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Declassified per Executive Order 13526, Section 3.3 NND Project Number: NND 63316. By: NWD Date: 2011 :"Frankly we have no solution of problem to suggest. It is basically matter for two parties to work out themselves and from your reports and those from Indochina we are led to feel that both parties have endeavored to keep door open to some sort of settlement. We appreciate fact that Vietnam started present fighting in Indochina on December 19 and that this action has made it more difficult for French to adopt a position of generosity and conciliation. Nevertheless we hope that French will find it possible to be more than generous in trying to find a solution."

The U.S. anxiously followed the vacillations of France's policy toward Bao Dai, exhorting the French to translate the successive "agreements" they contracted with him into an effective nationalist alternative to Ho Chi Minh and the Viet Minh. Increasingly, the U.S. sensed that French unwillingness to concede political power to Vietnamese heightened the possibility of the Franco-Viet Minh conflict being transformed into a struggle with Soviet imperialism. U.S. diplomats were instructed to "apply such persuasion and/or pressure as is best calculated [to] produce desired result [of France's] unequivocally and promptly approving the principle of Viet independence." France was notified that the U.S. was willing to extend financial aid to a Vietnamese government not a French puppet, "but could not give consideration of altering its present policy in this regard unless real progress [is] made in reaching non-Communist solution in Indochina based on cooperation of true nationalists of that country."

As of 1948, however, the U.S. remained uncertain that Ho and the Viet Minh were in league with the Kremlin. A State Department appraisal of Ho Chi Minh in July 1948, indicated that:


 * "1. Depts info indicates that Ho Chi Minh is Communist. His long and well-known record in Comintern during twenties and thirties, continuous support by French Communist newspaper since 1945, praise given him by Radio Moscow (which for past six months has been devoting increasing attention to Indochina) and fact he has been called "leading communist" by recent Russian publications as well as  makes any other conclusion appear to be wishful thinking.


 * "2. Dept has no evidence of direct link between Ho and Moscow but assumes it exists, nor is it able evaluate amount pressure or guidance Moscow exerting. We have impression Ho must be given or is retaining large degree latitude. Dept considers that USSR accomplishing its immediate aims in Indochina by (a) pinning down large numbers of French troops, (b) causing steady drain upon French economy thereby tending retard recovery and dissipate ECA assistance to France, and (c) denying to world generally surpluses which Indochina normally has available thus perpetuating conditions of disorder and shortages

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