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1. There are three parts to the State study:


 * a. Economic warfare against Communist China.


 * b. U.N. action in the event of U.S. armed intervention in Indochina.


 * c. Juridical relations to the French Union: Giving effect to the independence of the Associated States.

2. .— The paper seeks to determine whether, in the event of U.S. intervention in Indochina, intensified and broadened economic warfare measures would deter Communist China from openly intervening or hinder its military effort if it did intervene. The study concludes that the divisive risks of seeking an international program of broadened and intensified economic warfare measures against Communist China would be too great to be undertaken if the full support of the United Kingdom were absent. Even such a program as could be obtained with United Kingdom support would nevertheless not constitute a serious deterrent or countermeasure to open Communist Chinese intervention in Indochina in terms of economic impact. It might be possible, however, to achieve some deterrent psychological impact through the device of an advance multilateral declaration of the economic consequences of massive Chinese Communist intervention.

The paper does not deal with the question of a naval blockade, which State considers to be a military measure.

3. — With the exception of action under Article 51 ( individual or collective defense against "armed attack") the U.S. as a U.N. member is obligated  to use armed force except in response to orders or recommendations of the U.N. Therefore, "united action" without prior U.N. authorization would have to be taken under Article 51.

There are three possible types of U.N. action related to "united action":


 * a. U.N. action prior to U.S. intervention, designed to lay the foundation for "united action."


 * b. U.N. action following and supplementing the "united action."


 * c. Possible U.N. action in the event the Chinese Communists resumed hostilities in Korea as a result of "united action" in Indochina.

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