Foreign Relations of the United States, 1951, Asia and the Pacific, Volume VI, Part 2

112/4–1751

The Under Secretary of State (Webb) to the Director of the Bureau of the Budget (Lawton)

secret

Washington, April 17, 1951.

Dear Mr. Lawton: The Economic Cooperation Administration and the Department of State in letters dated March 16, 1951, asked the Bureau to reconsider the proposed recommendation to the President that the amount requested under the authority of Public Law 911 for use during fiscal year 1951 in the general area of China be reduced.¹ The President has now authorized $30,800,000 of the $38,146,741 requested. This reduction, which it is understood is in accord with the recommendation of the Bureau, affects Burma, Formosa and Thailand, but this letter is concerned only with Thailand.

Nine million four hundred thousand dollars would be required to complete the proposed program in Thailand, of which $7,550,000 is now authorized. The Embassy and STEM, in a joint cable dated April 6, 1951 (Tab A), insist that no cut be made in the proposed program because of the anticipated serious damage to the United States effort in Thailand.² The Department is in complete accord with the Embassy and STEM and urges that the Bureau now recommend to the President authorization of the additional funds required to complete the proposed program. The Economic Cooperation Administration strongly supports this request.

The primary objective of the economic program in Thailand, which is a keystone to the security of Southeast Asia, is political, rather than economic. The proposed program is designed to reinforce the alignment of the Government with the West by giving the Government confidence in the firm support of the United States, present immediate benefits to the rural areas that will reinforce the peoples’ confidence in their government, and place the United States in a position to influence the Government in adoption of reforms and utilization of its own resources for developments required for internal strength. This proposed program was developed in close collaboration by the Thailand Government and STEM in cooperation with the Embassy.

Last March, the Secretary of State, after consultation with the President, despatched to Southeast Asia a mission headed by Mr. R. Allen Griffin.³ The Mission recommended a program for Thailand requiring approximately $11,000,000. No commitment was made but it was necessary later to indicate to the Government the general magnitude of possible aid as well as specific lines the aid would take in order to give the Government confidence in support of the United States and to enable the Government to make proper arrangements for reception of an economic mission and to develop a suitable program for consideration of that mission. When the amount of funds available from the China aid program was determined, however, only $7,555,000 could be allocated. The Mission, then, together with the Embassy, in working with the Thai Government, made every effort to restrict the program to the basic minimum required to achieve our objective. The program that resulted is the one presently proposed for which a total of $9,400,000 is required. On the basis of the earlier information given to them and the close collaboration with STEM and the Embassy in developing this program, the Thai Government considered that there was a sufficiently firm undertaking to complete the proposed program to warrant making firm plans in each of its relevant ministries to accommodate the program.

Unless additional funds are made available, however, it will be necessary to reduce village-level projects in agriculture and public health, and to eliminate the proposed road building project unless agricultural and public health projects were to be drastically cut. Elimination of the road building project would be particularly unwise. This project has been worked out in detail with the Government. The Prime Minister and the Government consider the project to be of first priority because of the economic and military aspects, and the MAAG concurs in the military importance of the project. Elimination or reduction of the public health and agriculture projects would substantially weaken the basic village-level concept of the program.

If the program is thus reduced the effect will be to undermine the Thais’ confidence in the determination and ability of the United States to conduct and administer programs to assist Thailand. Such reductions would raise doubts as to the advisability of maintaining the present strong alignment with the West, particularly in view of the risks that the Government considers are involved in such alignment, and greatly reduce the ability of the United States to influence the Government. In the joint Embassy–STEM cable referred to above, it is stated: “At the present time, such reductions in quantity and elimination of major categories, evidencing the instability of United States policy, will be a major blow to Thailand and result in such loss of faith as to jeopardize underlying political objectives U.S. policy.”

In considering this request, it should be kept in mind that Thailand is the only country wholly on the mainland of Asia that is consistently supporting the foreign policies of the United States in the UN and elsewhere. It is the only country so situated that, for example, has sent troops to Korea and has recognized Vietnam.

Sincerely yours,

James E. Webb

1. Neither printed.
2. Tab A is not here printed; this enclosure is a paraphrased version of telegram 1556 from Bangkok, April 6, in which Ambassador Stanton argued that the proposed reductions in ECA funds for Thailand would seriously undermine Thai confidence in the United States and could cause the Thai to consider changing the basic orientation of their foreign policy away from close collaboration with the United States (892.00–R/4–651). A week later, on April 13, in telegram 1607, Ambassador Stanton advanced the additional warning that if the original ECA funds were not forthcoming, Prime Minister Pibulsonggram might fall from power and be replaced by men who would repudiate the Prime Minister’s policy of close cooperation with the United States (892.00–FA/4–1351).
3. For a short description of the Griffin mission, see footnote 2, p. 1606.