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 new economic and social measures to be undertaken in rural areas to accompany the anti-guerrilla effort...." ll/ These discussions implied that more GVN effort should be devoted to rural pacification and civic action and acknowledged that more regular military forces were needed, but they did little to clarify the relationships of these parts to the whole or to an overall scheme by which the process would develop.

The Staley group, a joint economic and financial committee co-chaired by Dr. A. Eugene Staley, Stanford Research Institute, and Vu Quoc Tuc, GVN, followed much the same pattern. Meeting in Saigon in June 1961, the committee agreed that RVMF strength should be increased to 200,000 during CY 1962 and that U.S. funding should be provided to various emergency economic and social programs. 12/ But the group did noghingnothing [sic] to tie together the strands of what it recognized as the central problem: to achieve a simultaneous "breakthrough" on both the military-internal security front and the economic-social front. 13/ Its recommendations were restricted (in part, no doubt, because of its limited charter) to specific program increases and to a restatement of the dimensions of the problem.

The devastation caused by the September monsoonal floods (320,000 refugees, 1,000 kilometers of road destroyed, 10 million acres of rice and other crops lost), combined with the losses attributable to increased insurgent activity, led President Diem to declare a state of national emergency on 19 October 1961. This declaration coincided with the visit to Southeast Asia (15 October - 3 November) of General Maxwell D. Taylor, heading a mission asked by President Kennedy to appraise the situation in South Vietnam. The President stated the scope of Taylor's mission in the broadest terms:

"While the military part of the problem is of great importance in South Viet-Nam, its political, social, and economic elements are equally significant, and I shall expect your appraisal and your recommendations to take full account of them. 14/"

In his report to the President, General Taylor sketched out the nature and aims of the Viet Cong threat and assessed the strengths and weaknesses of the Diem government. He proposed a U.S. strategy for "turning the tide and for assuming the offensive in Vietnam." 15/ The report warrants summarizing in some detail, not because it outlined the main thrust of the pacification effort (it did not), but because it represents the best document to portray the range of U.S. concerns at the time the U.S. was making a major commitment to South Vietnam and because it lays out the major elements of the U.S. strategy of response.

The Viet Cong, Taylor judged, were militarily powerful and becoming more powerful. But they were not yet ready to move to the third, climactic phase of Mao's classic format for guerrilla warfare:

The military strategy being pursued is, evidently, to pin down the ARVN on defensive missions; to create a pervasive sense of insecurity and frustration by hit-and-run raids on self-defense corps and militia units, ambushing Rh