Kissinger: We agree, but we will still have to come in for a supplemental. It's not enough.
On the economic side, the funds are totally inadequate. We gave a 5-year program and we said the worst way is to give just too little because you can never get a process of growth. $600 million is the minimum to stabilize the situation. At the levels now the situation will be seriously jeopardized. Food and fuel costs have risen tremendously. This has to do with political stability. In June we were impressed with Ambassador Martin's report of progress. Now the impact of these cutbacks is turning the situation around. The situation is a disaster.
Stennis: The actual facts as I understand. The money until now has come out of Defense without a method to let it be traced. This year there are requirements for proper accounting. I suggested a personal Presidential representative to watch the spending. I think we should try it and we should give $800-900 million. With tightening up it should be enough. They were firing like we did. They have reduced that. I think we should try this.
President: Do you recommend a military man?
Stennis: He must have military knowledge.
Aiken: One reason for the cut is they still have a million men under arms.
President: I would assume they have kept the levels up because there has been no reduction in the opposition.
Kissinger: On the contrary, North Vietnamese forces have tripled since the Agreement. North Vietnam has built a whole system of roads so that equipment can come in in a day or so. They [the ARVN] were doing OK until these cuts.
We maybe shouldn't have trained them in our tactics, but we have and it is now their own and it would be disastrous to change.
McClellan: How much more do you need?
Kissinger: $200 million in military and $150 in economic.
Mahon: We can provide Kissinger with this money right now. We have to try to hold the line now and try in the new session for more.
CONFIDENTIAL
