1 The estimates in this table for items 3, 4, 5, 6, and 7 are my own. They should be viewed as approximately correct, not as definitive. They are good enough for broad comparisons but not for fine calculations.

2 End-year data. Estimate includes regular, territorial, and paramilitary forces including the national police. 3 End-year data. Police excluded.

• Not available.

This is my own estimate. GVN defense expenditures include MOND budget plus Ministry of Interior budget. U.S. expenditures include personal conversions plus U.S. official piaster purchases.

These figures represent payments for commercial imports. Current-year values were deflated by the U.S. export price index. Noncommercial imports (AID project commodities, charity, and military assistance in kind) are not included. ? These figures are simply item 4 divided by item 1. Not all members of Vietnamese Armed Forces are full-time soldiers. Adjusting for this would increase each year's figure but not significantly affect the trend.

This is the GNP deflator used by AID. It is roughly consistent with the change in consumer prices. It can be used for estimating real wages, but is less appropriate for deflating economic variables other than wages.

This is the MOND budget divided by the numbers of regular and territorial forces. Since it includes expenditures other than wage and salary payments, it is not properly a real wage index. Since the percentage of wage and salary expenditures has remained the same, it's not a bad approximation, however.

DEVELOPMENTS SINCE 1966

Since 1966, the following developments have occurred:

1. The real burden of the war has increased substantially. Vietnamese military and paramilitary forces have increased by over 50 percent; resources used to support U.S. military activities have increased though very much less rapidly.

2. Imports have increased only slightly.

3. GVN civilian programs have hardly changed. Civilian employment in the public sector was no higher in 1969 than in 1966. 4. Increasingly, the burden of the war has been passed back to the Vietnamese soldier and civilian employee in the form of lower real wages.

ECONOMIC POLICY ISSUE INVOLVED IN VIETNAMIZATION

Turning from the past to the future, there is an important economic policy issue involved in the Vietnamization program. The purchase of piasters for military use will decline in the future as American troops are withdrawn from Vietnam. At the same time, increased military responsibility will have to be assured by Vietnamese Armed Forces. Unless some way is found to maintain or increase our economic support to Vietnam, it is unlikely, in my opinion, that Vietnamese military capabilities will increase as much as they otherwise could. This in turn could possibly influence the speed with which U.S. troops are brought home.

I would urge that adequate economic support be provided to Vietnam to enable the maximum increase in Vietnamese defense capabilities to be realized. If because of import stringencies

Senator GORE. May I ask a question, Mr. Chairman.

The CHAIRMAN. Yes.

Senator GORE. Do you think we should provide the economic and military support for the Vietnamization of Cambodia?

Mr. COOPER. I don't know what you mean by the Vietnamization of Cambodia, sir.

Senator GORE. The stationing by South Vietnamese of troops.

Mr. COOPER. Permanent stationing of Vietnamese troops in Cambodia?

Senator GORE. Yes.

Mr. COOPER. I doubt that that is going to happen. I really don't know much about Cambodia.

Senator GORE. Thank you, Mr. Chairman.

The CHAIRMAN. Proceed.

Mr. COOPER. If because of import stringencies Vietnamese force levels are held below what they might otherwise be, Vietnamese military and governmental performance is impaired by declining real wages and morale, and the attention of Vietnamese leaders is drawn away from the war effort because of economic crises, not only Vietnam but the United States will be the loser. U.S. economic support to Vietnam need not, and should not, be lavish. It should be related to Vietnamese defense efforts: large enough to offset the burden such efforts represent, and provided so as to promote as great an increase in these efforts as can be achieved. In my judgment these criteria imply an increase in U.S. economic support to Vietnam above current levels.

I know many people, both within and without the government who feel that now is the time to compel the Vietnamese to put their economic house in order, begin the slow and gradual climb back to reasonable economic self-sufficiency, and lay the basis for peacetime economic development. I disagree. U.S. interests seem to me best served by permitting the GVN to focus on the first-priority problem, the attainment of military self-sufficiency. Fundamental economic reforms with the political disruption they would inevitably entail, and with the limited effectiveness they could possibly have in the midst of war, should be postponed not because they aren't important but because they aren't important enough.

DOMESTIC TAXATION IN SOUTH VIETNAM

Before closing, I would like to comment briefly on the issue of domestic taxation in South Vietnam. Personally, I think increased domestic taxes in Vietnam are desirable. But I don't think this is an issue of great importance to the United States. Whether Vietnam finances their war burden via inflation or via taxation is an issue better left to Vietnamese leaders. We can determine the size of the war burden they are faced with through our economic assistance and we should, in my opinion, leave to them the responsibility for managing their own financial affairs. My own experience in Vietnam makes me confident they can discharge this responsibility effectively.

ECONOMIC POLICIES OF GVN IN RECENT YEARS

Finally, I would like to express to the committee my belief that, by and large, the economic policies of the GVN (Government of Vietnam) in recent years have been well-intentioned and reasonably effective. There are certainly rich Vietnamese, many of whom have gotten richer. This is inevitable in a wartime boom- and has happened in

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our country. But overall, the benefits of economic improvements in the period I am discussing have been widely shared. The passage of the land reform bill initiated by President Thieu, with very little U.S. input I might add, is not an aberration but a reflection of what I have found to be a generally responsible approach to economic and social issues, constrained by the exigencies of war and politics.

Thank you.

The CHAIRMAN. Thank you, Mr. Cooper.

PRESENT U.S. OBJECTIVE IN SOUTH VIETNAM

In your statement you say, "I disagree. U.S. interests seem to me best served by permitting GVN to focus on first priority problems.” I wonder if you could elucidate for a moment on what you consider to be our objective in Vietnam and relate it to our own national interests. What do you think is the objective of this overall effort?

Mr. COOPER. I think at this point, if I understand Administration policy correctly, the objective is to promote the increased military effectiveness of the Vietnamese as rapidly as possible in order to bring home American troops as rapidly as possible.

I think that is highly desirable and long overdue policy that could have been effected sooner than it was and that gives substantial promise of being successful.

The CHAIRMAN. I agree our national objective is to bring home the troops, but what is wrong with bringing them home the way the French brought theirs home?

Mr. COOPER. This is, you know, the fundamental question of the policy in Vietnam. My own views on this are that it is in the U.S. interests to bring home the American troops in what has been termed a responsible way, in other words, in a time period in such a way as to leave the Vietnamese with the capability of defending themselves. I think that this is in the U.S. interest.

I think it is also desirable because over the past 5 or 6 years we have given relatively little attention to helping the Vietnamese better defend themselves and it is only in the last couple of years that we have made this a first priority rather than a second priority objective. We have always worked on it, but it had never been a really top priority objective until quite recently.

The CHAIRMAN. Do you consider the way the French liquidated their ownership and presence in Vietnam irresponsible?

Mr. COOPER. Not for them. I wouldn't comment on that. Every country views their interests

The CHAIRMAN. Why is it irresponsible for us and not for them to do the same?

Mr. COOPER. Well, it is irresponsible not in any absolute sense, but because for a number of years now we have followed a policy in Vietnam with assurances to the Vietnamese and the Vietnamese Government without really giving them a chance to adjust to what is a very new and, I think, highly desirable change in this policy. I think they deserve as good a chance as we can give them to defend themselves, and I am also reasonably confident that they can respond to that responsibility when it is given to them unless it is given to them so abruptly that both their self-confidence and their physical capability for defending themselves are undermined.

RELATIONSHIP BETWEEN U.S. ACTIVITIES IN VIETNAM AND DOMESTIC CONDITIONS

The CHAIRMAN. Do you see any relation between what we are doing in Vietnam, both economically and militarily, and conditions in the United States?

Mr. COOPER. Of course.

The CHAIRMAN. What is that relationship?

Mr. COOPER. Well, Vietnam has been a large, although not overwhelming, economic burden for the United States and it certainly has been the most controversial and divisive political issue in my experience in this country.

The CHAIRMAN. As a matter of priority, do you feel our first duty is to Vietnam?

Mr. COOPER. Not at all. I feel that

The CHAIRMAN. Why not?

Mr. COOPER. I feel that both of those problems, both the political and the economic burden of Vietnam, can be and should be reduced substantially by the reduction of U.S. direct military participation in that country. It will save thousands of lives and if it will be successful it will be the most successful outcome of that unhappy war.

U.S. INTEREST IN SOUTH VIETNAMESE ABILITY TO DEFEND THEMSELVES

The CHAIRMAN. I misunderstand you then. I thought you were advocating increased assistance.

Mr. COOPER. Increased assistance in order that they can increase the size of their armed forces and effectiveness with which they fight so they can more quickly and more rapidly take over a larger share of their own self-defense. I think it is very much in our interests for the Vietnamese to be better able to defend themselves.

The CHAIRMAN. Why is that so vital to us? We never had this before. What has occurred within the last 6 years that has created such a vital interest to the United States?

Mr. COOPER. The war in Vietnam has occurred in the last 6 years. At this point, given the history that has gone before, I think it is in the U.S. interests to increase Vietnamese military capabilities. I think if they can better defend themselves that is in our interest.

The CHAIRMAN. How is that? What difference does it make to the United States?

Mr. COOPER. I may be wrong in my prediction

The CHAIRMAN. I didn't say you were wrong. I want to develop it so that we can understand what you have in mind.

Mr. COOPER. I would think that if the Vietnamese are better able to defend themselves, in fact we will bring troops home more rapidly than otherwise. That may be completely wrong. We are going to bring the troops home anyway, but there is always room for slippage. Even if you bring 150,000 troops home in 15 months, we are facing questions. If the Vietnamese performance is good, you might bring 10,000 of them home a month earlier. You might bring the next batch home

sooner.

The CHAIRMAN. You might not bring any of them home.

Mr. COOPER. In fact, we will bring troops faster, the more rapidly and the more effective Vietnamese own defense efforts are increased.

The CHAIRMAN. I still haven't come to grips with why what happens there is of such vital interest to this country that we risk the breakdown of our own system.

Mr. COOPER. Well, I think we have turned a very important corner in our policy in Vietnam.

The CHAIRMAN. What is that?

Mr. COOPER. By explicit and conscious policy of reducing rather than increasing or maintaining a U.S. effort there. I think it is terribly important and should have been done earlier and can be carried out very successfully. Maybe I am wrong in this, but I think it will be easier to speed that process if the Vietnamese prove themselves capable of defending themselves as they, I think, show good promise of doing it. The CHAIRMAN. Defend themselves against whom, the North Vietnamese?

Mr. COOPER. Primarily at this point, yes.

The CHAIRMAN. You think this is of such vital interest to us that it would justify all that is going on.

Mr. COOPER. I think it is a very important interest to us, and besides that I think in fact it will have an influence on how rapidly the U.S. troops are brought home.

If there were no question in anybody's mind that the Vietnamese were capable of defending themselves against the North Vietnamese, I think we could bring, I think we would in fact bring, American soldiers home much faster.

FRENCH SETTLEMENT IN INDOCHINA

The CHAIRMAN. The French brought their troops out very quickly as a result of the political settlement in 1954 known as the Geneva Accords. I don't see why you think it would be irresponsible for us to do that.

Mr. COOPER. We don't have that kind of settlement today. We don't have, we have not been able to reach any agreement on any cessation or cease-fire of hostilities.

The CHAIRMAN. We haven't offered any such terms as the French did; have we?

Mr. COOPER. I really can't speak to that.

The CHAIRMAN. So far as you know we haven't.

Mr. COOPER. I don't know what we have offered or haven't offered. I am not that familiar with the French terms.

The CHAIRMAN, Senator Gore.

Senator GORE. No, thank you.

The CHAIRMAN. Thank you very much, Mr. Cooper.

INTRODUCTION OF WITNESSES

The next witnesses are David Schoenbrun, who will discuss the historical aspects of American-Vietnamese relations, and Mr. Daniel Ellsberg, who will discuss the political impact of our policies in Vietnam.

Mr. Schoenbrun is a distinguished journalist, author and lecturer. He has covered events in Indochina as a journalist for about a quarter of a century or perhaps longer.