We are fortunate to have with us today Philip C. Habib, Assistant Secretary of State for East Asian and Pacific Affairs. Mr. Habib has been closely involved with Vietnam policy matters for several years. Our witness from the Department of Defense is Lt. Gen. Howard M. Fish, U.S. Air Force, Director, Defense Security Assistance Agency. Gentlemen, we welcome you before the subcommittee. Mr. Habib, you have a prepared statement and you may proceed. We prefer to save as much time as possible for questions by members of the subcommittee. We are delighted to have you and you may proceed as you wish.

STATEMENT OF HON. PHILIP C. HABIB, ASSISTANT SECRETARY OF STATE FOR EAST ASIAN AND PACIFIC AFFAIRS

Mr. HABIB. Thank you, Mr. Chairman.

Gentlemen, we are pleased to be here. We have submitted a statement for the record which we will leave. In accordance with your express interest that we pay particular attention to Cambodia this morning, I would like to introduce a few preliminary remarks directly relevant to that question before we proceed with the questions with your permission.

Mr. HAMILTON. Your statement, Mr. Habib, will be entered in full in the record.

Mr. HABIB. Thank you, sir.

Mr. Chairman, gentlemen, I welcome the opportunity to appear before you today. The House Foreign Affairs Committee has been a thoughtful and constructive participant in the evolution of U.S. policy toward East Asia, and it is appropriate that early consideration of the new and difficult situations in Vietnam and Cambodia should take place here.

PARIS AGREEMENT

Two years ago in Paris we concluded an agreement which we hoped would end the war in Vietnam and pave the way for settlements of the conflicts in Laos and Cambodia. The war has not ended in Indochina and peace has not been restored.

The Paris agreement contained provisions relating to Laos and Cambodia. The signatories were enjoined to respect the sovereignty and territorial integrity of those countries and to refrain from using their territory for military purposes. South Vietnam and the United States have abided by these strictures.

North Vietnam continues to use the territory of Cambodia to support its military operations in South Vietnam and in addition gives material assistance and advice in the military operations of Cambodian Communist forces. We do not contend that Hanoi is the sole motive force for the Cambodian insurgency; however, in its support and encouragement of that conflict, as well as in its own flagrant abuse of Cambodian territory, Hanoi bears a large measure of responsibility for the continuation of the fighting there. That fighting has recently intensified. Since January 1 Communist forces have stepped up their attacks in the area near Phnom Penh. At the same time they have increased their pressure along the Mekong River between Phnom Penh and the South Vietnamese border, the capital's main supply route.

CAMBODIAN SITUATION

Cambodian forces have fought well but they are stretched thin in attempting to combat this two-pronged offensive, and despite stringent economies their supplies of ammunition and fuel are dangerously low. The intensified Communist attacks have taken a heavy human toll, evident in even a short visit to that country. Casualties are running at more than 1,000 a day for both sides-killed, wounded, and missingand the stricken economic life of Cambodia is further weakened. At least 60,000 new refugees have been created, posing additional strain on the resources and the administrative capacity of the government. The Cambodian Government does not seek an end to the conflict through conclusive military victory; nor, however, does it wish it to end in military victory by Communist forces. The only logical and fair solution is one involving negotiations and a compromise settlement. To this end we welcomed the resolution, sponsored by Cambodia's neighbors and adopted by the last U.N. General Assembly, calling for early negotiations. The Cambodian Government has repeatedly expressed its readiness to negotiate, without preconditions and with any interlocutor the other side may choose. We fully support that position and have pledged to do our utmost to facilitate such talks.

EFFORTS FOR A NEGOTIATED SETTLEMENT

As you are aware, we have recently documented the efforts the United States has already made to promote a negotiated settlement in Cambodia-in 1973-74 and as recently as February of this year. These efforts, which included attempts to establish direct contact with the Communists and Sihanouk, have thus far been futile. The Cambodian Communists have been adamantly opposed to a negotiated settlement, and we believe their attitude is unlikely to change unless and until they conclude that military victory is not possible. The first imperative, therefore, and the aim of our military assistance program in Cambodia is to maintain a military balance and thereby to promote negotiations.

Restrictions on our military and economic aid, contained in the Foreign Assistance Act of 1974, make it impossible to accomplish that goal. Both the $200 million ceiling on military assistance and the $75 million drawdown authorized from DOD stocks have been largely exhausted as a result of significantly intensified Communist offensive actions. In addition, Cambodia also faces a serious impending food shortage. Therefore, to meet the minimum requirements for the survival of the Khmer Republic, the President has asked the Congress to provide on an urgent basis an additional $222 million in military aid for Cambodia and to eliminate the $200 million ceiling. He has also asked that the $377 million ceiling on overall assistance be removed or at least that Public Law 480 food be exempted from the ceiling.

THE BROADER PICTURE

Mr. Chairman and gentlemen, in previous testimony before the committees of Congress on behalf of the assistance for Indochina, I and other administration witnesses have attempted to relate our policies and our programs there to the broader purposes of the United States

in the world. For despite the agony of this Nation's experience in Indochina and the substantial reappraisal which has taken place concerning our proper role there, Indochina remains relevant to those broader foreign policy concerns. We no longer see the security of the United States as directly, immediately at issue. Nonetheless, it remains true that failure to sustain our purposes in Indochina would have a corrosive effect on our ability to conduct effective diplomacy worldwide.

Our readiness to see through to an orderly conclusion the obligations we undertook in Indochina cannot fail to influence other nations' estimates of our stamina and our determination. Thus, we cannot isolate the situation in Indochina from our other and broader interests in this increasingly interdependent world. To now weaken in our resolve would have consequences inimical to those interests.

I do not believe that we can walk away. Measured against the sacrifices which we and the people of Indochina have already offered, the amounts which are now being requested are not large nor, even in this time of economic constraint, are they beyond our ability to provide. They are, however, vital to the restoration of conditions which can lead to lasting peace in Indochina.

Thank you, Mr. Chairman.

[The prepared statement of Hon. Philip C. Habib follows:]

PREPARED STATEMENT OF HON. PHILIP C. HABIB, ASSISTANT SECRETARY OF STATE FOR EAST ASIAN AND PACIFIC AFFAIRS

Mr. Chairman, gentlemen, I welcome the opportunity to appear before you today. The House Foreign Affairs Committee has been a thoughtful and constructive participant in the evolution of United States policy toward East Asia. and it is appropriate that early consideration of the new and difficult situations in Viet-Nam and Cambodia should take place here. In the interim since this hearing was originally scheduled, I visited Indochina briefly, accompanying a Congressional delegation. I found the experience illuminating, as I believe did your colleagues, and I will draw on my observations there in my testimony today. My opening remarks will be relatively brief, so that most of our time can be devoted to your questions.

Two years ago in Paris we concluded an agreement which we hoped would end the war in Viet-Nam and pave the way for settlements of the conflicts in Laos and Cambodia. We felt the Paris Agreement was fair to both sides. From the standpoint of the United States, the Agreement in large measure met what had been our purpose throughout the long period of our involvement in Viet-Nam. It established a formula through which the people of South Viet-Nam could determine their political future, without outside interference. United States forces were withdrawn and our prisoners released. The Government of South Viet-Nam was left intact, and the Agreement permitted the provision of necessary military and economic assistance to that government.

The war has not ended in Indochina, peace has not been restored. Only in Laos have the contending parties moved from military confrontation toward a political solution. In Cambodia, the conflict is unabated. In Viet-Nam, after a brief period of relative quiescence, warfare is again intensive and the structure established by the Paris Argreement for working toward a political settlement is not functioning. This is deeply disappointing, but it is not surprising. The Paris Agreement contained no automatic self-enforcing mechanisms. Although instruments were established which could have been effective in restricting subsequent military action, the viability of those instruments-and if the Agreement itselfdepended ultimately on the voluntary adherence of the signatories. Such adherence has been conspicuously lacking in Hanoi's approach.

The Communist record in the last two years, in sharp contrast to that of the GVN and the United States, is one of massive and systematic violations of the Agreement's most fundamental provisions. Hanoi has sent nearly 200,000 additional troops into South Viet-Nam, although the introduction of any new forces

was expressly prohibited by the Agreement. Amply supplied by the Soviet Union and the People's Republic of China, Hanoi has tripled the strength of its armor in the South, sending in more than 400 new armored vehicles, and has greatly increased its artillery and anti-aircraft weaponry. The Agreement, of course, permitted only a one-for-one replacement of weapons and material. Hanoi has improved and expanded its logistic system in the South and, drawing on Soviet and Chinese support, has built up its armament stockpiles-within the borders of South Viet-Nam-to levels exceeding even those which existed just prior to the Easter offensive of 1972. Hanoi has employed a rich variety of tactics to undermine the mechanisms established by the Agreement for the purpose of monitoring the ceasefire. It has, for example, refused to deploy the jointly-manned military teams which were to oversee the ceasefire. It has also refused to pay its share of the support costs for the International Commission of Control and Supervision, has not allowed the ICCS to station teams in areas its forces control, and has prevented, by delay and obfuscation, any effective investigation of ceasefire violations.

Hanoi has been similarly obstructive on the political front, breaking off all political (and military) negotiations with the GVN, which were a cornerstone of the Agreement. The South Vietnamese Government has repeatedly called for negotiations to be resumed. Hanoi's response-reminiscent of its position prior to the fall of 1972-has been to demand the overthrow of President Thieu as a precondition to any talks. As you all know, Hanoi has also failed to cooperate with us and the GVN in helping to resolve the status of American and other personnel who are missing in action.

Finally, Hanoi has applied gradually increasing military pressure, seizing territory clearly held by the GVN when the Agreement was signed. More recently, beginning last December 5, Hanoi embarked on a major new offensive. Since that date it has overrun six district towns and one provincial capital, and now threatens additional administrative and population centers.

Through its massive infiltration of men and equipment since the ceasefire was signed, Hanoi obviously has the ability to conduct even more widespread and intensive actions. Through its systematic sabotage of the mechanisms set up by the Agreement to monitor violations of the ceasefire, and the evidence of the past two months, it is also clear that Hanoi intends to step up its attacks. The aim of this new offensive, clearly, is to force additional political concessions from the GVN and to dictate a political solution on Hanoi's terms, or-if South VietNam proves unable to resist-to achieve outright military victory. In either case, the Paris Agreement-and the progress toward peace which it represented-is gravely threatened.

The South Vietnamese have fought well, indeed valiantly, against difficult odds. The GVN still controls most of the territory it held in January 1973-which of course includes the vast majority of the South Vietnamese people—and it has done this without direct U.S. military involvement, and despite sharply declining levels of U.S. assistance. But the current North Vietnamese offensive poses new dangers.

Present levels of United States military aid to South Viet-Nam are clearly inadequate to meet them. We are unable to replace, on the one-for-one basis permitted by the Agreement, the consumables essential for South Viet-Nam's defense effort-ammunition, fuel, spare parts and medical supplies. We are unable to provide any replacement of major equipment losses-tanks, trucks, planes or artillery pieces. Thus, South Viet-Nam's stockpiles are being drawn down at a dangerous rate, and its ability to successfully withstand further large-scale North Vietnamese attacks is being eroded. South Viet-Nam is even now faced with a harsh choice: to husband its diminishing resources and face additional battlefield losses, or to use supplies at a rate sufficient to stem the tide and risk running out at an early date. It is for these reasons that the President has requested urgent Congressional approval of a $300 million supplemental appropriation for military assistance for Viet-Nam. This additional amount is the absolute minimum required, and it is needed now.

The Paris Agreement also contained provisions relating to Laos and Cambodia. The signatories were enjoined to respect the sovereignty and territorial integrity of those countries, and to refrain from using their territory for military purposes. South Viet-Nam and the United States have abided by these strictures. Hanoi has not. North Viet-Nam continues to use the territory of Laos to send forces and war material to South Viet-Nam, and continues to station troops in remote areas of that country. Nevertheless, the contending Laotian parties were able to establish a ceasefire-which is only infrequently broken-and to form a

Provisional Government of National Union. As a result of these encouraging developments, our military presence in Laos has been withdrawn (except of course for the normal Defense Attaché Office as part of our diplomatic establishment) and we have been able to reduce our military assistance to an enormous degree. For example, during the last fiscal year of widespread combat, FY1973. U.S. military aid amounted to $360 million. For FY-1975, the figure is $30 million.

Unfortunately, a similar evolution has not occurred in Cambodia. North VietNam continues to use the territory of Cambodia to support its military operations in South Viet-Nam, and in addition gives material assistance and advice in the military operations of Cambodian communist forces. We do not contend that Hanoi is the sole motive force for the Cambodian insurgency. However, in its support and encouragement of that conflict, as well as in its own flagrant abuse of Cambodian territory, Hanoi bears a large measure of responsibility for the continuation of the fighting there. That fighting has recently intensified. Since January 1, communist forces have stepped up their attacks in the area near Phnom Penh. At the same time they have increased their pressure along the Mekong River between Phnom Penh and the South Vietnamese border, the capital's main supply route. Cambodian forces have fought well, but they are stretched thin in attempting to combat this two-pronged offensive. And despite stringent economies their supplies of ammunition and fuel are dangerously low. The intensified communist attacks have taken a heavy human toll, evident in even a short visit to that country. Casualties are running at more than 1,000 a day for both sides-killed, wounded and missing-and the stricken economic life of Cambodia is further weakened. At least 60,000 new refugees have been created, posing additional strain on the resources and the administrative capacity of the government.

The Cambodian Government does not seek an end to the conflict through conclusive military victory. Nor, however, does it wish it to end in military victory by communist forces. The only logical and fair solution is one involving negotiations and a compromise settlement. To this end we welcomed the resolution, sponsored by Cambodia's neighbors and adopted by the last UN General Assembly, calling for early negotiations. The Cambodian Government has repeatedly expressed its readiness to negotiate, without preconditions and with any interlocuter the other may choose. We fully support that position, and have pledged to do our utmost to facilitate such talks.

As you are aware, we have recently documented the efforts the United States has already made to promote a negotiated settlement in Cambodia-in 1973-74 and as recently as February of this year. Those efforts, which included attempts to establish direct contact with the communists and Sihanouk, have thus far been futile. The Cambodian communists have been adamantly opposed to a negotiated settlement, and we believe their attitude is unlikely to change unless and until they conclude that military victory is not possible. The first imperative, therefore, and the aim of our military assistance program in Cambodia is to maintain a military balance and thereby to promote negotiations.

Restrictions on our military and economic aid, contained in the Foreign Assistance Act of 1974, make it impossible to accomplish that goal. Both the $200 million ceiling on military assistance and the $75 million drawdown authorized from DOD stocks have been largely exhausted, as a result of significantly intensified communist offensive actions. In addition, Cambodia also faces a serious impending food shortage. Therefore, to meet the minimum requirements for the survival of the Khmer Republic, the President has asked the Congress to provide on an urgent basis on additional $222 million in military aid for Cambodia, and to eliminate the $200 million ceiling. He has also asked that the $377 million ceiling on overall assistance be removed, or at least that PL-480 food be exempted from the ceiling.

Mr. Chairman, gentlemen, in Viet-Nam we seek to restore the rough military balance, now threatened, by North Vietnamese action, which permitted the progress toward peace represented by the Paris Agreement, and without which further progress toward a lasting political solution is unlikely to be found. Despite Hanoi's flagrant violation of the Paris Agreement, we believe it remains a potentially workable framework for an overall settlement, and it must be preserved. By redressing the deteriorating military situation in South Viet-Nam our hope is that the momentum can once again be shifted from warfare toward negotiations among the Vietnamese parties. In Cambodia also, only by maintaining the defensive capability of government forces can conditions be established which will permit negotiations to take place.