done the GVN but in their psychological effect upon Nhu and

company; and upon the potential opposition. These actions must demonstrate

U.S. determination not to tolerate the Nhus and their aitempts to destroy

American prestige. For every overt action, there should be corresponding

covert actions designed to spit the Nhu power group and further discredit

them. The entire operation should be conceived of as a psychological warfare

campaign designed to maintain U.S. prestige by dissociating ourselves from

the Nhus and discrediting them.

3. Specific Recommended Actions. Actions should be pinned to reportedly

ominous signs that the U.S. will not tolerate the repressive actions against

the Buddhisis or other citizens and will not tolerate and support any persons

directly responsible for such actions (i.e. the Nhus and Tung). A Congressional

or Senatorial Resolution to this purpose is recommended. (See below).

(1.) Overt

a. Requirement for a Singed Statement to Accompany U.S. Aid.

Instruct all U.S. agencies promptly to answer routine requests for support on

the merits, out to require a signed statement, in substance:

TOP SECRET - EYES ONLY

49061

DOCId:32626060 Page 5

---

## Page 6

TOP SECRET - EYES ONLY

"These supplies will not be used in any way to indicate U.S.

or GVN support of anti-Buddhist or other unjustified

repressive actions, or of those persons connected with or

directly responsible for such actions.."

Comment: No violent reaction from the President is likely if it is

explained to him by the Ambassador that these steps are absolutely necessary

to prevent all aid from being severed. Selected instances of this requirement

should be leaked to the press--alerting them to check on compliance. Instances

of rejection of the requirement should be broadly publicized as evidence of:

unwillingness to get on with the war. This should be very effective in hastening

consolidation of anti-Nhu opinion.

b.

Termination of CAS Support to Vietnamese Special Forces by

withdrawing CAS-owned equipment. Announce to Special Foreces that hence-

forth no additional funds will be paid through Tung for any projects whatsoever.

Other projects may be supported by payment directly to project officers,

provided project is in mutual best interest.. Any project capable of serving

personal ambitions of Nhu or Tung automatically excluded. • Actual harm

done to war effort or to Special Forces would be slight but it would be a

psychological blow of considerable proportions to Tung whose power rests in

the eyes of the Vietnamese, not only upon his connections at the Palace but

upon apparent unlimited U.S. support for him.

TOP SECRET - EYES ONLY

IN 49061 DocId: 32626060

Page 6

---

## Page 7

TOP SECRET - EYES ONLY

C. No U.S. participation in any new projects involving Tung -

specifically the Hamlet Militia Leader Training Program.. Our refusal to

participate because of Tung should be announced unequivocally to the GVN;

we can accompany this by a counterproposal that the CG/SDC Directorate be

put in charge since we consider it a worthy project.

: d. Cutting Aid to the Motion Picture Center - Direct U.S. - paid

personnel at USOM Mopix Centre and other media activities to refuse to

handle or process any material prohibited under 1. above. This may cause.:

temporary termination of U. S. participation in some activities under GVN

control, and will certainly evoke inspired local press attacks. Useful

activities should be carried on by improvised means, with full publicity for

„Niu attempts. to impede the war effort, and U.S. continuation of effort:

Diversion of Ammunition for Police . - Actual physical effect -

negligible but psychological effect considerable.

Response to attacks in the Times of VietNam. The Ambassador

does not wish to demean himself by protesting officially, however, if the U.S..

does not defend itself, this will be interpreted as a sign of weakness--the

U.S. will lose face and prestige. Suggested counteractions are leaks by

Eroassy officials such as "the Ambassador refuses to read the rag because

of its notorious reputation for outright lying", or other comments indicating

the U. S. considers the newspaper ridiculous.

Ambassador makes "unannounced" visits on key Vietnamese

TOP SECRET - EYES ONLY

NW 49061

DocId: 32626060 Page 7

---

## Page 8

TOP SECRET - EYES ONLY

personalities and key areas. Visits Ministers, JGS, General Don, Dinh,

Minh, and others, with the objective of seeking their views and indicating

American freedom to talk to whomever we please. Purpose is to büild up

American prestige and a feeling that we are in charge. Must be carefully

stage-managed to avoid embarrassment.

h. Direct immediate procurement in cash, and storage under

U.S. control, of approximately 3 million U.S. dollars worth of piastres.

The purpose is to make immediately available for essential on-going counter-

insurgency programs, the funds already authorized. Possibility of freezing

eighter U.S: or provincial bank accounts must not be overlooked.:

(2) Covert

• a. Suspension of any CAS projects capable of being used by Nhu to

build up his prestige and illustrate that the U.S. is continuing to support

him. CAS should be prepared to offer recommendations in this regard.

b. Set Dinh and Tung against each other by rumors and reports to

Dinh that Tung is plotting to assassinate him, etc.

c. Set Nhu against Tran Van Kiem, Mme Nhu's brother (and thus

increase tension between the Nhu's) by getting word to Nhu of what Khiem told

Warner about Nhu.

d.. Fabricate a document linking Nhu with the DRV thus discrediting

him with the Generals.

e. Put out our own black newspaper as a counter to the Times of

Vietname of the regular Vietnamese press.

TOP SECRET - EYES ONLY

NW

49061 DocId:32626060

Page B

---

## Page 9

TOP SECRET - EYES ONLY

4. Suggested Apocoach to Nhu

Although the approach by Asta and D Orlandi to Nhu was unproductive,

a further approach might be made by John Richardson. If so, the approach

should emphasize the strong possibility of aid cuts by Congress and our

decision to cut or redirect aid to those units responsible for the raid on the.

pagodas along the lines of Lodge's conversation with Diem. Richardson

should then appeal to Nhu to leave the country for a long vacation out of •

loyalty to the family, love of country,. and to make possible continued US

support of the war effort.

TOP SECRET - BYBS ONEX

NW 49061

DocId: 32626060

Page 9

---

## Page 10

TOP SECRET - EYES ONLY

Part C, Phase I

Congressional Action

A resolution expressing the "sense of the Senate"

that aid to South Viet-Nam be terminated unless that regime.

reverses its policies of repression might be useful .

ammunition for Ambassador Lodge, If it were passed by a

substantial margin

With tacit Administration approval,.

the Church-Carlson resolution has good prospects for passage:

In terms of general strategy. on the foreign ald bill, such

a resolution should be delayed until after senate passage.

of the aid' bill. Although a case can be made for earlier

approval of this resolution, what is contemplated here is

not a crash program of sudden aid termination but rather

a carefully phased plan which might well benefit from

Senate action at a later date.

TOP..SECRET - EYES ONLY

I 49061 DocId: 32626060

Page 10

---

## Page 11

TOP SECRET--EYES ONLY

Part D, Phase I

U.S. GOVERNMENT PUBLIC POSTURE IN PHASE I

TARGET

Public statements or explanations of U.S. Government actions in

phase one should be primarily directed toward those elements of

Vietnamese public opinion which our actions are attempting to influence.

This means that we should not make it our purpose to inflame mass public un

unrest.. Although demonstrations such as those spontaneously generated

by high school students doubtless have an effect even upon fanatics

such as the Nhus, on balance they probably result only in more vigorous

repression and at the same time more thorough debilitating of the war

effort among the "elite": Moreover, agitation whipped up by American

public statements which resulted in bloodshed of innocent victims

would be an additional burden which we do not wish to bear and which

would complicate continued acceptance of our policies here in the

United States.

Therefore, since the basic concept is of a surgical operation

directed against the Nhu family rather than a massive convulsion in

similarly•

South' Vietnam, our propaganda targetting should be as confined and as

precise as we can make it. We should primarily concern ourselves

with clarifying what we are attempting to do in the minds of the

TOP SECRET--EYES ONLY

NW 49061 DocId: 32626060 Page 11

---

## Page 12

TOP SECRET--EYES ONLY

Vietnamese

"elite". This "elite" must be made aware that our aims

and theirs coincide; that we are merely trying to help them remove

obstacles which stand in the way of the achievement of their basic

goals. They must be made to feel that we are sharing our confidence

with them concerning the actions we are taking in the hope that we can

continue to rely upon them to provide leadership stability once we have

finished our operation.

Exigencies of the American scene may require us from time to

time to elaborate on the basic theme and basic targetting of our public

output.

On the whole, however, we should be able to rely upon

interpretive analysis made by a very active and very well-informed

American press in clarifying the significance of our statements to the

American public.

METHOD

On the whole the Vietnamese "elite" has a very sensitive

grapevine which is alert to the.significance.of actions taken in the

political context..

On the whole, therefore, actions may be expected

to speak at least as loudly as words in most instances. This fact

suggests that our best course might be to let our actions speak for

TOP SECRET--EYES ONLY

NHI

49061

Docid: 32626060

Page 12

---

## Page 13

TOP SECRET--EYES ONLY

themselves without public explanation. Because of the Machiavellian

cleverness of the Nhus, however, this course leaves open the pos-

sibility that our actions could be so distorted and manipulated as.to

make their meaning confused even in the minds of the "elite"

observers.

Therefore, while still relying primarily upon the actions rather

than the words to carry the import of our objectives, it is felt

necessary to make limited public statements concerning the purpose

of our undertakings. There follows a short public announcement which

it is suggested should be made from the White House at the outset of

the actions being directed against Nhu in phase one. : This should

probably be issued after Ambassador Lodge has made clear to

President Diem that we intend to move to undercut the authority of the

Nhus.

Once this announcement has been made it is not considered

desirable to announce each specific step that is taken in implementa-.

tion of our operation.

Instead, on the assumption that the actions taken

will become readily and immediately known to the press, we should

merely be prepared to confirm each step as it is taken referring back

in each instance to the original announcement:

TOP SECRET--EYES ONLY

NW 49061 DocId: 32626060

Page 13

---

## Page 14

TOP SECRET--EYES ONLY

The Government of the United States is committed to helping the

people of Viet-Nam resist and overcome the threat to their peace;

security and freedom posed by the subversion and terror of the

Communists. We intend to stand by that commitment to the Vietnamese

people.

However, recent events in Viet-Nam have demonstrated that some

assistance from the. United States has been used by certain persons for

purposes and in ways repugnant to us. We are determined to prevent.

these diversions and abuses of our assistance. • We have undertaken a

review of our aid program and of administrative procedures with a

view to taking those actions necessary to halt these abuses by individuals

for their selfish ends and to insure that such abuses do not occur in the

future

We believe that these proposed actions by the United States •

Government wil strengthen the efforts of the Vietnamese people in

their struggle against the Communists. We think, too, that they will

assist Viet-Nam in its efforts to build a stable and popular administra-

tion assured.of the support of its own people.

TOP SECRET--EYES ONLY

NH

49061

DocId: 32626060 Page 14

---

## Page 15

TOP SECRET --EYES ONLY

Part E, Phase I

EVACUATION OF AMERICAN DEPENDENTS

Evacuation of dependents, as suggested by Ambassador Lodge, might

prove to be an important pressure weapon on the GVN. However, it is

tricky in its handling.. On balance, it seems wise not to order a mass

evacuation, but rather a selective evacuation of certain dependents.•

(Special means for finaricing the evacuation and a subvention for split

families will have to be found.)

• No public announcement would be contemplated. Selective evacuation.

will, however, probably become known to the press, in which case replies to

press queries would be made that certain families have decided to take

advantage of means made available to enable them to get away from the

tensions in Viet Nam.

TOP SECRET--EYES ONLY

I 49061 DocId: 32626060

Page 15

---

## Page 16

TOP SECRET

EYES ONLY

Phase II.

Purpose

The purpose of Phase II remains the

same as in Phase I.

The means are highly selective cuis, and redirection of U.s.

aid designed to avoid as much as possible hurting the war

effort. but underlining our determination to bring about a

change in the Vietnamese Government and policies.

Part A

Lodge approach to Diem: Lodge should continue his con-

versations with Diem reminding him of the conversations in

Phase. I and stating that reluctantly the United States has

decided to proceed with the aid cuts Lodge had earlier

mentioned--again in order to preserve the program as a

whole from a total cut-off by congress.

Lodge should then warn the President that

still further

aid cuts might be necessary to avoid losing the whole program

on Capitol Hill (Phase III specifies to be worked out).

Part B.

Selective aid cuts: An analysis of the aid cuts

contemplated in Phase II follows:

Background Factors

(1) The AID commercial import program and PI 480 de-

liveries constitute approximately 60-70% of South Viet-Nam's

imports.

(2)

TOP SECRET

EYES. ONLY

NW 49061 DocId: 32626060 Page 16

---

## Page 17

FOR SECRET

DES ONLY

(2) Piaster counterpart therefrom constitutes aproxi-

mately 70% of the GVN military budget.

(3) GVN reserves amount to about $170 million, ie.,

approximately 10 months import cover at 1962 levels.

(4) The SVN general supply and stock position, both

economic and military, is good.

(5) 50.

. Jong as the GVN can effectively administer its

budget and so long as it can allot foreign exchange from

its own reserves, the impact of aid cuts will be psychological

rather than real in the short run. The psychological impact

is greatest if it is credible that measures taken fore-

shadow all-out determination to suspend all U.s. aid for

political or. other reasons..

Action

The ald cuts recommended in Phase II of the Government's

program of pressures: on the GN fOllOw:

1: Withhold CIP allotments not yet made for August and

not being made in September:

(CIP pipeline will remain relatively so11à

for

about 4 months, then decline to virtually nil in about

8 months. Notwithstanding the negligible economic effect.

of making no allotments, the psychological effect upon

the saigon business communit would be

profound and

could well provoke hoarding, speculation, price rises

and general anxiety, if not panic, about the economic

•outlook.

TOP SECRET--EYES ONLY

NH 49061 DocId: 32626060

Page 17

---

## Page 18

TOP SECRET--EYES ONLY

C.

2. Publicly announce cancellation of U.S. support of

the Saigon Water Works ($17.5 million) and ühe Saigon

Electric Power Plant ($12.7 million).

These two projects are known to be highly valued

by Diem, are conspicuous evidences of long-term U:S.

interest in the City of Saigon's development, and are

now under way with completion dates 1-1/2 to 2-1/2

years hence. Suspension of these projects would have

a conspicuous impact upon public opinion in saigon

and would have to be regarded by Diem as evidence of the

seriousness of U.S. doubts' regarding its

*.:

long-term aid

intentions in SVN. Cancellation of existing contracts

would be costly to the United States and renewed

construction would present real difficulties and added'

expenses. This action might be a more credible re-

•flection of U.S. determination than verbal threats or

warnings of possible future U.S. moves. The action

should be publicly justified as indicating the un-

certainties of the. United States over the wisdom of

long-term Investments in the absence

of basic structural

changes in the OVN which offer promise of the long-term

security and stability of the country.

TOP SECPET

- EYES ONLY

NH 49061 DocId: 32626060

Page 18

---

## Page 19

TOP SECRET--EYES ONLY

3. Publicly announce continuation of U.S. support of

ongoing programs related to support of the military estab-

lishment, counter-insurgency, strategic hamlets, and the

social and economic development of the countryside.

• TOP SECRET--EYES ONLY

49061

DocId: 32626060

Page 19

---