The original quote comes from the
Vietnam War. After the
Tet offensive American forces went on a wild counterattack. After the village of Ben Tre was virtually destroyed, an American Major said to journalist
Peter Arnett (who would become famous for his work on
CNN during the
Gulf War), "It became necessary to destroy the village in order to save it."
As quoted by Neil Sheehan in his book about John Paul Vann -- A Bright Shining Lie.