AMENDMENT OF FOREIGN ASSISTANCE ACT OF 1961

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP66B00403R000300090022-7
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 20
• Document Creation Date: December 23, 2016
• Document Release Date: February 21, 2014
• Sequence Number: 22
• Publication Date: August 3, 1964
• Content Type: OPEN SOURCE

1964
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CONGRESSIONAL RECORD ? SENATE 17159
deposited in the Age of Reptiles may be seen
in the exposed strata. In 1957, the year be-
fore construction of that visitor center, the
number of visitors to Dinosaur National
Monument was 66,000. By 1959, it had in-
creased to 112,000. Now it is over 200,000
annually.
The National Park Service has estimated
that, by the time Agate is fully developed, in
about 5 years, the number of visitors will
be at least 120,000, and possibly 200,000 or
more.
The National Park Service plans a develop-
ment program estimated to cost $1,902,000
during the first 5 years, probably 90 percent
which can be spent locally on labor and sup-
plies and materials. When fully staffed and
developed at the end of 5 years, the operating -
program for management and protection and
maintenance of the area will require about
$135,000 a year.
The committee unanimously approves the
proposal.
Mr. HRUSKA. Mr. President, the ac-
tion of the Senate in taking up and act-
ing upon this bill, S. 1481, to establish the
Agate Fossil Beds National Monument,
is most gratifying.
The purpose of the bill is to preserve
and provide for the orderly development
by the National Park Service of the
paleontological deposits located at Agate
Springs in western Nebraska. The site
has been described as the most remark-
able deposit of mammalian remains of
the Tertiary age that have ever been
found. They are unique and irreplace-
able, and therefore must be protected.
We of Nebraska are- particularly
proud of the manner in which these
fossil remains have been protected and
developed to date. By an extraordinar-
ily fortunate accident of history the de-
posits were first discovered by one who
had the imagination and understand-
ing to see the tremendous importance of
preserving them and investigating their
scientific significance in an orderly way.
They were discovered in the 1870's by
Capt. James H. Cook, Indian scout and
frontiersman, and later author of "Fifty
Years on the Old Frontier." Captain
Cook recognized the potential impor-
tance of the deposits and brought them
to the attention of geologists and paleon-
tologists, and later acquired title of the
property on which they were located.
Under his ownership and that of his son,
Dr. Harold Cook, a noted paleontologist
himself, the deposits were carefully pro-
tected against destruction or misuse, but
were made freely available to scientific
expeditions interested in their syste-
matic exploration.
Dr. Harold Cook died 2 years ago and
a danger now exists that, unless timely
action is taken to provide for their sys-
tematic care, these irreplaceable deposits
may be destroyed or dissipated. Fur-
thermore, it is intended by the Park
Service to develop the quarries on the
spot in a manner to permit students,
tourists, and others to view the deposits
in the condition in which they are found
in the ground.
Aside from its scientific importance,
this monument is of especial significance
as part of a developing network of tour-
ist facilities in a four-State area com-
prising Nebraska, South Dakota, Wyo-
ming, and Colorado. The National Park
Service has announced that its devel-
opment program f or the monument is to
cost slightly less than $2 million. The
Park 'Service has also projected that, by
the time Agate is fully developed in about
5 years, the number of visitors annually
will amount to ? between 120,000 and
200,000. It seems certain that this vol-
ume of tourist traffic will bring into the
area well over $500,000 per .year from
outside.
Mr. MANSFIELD. Mr. President, that
concludes the call of the calendar at this
time.
Mr. President, with the same pro-
viso, that the senior Senator from Ore-
gon [Mr. Moan] not lose his right to the
floor, I suggest the absence of a quorum.
The ACTING PRESIDENT pro tern-
pore. Without objection, it is so ordered.
The clerk will call the roll.
The legislative clerk proceeded to call
the roll.
Mr. MANSFIELD. Mr. President, I
ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without
objection, it is so ordered.
AUTHORIZATION FOR COMMIT-
TEE MEETING DURING SENATE
SESSION
Upon request of Mr. MANSFIELD, and
by unanimous consent, the Committee
on Appropriations was authorized to
meet during the sessions of the Senate
for the week beginning August 3, 1964.
ORDER OF BUSINESS
Mr. MANSFIELD. Mr. President, I
suggest the absence of a quorum under
the conditions previously stated.
The PRESIDING OFFICER. Without
objection, it is so ordered. The clerk
will call the roll.
The legislative clerk proceeded to call
the roll.
Mr. MORSE. Mr. President, I ask
unanimous consent that the order for
the quorum call be rescinded. , . ?
The PRESIDING OFFICER. (Witjlol4t
objection, it is so ordered.
AMENDMENT OF FOREIGN' ASSIST-
ANCE ACT OF 1961
The Senate resumed the consideration
of the bill (1-1.a.-.1.43/10) to amend fur-
ther the Foreign Assistance Act of 1961,
as amended, and for other purposes.
Mr. MORSE. Mr. President, as the
6ONGRESSIONAL RECORD Will show, I an-
nounced on Saturday, following the
speech of the able chairman of the Sen-
ate Committee on Foreign Relations, the
Senator from Arkansas [Mr. FULBRIGHT],
that I would answer his speech today.
First, I wish to make the following brief
comment as to what my position will be
on procedural questions during the
course of the debate of foreign aid.
It is my hope, and it will be my in-
tention, to cooperate in fulfilling that
hope, that the Senate will dispose of the
foreign aid bill by the end of this week?
sooner, if possible. I have already no-
tified the majority leader that I am
delighted to cooperate in as many night
sessions as he cares to hold for as long as
he cares to hold them. This year, as
last year, however, I shall insist that the
foreign aid bill be debated under the
rules of the Senate without any agree-
ments to limit time or to fix a time cer-
tain to vote. I have also made clear to
the majority leader that I hope that
those of us in opposition to the bill will
receive the cooperation of the majority
in our requests for yea-and-nay votes on
amendments that we think ought to be
made a matter of rollcall record.
The time schedule of the Senate is
well known. The record on foreign aid
in the past several years, both pro and
con, has been made over-and over again
in the Senate. By and large most Sen-
ators probably know now how they are
going to vote on the major issues con-
nected with the bill, irrespective of what
is said during the course of the debate.
But that does not in any way diminish
the trust that each Senator owes to the
country and to his own constituents to
make the record. I am hopeful?and my
cloakroom discussions with some of my
colleagues seem to justify that hope?
that in respect to some of the amend-
ments that some of us will offer during
this week on the bill, all minds have not
been made up, and that there are still
Senators who will study the record.
A good many Senators are absent
today because of 'a very sad journey that
the funeral group is making to California
to pay respects to our beloved Clair
Engle. I wish the RECORD to show that
I would have taken that trip, but I
agreed to remain in Washington today
to make the first speech in opposition
to the foreign aid bill so that the final
vote on tile bill could be advanced by
that much time. But bearing out what
I have said?that minds are pretty well
made up?one need only to look at the
attendance in the Senate at the present
moment to know whereof I speak.
Absentees will graciously say that they
will carefully read the I/zoom:a?and I
hope they will. Nevertheless, it is some
'ndication, I suppose, that a majority
nators would welcome voting to-
orrow without any debate at all. Yet
ose of us in opposition to the bill in-
tend to make a record this week that the
proponents of the bill will have to live
with, and for which the proponents of
the bill will have to answer to their own
constituency, not only this year, but also
in the years immediately ahead.
Mr. President, we have heard it said
over and over again that major reforms
in the foreign aid program ought to be
adopted. Last year, the Foreign Rela-
tions Committee, in its report to the Sen-
ate, said it thought the reforms ought to
be adopted the following year. That
year has passed. The reforms have not
been adopted.
In the debate last year it was argued
over and over again, "Pass this bill and
we will adopt reforms in the coming
year." As of the moment I speak, the
policy of foreign atd is about the same
as was the policy of foreign aid a year
ago.
Ten days ago a very high official of
the State Department said to me:
We have analyzed your minority v1ews,
and we find them very disturbing, because
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17160 CONGRESSIONAL RECORD ? SENATE
we recognize that so much of what you said
Is correct. We want you to know, Senator,
that between now and next year the criti-
cisms that you have brought out in those
minority views?and there are many of them
that are unanswerable, in our opinion?will
be answered by changes in policy that will
be adopted.
To that high official of the State De-
partment I said:
I have heard the same thing over and over
again for the last 10 years, and you have not
adopted reforms. What makes you think I
should place confidence in your statement?
Mr. President, that is a sad statement
to have to make, but the record is un-
deniable. Year after year the State De-
partment, the Pentagon, and the AID
officials have been brought up to a con-
sideration of needed reforms only to urge
upon the Congress that it pass the bill
and let them work on reforms in the en-
suing year. I mean not to be unkind,
but I speak out of long experience with
the executive branch of the Government.
In my judgment, no reforms in foreign
aid will be adopted, to any substantial
degree, except when adopted by the Con-
gress.
If Congress is looking for conversion
among State Department, Pentagon, and
foreign aid officials with respect to for-
eign aid and is expecting to have that
conversion result in the necessary re-
forms essential to eliminating great
abuses in foreign aid, the Members of
Congress who so think are engaging, in
my opinion, in wishful thinking. Neither
the State Department, the Pentagon,
nor the AID officials will carry out re-
forms on their own volition. Such re-
forms will be adopted only if Congress
adopts them.
I shall make the record of the rea-
sons for my opposition to the foreign
aid program, because the people of this
country are entitled to have that record
made.
As I have said so many times, I would
vote for more foreign aid than an ad-
ministration in recent years has recom-
mended. It is difficult for people to un-
derstand that one can oppose a specific
foreign aid bill, as I have opposed the
foreign aid bills of the past 10 years, in-
cluding this year, and still be for foreign
aid. But my own amendments have
shown the kind of foreign aid I would
support. I would vote for more than
$3,500 million of foreign aid, if it were
a foreign aid program that protected the
American taxpayers. It would be a for-
eign aid program that strengthened the
American image abroad. It would not be
a foreign aid program which the Comp-
troller General of the United States, in
report after report, has pointed out re-
sults in shocking inefficiency, the waste
of hundreds of millions of dollars, and
much corruption in many countries of
the world, particularly the underdevel-
oped areas.
In a broad brash stroke or two, let me
say that I am a loan advocate in foreign
aid. I am a project-to-project man in
foreign aid. I would lend more money
for needed economic projects around the
world than would this administration, or
the previous administration, or the ad-
ministration previous to that one, has
been willing to recommend. But they
would be loan programs, not grant pro-
grams.
They would not be deceptive loans, as
are so many of the so-called loans today.
The word "loan" should always be put
in quotation marks when used by the AID
officials downtown. So much of the loan
program in this bill spells the word "de-
ception," for they are not loans at all.
The so-called loans are made at a cost
of three-quarters of 1 percent, with a
10-year grace period, and then they are
to be paid, not in American dollars, but
in the soft currencies of the countries
concerned. To use the word "loan" in
that connection is a deception of the
American taxpayer. This Senator will
not be a party to that deception. The
American people are entitled to receive
from their Government protection of
their money.
The "loan" program we have today is
not only a grant program, but it is a-give-
away program, based upon deceit.
That abuse in the foreign aid program
must be eliminated before the Senator
from Oregon will vote for foreign aid.
I will vote for a foreign aid program in-
volving more money than this bill calls
for, or that the predecessor bill called
for, or that the various Eisenhower bills
called for, but it must be a program of
loans based upon sound economic de-
velopment projects that will do some-
thing to better the economic standard of
living of the people of the underdevel-
oped areas that live within the shadows
of their economic environments. They
must not be so-called loans to govern-
ments.
Read what the Comptroller General of
the United States has said. He is our
watchdog. He is an agent of the Con-
gress of the United States. His spot-
check survey of foreign aid in recent
years has brought out the facts. Before
the debate is over this year I shall again
pile on my desk the reports of the Comp-
troller General, some of which are
marked "Secret." I have yet to read a
single report of the Comptroller General
that really is "secret." Every report of
the Comptroller General that I have read
contains material that should be made
available to the taxpayers of the United
States. If the taxpayers of the United
States could read the shocking reports of
the Comptroller General of the United
States, they would demand a houseclean-
ing in foreign aid, and quickly.
Mr. President, I am against so-called
"loans" to governments, for too much of
that money lines the pockets of corrupt
politicians abroad. We ought to put our
money in dams, in refineries, in indus-
trial plants, in roads, in irrigation-recla-
mation pr6jects. We ought to put our
money in economic projects which a
study shows will do something about the
deplorable condition of the standard of
living of people living in those sad areas
of the world. Until we do it, all the
money we pour down the ratholes of
those countries will not save them from
communism, but make Communists.
The State Department, the AID offi-
cials, and the Pentagon do not like to
hear it said, but it is true. A great deal
-
August 3
of our foreign aid program has played
into the hands of communism abroad,
because the people in those areas of the
world know that so little of it trickles
down to the benefit of most of the peo-
ple, and too much of it is absorbed by
politicians who function as sponges,
soaking up millions of dollars of Amer-
ican taxpayer money which have come
to comprise the phony "loans" and
grants, by the millions, of American tax-
payer money.
I am also a line-of-credit man. I am
not in favor of turning a great deal of
money over to any group. To use a
hypothetical instance, speaking as chair-
man of the Subcommittee on Latin
American Affairs, I would vote much
more money by way of development loans
to Latin America, related to specific proj-
ects, than the bill calls for, or any ad-
ministration has recommended, if the
governments of Latin America showed
they are ready to use it effectively.
However, I would insist that the money
be loaned under a hard money policy,
with an interest rate charged that will
pay for the use of the money, which
at the present time, according to the
latest Treasury reports, would be in the
neighborhood of -3 percent, not three-
quarters of 1 percent. The money would
be drawn upon as the dam went up seg-
ment by segment, or the refinery went
up part by part, or the irrigation-rec-
lamation projects proceeded segment by
segment. What is wrong with that?
That is a pretty good way to build in
the United States. What is wrong with
building that way in other countries,
when we are using taxpayer dollars?
Whenever any of us wish to build a
reclamation project in our State, or build
a great dam in our State, or put up any
other public works, what do we have
to show? We must show a benefit-to-
cost ratio favorable to the project. We
should. That is not a requirement in
foreign aid.
We get a great deal of lipservice from
the AID officials. However, Congress has
not written that check into foreign aid.
I believe that there should be a congres-
sional check on the expenditure of tax-
payer dollars on individual projects, one
by one. We require that kind of check
in the United States.
It will be said that that would be
offensive to the country in which the
money would be used. My answer is that
it is our money. If a country does not
want the money under such reasonable
checks, it does not have to ask for it.
Senators will note that I said "ask for
it." The history of foreign aid is that
we often ram a great deal of foreign
aid down the gullets of many countries
which do not ask for it. That has given
rise to many abuses.
I shall offer my amendment again, as
I did last year, to bring to an end com-
pletely all foreign aid at the end of fiscal
1966. Last year I offered it to apply at
the end of 1965.
Let us start all over. That is the way
to bring about a foreign aid program free
from abuses. Let us start all over. Let
us limit foreign aid to a maximum of
50 countries. We will have a hard time
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1964 CONGRESSIONAL RECORD ? SENATE
finding 50 countries in the world with
which we can justify entering into for-
eign aid agreements. Let us limit it to
50 countries on their application. I say,
on their application, Mr. President. Let
us do that, instead of urging them to
take the largess of the taxpayers of the
United States, as is still being done to
a great extent. Let, them come forward
and apply. Let them apply for projects
which they think they can justify. Let
them agree to meet conditions that
sound administration of a foreign ,aid
program' dictates.
What is wrong with that?
I am still waiting to hear from the
State Department, the AID officials, and
the White House as to what is wrong
with that philosophy.
Do they have good projects? If they-
do not have good projects that are self -
liquidating?I am talking now about the
loan projects?why should I vote to waste
American taxpayer money on projects
that are unsound? If they have proj-
ects that will pay out, and are unwilling
to borrow money, they should not be
allowed to get it.
Later in the week, I shall speak about
another abuse. It refers to our pouring
out millions of American taxpayer dol-
lars at three-quarters of 1 percent in-
terest, and a great deal of it in the form
of out-and-out grants. Much of that
money has been uted by those govern-
ments to pay back some of our alleged
allies, and some who are not allies even
with the "alleged" as a prefix, with whom
they have entered into loan arrange-
ments at 5 percent and 6 percent inter-
est. In that way the American taxpayer
assumes the obligation.
No jury would approve of such a prac-
tice. I am making a plea in my speeches
this week that the Members of the Sen-
ate at least carry out their duties as leg-
islative jurors. If they carry out their
duties as legislative jurors, they cannot
underwrite the present loan program.
Many? Americans like to stick their
heads in the sand and engage in the
psychologically comforting experience of
wishfully thinking that it could not be
that bad.
To the American people I address this
question: "When are you going to get
busy and make it perfectly clear to your
Government that government by se-
crecy must end?" I say to the American
people: "You will not remain free in-
definitely if you permit administration
after administration to deny you the
facts, for you are entitled to know about
the expenditure of your money under the
label 'Secret.'"
I repeat what I have said so many
times in my 20 years in the Senate; 85
percent of the material marked "Secret"
that has come before the Committee on
Foreign Relations and that came before
the Committee on Armed Services when
I was a member of that committee never
should have been marked that way in the
first place. It is marked "Secret" pri-
marily to keep the American people un-
informed. But in a democracy, there is
no substitute for a full public disclosure
of the public's business. One of the
great reforms needed in the field of for-
No. 149-4
eign aid is to lift the curtain of secrecy
that veils it and to give the American
people the facts.
I wish now to say a word about 'My
position with regard to grants. It is a
position I have taken for some time. I
shall vote for grants. I shall not vote
for grants in the amounts that the ad-
ministrations, present and past, have
sought and succeeded in getting. There
are a good many nonloan programs that
are as much needed abroad as are the
loan programs. I shall vote for grant
money for health programs, food pro-
grams, programs for the alleviation of
starvation, programs for the meeting of
disasters, and baby care programs. It
has always been interesting to me to ob-
serve how the foreign aid advocates use
those causes as a justification for carry-
ing along other grants that cannot be
justified to the tune of hundreds of mil-
lions of dollars.
Last year I stated in the debate that
since 1946 the American people have con-
tributed a little more than $100 billion
in foreign aid. The latest figures I have
received show that the amount is greater
than $104 billion. That is a huge amount
of money. I do not see how anyone can
argue that on the basis of policies that
continue to permeate the foreign aid bill,
we will not weaken the economy of the
country. The economy of the country is
the greatest defense weapon we have.
The arguments I have made thus far
In my speech are merely a recapitulation
of the major arguments I made last year.
I merely add the statement that there
has been no change, in my judgment, in
foreign aid policy that would not justify
my making the same argument, point by
point, that I ,made last year in opposi-
tion to foreign aid as it is now devised
and administered. Therefore, I incor-
porate by reference the major arguments
I made last year.
I turn now to my arguments and objec-
tions concerning the bill that is presented
to the Senate this year.
PRESENTATION OF 1964 PROGRAM
This program is presented to Congress
year after year under false pretenses.
Economic development remains a second-
ary purpose, and not the primary pur-
pose of foreign aid.
Every public presentation of foreign
aid calls it an investment in the econom-
ic future of the struggling and impover-
ished nations. But that is not the
purpose for which we spend most of the
money. Until we do, foreign aid is not
promoting the real interests of the
American people.
The chairman of the 'Committee on
Foreign Relations told the Senate on
Saturday:
All that is markedly new about this year's
foreign aid bill is the amounts proposed to
be authorized, which are greatly reduced be-
low the levels of previous years.
What a sad commentary on the exten-
sive recommendations by the majority of
the committee last year for a revised and
revamped foreign aid program. _Senator
FULBRIGHT is quite right. There is noth-
ing new about the program this year ex-
cept the amounts, but I am ashamed that
17161
the Foreign Relations Committee would
accept such a situation after the report
it published last year calling for exten-
sive changes. The Committee-on_Foreign
Relations voted for the bill. Where are
those changes?
The fact that the committee year in
and year out gives nothing but lip service
to reform in foreign aid is exactly why
there never is anything markedly new
in what the administration sends up.
Aid administrators have learned that the
committees having jurisdiction over the
program are paper tigers, and that the
committees are content to confine their
misgivings to print, without doing any-
thing about them.
I have long since come to the conclu-
sion that only the Senate and the House
of Representatives acting as a whole can
make worthwhile changes in foreign aid.
We have already made some.
Senator FULBRIGHT also bemoans what
he regards as an undue examination of
foreign aid by Congress relative to space
and military programs. But our failures
in those areas do not mean that we
should fail, too, to give foreign aid the
careful examination it needs. In all
three areas, the responsible committees
are too often the representatives of ad-
ministration programs, rather than their
critics and reformers.
If Congress ever is to give the study
it should to international and foreign
policy appropriations, it is going to have
to start with foreign aid. I remind the
committee chairman that a good third
of this program?right off the top?is
for exclusively military purposes. When
are we, in the committee and in the
Senate, going to delve into the purposes
and administration of the military aid
program? When are we going to give it
the kind of examination the chairman
thinks should be given to the space pro-
gram and to Defense Department appro-
priations?
He knows that year after year the For-
eign Relations Committee accepts in al-
most dead silence whatever the Defense
Department tells it about military aid.
We shove the critical reports of the
Comptroller General under the table
when the Secretary and Assistant Secre-
taries of Defense testify because we do
not want to embarrass them with chal-
lenges to their decisions, even when the
challenges come from the Comptroller
General, and not even from ourselves.
We have yet so much as to question
the basis of foreign aid, which is that
military solutions are possible for eco-
nomic problems. The chairman has
questioned that assumption in the ab-
stract, but I say it is time we questioned
it in its specific,' and the place to start
is with the foreign aid program. I con-
tinue to hope that someday he will join
me in this endeavor.
A good deal more of the foreign aid
program is for political purposes. Again,
I do not believe that political solutions?
and they are closely tied to military ob-
jectives?are any answer for economic
problems.
The United States has little or no con-
trol over the military forces of the na-
tions receiving our military aid, and
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17162 CONGRESSIONAL RECORD? SENATE
it has little control over the political ob-
jectives to which other countries may put
our aid. If We really believe that it is in
economic development abroad that the
interests of the United States really lie,
then why are we so fearful, so timid, so
reluctant to reexamine foreign aid and
devote the bulk of it to economic develop-
ment?
COMPARISONS WITH OTHERS
Much is made each year of the per-
centage of gross national product that
other free and Communist nations spend
on aid to less developed countries, rela-
tive to the United States..
This was one of the favorite argu-
ments of the chairman of the commit-
tee in the committee sessions. It should
be analyzed, because it is a propaganda
argument which is being used to pull
the wool over the eyes of millions of
American taxpayers.
I have come to the conclusion that
the percentage of gross national product
is used because it is the only way that
the foreign aid programs of other na-
tions can be made to appear even rea-
sonably close to that of the United
States.
The Foreign Relations Committee
went into this matter in our hearings.
AID Administrator Bell furnished for the
printed hearing record a lengthy mem-
orandum concerning the aid programs
of other nations.
' I particularly invite attention to the
table on page 335 of the hearings. It
shows the 1962 bilateral aid commit-
ments of all developed countries of the
free world, and the percentage of such
bilateral aid of the gross national prod-
uct of each. It indicates that only
France, with 1.6 percent and Portugal,
with 2.21 percent, extended a larger per-
centage of their gross national products
in aid to less developed countries than
did the United States. Moreover, in the
case of Portugal, this aid went to pos-
sessions in Africa which, according to
Portuguese officials, are part of Portu-
gal and by their sights should not be
counted as foreign aid at all. In the
case of France, a very large bulk of
French aid still goes to former French
colonies in Africa. As Mr. Bell stated,
it takes the form of budget support to
the new governments , of these former
colonies. In 1962, 86 percent of French
bilateral aid was for these grants.
There is a "gimmick" even in this, be-
cause France is one of the worst of-
fenders in the world in discriminating
against the legitimate trade interests of
the United States. The countries to
which France is granting aid are still
considered by her to be a part of its
economic empire. Furthermore, she still
exerts great influence upon them in re-
gard to their trade practices.
I am not opposed to what France and
these other countries are doing. But
they are doing it to maintain the direct
commercial and political ties with these
countries or possessions that were built
up over decades of colonialism.
It is a rather weak reed which the
AID people in the State Department lean
on to cite examples of Portuguese and
French aid, in order to bring up the
average for all countries extending de-
velopment assistance.
Interestingly enough, France and Por-
tugal have been recipients of substan-
tial aid from the United States since
1946.
The same table on page 335 indicates
that in 1962 the United States com-
mitted 0.84 percent of its gross national
product to bilateral aid to less developed
countries, Germany 0.50 percent, Great
Britain 0.70 percent, Japan 0.51 percent,
Belgium 0.55 percent, and the others on
down to 0.01 percent by Denmark.
The table for 1963 shows the commit-
ments by these countries, but not as a
percentage of gross national product for
1963. However, in several cases, the
commitments are down from 1962. This
is true of France, Great' Britain, Portu-
gal, and the Netherlands. The com-
mitment by Norway is the same and that
of Japan is up only to $268 million from
$265 million the year before. Canada,
Denmark, Belgium, Germany, and Italy
increased their commitments. But all
free world aid other than U.S. aid was
up, in 1963, only $263 million above the
commitment for 1962. And in 1962, their
aid as a percentage of their gross na-
tional products totaled 0.60 percent, as
compared to 0.84 percent for the United
States.
When we take into account the even
more tremendous difference between the
American effort for national defense and
the defense effort of these same coun-
tries?and the U.S. effort was exactly
double that of our industrially developed
allies?it is evident that they will let
Uncle Sam carry the international
burden as long as we continue appro-
priating the money.
On that point, let me stress that our
AID program does not begin to cover
our foreign assistance program, because
the AID program does not begin to cover
the expenditures of our own forces
abroad. Consider military aid. The
military aid program that we make
available?I do not care what part of
the world is touched?does not include
? the expenses of maintaining our own
military forces in that area, under whose
canopy of defense all those areas live
and have their security.
Later in my speech, I shall have some-
thing to say about my criticisms of mili-
tary aid, but I wish to drive this point
home now.
The expenditure for aid to South Viet-
nam now is somewhere between $11/2
million and $2 million a day. It will go
up and up in skyrocketing fashion if we
continue our aggressive policies in south-
east Asia, and continue to provoke at-
tacks upon us in southeast Asia on a
unilateral military basis.
But even as of now, our military aid
program does not take into account the
millions of dollars which are being spent
on our own military operations in the
area. When all is said and done, it is
those operations which provide security
and protection to the nations of southeast
Asia. They all live under the canopy of
American milita:ry might. It is our air
armada, our 7th Fleet, and our thou-
sands of boys who are distributed in that
August 3
area of the world, that provide them with
their defenses.
If we got into a war with Russia to-
morrow, in many instances their own
military programs would be of no value
to us whatsoever. They would become
liabilities. We should not be using them,
because we all know the kind of war
that would be. That is one of the rea-
sons?as I shall show later in this
speech?why I shall be offering amend-
ments on this question, in the course of
the debate, to cut drastically American
military aid because, by and large, it is a
shocking waste of American taxpayers'
dollars. That military aid does not
strengthen one iota the defense of this
Republic. The security of this Republic
is dependent, after all, on the nuclear
might of the United States, upon our air
and naval armada.
Another table prepared by Mr. Bell
shows the actual disbursements for bi-
lateral and multilateral aid in- 1962.
Since the table did not show this total as
a percentage of each country's gross na-
tional product, I asked the aid agency to
calculate ,that percentage for me, and
have added it to the table III which ap-
pears below.
It is this figure which shows the pro-
portion of their gross national product
that developed free world countries spent
on aid to less developed countries in 1962,
in both bilateral and multilateral aid
programs. For France, the percentage
was 1.39, for Germany 0.50; for 'Great
Britain 0.53, for Japan 0.32, for Belgium
0.76, for Portugal 1.36. For the United
States the percentage was 0.65 and for
all other development assistance coun-
tries it averaged 0.58.
Aid commitments to the less-developed
countries from development assistance
countries other than the United States
have risen only $300 million from 1961'
to 1963. Their grants as a percent of
their total dropped from 55 to 48 percent,
while ours dropped only from 66 to 60
percent.
If there are those who can find com-
fort in these figures, they are easily
comforted.
Mr. President, I ask unanimous con-
sent to have the AID memorandum
printed at this point in the RECORD.
There being no objection, the AID
memorandum was ordered to be printed
in the RECORD, as follows:
TOTAL FREE WORLD AID
A decade ago the United States was the
only important source of aid to the develop-
ing countries. Today 17 free world coun-
tries other than the United States?many of
them former recipients of 'U.S. economic
aid?conduct substantial assistance pro-
grams. Eleven of them?Belgium, Canada,
Denmark, France, Germany, Italy, Japan,
the Netherlands, Norway, Portugal, and the
United Kingdom?are members of the DAC.
They account for some 95 percent of the
bilateral aid from all 17 countries. The other
5 percent comes from six nonmembers of the
DAC: Australia, Austria, Kuwait, New
Zealand, Sweden, and Switzerland.
International agencies such as the World
Bank, the International Development Asso-
ciation, the European Development Fund,
and the Inter-American Development Bank
are also channeling large amounts of capital
and technical assistance to the developing
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1964 CONGRESSIONAL RECORD? SENATE
world. Ten years ago the World Bank was
the only multilateral source of capital for
this purpose.
There has been a significant growth in the
programs of these aid donors. The total
volume of free world aid commitments to
the less-developed countries increased
from $6.5 billion in 1960 to $8.4 billion in 19'62
(the last year for which complete commit-
ment figures are available). This represented
an increase in commitments from all three
major aid sources: the United States, other
donor countries, and international organiza-
tions.
Commitments from sources other than the
United States increased at the greatest rate.
Whereas U.S. bilateral commitments went up
20 percent between 1960 and 1962 1 commit-
ments from multilateral agencies and other
donors rose 64 percent and 34 percent, respec-
tively. As a consequence, the U.S. share of
the total aid bill declined. By 1960 some 40
percent?or $2.6 billion?of aid commitments
came either from multilateral agencies or
from free world bilateral sources other than
the United States. By 1962 this had risen to
44 percent, or $3.7 billion.
It should be noted that some of the aid
funds committed by the multilateral agen-
cies are supplied by the United States. Those
agencies finance their aid activitieS partly
with Government funds and partly with
funds derived from earnings, repayments,
and private capital. In 1962, for example, the
international agencies received a total of
$665 million in Government grants and sub-
scription payments from the DAC countries.
The U.S. share of this was 42 percent and the
other DAC countries provided 58 percent.
Therefore, it is clearly in our interest to
have these multilateral agencies increase
their aid programs so long as every dollar
from the United States is matched by a sig-
nificantly larger contribution from others.
In addition to support from U.S. and
other DAC government subscriptions, the
multilateral agencies also receive contribu-
tions from non-DAC governments, and ob-
tain a substantial share of their financing
from repayments and from private capital
markets. , In 1962, for example, $307 mil-
lion?more than half the World Bank's total
financing that year?came from the sale of
loans to the private sector.
One result of the growing volume of aid
is that the United States is now bearing a
smaller share of the aid burden. Another is
that greatly increased resources are available
to the developing countries, thereby quick-
ening their prospects for growth and stabil-
ity. Moreover, we are witnessing the emer-
gence of more donor countries. Israel, the
Republic of China on Taiwan, and Mexico
now provide technical assistance to nations
less developed than themselves. We hope
this list will continue to grow as more coun-
tries approach economic self-reliance.
ARE OTHERS DOING ENOUGH?
The mere fact that other countries are con-
tributing more aid each year does not answer
the question of whether they are doing
enough. A
This is not an easy question to,, answer.
There is no internationally agreed standard
for evaluating aid performance, and there
is even disagreement over what should be
counted as aid. The attached table I shows
some indications of aid performance for
1962.
This year's report by the President's Coun-
cil of Economic Advisers suggested several
1 The three main types of economic aid in-
cluded in the U.S. aid figures used in this
statement are: (1) Economic aid under the
Foreign Assistance Act, (2) loans made by
the Export-Import Bank to less-developed
countries for terms of more than 5 years, and
(3) provision of U.S. surplus agricultural
commodities under Public Law 480.
measures of the ability and the interest of
donors to sustain aid programs: their gross
national product, the size of their defense
burden, and their dependence on trade with
the less-developed countries. These indica,
tors produce this comparison for calendar
year 1962:
"The 1962 bilateral aid commitments of
the other DAC countries combined amounted
to six-tenths of 1 percent of their GNP com-
pared with slightly more than eight-tenths
of 1 percent for the United States that year.
France and Portugal committed a consider-
ably larger share of GNP than did the United
States: 1.26 percent for France, and more
than 2 percent for Portugal. The average
for the other DAC countries excluding France
and Portugal was only four-and-one-half-
tenths of 1 percent.
"The per capita GNP of the other DAC
countries, however, is far smaller than ours.
In 1962 per capita GNP averaged $1,135 for
other DAC countries. This is only about 40
percent of the $2,974 per 'capita GNP for the
United States that year.
"Other DAC countries are not spending as
much for defense as the United States.
Their defense expenditures in 1962 averaged
4.7 percent of GNP, compared to 9.4 percent
for the United States.
"Other DAC countries have a greater rela-
tive stake in trade with the developing coun-
tries than we do. That is, a larger percentage
of their GNP-7.5 percent on the average?
depends on trade with the developing coun-
tries as compared with 2.4 percent for the
United States. Despite this, they finance a
smaller share of their trade with aid com-
mitments than we do. Their aid financed
17.6 percent of their 1962 exports to devel-
oping countries, whereas in the same year
nearly 65 percent of U.S. exports to develop-
ing countries were financed by aid. Only
France, with 37.1 percent and Portugal, with
45.8 percent, approached the U.S. per-
formance."
Weighed together, these comparisons sug-
gest that DAC countries other than France
and Portugal could reasonably be expected
to increase their aid commitments. Some
are doing so. Canada intends to raise its aid
expenditures 50 percent in 1964, over a level
already raised in 1963. Denmark and Nor-
way say their target is an eventual aid level
of 1 percent of GNP. The United Kingdom
and Japan have announced their intention
to increase the size of their assistance pro-
grams. But some others?notably Germany,
which we believe could well afford it?show
no signs of doing so.
TERMS OF AID
We are concerned not only with the vol-
ume of aid from other donors but with the
financial terms on which it is given. The
attached table II shows the terms of bilat-
eral aid from 1961 to 1963.
In the aggregate the record of the other
DAC countries on grant aid is good. In
1962 the 11 DAC aid givers provided 56 per-
cent of their total bilateral aid, or more than
$1.3 billion per year, on a grant basis. The
comparable U.S. figure for the same year was
65 percent, or $3 billion. However, if $1.7
million of Public Law 480 is excluded, 46 per-
cent of our 1962 aid was on a grant basis.
Two-thirds of the grants of the other DAC
countries in 1962 financed capital projects
and commodity imports. The remaining
one-third financed technical assistance.
"Some 26,000 students and trainees from
less-leveloped countries were ?supported by
the other DAC countries that year, compared
to 10,388 financed by the United States.
"A total of 75,000 operational and advisory
personnel financed by other DAC countries
were helping to fill the human resources gap
in less-developed countries that year, com-
pared to about 8,500 from the United States."
The loan programs of the other DAC coun-
tries are all conducted on less favorable
terms than ours. But the last few years
17163
have seen marked changes for the better, and
we anticipate further liberalization in the
future. Take maturities, for example:
"In 1962, U.S. loans to less-developed
countries carried an average maturity of
29.9 years.
"No German loans carried more than 5
years' maturity in 1959. By 1961 new Ger-
man commitments averaged 14.5 years. By
1962 they averaged 17 years. Preliminary
figures show the average climbed to 20.2
years in 1963.
"Britain announced a new policy last fall
of offering loans up to 30 years' maturity.
"Canada has announced its intention to
supplement its existing grant and hard loan
programs with a new soft loan program on
terms approximating those of the Interna-
tional Development Association: 50 years'
maturity, three-fourths of 1 percent inter-
est and 10 years' grace.
"In 1962 Italy made no loans for more than
a 12-year repayment period. Since then,
however, Italy has made one large loan with
an 18-year maturity and another of 25 years'
maturity."
Interest rates on the aid loans of other
DAC countries have been high?often, in our
judgment, much too high for those of the
developing countries with serious balance-
of-payments problems. In both 1961 and
1962 they averaged 5.1 percent as against 2.6
percent in 1962 for the United States. Our
average will rise in the future because of
the higher minimum interest rates on AID
loans required by the Foreign Assistance Act
of 1963. The interest rates of other aid
givers, however, are coming down. For
example:
"A new British policy provides for a waiver
of interest payments for up to 7 years. This
lowers the 6-percent-interest rate on a long-
term loan to an effective rate of about 3 per-
cent. Britain has already granted such a
waiver for loans to India, Pakistan, and Tur-
key totaling $115 million.
"Although the average German rate is 4.2
percent, Germany has been making an in-
creasing number of low-interest loans. Last
year, for example, Germany made a loan of
$13.2 million to Togo at 2-percent interest
with a 30-year maturity.
"As I have already noted, Canada will
begin lending on IDA terms?three-fourths
of 1 percent interest, 50 years' maturity, and
10 years' grace."
The present softening of aid terms can be
traced in large part to a policy agreement
reached by the DAC in April 1963. All the
DAC members agreed that loan terms should
be consistent with the debt-servicing ca-
pacity of the recipient countries, that terms
should be more nearly comparable among
donors, and that these aims should be met
by liberalizing the terms of the harder
lenders.
GEOGRAPHIC DISTRIBUTION OF AID
A decade ago, the little aid provided by
donors other than the United States took
the form of assistance from European coun-
tries to their colonies. In 1962, about one-
fourth of the aid of the other DAC countries
went to dependent areas. Today, with only
a handful of colonies remaining in the free
world, indications are that this proportion
has declined to about 10 percent.
Much French, British, Belgian, Dutch, and
Italian aid does go to former colonies that
are now independent states. The United
States has a direct stake in the continuation
of this support. It is very much in our in-
terest?our political interest, our budgetary
interest, and our balance-of-payments inter-
est?to have Britain carry on sizable aid pro-
grams in Kenya and Uganda, to have France
do so in French-speaking Africa, and to have
Belgium do so in Rwanda and Burundi.
Some two-thirds of all development assist-
ance in Africa is now provided by the West-
ern European nations.
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17164 CONGRESSIONAL RECORD - SENATE
European donors are, however, giving more
and more aid outside their former colonial
dependencies. Both Britain and France
have stated their intention of doing so as a
matter of policy. France, for example, has
made sizable commitments (including soft
loans) to Mexico and Greece while Britain
is enlarging its technical assistance program
in Latin America.
Three of the major DAC donors-Germany,
Canada, and Japan-have no colonial con-
nections. Germany has a worldwide pro-
gram. In the last 3 years, Germany made
loan pledges to 65 less-developed countries
and provided technical assistance to '70.
Canada's assistance ranges through the
Commonwealth countries and Latin America.
Japan aids much of Asia and Latin America.
- The broadening of aid relations is exem-
plified by the aid expenditures of DAC
countries other than the United States in
Latin America. In 1960 these totaled less
than $50 million. In 1962 they reached
$110 million.
One factor that has helped draw European
aid into new fields has been the formation
of aid consortia. Belgium, Italy, France,
Germany, and the Netherlands, for example,
are members of the consortium for Pakistan,
along with Canada. Japan, the United King-
dom, and the United States. These same
countries plus Austria are also members of
the aid consortium for India. The same
countries minus Japan but including Sweden
and Luxembourg are in the Turkish con-
sortium. The attaehed table III shows DAC
aid disbursed through multilateral and con-
sortia type arrangements in 1962.
SINO-SOVIET AID TO LESS DEVELOPED C017NTRIES
Total extensions of long-term economic
development credits by the Sino-Soviet bloc
amounted to more than $4.9 billion by the
end of fiscal year 1963. Of this amount, the
U.S.S.R. contributed $3.4 billion, Communist
countries of Eastern Europe contributed $1.1
billion, and Communist China $0.4 billion.
Since the beginning of calendar 1964, bloc
countries have extended new economic aid
totaling more than $800 million. Major re-
cipients include United Arab Republic, India,
and several African countries. A signifi-
cant proportion of this aid was from Com-
munist China.
About 5 percent of bloc aid is extended in
the form of grants. Bloc credits are gen-
erally repayable in local currency, with grace
periods on principal extending 1 year beyond
completion of projects. Interest rates are
generally 2.5 percent repayable in 12 years.
Some credits (particularly Chinese Com-
munist credits) are extended interest free
for up to 50 years.
The following table shows commitments
and expenditures for 1961-63.
Sino-Soviet aid to less developed countries
(excluded Cuba)
[In millions]
,
1961
1962
1963
1964 (Janu-
ary to June)
-
Commitments_ __
$1,000
$325
$310
$800+
Expenditures_ ___
275
390
475
Soviet aid
Total extensions of long-term economic
development credits by the Soviet bloc
amounted to an estimated $4.5 billion by the
end of 1963, of which the U.S.S.R. contrib-
uted $3.4 billion and the Communist coun-
tries of Eastern Europe about $1.1 billion.
Most of this aid has been extended for spe-
cific projects. The largest amounts have
gone to Asia and the Middle East.
Drawings on Soviet bloc aid are almost one-
third of the credits extended, amounting to
about $1.2 billion from the U.S.S.R. (about
one-third of its extensions), and more than
$300 million from the Communist countries
of Eastern Europe (nearly 30 percent of their
extensions). Drawings on Soviet bloc aid
amounted to almost $450 million in 1963.
August 3
Extensions of long-term economic develop:
mental credits by the bloc during 1963
amounted to more than $220 million, most of
which was extended by the U.S.S.R. The
major commitments were by the U.S.S.R.,
$100 million to Algeria and $39 million to
Iran.
There are about 12,000 economic techni-
cians from the Soviet bloc in the less-devel-
oped countries, of which more than 8,800
were from the U.S.S.R. and more than 2,600
from Eastern Europe. Most of these techni-
cians were assisting on Soviet-bloc aid proj-
ectTsh.e attached table IV shows Soviet bloc_
aid to underdeveloped free world countries
from 1954 to 1963.
Chinese Communist aid
Total extensions of long-term economic
development credits by Communist China
amounted to $446 million by the end of 1963.
The largest amounts of this aid have gone
to countries in southeast Asia and west
Africa. Prior to 1962 a number of Chinese
Communist aid extensions were grants, but
more recently Chinese economic aid has con-
sisted primarily of credits.
Drawings on Chinese aid amounted to
about one-fourth of commitments by the end
of 1963; i.e., a little more than $100 million.
Many recipients of Chinese aid have received
few or no deliveries on their credit or grants.
Extensions of long-term economic devel-
opmental credits by the Chinese Communists
during 1963 amounted to about $89 million,
all of which went to African countries.
In the latter half of 1963 there were an
estimated 470 economic technicians from
Communist China in the less-developed
countries, of which a handful were in Ye-
men and the rest were in Africa and in Asia.
Many of these technicians were assisting on
Chinese aid projects in either a technical or
manual capacity.
The attached table V shows Chinese Com-
munist aid to underdeveloped free world
countries from 1954 to 1963.
TABLE 1.-1965 bilateral aid commitments and various measures of donor capacity and interest
Bilateral
Bilateral
commit-
Bilateral
commit
Total
Bilateral
Bilateral
commit-
Bilateral
commit-
Total
Bilateral
aid
Defense
ments
ments
LDC
Bilateral
aid
Defense
ments
ments
LD 0
aid
commit-
GNP
expendi-
as per-
as per-
trade as
aid
commit-
GNP
expendi-
as per-
as per-
trade as
commit-
ments
per
tures as
cent of
cent of
percent
commit-
ments
per
tures as
cent of
cent of
percent
ments
as per-
capita
percent
exports
total
of donor
ments
as per-
capita
percent
exports
total
of donor
cent of
(INP'
of GNP
to
LDC's
trade
with
GNP
cent of
GNP'
of GNP
to
LDC's
trade
with
GNP
LDC's
LDC's
Belgium 2
Millions
$70
0. 55
$1, 381
3. 3
12. 8
5. 5
10.0
Portugal
Minion,
$60
2. 21
$294
7. 4
.
45. 8
20. 3
10. 9
Canada
58
.16
2,009
4.5
13.3
5.2
3.0
United Kingdom_ _ _
556
.70
1,482
6.4
16.2
7.2
9.7
Denmark 4
1
.01
1,059
3. 1
. 6
.3
4. 1
France'
001
1.26
1,524
6.1
37.1
17.6
7.2
Total, other
Germany
428
50
1,558
5. 1
16. 8
7.8
6. 4
DAC
2,445
. 60
1. 135
- 4. 7
17. 6
8. 1
7. 5
Italy
60
. 15
788
3. 5
5. 6
2. 3
6. 7
United States
4,656
. 84
2,974
9.4
64.9
35. 1
2. 4
Japan
265
. 51
547
1. 1
11. 4
6.0
8. 6
.. 7,101
.74
1,766
7.4
33.8
16.3
4.5
Netherlands
42
.32
1.105
4.6
6.0
2.5
12.8
Total, DAC
Norway
4
.08
1,423
3. 7
3. 4
1. 3
.
6.0
I Grants and loans over 5 years.
2 GNP at current market prices.
Bilateral gross expenditure figures.
4 1961 figure.
a Grant component is expenditure figure.
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CONGRESSIONAL RECORD - SENATE
TABLE 11(a) .-1961 bilateral aid commitments: Grants, loans, and average loan terms
[Dollars in millions]
17165
Country
Total
bilateral
aid
commit-
ments
Grants
Grants
as
percent
of
total
Loans
over
5 years
Average
matur-
ity 1
Average
interest'
?
Country
Total
bilateral
aid
commit-
ments
Grants
.
Grants
as
percent
of
total
Loans
over
5 years
Average
matur-
ity 1
Average
interest'
Belgium 2
$71
$71
100
Norway
$1
$1
100
Danada
96
56
58
40
10. 7
6. 0
Portugal
58
3
5
55
22.9
4. 6
Denmark
1
1
no
United Kingdom
402
150
37
252
22.9
6. 0
France 3
977
787
81
190
23.9
3. 3
2,419
1,138
55
1,081
17. 8
5. 1
3ermany
401
125
31
276
14.5
4. 7
Total, other DAC__
ftaly
64
29
45
35
7. 5
4. 5
United States
4,418
4 2,910
66
4 1,508
21. 6
4. 1
fapan
Netherlands
308
40
81
34
26
85
227
6
12. 2
26.0
6.4
2.4
Total, DAC
6,837
4,248
62
2,589
19.9
4.5
1 Data available lacks some precision or consistency; these average terms should be
regarded as rough orders of magnitude.
Expenditures.
3 Grants are expenditures; loans are commitments.
Includes country use portion of sales under Public Law 480, titleI and commodity
grants under Public Law 480, tit es II and
Includes Foreign Assistance Act, Export-Import Bank, and Public Law 480, title
IV commodity loans.
TABLE 11(b) -1963 bilateral aid commitments: Grants, loans, and average loan terms
[Dollars in millions]
Country
Total
bilateral
aid
commit-
ments
Grants
Grants
as
percent
of
total
Loans
over
5 years
Average
matur-
ity I
Average
interest 1
Country
Total
bilateral
aid
commit-,
ments
Grants
Grants
as -
percent
of
total
Loans
over
5 years
Average
.matur-
ity I
Average
interest'
3elgium 2
)anada
)enmark
i'rance 2_
lermany_
taly
'span
qetherlands
$70
58
1
901
428
sa
265
42
$66
44
71
772
154
19
104
11
94
76
- 100
86
36,
32
39
26
4
14
129
274
41
161
31
7. 5
14.0
23.3
17.0
9.8
8. 1
20.0
5. 5
6.0
4.4
4.2
4. 9
6. 1
5.0
Norway
Portugal
United Kingdom
Total, other DAC _
United States
Total, DAC_ _
$4
60
556
$4
3
158
100
5
28
57
398
22.4
26.3
4.6
5.6
2,445
4,606
1,336
4 3,025
55
65
1,109
4 1, 631
19.8
29.9
5.1
2. 6
7, 101
4,361
61
2,740
23.8
3.6
1 Data available lacks precision or consistency; these average terms should be re-
garded as rough orders of magnitude.
2 Expenditures; interest rate is assumption.
3 Grants are expenditures; loans are commitments.
Includes country use portion of sales under Public Law 480, title I, and commodity
grants under Public Law 480, tit es II and III.
Includes Foreign Assistance Act, Export-Import Bank, and Public Law 480,
title IV commodity loans.
TABLE II(C).-1963 bilateral aid commitments: Grants, loans, and average loan terms
[Dollars in millions] 1
Country
Total
bilateral
aid
commit-
ments
Grants
Grants
as
percent
of
total
Loans
over
5 years
Average
matur-
ity'
Average
interest'
Country
Total
bilateral
aid
commit-
ments
Grants
Grants
as
percent
of
total
Loans
over
5 years
Average
matur-
ity I
Average
interest'
Belgium
Canada
Denmark
France
Germany
Italy
Japan
Netherlands
$83
125
7
877
665
128
268
39
$76
44
5
697
155
14
80
9
92
35
71
80
23
11
30
23
7
82
2
180
510
114
188
31
(2)
(2)
(2)
(2)
(2)
(2)
(2)
(2)
(2)
(2)
(2)
(2)
(2)
(2)
(2)
(2)
Norway
Portugal
United Kingdom
Total, other DAC
United States
Total, DAC
$4
54
458
$3
9
219
75
17
48
1
45
239
(2)
(2)
(2)
(2)
(2)
(2)
2,708
4,056
1,311
2,457
48
60
1,399
1, 599
(2)
(2)
(2)
(2)
6,764
3, 768
55
2,988
(2)
(2)
Preliminary DAC figures.
2 Precise data on interest rates and maturities not yet available for 1963.
TABLE III.-1962 DAC multilateral aid and bilateral aid subject to coordination, and percentages, total official aid
[Dollars in millions]
(I)
Total net
official aid
disburse-
(2)
Total multilateral aid
contributions
(3)
Total net bilateral aid
subject to coordination'
(4)
Total net multilateral aid
and bilateral aid subject
to coordination (2+3)
(5)
Percent
col. (1) is
of gross
national
..
ments
Percent of
Percent of
Percent of
product
Amount
net official
aid
Amount
net official
aid
Amount
net official
aid
Belgium
aa
.W WWWWW W.
,W4a,.4aWW.lavWW
$28.3
29. 2
$65. 31
67. 4
-
$93.61
,
,wmcowg,,-4.ocaP
0. 76
Canada
32.8
2.5.4
25.44
50.6
38.24
.13
Denmark
7.8
91.8
7.80
. 11
France 2
116. 7
11. 7
19.90
2.0
136. 60
.39
Germany
102. 3
24. 0
144. 06
33. 7
246.36
. 50
Italy
31. 5
47. 4
10.90
30. 0
51. 40
. 17
Japan
7. 1
4. 3
120. 56
73. 0
127. 66
.32
Netherlands
43. 7
51. 0
.94
42. 76
. 66
Norway
. 2
34.3
. 40
28. 6
. 60
. 04
Portugal
. 1
. 3
. 10
1. 36
United Kingdom
39. 5
9. 5
102.63
46. 2
232. 13
. 53
Total, other DAC
2,351. 0
390. 0
16. 6
578. 26
25. 0
977. 26
41. 6
, 53
united Statee
3,606. 0
278. 0
7. 7
2, 138. 00
59. 3
2,416. 00
67. 0
. 65
Total, DAC
5, 957. 0
668.0
11.2
2, 725. 26
45.7
3, 393. 26
57.0
.62
'Disbursements of members of IBRD consortia for India and Pakistan, OECD South Vietnam, Philippines, South Korea, China (Taiwan), Argentina, Brazil, and
consortia for Greece and Turkey, IB RD consultative groups for Colombia, Nigeria, Chile.
and Tunisia, OECD/DAC coordinating groups for Thailand, Indonesia, East Africa 2 French bilateral aid to coordinated efforts includes Laos and Cambodia, and esti-
(Kenya, Tanganyika, Uganda). and the Congo (L6opoldville), and DAC meetings on mate for Tunisia.
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17166 CONGRESSIONAL RECORD ? SENATE
TABLE IV .?Estimated Soviet bloc credits and
grants to the less-developed countries of
the free world, 1954-63
[Million U.S. dollars]
Area and country:
Total
Total
4,453
Latin America
Argentina
Brazil
287
104
183
Middle East
1,
237
Cyprus
1
Iran
45
Iraq
2/8
Syria
193
Turkey
17
Egypt
736
Yemen
27
Africa
718
Algeria
108
Ethiopia
114
Ghana
171
Guinea
97
Mali
78
Morocco
17
Somali Republic_
63
Sudan
22
Tunisia
48
Asia
2,
207
Afghanistan
507
Burma
15
Cambodia
26
Ceylon
40
India
982
Indonesia
594
Nepal
10
Pakistan
33
Europe
4
Iceland
TABLE V .?Estimated economic credits and
grants extended by Communist China to
non-communist less-developed countries,
1954763
[Millions U.S. dollars]
Area and country: Amount
Total 446
Latin America 0
Middle East 37
Syria 16
United Arab Republic 5
Yemen 16
Africa 138
Algeria 50
Ghana 20
Guinea 25
Mali 20
Somali Republic 23
Asia 271
ger share of their gross national product
on liquor, cigarettes, and gambling than
we do, but that does not mean that we
must embark on a national effort to out-
do them.
France, which is the favorite example
in this comparison, is not only spending
a higher percentage of her gross national
product on foreign aid than we are, but
she is spending a higher percentage on
development of her nuclear weapons
systems. Surely this does not mean we
must increase our outlay there, too. Yet
that is the implication of the comparison.
The only important question for us is
whether the money the United States
does spend on aid is effective and worth-
while in promoting the economic better-
ment which we advertise as its purpose.
I do not think it is, or at least not enough
of it is to justify the sum requested for
the fiscal year 1965.
FOREIGN AID AS A SLUSH FUND
Many advocates of aid think they are
being sophisticated in recommending
foreign aid as a slush fund to buy off
other countries. They often say that
every great nation has had to do the
same thing, and that the United States
should now undertake to carry the same
burden, with the understanding that it
is a waste of money and is spent only
to prevent unfavorable things.from hap-
pening.
Our experience shows that countries
do not remain bought off. Pakistan did
not remain bought off. Pakistan is en-
tering into agreements with Red China.
The Foreign Minister of Pakistan stood
up in the Washington, D.C., Press Club
not so many weeks ago and blatantly
pointed out that they have no intention
of being of any assistance to us in South
Vietnam. Yet we poured millions and
millions of dollars of aid into Pakistan.
To build up what? To build up her mili-
tary forces for a potential war with
India over Kashmir. We poured many
millions of dollars into India, for the
same purpose.
The sad, shocking danger is that if
Pakistan and India go to war over Kash-
mir, they will fight it almost entirely with
American military equipment. Does that
make friends for us in the world? It
makes Communists.
Mr. President, it is just such unsound
policy on foreign aid that-is strengthen-
ing the drive for communism. I want to
see it stopped. Our foreign aid program
has been a colossal failure as a check
upon communism; and I care not what
part of the world we name.
Our own defense posture has held Rus-
Burma 84 sia in check?not the defense posture of
Cambodia 50 Turkey, Greece, Pakistan, India, or any
Ceylon 36 of the other countries whose military
Indonesia 57 power we have developed. What I have
Nepal 44
said about Pakistan and India is equally
COMPARISONS DO NOT TELL WHETHER U.S. AID applicable to Turkey and Greece. They .
IS SOUND would be worthless to us in the event of a
Mr. MORSE. Comparisons with other war with Russia. Yet, there is a danger
nations, free or Communist, do not tell in the Mediterranean that -Greece and
us anything about whether the U.S. aid Turkey might get into a war with each
program is sound. If every other na- other?totally equipped on each side
tion in the world is hellbent for bank- with American military equipment.
ruptcy, that would not be a reason for the Reconcile that with morality. It cannot
United States to get there first. No doubt be done. We cannot eliminate moral
there are many nations that spend a big- principles from American foreign aid
Aqust 3
policy. Much of it cannot be squared
with principles of morality.
Several things are wrong with the view
of using foreign aid as a slush fund.
First of all, it assumes that money (or
military equipment) buys more than it
does. To holders of this view, the giving
of money is synonymous with the influ-
encing of the recipient; but more often
than not, recipients, in the manner of
Sukarno, take the money and then do as
they intended to anyway.
I wonder what America's foreign aid
policy would be in Indonesia if there were
not in the neighborhood of $2 billion
worth of oil investments there. I wonder
if the explorations for oil in South Viet-
nam and the planned building of an oil
refinery in South Vietnam by an Amer-
ican oil company might have some indi-
rect influence upon foreign aid in South
Vietnam. '>
The best way to make perfectly clear
that it does not have any influence is to
ask the United Nations to replace the
United States in South Vietnam. I shall
have more to say about that later this
week.
Mr. President, the slush fund to Su-
karno did not hold him in line. Slush
funds by way of foreign aid have not
kept the recipient countries in line. The
principle upon which such an approach
Is based is not sound.
Second, handing out money and
weapons with the idea that they will
promote political stability, or, keep
friendly governments in power, or prop
up a bloated military establishment in a
foreign country are all efforts to impose a
political order from the top down. The
underlying causes of unrest- or suscepti-
bility to communism are ignored, and
sometimes worsened.
These uses of foreign aid are justified
with such phrases as "forward defense
against communism," "vital to the inter-
ests of the United States," and "of
strategic importance to the United
States," concepts that now embrace vir-
tually the entire globe.
It is semantic "hokum." The Depart-
ment of State and the AID officials in
the Pentagon have been trying to feed
the American people semantic "hokum."
But they are getting ready to regurgitate.
They will not swallow it any longer.
Most of the countries receiving huge
and largely unconditional aid on the
ground that they border the Communist
bloc are already protected by mutual de-
fense treaties with us, and by our retalia-
tory capacity.
The real justification for "forward de-
fense" aid is not that the recipient can
use it against communism, because a
nonindustrial country that cannot sup-
port a peacetime army cannot sustain a
war effort against Russia or China.
Once Europe and Japan were rebuilt and
rearmed, military aid ceased to have
much practical value for indigenous
forces. What "forward defense" aid
does buy is entree for American military
and intelligence agencies close to Com-
munist ) borders. For these privileges,
we have paid since World War II a dozen
times more than we need to have paid.
I shall say something about Turkey
later. Turkey is one of the horrible ex-
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1964 .
CONGRESSIONAL RECORD ? SENATE
amples. Turkey could'not begin to sup-
port its military establishment with its
economy. Turkey is not protected by
its military establishment. Turkey is
protected by the striking power of the
United States. We have been pouring
hundreds of millions of dollars into Tur-
key for the operation of government in-
dustry. Plant after plant in Turkey is
government-owned. The evidence is
perfectly clear?and the Comptroller
General's report makes it clear_too?that
the government plants are used for the
employment of a large percentage of the
people over and above the need of the
employer to operate an efficient plant.
It is a sort of government dole, handed
out with American taxpayer dollars. It
is a make-work program. Yet when we
try to obtain needed assistance in our
own country for some of our depressed
areas, we see the trouble that we en-
counter. But not in Turkey. In my
judgment, much of the economic aid, as
well as much of the military aid to Tur-
key, is a shocking waste of the American
taxpayers' dollars. I do not believe we
ought to be supporting with an AID pro-
gram these government-commercial
monopolies in Turkey.
Many will say: "Anything that helps
us against Russia and China is worth
while." But our failure in insist on
sound economic standards even for this
aid has not helped us. It only means
that we are still vulnerable to eviction
from these countries without, in the
meantime, having improved their eco-
nomic prospects.
ECONOMIC FREEDOM SHOULD BE BASIC PURPOSE
OF AID
In the long run, climates and attitudes
sympathetic to the United States and
compatible with American objectives will
have to be created by the creation first
of economic freedom in these countries.
And economic freedom can only be ad-
vanced through the developmental part
of the AID program.
But, sad to say, of the economic sec-
tion of the program, not more than half
is devoted to bona fide economic develop-
ment. Supporting assistance, the con-
tingency fund, and nonproject loans
from the development loan fund are but
political props and pay-offs to foreign
governments. They do not develop;
they merely patch over and perpetuate
the lack of development.
Even the technical assistance program
is being used for transportation and
communication projects against the day
when they may be of use to American
forces, and to train small-time police
states in emerging countries.
The words "economic freedom of
choice," without which the security of
this country will never be strengthened
in this world, are being relegated to
whatever is left over in the foreign aid
pot. Education, sanitation, vocational
training, capital projects, agricultural
extension?the activities that our of-
ficials trot out to gain support for aid
among the unknowing American peo-
ple?these constitute at most only about
40 percent of the $3.5 billion being re-
quested.
Cutting the $1 billion-plus military aid
expenditure in half and applying the un-
productive economic aid to genuine eco-
nomic development projects would do
more to strengthen the longrun security
of the United States than any other
changes that could be made in the for-
eign aid program.
NO EVIDENCE OF CHANGE IN CURRENT PROGRAM
Since January, Congress and the
American people have been told again
and again that this year the program is
being tightened, curtailed, and improved.
But there is no hint in any of the ma-
terial presented to the committee of
where these changes are taking place.
All that Congress is given in the annual
presentation is a look at on-going pro-
grams, started in the current fiscal year
or before.
Contrary to past efforts and directives
from Congress, requested funds for sup-
porting assistance have been increased
over last year, even without the addi-
tional request for Vietnam. This grant
economic aid has been a target for con-
gressional criticism since adoption of the
Mansfield amendment in 1959, calling
for its eventual termination. The aid
request for this category is a backward
step from the Mansfield reform.
Unspecified loans called program
loans abounded in fiscal 1964, and they
apparently are to be used just as freely
in fiscal 1965. Project loans finance the
importing of commodities for specific
projects whose soundness can be verified
by AID officials; but program loans go to
balance accounts and finance imports in
general. In many countries these in-
clude imports that contribute nothing to
local improvement and development.
They only create a debt obligation to the
United States whose chances of repay-
ment are slim.
I warn the American people that, in
my judgment, a large bulk?probably the
larger bulk?of the 40-year loans at
three-fourths of 1 percent interest, 10-
year grace period in which no payments
will be made, and then payment in soft
currency, will never be repaid at all. It
would be more direct and honest to des-
ignate them as outright grants.
Mr. President, they are not psychologi-
cally beneficial, either, because?and this
is particularly true in Latin America--
many of the people recognize the decep-
tion of this approach. We ought not to
present that image of the United States
to the world. We ought to make
either loans or grants. We ought not to
pretend that we are making a loan when
we give the money on the basis of in-
terest of three-fourths of 1 percent, with
a 10-year grace period for no payment,
and 40 to 50 years in whichto repay, and
then in many instances in soft currency.
We would win more respect for ourselves
if we did not engage in such deceitful
semantics.
Moratoriums on debt obligations due
us from Turkey and Brazil, and the pros-
pect of renegotiation of Argentina's ob-
ligations, call for a much tighter control
by Congress over this type of loan. In
the case of Brazil and Turkey, we are
making them new soft loans even as we
give them moratoriums on repayment of
old ones.
17167
These loans, as with aid in general,
are touted as creating a future market
for American goods. Tommyrot. This
theory is based on the advertising gim-
mick of giving away free samples. But
their cost is absorbed by the American
taxpayer, not the manufacturer. Yet
testimony to this committee?not from
administration sources but from U.S.
commercial sources?brought out that in
Colombia and Chile, U.S. exports de-
clined as these countries received our
goods under program loans and diverted
the foreign exchange saving into new
purchases from the European exporters,
not U.S. exporters. Worst of all, the
chances that the taxpayers will ever re-
cover any of this subsidy to American
business are not good.
It is no wonder that committees of
U.S. businessmen are becoming the ma-
jor tub thumpers for foreign aid.
So far as Latin America is concerned,
the indications are that the aid standards
are being loosened, not tightened.. A $50
million loan for no particular develop-
ment purpose, but just to balance inter-
national payments, has been extended to
Brazil. This is despite the suspension
Of loans, pending fulfillment of certain
economic conditions by the Brazilian
Government. There is as yet no more
or better economic performance to justi-
fy a loan than there had been under the
previous government. But once a new
junta takes over in Latin America, we
rush to curry favor with it, and in Brazil
it is costing us already $50 million.
In fact, the U.S. aid program in four
other junta-ruled countries of Latin
America where constitutional govern-
ments were pushed out, has been re-
sumed. These are the Dominican Repub-
lic, Guatemala, Ecuador, and Honduras.
This is a full turnback to the evil days
of the 1950's when the United States
gained a record level of ill will and ill
repute among the people of Latin Amer-
ica who had to live under the brutal heel
of U.S.-supported tyrants. The Alli-
ance for Progress was supposed to have
changed all that by financing economic
reform within a framework of political
freedom and domocratic institutions.
But today we are merely handing out
more money for the same old purposes as
before.
Having ignored ourselves the political
conditions for aid under the Alliance,
our partners feel free to ignore the self-
help conditions as well. Why should
they not when they get this money any-
way?
Later I shall discuss the President's
contingency fund. Why in the world
we should go along with the proposal to
give him $150 million, to spend at his own
discretion, I am at a loss to understand,
particularly when we take note of how
contingency funds have been spent in
recent years. "Slugs" have been spent to
help governments balance their budgets,
to help them with payments, to help them
pay debts. That is a misuse of the Presi-
dent's contingency fund. I protested it
last year. I shall protest it this year.
The purpose of a President's contin-
gency fund is to give a President of the
United States overnight funds. That is
all. It takes 20 minutes to get from the
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17168 CONGRESSIONAL RECORD ? SENATE
White House to Congress for the Presi-
dent to come before the Congress in an
emergency. Any time the President has
an emergency to lay before the Congress,
he can get the funds, if he shows there
is an emergency.
It goes back to the point I made earlier
about the danger of Government by
secrecy. No President?I do not care
who he Is?should be allowed to have
$150 million to play with any way he
wants to play with it in America's for-
eign affairs. It is a dangerous power. It
Is an unchecked power. It is in violation
of the theory of our form of government.
No President should be given an un-
checked power. Fifty million dollars is
ample for any overnight need of any
President of the United States.
I say respectfully, but the record
speaks for itself, that Presidential con-
tingency funds have been abused in the
past several years, in my judgment, and
that abuse should be stopped.
FUNDS SHOULD NOT GO ABOVE FISCAL 1964
As reported by the Committee on For-
eign Relations, the bill increases the pro-
gram for fiscal year 1965 over the pro-
gram for fiscal 1964. This has been done
despite the overwhelming evidence that
the American people are demanding
long overdue reductions in the foreign
aid burden, that the impact of the aid
program is woefully smaller than its size,
that U.S. Government funds are increas-
ingly needed at home, and that our so-
called allies are permitted to shirk their
responsibilities because of our often reck-
less generosity.
Undoubtedly the administration sin-
cerely believes its appropriation request
for $3,516,700,000 to be a barebones
budget. However, the determining fac-
tor in shaping this request had to be the
judgment of the Agency for Interna-
tional Development. And our past ex-
perience has made it painfully clear
that?at a minimum?there is nothing
sacrosanct about the AID judgment.
The Congress, on the other hand, is
not?or should not be?content merely to
accept the arguments of stanch advo-
cates, but takes into account a range of
other sources of information. Foremost
among the latter are the reports by the
Comptroller General of the United
States, which time after time have
severely criticized in detail the planning,
the programing, and the implementation
of the aid program. On the basis of such
information, as well as a full study of the
AID presentation material, I can only
conclude that there is a great deal of fat
clinging to the barebones.
The appropriation last year, for fiscal
1964, was an even $3 billion?a cut of
almost $2 billion from the original budget
request. Judging by the cries of anguish
and forecasts of catastrophe which rose
from Foggy Bottom during that trim-
ming process, one might have envisioned
the United States and the rest of the free
world sliding irretrievably toward dis-
aster. Yet a year later the Republic still
stands, and no one is able to point to
any foreign policy reverse attributable
to a lack of aid funds. Indeed, our set-
backs appear to have come in the Medi-
terranean and in southeast Asia, areas
into which the United States has poured
money most lavishly.
During this year's hearings and com-
mittee discusSions no evidence was pre-
sented to justify an authorization for
fiscal year 1965 of almost $467 million
more than the $3 billion appropriated
for fiscal 1964. It might be noted in this
connection that a great deal of atten-
tion and lipservice was given last year
to the so-called Clay Committee report.
While I disagreed strongly with that re-
port's inflated financial recommenda-
tions, it did contain the extremely valid
proposition that there should be a grad-
ual but steady reduction in the size of
the aid program annually in the future.
Our experience last year with a program
scaled to $3 billion in new funds certain-
ly suggests that a cut even below that
level could be safely made this year.
Because of a carryover from prior year
appropriations, the final figure for the
fiscal 1964 program was almost $3.4 bil-
lion, rather than $3 billion. The carry-
over this year supposedly is only to be
about $53 million. If true, and if the $3
billion level of new money were-main-
tained, the end result would be a reduc-
tion of about $344 million under last
year's figures. The word "supposedly"
must be emphasized. For the admin-,
istrators of the AID program are highly
accomplished producers of rabbits from
their hats, and there is good reason to
believe that other funds may in time be
brought out of hiding. Indeed, when
such a wonderland category as "deobli-
gations of prior year obligations" is
counted, the understandably confused
American man-in-the-street finds that
the foreign aid program which he
thought was $3 billion last year turned
out to be in excess of $3.6 billion. The
conclusion that $3 billion in new money
would not represent any real reduction
from last year is shared by many Mem-
bers of the House, who wrote in the
minority views in the House Appropri-
ations Committee report:
Further, it is impossible for the Appro-
priations Committee to ascertain with any
degree of accuracy the amount of unobli-
gated funds which are left at the end of the
fiscal year. It has been stated that these
figures for any fiscal year are not available
until October of the following year.
FOREIGN A?SISTANCE ACT ONLY A PART OF TOTAL
FORE/ON A/D
This leads to another major objection
to the character of the foreign aid pro-
gram as it now stands. It is only the
beginning figure for what we spend over-
seas on an annual basis. Many Members
of the Congress, much less the American
public, have only the haziest idea of how
money is involved in our contributions to
a large number of international financial
and developmental organizations, and in
our shipments of agricultural surpluses.
Moreover, executive branch requests
for the same general purpose in succes-
sive years have a tendency to disappear
from one bill or category and turn up in
another. For example, $135 million for
Latin American development?through
the Inter-American Bank's social prog-
ress trust fund?contained in the 1964
foreign aid -appropriation bill does not
recur this year. At first blush this might
ifugust 3
appear as a reduction in our total aid.
But no, the administration has just sub-
mitted a separate new request for $750
million over a 3-year period for the same
purpose with a slight change in termi-
nology. There is no corresponding cut
in this bill. Under these circumstances
It is extraordinarily difficult to perceive
the overall total of United States foreign
aid, and to make intelligent judgments
about the validity of its components, such
as those contained in this bill.
EXCESSIVE NUMBER OF COUNTRIES CONTINUE TO
RECEIVE BILATERAL ADD
This confusion carries over into the
question of how many countries are feed-
ing at the American trough. If only aid
under the Foreign Assistance Act is
counted, then some 83 countries are
scheduled to receive assistance in fiscal
year 1965. But the total rises to over
99 countries and territories when all
forms of assistance are counted. And
Indeed they should be counted. The ad-
ministration can scarcely claim it is ex-
tending little aid to Nasser's Egypt, for
Instance, when Public Law 480 supplies
are flooding that country.
Now it appears that the number of
countries getting help under the Foreign
Assistance Act has fallen by something
like the figure of 10. It is noteworthy
that there is no commensurate cut in
the administration request for new
funds. On the contrary, the AID offi-
cials point with pride to the growing
concentration of effort in fewer "key"
countries. By that standard, no matter
how many nonessential applicants are
cut off the AID payroll, the level of for-
eign assistance requests is likely to re-
main unchanged.
Anyone reading the majority commit-
tee report, supported by the majority of
members who voted for this bill, will be
struck by the absence of persuasive an-
swers to the outstanding questions which
. have always surrounded the foreign aid
program. It is said that it is unrealistic
to expect agreement on the purposes and
aims of the foreign aid program. This
at least is- refreshing candor, although
there is little novelty in the observation.
My own experience with AID officials
has always been that when I make a
valid criticism of an economic project,
they say the objective in that case is not
economic but political?and vice versa
in other cases. In numerous instances
those officials have accepted the validity
of my criticisms "in principle" but have
cited so-called special circumstances
which prevent them from taking correc-
tive action. It is no wonder that we have
difficulty in justifying foreign aid ex-
penditures to our constituents.
The committee report states that
the total of U.S. bilateral aid is
declining. Yet, as substantiation, it
merely cites the difference between last
year's administration request and the
one this year. The fact is there is no
hard evidence to cite which would back
up that statement in terms of last year
and this.
The majority report then goes on to
note that "aid has been terminated in
17 countries." But it ignores the fact
that some of these countries were cut
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/964 CONGRESSIONAL RECORD ? SENATE
off several years ago, and liave been
trotted out each year since as happy
examples. In any event, as stated above,
a reduction in recipients means little
without a consequent reduction in ex-
penditures.
A table is inserted in the report which
supposedly "should provide some reas-
surance" that our development loans
will be repaid. The only conclusion I
draw from that table is that the World
Bank?whose record is not at issue?
has done extremely well with its hard
loans on stringent criteria. I join Sen-
ators MUNDT and LAuscHE in their ob-
jections to the easy terms of most of our
loans.
I call this an obvious fallacy in the
misleading statement of the AID admin-
istration and I issue the challenge: "Do
you want to adopt the World Bank pro-
cedures and policies for your loans? If
you do, I am all for you."
But to cite the World Bank, which
Issues hard loans, which charges interest
rates that ought to be charged, as an ex-
ample or as an argument in support of
the fallacious contention that AID loans
will be repaid is pure deception.
' Mr. Presidentc I resent such an insult
to my intelligence. But that is what we
are up against when we deal with the
AID administration. The AID adminis-
tration ought to be swept clean. We
ought to bring an end to the whole pro-,
gram and start all over again on the
basis of conditions that Congress lays
down, instead of always passing the buck
to the executive branch of the Govern-
ment to determine the conditions.
Finally, the majority report meets the
criticism that our industrialized friends
are failing to take a fair share of the for-
eign aid burden by stating:
This is a complicated question, for which
there is no categorical answer.
It is about time that the majority of
the Committee on. Foreign Relations set
about trying to find some of the answers,
instead of passing the buck to the State
Department, the AID officials, and the
Pentagon. Read the report of the Com-
mittee on Foreign Relations of a year ago
and compare it with the report of the
Committee on Foreign Relations this
year. It is almost unthinkable and un.,
believable that it was written by the same
members of the committee, but it was.
A year ago, the majority of the Com-
mittee on Foreign Relations tried to sell
us an unsound report-with the pleading,
the rationalization, and the semantics in
that report of a warning to the State De-
partment and the AID officials, "If you
do not do something in the intervening
year, you will be in trouble; something
will have to be done on the Hill."
What has been done? Let the chair-
man of the Committee on Foreign Rela-
tions take the door of the Senate and
give us a bill of particulars as to what
has been done to carry out his report of
a year ago. I charge now, as I charged a
year ago, that what the committee did
then, as it is doing now, was to pass the
buck back to the administration.
When we raise the objections that I
raise, we are told, "These are complicated
No. 149-5
questions, for which there is no categor-
ical answer." The American people are
entitled to have some answers. It is
about time the majority of the Commit-
tee on Foreign Relations started to sup-
ply the answers instead of writing the
kind of report we have received again
this year. Again, the statistical informa-
tion contained in the report simply does
not support an optimistic conclusion.
In the following sections I set forth my
own specific conclusions and recommen-
dations for cutbacks in funds, which lat-
ter are summarized at the end in tabular
form.
DEVELOPMENT LOANS
Congress should reduce funds for de-
velopment loans so long as these loans
continue to be made for general purposes
and not for specific projects. The House
Foreign Affairs Committee report, in
both its majority and minority views, was
critical of the large sums in program
loans during fiscal 1964. Yet Congress
must be aware by now that mere criti-
cism in a committee report makes no im-
pact whatsoever on the foreign aid pro-
gram.
I repeat what I said earlier this after-
noon; Do not provide blanket funds; do
not provide blanket authority in dealing
with development loans. If money is
wanted for development loans, the appli-
cants should be required to submit spec-
ific projects to the committees and to
Congress for specific approval, just as
every Senator who seeks a project for his
own State must submit a specific pro-
gram showing that a cost-benefit-ratio
formula is being met.
We cannot clean up foreign aid if we
leave the policy decisions to Foggy Bot-
tom. We will not clean up foreign aid
until Congress does the job which is
clearly its job as the caretaker of the
public pursestrings, and passes its valued
judgments upon specific requests for
specific loans for specific projects.
I agree with the House committee.
Congress must be aware by now that it
will have to insist upon specific projects
if foreign aid is ever to be cleaned up.
Said the majority report:
Nevertheless, the committee believes that
countries which progress to the point where
they qualify for large development loans
should be encouraged to assume increasing
responsibility for financing their imports,
except imports related to projects for which
loans are made. There is danger that de-
pendence on the United States for such
financing could- result in levels of consump-
tion higher than the recipient could normally
sustain and could encourage unsound finan-
cial and monetary practices.
The minority report of the House com-
mittee showed program loans in fiscal
1964 as follows:
Million
Tanganyika
$1
Tunisia
10
India
275
Pakistan
100
Turkey
'70
Chile
40
Colombia
15
This makes a total of $511 million.
Since then, Brazil has received a $50
million program loan.
17169
This means that about a third of all
development loan funds available for
fiscal 1964 have already been lent
for general purposes unrelated to any
specific development project. ?
Turkey again ranks as the No. 1 failure
of the foreign aid program and among
the No. 1 recipients of program loans.
She is receiving over $100 million in
economic aid this fiscal year, and con-
siderably more in fiscal 1965, most of it in
"program" loans.
Both the Organization for European
Cooperation and Development, and the
General Accounting Office of the United
States have found Turkey's economic de-
velopment to have stagnated despite the
huge American aid program these since
1947. The OECD report of 1963 was pre-
pared for a consortium of Western Euro-
pean countries that were supposed to join
the United States in financing Turkey's
development. AID presentations always
refer to this consortium but do not men-
tion that its total pledges amount to less
than the American aid alone, and that
the European members are not coming
through on their pledges because Turkey
has not carried out the reforms required.
Let us not forget the lesson of that
precedent. If we follow the policy we
have been following toward Turkey, we
shall be confronted with the argument
from many another country, "Well, you
let Turkey do it; why not us?"
Either we shall operate the foreign aid
program on a sound procedural basis,
with fair conditions imposed and en-
forced, or we shall run into the kind of
wasteful expenditure of taxpayers' mon-
ey that has occurred in Turkey.
Mr. President, our aid program to Tur-
key, in my judgment, has involved the
waste of many millions of taxpayers' dol-
lars. We should stop it. Senators should
not get the idea that they are support-
ing democracy in Turkey because there
is no democracy in Turkey.
Although the United States has put
$1,670 million into Turkey's economy
since 1947?let me repeat: the American
taxpayers, through their Government,
have poured into Turkey's economy since
1947, $1,670 million?and given her com-
bined military and economic aid of over
$4 billion, that country's economic con-
dition is worsening. The population in-
crease has almost entirely wiped out the
increase in the gross national product.
If anyone wishes an example of the
failure of the representation about for-
eign aid, while it is supposedly accom-
plishing so much, take a look at Turkey.
Since 1947, we have poured more than
$4 billion into Turkey, and yet there is
no democracy there. There is no strong
private economy in Turkey. It is, by and
large, a state monopoly economy. We
are maintaining a military establish-
ment there which Turkey could not pos-
sibly maintain.
It would be much better for us to
follow the kind of aid program which I
announced at the beginning of my
speech I would gladly support, dealing
with loans and hard money loans to
specific economic projects, which will do
something for the people of Turkey and
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17170 CONGRESSIONAL RECORD ? SENATE
help their standard of living, then to
engage in the kind of wasteful programs
we have been engaging in there.
If there is any question about my
position, read the reports of the Comp-
troller General. Senators can read them.
So can the public read this one. I do
not see how anyone can read the Comp-
troller General's reports on Turkey and
go along with this bill.
Reform of the grossly wasteful state
enterprises, and tax reform are the most
urgent. The U.S. General Accounting
Office reported a few weeks ago:
In the absence of a development plan and
adequate information about the economy's
resources and needs, the commodity import
program (which has been the largest seg-
ment of United States economic dollar aid
to Turkey) was an integrated part of the fi-
nancing of Turkey's overall import programs
and as such was not geared to specific long-
range objectives. Moreover, substantial
amounts of local currency generated under
the commodity import program were allo-
cated for the general support of investment
budgets of state economic enterprises (those
owned by the Turkish Government). Be-
cause neither the Turkish Government nor
the misSion exercised adequate control over
commodity imports and the operations and
investment programs of state enterprises, aid
funds frequently were used to nonessential
or low-priority purposes. State enterprises
also received U.S. dollar aid to finance the
foreign exchange cost of facilities which had
been poorly utilized or not utilized at all. As-
sistance was freely provided some state enter-
prises notwithstanding their inefficient op-
erations and uneconomical practices.
In a supplement to our prior report on the
Turkey program: we pointed out that ac-
complishments in Turkey's economic devel-
opment and support of the country's defense
efforts had been accompanied by serious eco-
nomic problems with consequent increases in
the amount of aid required from the United
States. The average level of U.S. aid for the
5 fiscal years (1958-62) covered by our re-
cent examination ipereased significantly over
the level for the preceding periods. More-
over, U.S. officials estimate that during the
5-year period which began March 1, 1963,
Turkey will need more aid than heretofore
from both the United States and others and
that Turkey will not reach self-sustaining
growth before 1975. Steps taken since the
military coup of May 1960 offer promise that
sound and necessary economic control meas-
ures may be forthcoming, but much remains
to be done. As can be seen from the above
there is a need for more effective action to
improve operations and increase earnings of
state economic enterprises and for more pro-
ductive utilization of resources available to
Turkey.
Some Senator speaking on the floor of
the Senate in 1975, if we go through with
this prognosis, will be saying, in my judg-
ment, just about what the senior Senator
from Oregon is saying today. The Turk-
ish system will not bring about resulting
economic freedom. I shall not vote to
waste American taxpayers' dollars in
that way. I shall not vote to sink Ameri-
can taxpayers' dollars in such bottomless
pits as Turkey.
A continuation of a wasteful foreign
aid program to Turkey cannot be justi-
fied. I shall not vote for a foreign aid
bill that includes it.
Mr. LAUSCHE. Mr. President, will
the Senator yield?
Mr. MORSE. I yield.
Mr. LAUSCHE. I listened to the
reading of the report concerning aid that
has been given to Turkey. I believe it is
stated in the report that there was waste
and inefficiency in the governmental
enterprises.
Mr. MORSE. It was shocking. Read
the report of the Comptroller General on
that point.
Mr. LAUSCHE. Does the senior Sen-
ator from Oregon object to the granting
of aid to Turkey because of the govern-
mental operations as distinguished from
private operations, or is it on that ground
and additional grounds?
Mr. MORSE. Oh, it is based on many
additional grounds. I am not taking the
position that we should not aid a coun-
try that may decide that it wants to con-
duct on a governmental, monopolistic
basis, certain operations that are vested
with the public interest. I do not like
them. It happens to be their right. But
I shall not vote the taxpayers' money to
support grossly inefficient and wasteful
industries, be they public or private.
And I shall not vote the taxpayers' money
to support state monopolies in the fields
of what ought to be private enterprise.
Mr. LAUSCHE. I thank the Senator.
Mr. MORSE. I suppose I am odd
about my position in regard to the use of
aid. I have said over and over again
that we must look at it from the stand-
point of our self-interest. We must look
at it from the standpoint of whether or
not we can really try to export economic
freedom.
The Senator has heard me say time
and time again that there is no hope for
political freedom anywhere in the world,
in any country that we are trying to
help, unless we first prepare the seedbeds
of economic freedom. We cannot export
political freedom. We have tried to do
it. It has been a colossal mistake and
failure for years. But we can export the
institutions of economic freedom, and the
interesting lesson of history is that we
cannot cite in the history of mankind a
people who were economically free who
were not also politically free. We can-
not 'cite that any people who were politi-
cally free lived under the kind of eco-
nomic totalitarianism under which the
Turks live.
Mr. LAUSCHE. Mr. President, do I
correctly understand that the senior
Senator from Oregon does not believe
that the AID program should be discon-
tinued, but does believe that it has been
administered in many instances on poli-
cies that were wrong, and also adminis-
tratively inefficient?
Mr. MORSE. Early this afternoon, I
stated I would vote more money than
this bill calls for if the AID pro-
gram were reformed. It makes a great
deal of difference to me whether they are
asking for hundreds of millions of dollars
for so-called loans which are deceptive.
As I have stated over and over again, as
an experienced teacher, I know the value
of repetition in the learning process. I
shall repeat, repeat, and repeat until the
American people begin to understand
what it is that we are driving at when
we oppose the AID program.
I stated earlier this afternoon that I
am against loans of three-fourths of 1
percent interest, 10 years' grace, 40 to
50 years to repay, and repayable in soft
currency. That is plain deception.
August 3
The American people are fed semantic
"hokum." But I would vote more money
for hard loans and for loans that go to
projects that we have checked. I am not
going to leave it to the AID officials to
take a total sum of money and spend it in
their wisdom for a project.
It is time to put a control on that kind
of program?the same kind of control
that the Senator from Ohio [Mr.
LAuscnEl, and the senior Senator from
Oregon have to measure up to, and
rightly so, when we seek to obtain loans
or development grants for projects in our
State.
Mr. LAUSCHE. Mr. President, will
the Senator yield further?
Mr. MORSE. I yield.
Mr. LAUSCHE. I heard the Senator
say that we have made loans most inad-
visedly in areas where they would not be
of any help to us. My philosophy has
been that we cannot discontinue the AID
program.
However, we can reform the policies
under which the program has been ad-
ministered. From my own standpoint,
I have always felt that we never ought
to deal with any country that wishes to
auction off its fidelity to the highest
bidder. There have been too many in-
stances in which countries have said,
"You will have to pay us more than Red
Russia. Unless you do, we shall go to
Red Russia."
To those nations I would say, "Go."
They will come back quickly, and with
the knowledge that what we do is in-
tended sincerely to be of help and not
to be a militaristic exploitation such as
Red Russia is practicing upon them.
Mr. MORSE. The Senator from Ohio
knows that in the Foreign Relations
Committee, on which he and I have had
the privilege of serving, I have sup-
ported him on that stand. When he has
said "Go," I have added the phrase, "And
Godspeed."
Mr. LAUSCHE. The Senator is cor-
rect. Too frequently we give aid to our
enemies. We are giving aid to countries
whose leaders have publicly declared
their affection and support for Red
Russia.
Mr. MORSE. Pakistan.
Mr. LAUSCHE. Zanzibar.
Mr. MORSE. Sukarno.
Mr. LAUSCHE. Sukarno; Bella in
Algeria and Jagan in British New
Guiana.
Mr. MORSE. And Nasser.
Mr. LAUSCHE. I do not believe that
+we are serving the interest of our coun-
try by giving aid to those who love our
enemies and frequently reveal their dis-
trust and hatred for us:
Mr. MORSE. What they love about
us is our dollars.
Mr. LAUSCHE. Frequently we hear
them say, when they are supposedly
speaking without being heard and ob-
served, "Beware of the capitalists of the
West." They do not mention the United
States, but that is the term of oppro-
brium that they apply to us, indicating
their affection for our enemy and not
for our country. '
Mr. MORSE. I thank the Senator.
Mr. LAUSCHE. I thank the Senator
from Oregon very much for yielding to
me.
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CONGRESSIONAL RECORD ? SENATE
Mr. MORSE. Continuing the discus-
sion of the Comptroller General's report
on Turkey? twe ,,read that the Turkish
Government operates about half of the
country's industrial production, includ-
ing enterprises in the fields of manufac-
turing, mining, trading, banking, trans-
portation, and public utilities.' They
have steadily lost money due to "poor or-
ganization, inefficient operations, and
poor pricing policies." ?
The report states:
Despite these basic management deficien-
cies, the United States continued to provide
substantial sums of direct and indirect dol-
lar aid and counterpart and U.S.-owned local
currency to some state enterprises. This aid
has contributed 'little toward improving op-
erations of the enterprises, relieving their
drain on the Turkish economy, and thereby
reducing the need for outside aid.
Turkey's failure to correct the worst of
these conditions has led the consortium
to curtail its scheduled aid. But instead
of doing the same, the AID presentation
indicates that the United States is going
to increase its aid substantially over last
year.
The others who belong to the con-
sortium have become so fed up with
Turkey's failure to deliver that they have
announced they will reduce their assist-
ance, but not the United States. We are
going to increase ours. When is this
mulcting of the American taxpayer go-
ing to stop? I say to the American tax-
payers, "It will stop when you, the tax-
payers, begin to recognize that your most
important business happens to be your
own government. When you begin to
exercise your responsibility of citizen-
statesmanship, the politicians will stop
it, and not until then."
That is why this Senator, difficult as
it has been over the years -to face the
kind of opposition that following this
minority role imposes upon him, has been
willing to stand up and challenge ad-
ministration after administration. To
date no administration has been able to
answer the facts that we have presented
in opposition to the shocking, wasteful
and inefficient foreign aid program that
has come 'to characterize our whole
foreign aid process.
DEBT DEFAULT BY TURKEY
Mr. President, the GAO report also
found that Turkey was by 1957 in arrears
on three loans, with the arrearages
amounting to $6.4 million. In May
1959, AID deferred for periods ranging
from 28 to 31 years all principal and
interest payments originally due be-
between 1956 and 1965.
When they did it, they did it 'with
American taxpayer dollars. I do not
intend to continue to vest that kind of
bureaucratic power in a group of little
bureaucrats down in Foggy Bottom.
The Government of Turkey is to make
the three interest and principal pay-
ments due between 1966 and the orig-
inal maturity dates pursuant to the orig-
inal repayment schedule, and make the
deferred payments after the original ma-
turity dates. But. interest will not be
charged on the principal and interest
payments that were deferred, which rep-
resents another grant of $31 million to
Turkey.
The dreary details of American aid for
importation of station wagons, for a
meatpacking plant that is virtually un-
used, for modernization of the state-
owned bituminous coal industry that
continues to sink deeper into indebted-
ness, and for grain storage silos whose
peak loads averaged less than 40 percent
of capacity are included in this GAO
report. It should be read by every cit-
izen who still believes that the foreign
aid program is designed to help the
world's unfortunate.
Much of it helps the politicians, the
in-crowd, the tyrants, the dictators
that control these countries. It lines
their pockets, and a little gets down to
the mass of the people.
The report states:
The Agency (AID) advised us that it had
encouraged Turkey to adopt necessary re-
form measures for management of its fiscal
and economic affairs. However, although ac-
tions taken by the Government of Turkey
were not satisfactory, the Agency decided to
not insist on a greater measure of coopera-
tion because of foreign policy considerations.
How do Senators like it? They know
what he has said is true. AID gave the
Turkish Government a slap on the wrist
and said, "Now, you must do better. You
ought to adopt some reforms." But _
when the reforms were not adopted, AID
continued to pour the taxpayers' money
in for what it considered to be foreign
policy considerations.
What foreign policy considerations?
There are no foreign policy considera-
tions that can justify this kind of waste.
It is Turkey that is dependent upon the
United States, not the United States that
is dependent upon Turkey. If war broke
out between Russia and Turkey, we all
know that our mutual security obliga-
tions would move this country in, and we
know what kind of war it would be. It
would be a nuclear war, and quickly.
Turkey should be required to come in as
an applicant for aid willing to meet rea-
sonable conditions we impose for the/
granting of aid. I propose to give the
Senate an opportunity, before the week
is Over, to vote on just such an amend-
ment.
Primary in these considerations are
the extensive intelligence and military
Installations operated in Turkey by thou-
sands of American personnel. They
largely explain why protests about Tur-
key's stagnating economy and misuse of
aid funds are brushed aside with refer-
ences to Turkey's being "vital to Ameri-
can security."
Our aid to Pakistan is in very much
the same category, and we seem to be
heading in the same direction with India.
The "forward defense" policy of aid is
not one of promoting economic freedom
of choice at all.
What is happening now in Laos and
Vietnam is typical of what would happen
in each of these peripheral countries
should it come under any pressure from
within or without. The American aid
that we send them now would be only a
drop in the bucket of what it would take
to prop them up under conditions of war
or near war.
Program loans to these countries are
17171
little better than outright grants and
should be stopped.
TECHNICAL COOPERATION
For many years, this descendant of the
point 4 program has been an almost un-
touchable segment of the foreign aid pro-
gram. But a close examination of its
current projects, and those in the com-
parable category in the Alliance for
Progress, indicates that technical co-
operation is moving far away from the
original point 4. Today, a major func-
tion of technical cooperation is the train-
ing of local police forces in internal
security matters. These programs are
zealously pursued by American authori-
ties even in countries like Panama and
Indonesia, where their uses are more
likely to be anti-American or anti-
British instead of anti-Communist.
In short, these programs are being con-
ducted in the countries where we have
little or no control over the purposes to
which they will be put. They include the
recent miltary junta-ruled countries of
the Dominican Republic, Honduras,
Ecuador, and Guatemala. Just what we
think we can teach the Dominican na-
tional Police that they did not learn for
themselves in Trujillo's day is hard to
guess. But we are trying.
We are undertaking similar endeavors
in Somalia, Chad, 'Tunisia, the Central
African Republic, Dahomey, the Ivory
?Coast, the Malagasy Republic, Niger,
Upper Volta, the Congo, and Ethiopia
in Africa. The programs are equally
widespread throughout Latin America
and Asia.
In few of these countries is there the
institutional framework that would make
them a wise undertaking. All we are do-
ing for most of them is making their
police ?:z.tes a little more efficient?may-
be. But we have not the sligl_test idea
to what use this efficiency will be put,
and whether it will advan:e any interest
of the United States.
In many ways, this kind of technical
assistance is the most dangerous aid pro-
gram ever undertaken by the United
States. Any reduction Congress makes
in it will be a step in the right direction.
The aid presentation for technical as-
sistance gives no real reason for the $9
million i-f3rease it plans over fiscal 1964.
AID declares that it is moving the capital
projects that have been under technical
cooperation into the development loan
category. But if so, what does it plan
to do with the money saved, plus the in-
crease over last year? Research is the
only explanation for this in the presenta-
tion.
If one ever had a semantic gimmick,
If one ever had an escape hatch, if one
ever saw a bureaucratic exit sign, it is
the word "research." Whenever we go
after them and ask them what they are
going to do with the money they save,
they say they are going to research
something. When we cross-examine
them as to what the research is to be,
they hedge. It is difficult to get any-
thing from them. They do not want
to give up the money. They do not want
to save money. They want to use it to
build another wing in their bureaucratic
building.
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17172 CONGRESSIONAL RECORD ? SENATE
We shall never accomplish foreign aid
reforms until the Congress does it.
Based upon years of experience, I can
say there is no such intention on their
part. There is no basis for any assump-
tion that we can rely upon the State
Department or the AID officials or the
Pentagon to save any money or to re-
form the waste and efficiency that char-
acterize and honeycomb the foreign aid
program.
Many of the other projects undertaken
in the name of technical cooperation
and assistance have a similar flavor of
political and military intrigue. In the
Near East and Asia, many of the trans-
portation projects seem to be directed
at military rather than commercial use.
In Afghanistan, for example, we have
a total program of $10 million worth of
continuing projects. One of them is to
plan a highway to the Iranian border.
Its justification is that it would give
Afghanistan an outlet in the West. But
we had already helped her build a high-
way to the Pakistani border for the same
purpose; then there were troubles be-
tween Afghanistan and Pakistan, caus-
ing the border to be closed, off and on.
It seems a great hypocrisy to call this
"technical cooperation," when it does
not appear that Afghanistan is as much
interested in having an outlet to the
West as we are in insisting that she have
one, no matter how much it costs the
American taxpayers.
Cyprus is another question mark.
Cyprus is down for many hundreds of
thousands of continuing projects. What
has happened to them during the civil
war? No one will ever know from read-
ing the presentation.
Turkey, of course, is the most shame-
ful failure of all aid recipients, not only
in the technical aid but in all categories
of aid. In technical assistance, many
of the programs we are maintaining .in
Turkey are designed to help Turkey run
her state enterprises. Shice it is these
state enterprises that are largely re-
sponsible for the stagnation of her econ-
omy, and the responsibility for their con-
tinuation is a political rather than a
technical problem, it is hard to see how
the United States is helping to improve
her economic situation by aiding in the
perpetuation of these enterprises. An-
other way of putting it is that we are
training Turks in socialism, and creat-
ing more bureaucrats who will have to
be employed in these establishments al-
ready suffering from bloated payrolls.
As for Thailand, one cannot read the
continuing projects there without con-
cluding that they are laying the founda-
tion for an American military operation
in Thailand. The so-called transporta-
tion projects include a four-lane high-
way from the country's main interna-
tional airport to Bangkok. From Bang-
kok, a two-lane highway is to continue to
the northeast area where the border with
Laos is threatened. Much the same pic-
ture is seen in the projects for aeronau-
tical ground services which are "intended
to make several airfields fit for military
use, as well as civilian." It is hard to see
where any civilian use in Thailand could
justify "several" airfields of this nature.
In sum, showing people how to live
better is on its way to becoming only an
adjunct to the technical cooperation pro-
gram, as it is to the rest of foreign aid.
It is the Peace Corps that is making the
greatest contribution to this cause.
AMERICAN SCHOOLS AND HOSPITALS ABROAD
In my opinion, the funds authorized
for this activity -rank high among the
most worthwhile expenditures made in
the name of foreign aid. Mr. President,
I shall vote for more money, not less
money, for that program. That program
aids people. Indeed, I have made a mat-
ter Of record my willingness to support a
larger sum for these purposes than the
administration requested.
A number of my committee colleagues
and I expressed great interest during the
hearings in providing assistance to Mex-
ico City College now renamed the Uni-
versity of the Americas. This eminent
institution certainly seems to qualify for
help under the aid category of American-
sponsored schools. Unfortunately, the
university had not submitted its detailed
application by the time of committee
action on the bill. I believe it likely that
the majority of members would have
voted to increase the authorization for
this section had they been in receipt of
data from the university which seemed
to require such action.
However, the committee was assured
by the Administrator and other AID offi-
cials that the university's application,
when forthcoming, would be reviewed
most sympathetically. We were also as-
sured that the funds requested ifor this
general purpose would be sufficient to
permit assistance to be granted to the
University of the Americas in fiscal 1965.
- I take this occasion to express my inten-
tion of seeing to it that this project is
not lost in the bureaucratic shuffle.
THE ALLIANCE FOR PROGRESS
As chairman of the Subcommittee on
American Republic Affairs, I yield to no
one in my deep interest in the countries
of Latin America and their progress with
economic and social reforms in the con-
text of democratic political institutions
and practices. I would certainly sub-
scribe to the words of the committee re-
port:
Dramatic breakthroughs and economic
takeoffs are unlikely in the absence of a
basic social and political reorientation in
most of Latin America.
But sadly inadequate emphasis has
been given to the fact that U.S. policy,
father than American public money, is
the instrument through which we can
best help our Latin American friends to
help themselves.
It is a truism that a change in the price
of a basic Latin American export com-
modity, such as coffee, by a few pennies,
or a reversal of capital flight from that
area, would have many times the effect
of all the financial aid which the United
States could possibly make available.
What is irreplaceable, on the other hand,
is a U.S. policy which actively encour-
ages democratic constitutional means of
governing and of tackling the fearsome
social and economic problems of the
Latin American countries. Regretfully,
one cannot avoid the conclusion that
August 3
such a policy still is not sufficiently in
evidence in Latin America.
Time and again we have reacted to the
military overthrow of a constitutional
regime by temporarily withholding rec-
ognition and foreign aid funds, and then
by granting them without any reliable
assurances that the new rulers are mov-
ing to reestablish constitutional and pop-
ular government. It is not merely that
such practices evoke justified criticism
from all parties involved; they serve to
undermine our entire overall policy to-
ward Latin America. Until the United
States unequivocally alines itself with
those democratic elements which are
trying to bring about peaceful revolution
in the social and economic spheres, the
Alliance for Progress will be a pious ex-
hortation rather than an instrument for
dramatic change.
Our "aid as usual" policy toward the
Dominican Republic, Guatemala, Hon-
duras, and Ecuador is the greatest single
threat today to the success of the Alli-
ance.
At any time when the Dominican Re-
public, Guatemala, Honduras, and Ec-
uador wish to set up a constitutional sys-
tem of government, at any time they
wish to return to democratic processes,
at any time they wish to announce
specific election dates for the holding of
democratic elections, the senior Senator
from Oregon Will start urging that we
give some attention to development loans
for those countries; but not until then.
Because it is clear that money alone is
not the key to the Alliance for Progress,
there is no reason why foreign aid re-
quests for Latin America should not be
scrutinized?and reduced when neces-
sary?on the same basis as AID pro-
grams in other world areas. Last year's
appropriations for the Alliance totaled
$455 million, but the administration has
requested $550 million under that head-
ing for fiscal year 1965. Although the
overall foreign aid appropriation should
be gradually reduced each year, this
should not involve a rigid approach which
would inevitably cut each and every com-
ponent of the act. Therefore, I am rec-
ommending $465 million for the Alliance
in the 1965 authorization, or an increase
of $10 million over last year. Of this
total, $80 million would be for grants?
the same figure as in 1964?and $385
million would be devoted to development
lending.
I would be willing to add to this
amount whatever millions of dollars
Congress would be willing to strike from
the military aid program to Latin Amer-
ica. A good many millions of dollars
should be stricken from it. I would be
willing to add to the development loan
program the savings which Congress
wishes to make on military aid payments
or loans to Latin America.
My reasons for cutting $5 million from
the administration request for Alliance
grants stem from a painstaking exam-
ination of the presentation material. On
the basis of listing: projects which
seemed inadequately justified? unduly
extended?often for 15 or 20 years?or
otherwise of dubious value, I might have
sought a precise cut of $8,243,000 had I
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1964 CONGRESSIONAL RECORD ? SENATE
not again preferred to err on.the side of
caution.
I would return that cut on the basis
of the submission on the part of the AID
officials of the type of hard money loans
that I referred to earlier in my speech,
related to specific projects, to be drawn
upon as the projects are built.
In two major countries we make tech-
nical assistance grants to encourage the
production of export items which are sur-
plus in the United States. In a number
of cases there are projects which involve
the United States in paying local ex-
penses which could be met by the Latin
American country concerned. In other
cases the United States is making grants
of both heavy and light equipment which
properly should be purchased by the local
government with the proceeds of a de-
velopment loan. The ill-advisability of
training and equipping of police forces
in totalitarian states is discussed in the
section on technical cooperation. It is
for these reasons that it seems correct
to hold grants at last year's level while
providing $10 million more for lending.
There should be no confusion about my
position regarding technical assistance
for Latin America and other regions of
the world. So long as this cooperation
is extended in terms of working with
fellow human beings through education
and training in productive activities, it is
of supreme value and it is self-justifying.
But this fine program must be kept sepa-
rate from the provision of capital equip-
ment, other material, and commodities.
Development loans obviously are required
In order to make such provision, but we
must also make it as certain as possible
that loans are confined to those pur-
poses, and not devoted to budgetary and
balance-of-payments support. The com-
ments made elsewhere in these individual
views concerning the Development Loan
Fund are equally valid in the Latin
American context.
One further point about the Alliance
for Progress. There is no activity in
Latin America which is more important
in terms of reaching the people than the
construction of decent, low-cost housing.
Yet all indications are that there has
been too little movement in this sphere,
despite the special authority in the For-
eign Assistance Act. I strongly urge far
greater attention to this subject by AID
officials on an immediate basis.
SUPPORTING ASSISTANCE
It is inexcusable that the administra-
tion request for supporting assistance
funds should be raised over the amount
available last year; even before the spe-
cial request for additional money for
Vietnam was sent to Congress. The
Mansfield amendment of 1959 called for
an eventual phasing out of these finan-
cial grants. Yet $335 million was ini-
tially requested, compared to $330 mil-
lion appropriated last year. On top of
this, $70 million more was later requested
for Vietnam, bringing the total to $405
million.
Congress has suffered in the past from
the shifting by AID of supporting aid
funds away from the purposes presented
in the hearings into other uses. If past
experience is any guide, it is more than
likely that much of the supporting assist-
ance requested for Vietnam will be used
elsewhere.
The $30.3 million reduction in this
category by the full Committee is not
enough. Three countries in Latin Amer-
ica, for example, are scheduled to receive
supporting assistance. One of them is
Haiti. Although the program being sup-
ported is malaria eradication, our pro-
gram is in addition to UNICEF and Pan
American Health Organization prodams
in Haiti for the same purpose, to which
we also contribute. The brutality of the
Duvalier dictatorship in Haiti is not ex-
ceeded even in Castro's Cuba. There is
no more reason for the United States to
maintain a unilateral health program in
Haiti than in Cuba, or for that matter,
in Communist China.
Supporting assistance aid to Bolivia
simply undercuts the requirements of the
Alliance for Progress and underwrites-
the incredible mismanagement of the
government-owned tin mines. As with
Turkey, the excuse for this aid is the old
reliable Communist bogeyman, and the
result is the subsidizing by American tax-
payers not only of Socialist enterprises
but of outrageously inefficient Socialist
enterprises. In ?the case of Bolivia, we
have been suPporting these tin mines
with their grossly padded payrolls since
1954 and there is no end in sight so long
as the word is out that there is more
supporting assistance coming from the
United States. Why should Bolivia
change so long as she can scare money
out of us?
Jordan and Yemen will account for
another large chunk of supporting assist-
ance. Despite the pretentious and glow-
ing references to Jordan's "progressive"
government in the presentation, there
are no plans for loan aid to Jordan in
this year's budget, and one of the three
remaining capital projects under teoh-
nical cooperation is also in Jordan.
Nothing but grant money is planned for
Jordan this year because with her pres-
ent policies she is an economic impossi-
bility. The presentation uses the phrase:
"Eventual viability may be more securely
rooted" in Jordan. That is the best
outlook.
Much of Jordan's poor outlook is di-
rectly due to her expenditure of $60
million for defense. Offense is probably
the better word. Jordan's army is con-
cerned with nothing in the world but
Israel, and King Hussein has made it
quite clear that he is ready to move
against Israel if the Jordan River project
goes through. If he does, it will be only
because the United States has subsidized
his military establishment since 1957
through supporting assistance grants.
Jordan is not of interest exclusively to
the United States. If she needs subsi-
dization to exist, in the same way the
Congo does, she should become an inter-
national ward, supported- by some kind
of consortium. That might also reduce
the military threat she poses to Israel.
But so long as.the United States furnishes
her this wad of money as a military sub-
sidy, this willneVer happen. The contri-
butions to her budget from Britain are
very small, compared to ours, and Jor-
dan's other sources of aid are loans, not
grants. At the rate we are going in Jor-
17173
dan, it will be the American taxpayers
who will repay these loans. The budget
support to Jordan should be cut by sev-
eral million this year, so a start can be
made toward a longrun solution to Jor-
dan's problems.
In Yemen, we are giving supporting as-
sistance to a government that is little
more than a creature of Nasser's, and
that is still fighting against a royal gov-
ernment that is in turn backed by
Britain.
Unilateral American aid to Yemen is
in the same class with aid to Sukarno.
Worse yet, a good half of it is for high-
way construction that is of far more mili-
tary significance to -Yemen now than
commercial significance. This aid is
nothing but an attempt at political in-
trigue. It should be stopped until the
civil war there is over.
In the Far East, South Korea, Laos,
Thailand, and South Vietnam are sched-
uled to receive large amounts of sup-
porting assistance. Although much is
claimed in the presentation for South
Korea's economic prospects, no reason
is given why supporting assistance to her
is being increased over last year. It is
all nonproject aid, and although the
presentation indicates that it will be re-
leased only in increments as the South
Korean Government makes good on its
promises of economic reform, I see no
reason why more should be provided than
was provided last year.
Moreover, the only other non-Ameri-
can aid to Korea is taking the form of
loans. As with Jordan, the United States
will end -up repaying these loans unless
we develop a more effective program in
Korea.
The Optimistic note in the presentation
book about Korea's future depends heav-
ily upon its renewing aid and trade ties
with Japan. The people of Korea, in-
cluding the young people who rioted re-
cently against this policy, should under-
stand that the United States is not going
to underwrite indefinitely their emotional
aversion to Japan, however real it may
be. We do underwrite it when we raise
their budget support considerably over
last year.
This large sum for Korea is also a re-
sult of the 600,000-man Korean Army
we are supporting, in addition to the 50,-
000 American troops in Korea. This
compares with figures I have seen that
the North Korean Army is about 400,000.
, No good reason has ever been offered for
? maintaining this vast preponderance of
military force in South Korea. The lat-
ter's army should be brought down at
least to 500 000 and preferably to 400,000.
The levels of supporting assistance to
Laos and South Vietnam are indicative
of what- we face in every other under-
developed country where we are main-
taining large military aid programs. The
presentation books stress over and over
again the meager economic resources of
these countries and the high concentra-
tion of military activity. The result is
that the United States finances a West-
ern-style war effort, in feudal countries.
It costs us a yearly average of about $40
million in Laos, a country of 2.5 million
people, exclusive of military aid. In
South Vietnam, it has run about $130
million for economic aid, with this year's
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17174 CONGRESSIONAL RECORD ? SENATE
level much higher, in a country of 15
million. In both countries, much of this
money goes for the enrichment of ruling
classes and factions that we hire to fight
communism.
Anyone who thinks the United States
gains something by maintaining these
indigenous armies in underdeveloped
countries around the world should figure
out first how much we would have to
subsidize any one of them if it became
involved in any kind of a war.
The figures for Korea, Laos, and Viet-
nam should be a lesson to us, because
in addition to direct action by the
U.S. Armed Forces, it would cost us bil-
lions of dollars to subsidize a war effort
in such countries as Turkey, Greece, Iran,
Taiwan, or any of the others whose mili-
tary establishments are creatures of the
United States.
CONTINGENCY FUND
Once again, the uses of the con-
tingency fund were advertised as being
for unforeseen emergencies. But one of
the largest transfers out of contingency
funds was $50 million into development
loans to make a "program loan" to
Brazil. Other uses of the contingency
fund have been $38 million for Viet-
nam?in addition to its programed funds
and the special request of $125 million?
and a transfer of $75 million into mili-
tary assistance. All those obligations
were entered into only in the 2 months
before Congress acted on the foreign aid
bill.
Use of the contingency fund for
Brazil's balance-of-payments problem
continues to typify the abuses of this
fund. This is neither an unforeseen nor
an emergency situation. The con-
tingency fund only provides the loophole
whereby Brazil evades the stipulations
of the Alliance for Progress.
The use of the fund alone justifies a
$50 million cut.
MILITARY ASSISTANCE
There is no part of foreign aid on
which the Congress has received a worse
flimflam from the executive branch
than on military assistance.
One of the major criticisms leveled by
both the Clay Committee and the Senate
Foreign Relations Committee last year
was that we had too many token mili-
tary aid programs that seemed to be de-
signed merely to give the American mili-
tary a presence in most countries out-
side the Communist bloc.
Figures prepared for the hearings at
my request indicate that the total num-
ber of countries receiving military grant
aid in fiscal 1965 will be 55, compared to
63 in fiscal 1964. However, the March
1964 publication from the Defense De-
partment called "Military Assistance
Facts" includes an estimate that 62
countries will receive grant military aid
in fiscal 1965, and that 10 more coun-
tries will acquire American arms through
direct or credit purchases.
If there is in fact any reduction
planned in the total number of countries
receiving grant military aid next year, it
does not show up in the request for
$1,055 million. These is no explanation
of why we are sending the same total aid
to fewer countries, if that is in fact what
we are doing.
On March 6 of this year, the General
Accounting Office issued another of its
periodic reports that have consistently
found extensive waste in military aid.
This one reported that the Defense De-
partment has continued to maintain
large military aid staffs in the countries
of Western Europe even though military
add to them is being phased out.
The report also stated that these mili-
tary aid missions continue to prepare
military add plans even though no more
grant aid is supposed to go to these
countries.
To quote from the GAO report:
We found that in 1962, when the value of
grant aid deliveries to eight of the countries
covered by our review was $190 million, the
Military Assistance Advisory Groups in these
countries were staffed in total with approxi-
mately 345 U.S. personnel or 56 percent of
the level maintained to administer programs
during the peak year of 1953, when the value
of grant aid deliveries was $2.3 billion. * * *
The failure to eliminate or reduce the
Military Assistance Advisory Groups' func-
tions and to make appropriate reduction in
the number of personnel assigned, as the
military assistance programs were accom-
plished or reduced, has resulted in the un-
necessary expenditure of millions of dollars
overseas; the ineffective utilization of highly
skilled, highly trained personnel; and the
continued but unnecessary support overseas
of the dependents of many Military Assist-
ance Advisory Group personnel. * * * The
Department of Defense furnished us with
comments in response to our findings and
proposals for corrective action by letter dated
July 25, 1963, classified secret. The Depart-
ment of Defense has informed us that a
worldwide review is now being made of the
missions and functions of Military Assist-
ance Advisory Groups to determine the feasi-
bility of reducing U.S. representation abroad.
We believe that immediate personnel reduc-
tions can be made by eliminating or reduc-
ing functions now being performed by these
groups. We intend to make a followup re-
view at a later date, and at that time we will
examine into the adequacy of the Depart-
ment of Defense's action to reduce or elimi-
nate the .staffs of the Military Assistance
Advisory Groups in the countries in-
volved. * * ?
Although virtually no additional grant aid
Is to be provided to the eight Western Euro-
pean countries, we were advised by the
MAAG's that they are continuing to prepare
military assistance plans. In France, the
plans were being prepared in the same detail
and on the same basis as though grant aid
were to continue, whereas, in other countries
the plans were being updated and revisions
were being made as necessary.
Secretary McNamara, in his testimony
to the Foreign Relations Committee,
pointed out that only Denmark and Nor-
way in Western Europe are receiving
grant military aid in fiscal 1965, and that
no new commitments are being made in
Europe. Yet the military aid budget
does not reflect any curtailment any-
where of small aid programs or of over-
sea missions.
A real deception of Congress took place
in connection with Vietnam. The orig-
inal 1965 budget reduced military aid to
South Vietnam considerably below the
level of fiscal 1964, and parcelled it out
to other countries. Then the President
sent a special message to Congress claim-
ing that conditions in Vietnam were so
critical that an additional $55 million for
military aid was needed- to meet that
emergency. The addition only brings
August 3
South Vietnam's military aid back to
last year's level.- ?
Those of us who have'been?through 15
years and more of that kind of shell
game from various administrators can
no longer take at face value anything
about aid that is told us by either mili-
tary or civilian officals. In the case of
this "bare bones" request, the funds
available for military aid this year in-
clude not only the $1,055 million in new
appropriations, but $25 million which
was unspent last year and for which re-
appropriation is requested, $135 million
which is expected to be recouped from
cancellations, price changes, and various
slippages, plus a continuing standby au-
thority to use $300 million in Defense
Department stocks when the President
finds it "vital to the security of the
United States." In recent weeks, $75
million in contingency funds has also
been used for military assistance.
This means there is really available
not $1,055 million but $1,515 million for
military assistance, plus the contingency
funds. It is why an eventual cut of $500
million in military aid would be one of
the soundest steps that could be taken
toward a sound and useful long-range
foreign aid program.
It is becoming clear from the testi-
mony Congress receives year in and year
out that the Pentagon has come to con-
sider military aid a permanent program.
Each year, the requests are justified with
accounts of Greece or Pakistan or some
other country using obsolete equipment
that must be replaced by the United
States to keep it current with Bulgaria
in the case of Greece, and to keep cur-
rent with India, in the case-of Pakistan.
It is about time that the Pentagon were
required to produce some long-range
plans for what it expects of military aid
in the future. We should find out wheth-
er these countries are going to have their
obsolete equipment replaced by us for-
ever, and by whose standards it is obso-
lete. For example, a perennial favorite
is the claim that countries in the Far
East need new jet planes. But the only
conceivable enemy against which we are
arming them is Communist China, whose
jet aircraft from the Soviet Union was
cut off several years ago and who does not
produce its own jets. Published esti-
mates put the Chinese jets at the period
of about 1956.
There is no reason for upgrading the
level of any military forces in the Far
East above that of Communist China,
whose air, naval, and mobile capability is
very low.
Future Pentagon estimates for milita:7
aid should also include ,an estimate of
how much it would cost the United States
to finance a war effort in each country
receiving military assistance. We are
told, for example, that Taiwan no longer
receives huge sums-of economic aid, but
she continues to receive large quantities
of military aid. All this means is that
Taiwan still cannot support a large
peacetime military establishment. How
much would it cost the United States to
underwrite a war waged by Taiwan?
It continues to be my opinion that any
military aid given to a country in peace-
time is only a small fraction of what it
would cost the United States to support
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CONGRESSIONAL RECORD ? SENATE
that country in time of war, if indeed, we
decided to support it at all. Such na-
tions are not allies against communism;
they are only dependencies. It is worst
of all to continue giving large-scale,
Western-style military aid to nations
that have no prospect of being able to
support a modern war out of their own
economies in the foreseeable future.
It is not these indigenous forces that
deter China or the Soviet Union; it is the
likelihood of American response to an in-
vasion of any one of them.
We are having a hard enough time
trying to advise the South Vietnamese
how to fight, after giving them the most
modern equipment, without committing
ourselves to the same undertaking with
the several million foreign soldiers we
keep .under arms under the pretext that
they are contributing to free world de-
fenses.
The most astonishing testimony of all
has been that this amount of the request
is needed to upgrade the armed forces of
Greece and Turkey. Why we should ad-
vertise that we cant to do even more than
we have in the past to prepare them to
fight each other, I cannot imagine.
A 20-percent reduction in the military
aid for both Greece and Turkey, and for
Pakistan and India, would' do more to
end the quarrels over Cyprus and Kash-
mir than all the high level conferences
held to date. The spectacle of stoking
their war machines while we beg them to
be peaceful is as much a reflection upon
Congress as upon the executive branch.
CRITICAL REPORTS FROM GENERAL ACCOUNTING
OFFICE CONTINUE
Reports by the U.S. Comptroller Gen-
eral criticizing the aid program in Turkey
and the size of military aid missions in
Western Europe have already been cited.
But there are other reports, too. They
continue year in and year out to cite ex-
amples of wasted money in the foreign
aid program. These reports are in no
sense a comprehensive review of aid;
they are only reports of practices un-
covered in spot checks.
On March 5, 1964, the Comptroller -
General summarized as follows a report
on "Certain Economic Development
Projects for Assistance to Central Treaty
Organization":
Because the availability of local resources
was not adequately explored, grant and loan
funds aggregating more than $8 million were
used for purposes other than those for which
they were initially obligated and for financ-
ing imports which were not needed or could
be produced in the recipient country. Fur-
thermore, the economic feasibility of the
three projects for which the funds were obli-
gated was dubious and, as conditions existed
at the time of our review, there was no as-
surance that two of the three projects in-
volved would ever be completed.
In light of the foregoing findings, we sug-
gested certain basic policy guides for con-
sideration by the Agency. The Agency ex-
pressed agreement with the principles of our
proposals but claimed that the origin and
objectives of the projects were primarily po-
litical and that its decisions and actions in
the implementation of the projects were con-
cerned principally with the achievement of
political success.
The annual program presentations to the
Congress on three of the projects did not
fully disclose the unusual circumstances and
the problems which have attended the proj-
ects. Moreover, the presentations were in-
complete and inaccurate and indicated that
the aid provided to these projects was more
effective than was actually the case. We are
repeating our recommendation made in pre-
vious similar instances, that the Agency
make more informative, clear, and accurate
disclosure of significant data in annual pro-
gram presentations.
On March 12, 1964, a report was sent
to Congress on "Unnecessary or Prema-
ture Procurement of Sidewinder Missile
Training Systems and Their Delivery to
Foreign Countries Under the Military
Assistance Program." It said in part:
Tow target systems costing in excess of
$1 million, designed for training pilots in
the use of Sidewinder missiles, were uneces-
sarily or prematurely delivered to 11 foreign
countries because responsible Department
of Defense agencies had not given considera-
tion to the countries' inability or unwilling-
ness to use the systems. Six countries were
unwilling to use the tow target systems for
reasons of safety and cost, and five countries
did not have the equipment, missiles, or.
test programs to enable them to use the
tow targets at the time of delivery. An addi-
tional $240,000 had been expended by the
Air Force for tow targets for which no firm
requirement existed and which were. never
delivered under the military assistance pro-
gram. These targets were still in storage
at the time of our review.
In commenting on our findings and pro-
posals, the Department of ?the Air Force
advised us that action had already been taken
or was underway to recover the excess equip-
ment in six countries and that no immediate
action was proposed in five cOuntries because
utilization had been planned.
With regard to the procurement of un-
needed tow targets that were never delivered
to recipient countries and are now in stor-
age, inasmuch as the Department of the Air
Force failed to comment on our finding, we
are recommending that the Secretary of De-
fense require that an appropriate inquiry be
made to determine the reasons for the Oyer-
procurement and which persons were re-
sponsible so that appropriate corrective and
disciplinary measures may be taken.
Our reports on the military assistance pro-
gram over the past 7 years have shown that
a basic deficiency in the administration of
the program has been the failure of the
Department of Defense to limit material de-
liveries in accordance with the capability of
the recipient countries to maintain and
utilize equipment even though this is re-
quired by the Department's own regulations.
Accordingly, we have recommended to the
Secretary of Defense that these regulations-be
strengthened by requiring that future de-
liveries of major end items included in ap-
proved military assistance programs be made
only upon a written certification by the
Chief of the Military Assistance Advisory
Group based on a specific determination
that the recipient country has the necessary
capability to effectively absorb, maintain,
and utilize the item to be delivered.
The Department of Defense has disagreed
with our recommendations and has main-
tained that, under current directives, the
Military Assistance Advisory Group Chiefs
have the continuing responsibility for
screening undelivered military assistance
program materiel and for taking timely can-
cellation or deferral action where delivery of
materiel is not consistent with host country
capability to absorb, maintain, and utilize
the equipment. The Department of Defense
maintained also that certification by the
Military Assistance Advisory Group Chief
would serve no significant useful purpose.
We believe that such a certification re-
quirement would encourage a current re-
appraisal'of the need for the equipment and
17175
the country's capability to maintain and
utilize it before it is delivered and would help
to prevent future deliveries of military as-
sistance program materiel in excess of the
country's capability to effectively absorb,
maintain, and utilize the items delivered.
Military assistance program materiel has con-
tinued to be delivered for a number of years
to countries which cannot effectively absorb,
maintain, or utilize the equipment and has
been the subject of numerous reports to the
Congress and the Secretary of Defense, even
though during that time the Military Assist-
ance Advisory Groups have been charged
with the responsibility of preventing this
from occurring. We therefore believe that
affirmative action by the Military Assistance
Advisory Group Chief before delivery should
be required.
In view of the position of the Department
of Defense with respect to this matter, the
Congress may wish to consider the enact-
ment of legislation requiring additional safe-
guards before delivery of military assistance
program materiel. We shall be pleased to
assist in drafting such legislation if desired.
Certainly the inclusion of legislation
along this line must be considered at the
next drafting of foreign' aid legislation.
On June 17, 1964, a report was received
on "Ineffective Administration of U.S.
Assistance to Children's Hospital in
Poland." It said in summary:
Our examination into the U.S. assistance
to a children's hospital in Poland, for which
about $2.2 million in dollars and the equiva-
lent of $8.3 million in U.S.-owned Polish cur-
rency has been appropriated, disclosed an
almost complete lack of U.S. Government
surveillance of project activities. Conse-
quently, U.S. officials were not aware of cer-
tain unfavorable financial and operational
factors attending this project.
We found that cost estimates submitted
to the Agency for International Development
did not include supporting details and that
the Agency had not made a proper review
and evaluation of the estimates. We found
also that (1) the Agency disbursed more
funds to the private sponsor of the hospital
than were provided for in the original grant
agreement, (2) the sponsor had incurred
costs in excess of the maximum amount
provided for in the original grant agreement
and in excess of the erroneous amount dis-
bursed by the Agency, and (3) the sponsor
continued to incur costs even though all
available funds were exhausted. We found
further that the hospital may not be ade-
quately staffed for effective operation at the
time of its completion. We believe that this
loose administration was caused in good part
by a failure to define Agency responsibility.
The Agency made a commitment in August
1961 to finance the local currency costs of
constructing the hospital on the condition
that the sponsor would attempt to raise from
private contributions in the United States
the dollar funds required for certain mate-
rial and equipment not available in Poland.
The Agency made this commitment in the
face of overwhelming evidence at the time
that the sponsor would not be able to raise
the dollar funds and that U.S. Government
dollar financing would ultimately be neces-
ssary to complete the hospital. As far as
we could determine, the Agency did not pre-
sent this matter for the consideration of the
'Congress prior to making the commitment.
At the time of our review, construction
was well underway with Polish currency
made available by the Agency but the sponsor'
had raised only a fraction of the dollar re-
quirement and reported that no prospect
existed for raising the dollars. Consequently,
in order to complete the hospital, the Agency
requested $2.2 million in dollars for the hos-
pital in its fiscal year 1964 budget presenta-
tion to the Congress. The request was made,
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17176 CONGRESSIONAL RECORD - SENATE
notwithstanding the then existing prohibi-
tion against giving dollar aid to Communist
countries. The funds were appropriated in
the Foreign Aid and Related Agencies Appro-
priation Act, 1964, approved January 6, 1964.
In requesting funds for the hospital in its
budget presentations to the Congress for
fiscal years 1963 and 1964, the Agency did
not disclose the unusual circumstances and
problems which have attended this project,
as described in our report, and furnished in-
complete and inaccurate information regard-
ing some of the financial and operational
aspects of the project. Also, because the dol-
lars were not available when needed, comple-
tion of the hospital will undoubtedly be de-
layed considerably beyond its scheduled
date.
The comments of the Agency for Interna-
tional Development, concurred in by the
Department of State, reflected general dis-
agreement with our findings and conclu-
sions. After an analysis of these comments
and further review of files and records, how-
ever, we concluded that the Agency had pre-
sented no information which would causes a
significant change in our basic report with
respect to our presentation of the facts or
the conclusions drawn.
We believe that, in addition to the correc-
tive actions cited in the report, it is incum-
bent on the Agency for International Devel-
opment to take steps to assure that arrange-
ments have been worked out for adequate
staffing of the hospital. Also, we are again
recommending that future annual foreign
aid budget presentations to the Congress
describe projects and other significant ac-
tivities in such clarity and specifics as will
facilitate a full and correct understanding
by the Congress of their scope, status, and
administration.
On June 29, Congress received a report
on "Deficiences in Administration of the
Earthquake Reconstruction and Reha-
bilitation Program for Chile." It said in
summary:
On the basis of our review of projects fi-
nanced under the reconstruction and reha-
bilitation program in Chile following the
earthquakes in May 1960, we believe that
serious problems were encountered because
the Agency for International Development'
did not adhere to accepted standards of pro-
graming and project planning for the large
number of projects included in such a vast
program.
For the most part, no meaningful review
was made of the Government of Chile's plans,
specifications, and cost estimates for the
projects undertaken. The Agency did not ad-
just the size and makeup of its mission staff
to meet the tremendous expansion of assist-
ance to Chile under the earthquake program.
Also, appropriate consideration was not given
to the abilities of the various agencies of the
Government of Chile to carry out their part
of the program. As a result, serious cost
overruns and delays occurred in many proj-
ects and a number of projects had not been
completed, or in some cases had not been
started, some 3 years after the earthquakes
and substantially after their estimated com-
pletion dates.
For a substantial part of calendar year
1962, the maximum rate of exchange was not
obtained for dollars disbursed under the
earthquake reconstruction program. The re-
sulting loss to the earthquake program was
estimated to be in excess of 26 million Chil-
ean escudos, the equivalent of $13.8 million
on a most conservative basis. As a practical
matter, it can be said that earthquake re-
construction funds were used for a period of
time to subsidize and help maintain the
Chilean escudo at a rate that was known to
be overvalued in relation to the dollar.
Despite the disbursement of large sums in
calendar year 1961 and 1962 under this pro-
gram, Chilean imports from the United
States declined in those years, both in dollar
value and in relation to total imports. Also,
we noted that several earthquake recon-
struction projects were adversely affected be-
cause of Chile's shortage of foreign exchange,
despite the fact that $120 million we being
supplied under the earthquake program, and
the amount of foreign exchange required for
earthquake projects was relatively minor.
We are recommending that, in future agree-
ments providing dollar financing for proj-
ects or programs consisting principally of
local currency costs, adequate provision be
made requiring -the utilization of the dollars
so provided for any direct foreign exchange
costs of the specific projects or programs be-
ing financed.
To the extent deemed appropriate, the
comments of the Agency on our findings
have been included in this report. The
Agency's comments on the exchange rate
matter, together with our evaluation of such
IMIAugust 3
comments, are contained in a supplementary
report which has been classified as "confi-
dential."
In May, two more reports were re-
ceived. They concerned waste in the
military aid programs to Indonesia and
Ethiopia, and both were marked "classi-
fied."
This year's reports on foreign aid are
only typical of those Congress receives
every year. The answer always comes
back: "Some waste must be expected in
a program of this size." But I do not
know of any Federal program of any size
where so much known waste of money
continues with so little action being
taken to stop it. So long as these critical
reports on foreign aid come in from the
General Accounting Office, I shall con-
tinue seeking to reduce and tighten the
program.
CONCLUSION
On the basis of the foregoing discus-
sion and other information which can-
not be made public, I am recommending
cuts totalling $466,700,000 less than the
figures approved by the Committee on
Foreign Relations. This would bring the
overall foreign aid authorization to the
$3 billion level of new money which was
appropriated last year.
If this is a barebones request, then
at least not a dollar should be asked for
above what was asked for last year.
Also, when we have received promises
that we would move toward reducing,
year by year, instead of increasing, we
ought, at least, not to vote for more
money than was made available last year.
This is not a barebones program at all.
The administration is asking for more
money than it got last year. There is
a great deal of fat hanging on the so-
called skeleton of this year's program.
Mr. President, I ask unanimous con-
sent to have printed at this point in the
RECORD the table giving the statistical
details of my proposal.
There being no objection, the table
was ordered to be printed in the RECORD,
as follows:
Appropriation,
fiscal year
1964
Administration
appropriation
request, 1965
House
appropriation
bill
Senate
Foreign
Relations
Committee
Reduction by
Senate Com-
mittee from
administration
request
Recommended
further cuts
Recommended
Senate
authorization
Pt. I. Economic: .
Ch. 2. Development assistance:
Title I: Development loans
$687, 300, 000
$922, 200, 000
$782, 200, 000
(')
$140, 000,000
$782, 200, 000
Title II:
Technical cooperation, develop-
.
ment grants
155, 000, 009
224, 600, 000
204, 600, GOO
$215, 000, 000
$9, 600, 000
215, 000,000
American schools and hospitals_
19, 000,000
18, 000, 000
18, 000, 000
18, 000, 000
18, 000, 000
Title IV: Surveys of investment
opportunities
(1)
2, 100, 000
2,100, 000
-2, 000, 000
100, 000
2,000, 000
Title VI:
Alliance for Progress loans
375, 000,000
465, 000, 000
425, 000,000
(9
80, 000, 000
385, 000, 000
Alliance for Progress grants
80, 000, 000
85, 000, 000
85,000, 000
85,000, 000
5,000, 000
80, 000, 000
Ch. 3. International organizations
116, 000, 000
134, 400, 000
134, 272, 400
134,400, 000
184, 400, 000
Ch. 4. Supporting assistance
330, 000, 000
405, 000,000
405, 000, 000
374, 700, 000
30,300, 000
11,700, 000
363, 000, 000
'Oh. 5. Contingency fund
50, 000,000
150, 000, 000
150, 000, 000
150, 000, 000
50, 000,000
100, 000, 000
Pt. II. Military
1, 000, 000, 000
1,055, 000,000
1, 055, 000, 000
1,045, 000, 000
10, 000, 000
180, 000,000
865, 000, 000
Pt. III. Administrative expenses:
AID
50, 000, 000
52, 500, 000
52, 500, 000
52, 500, 000
52, 500, 009
State Department
2, 700, 000
2,900, 000
2, 900, 000
(I)
2, 900, 000
Pt. IV. Other laws: Latin American development
135, 000, 000
,
Total
3,000, 000,000
3, 516, 700, 000
3,316, 572, 400
. 2, 076, 600, 000
50, 000, 000
466, 700, 000
3, 009,000, 000
Previously authorized.
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CONGRESSIONAL RECORD ? SENATE 17177
Mr. MORSE. It will be noted that in
virtually every category but military as-
sistance my recommended figures exceed
the amounts appropriated for fiscal year
1964. The fact of this excess should
counter the tortuous argument for in-
creases based on carryovers, deobliga-
tions, and so forth?an argument which
plagues and distorts our debates on the
subject of foreign aid each and every
year.
Needless to say, I am convinced that
any authorization for a foreign aid pro-
gram of more than $3 billion is not in the
national interest, and is actually inimical
to the individual American taxpayer.
The foregoing explains the conclusion
I set forth in my individual views on the
bill as it came from the Foreign Rela-
tions Committee?that it has become one
of the most stagnant, unproductive, and
misrepresented of all Federal activities.
It is stagnant because its objectives are
till tied largely to American strategic in-
terests of the 1950's; it is unproductive
because much of it goes for uses that
neither build nor develop; and it is mis-
represented because in spite of all the of-
ficial handwringing pleas that we help
the underprivileged and depilved people
of the world, not more than 40 percent of
it goes for that purpose. Little of it
actually ends by helping them.
The basis of my approach to foreign
aid is that it must serve the interests of
the United States. I believe in "strings"
on aid. Congress may spend public
money only for the general welfare of the
United State's, not for the general wel-
fare of any other people, no matter how
deserving they may be.
My difference with much of the pro-
gram is over what really does serve the
interests of the United States. I do not
believe that aid extended for military
reasons, security reasons, or for reasons
of political intrigue serves our long-run
interests, and this is a long-run program.
Foreign aid should be primarily develop-
mental and for specific developmental
projects, with the short-run considera-
tions very secondary, instead of the other
way around.
Unless and until it is put on that basis,
foreign aid will remain a dole, and its
recipients will be either dependencies of
the United States?like Vietnam?or
they will take our military aid and then
use it for their own national purposes
which may be quite contrary to our own.
There is no longer any expectation
that the administration will revamp for-
eign aid toward these ends. It is there-
fore up to Congress to do it.
Mr. President, when I say that it is
. up t6 Congress to do it, I mean it is up
to the Senate Committee on Foreign
Relations and the House Committee on
Foreign Affairs to assume major respon-
sibility in bringing about changed poli-
cies in foreign aid. The committee re-
port of last year promised it; the com-
mittee report of this year did not fulfill
that promise.' We cannot square the
report of the Committee on Foreign Re-
lations this year with the promises of
ast year. The committee has given us
ir ore of the same. The majority has
p ed the buck again. It will be from
A No. 149-6
downtown, and not on Capitol Hill, that
any reform will come, so far as this
year's report is concerned; but we shall
wait in vain if we wait for any reform
in policy concerning foreign aid from
anywhere downtown.
I said earlier in my speech that this
Is a legislative responsibility under our
system of checks and balances. I do not
like to stand on the floor of the Senate,
year after year, and criticize the body
of which I am a Member; but I have
been doing so for several years, and I
shall continue to do so until the Senate
starts to assume its responsibility for a
reform of foreign aid as a matter of
policy. The Senate did start the job
last year; but the Foreign Relations
Committee has not advanced the work.
It is up to the Senate itself to continue
the job.
To the American people, I say: "You
have a responsibility, as individual citi-
zens, of making a study of exactly what
the foreign aid policy of your Govern-
ment is. I know that many of the facts
will be kept from you under the secret
label; but enough has already been made
public by those.: of us who in the past
several years have made the record each
year as to the shortcomings of foreign
policy. It is for you, the people, to start
to demand of your officeholders that if
they want your continued support, they
had better get on the job in reforming
foreign aid as a matter of policy.
Before the week is out, I shall offer
some policy amendments, at least for
educational purposes. Sooner or later?
and I hope this might be the year?some
of the policy changes will be demanded
by Congress by writing them into the
bill.
Mr. President, that is my case. This
Is my first speech this week on the sub-
ject. I am pleased to rest on that case.
If it meets with the approval of the
majority leader, I shall suggest the ab-
sence of a quorum.
Mr. MANSFIELD. Mr. President, will
the Senator withhold that request?
Mr. MORSE. I withhold the request.
Mr. MANSFIELD. Has the Senator
,frielded the floor?
r. MORSE. I yield the floor.
AID FOR DEPENDENT CHILDREN OF
UNEMPLOYED PARENTS IN THE
DISTRICT OF COLUMBIA
During the delivery of Mr. MORSE'S
speech,
Mr. RIBICOFF. Mr. President, will
the Senator from Oregon yield to me?
Mr. MORSE. Mr. President, I am glad
to yield to the Senator from Connecti-
cut [Mr. RIBICOFF], with the under-
standing that the interruption will ap-
pear elsewhere in the RECORD, and with
the further understanding that it will
not interfere with my rights to the floor.
The PRESIDING 0.v.teiCER (Mr.
M^INTYRE in the chair) . Without ob-
jection, the Senator from Connecticut is
recognized.
Mr. RIBICOFF. I thank the Senator
from Oregon for yielding to me.
Mr. President, last Friday, the Senate
decided by seven votes not to include the
District of Columbia in the national
program of aid to families with depend-
ent children of unemployed parents.
While I am disappointed, I am not dis-
couraged by this outcome. The pros-
pects for eventual victory have improved
since last year.
This year, unlike last year, the House
of Representatives approved the pro-
gram.
Further, I note that while the issue
was lost by seven .votes, nine Senators
who voted in favor of the program last
year were absent or otherwise not re-
corded- this year.
So, I am convinced that the fight
must continue. The plight of these
needy children will not disappear. The
issue of he-ping them will not go away.
I can assure the Senate that so long as
I have the privilege of serving in the
Senate, the effort to help these children
will be made.
During the debate, the distinguished
Senator from West Virginia [Mr: B-Vria],
who oppOsed the program, listed 21 argu-
ments against including the District in
the unemployed parent program.
For the benefit of the conferees who
still must consider this issue, and for all
those who will have to consider it next
year if it is not agreed to in conference,
I have prepared an analysis of those 21
arguments and an answer to each.
I ask unanimous consent to have this
analysis printed in the RECORD.
There being no objection, the analysis
was ordered to be printed in the RECORD,
as follows:
Argument No. 1: "The House turned down
the request in fiscal year 1963, so that it
cannot be said, as was said a few moments
ago by the distinguished Senator from New
Hampshire?who is -now in the chair as the
Presiding Officer?that the program has been
denied by the Senate Appropriations Sub-
committee on the District of Columbia.
"That is only ?iartly true. The House
turned down the request in fiscal year 1963.
The Senate turned down the request in fiscal
year 1964. The request last year was never
presented to the House. The House acted on
the A budget. This item was not in the A
budget. This item last year was in the
B budget which came to the Senate and it
was denied by the Senate when it rejected
the Ribicoff amendment. Of course, the
Senate Appropriations Committee and the
subcommittee last year had, prior to the
action taken by the Senate, denied the
request.
"This year, the House included the item.
But I say to the Senate that only 12 ques-
tions were asked in the House subcommittee.
"This is not intended as any reflection on
the House subcommittee, but the record will
show that no more than 12 questions were
asked: whereas, in the Senate Appropria-
tions Subcommittee this year, approximately
100 questions were asked concerning this one
item alone, and last year approximately 225
questions were asked by the Senate subcom-
mittee concerning this one item."
Answer No. 1: No matter what happened
in fiscal year 1963, the undeniable fact re-
mains that last year, and more importantly,
this year, it is the action of the Senate that
Is keeping the District out of the AFDC-UP
program. This year the House Appropria-
tions Committee and the House of Repre-
sentatives voted in favor of the program.
The number of questions asked in sub-
committee is no measure of the need for a
program. The Senate subcommittee did ask
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17178 CONGRESSIONAL RECORD ? SENATE
more questions about the program than the
House subcommittee, but it also received
more answers showing the need for the
program.
Argument No. 2: "The program is not jus-
tified in the District of Columbia because the
unemployment rate is low comparatively
speaking."
Answer No. 2: The size of the unemploy-
ment rate has no bearing on the need for
this program. It provides aid for needy chil-
dren of unemployed parents. Their needs
are just as severe, whether the total number
of unemployed parents is large or small.
West Virginia uses the program for 11,000
families. Oklahoma uses it even though
only 25 families are eligible.
Argument No. 3: "The general level of pros-
perity is high."
Answer No. 3: The high level of prosperity
means nothing to the hungry children of
parents who cannot find a job. If prosperity
is generally high, then surely those who
benefit from it would not mind spending a
little tax money to help those who do not.
Argument No. 4: "The Department of Wel-
fare has been unable to prevent a firm pro-
jection of cost estimates for the future oper-
ation of the program."
Answer No. 4: Neither the District of Co-
lumbia Department of Welfare, nor its coun-
,terpart in West Virginia, has a crystal ball.
Neither can predict how many parents will
be unemployed in the years ahead. But we
do know that the unemployed rate in the
District has been fairly constant and we also
know there is a present need that is not being
met.
Argument No. 5: "The man-in-the-house
rule would be nullified, and the Federal Gov-
ernment would close its eyes to the presence
of the paramour in the home, and he could
be included in the benefit plan."
Answer No. 5: This is simply not so. The
man-in-the-house rule would not be nulli-
fied. It would be modified only to the extent
that the presence of a man in the home
would not render the family ineligible if that
man was the father of one or more of the
children. But the man-in-the-house rule
would continue to apply to every man who
was not a father of any of the children in
the home. A paramour would certainly not
be included in the benefit plan.
Argument No. 6: "The ADC caseload, which
has been reduced roughly 30 percent over the
last 21/2 years, would be increased 271/2 per-
cent in the first full year of operation of
the program. Our work in reducing the case-
load over the past 2% years would virtually
go for naught."
Answer No. 6: The caseload would increase
only if there are needy and hungry children
of unemployed parents. There is no virtue
in keeping a caseload figure low by exclud-
ing hungry and needy children.
Argument No. 7: "Additional positions
would be needed and additional policing
would be required."
Answer No. 7: The need for personnel to
run the program is no more an obstacle in
the District than it is in any other of the 18
States that have the program.
Argument No. 8: "Administrative burdens
would be increased."
Answer No. 8: The administrative burdens
are no more an obstacle in the District than
they are in any other of the 18 States that
have the program.
Argument No. 9: "Additional opportunities
for cheating would be presented."
Answer No. 9: Because a very small number
of people cheat is no reason to deny benefits
to the vast majority who do not. This, too,
is no more an obstacle in the District than
in the 18 other States.
Argument No. 10: "It has not been shown
that a feasible and practicable work pro-
gram in the District of Columbia can be
established. States which presently partici-
pate in the AFDC-UP program have vast
opportunities for employment of AFDC-UP
recipients and can loan them to municipali-
ties and county courts, and use them to
clean up after floods, fight forest fires, re-
move brush along the highways, and so
forth."
Answer No. 10: There are plenty of useful
work opportunities here in the District. Let
us make our streets and parks as clean as
any European capital before concluding there
is no work to be done.
Argument No. 11: "Work training programs
already exist in the District of Columbia.
Another work training program is not
needed."
Answer No. 11: If existing work training
programs can be adapted for the unemployed
parents who would be eligible under the
AFDC-UP program, then nothing new would
be set up. In any event, this is no reason
to deny assistance to the needy.
Argument No. 12: "The program is costly
.both to local and Federal Government. The
first full year's total cost of the program
would exceed $2,577,000. What the cost will
be beyond that, nobody knows."
Answer No. 12: The cost to the community
is far less than meeting the need in other
ways. The AFDC-UP payment per child is
less than the foster home payment and far
less than the cost of maintaining the child
in Junior Village.
Argument No. 13: "If the program is initi-
ated it will never be terminated until the
Federal law is repealed or permitted to be
terminated without renewal. The peculiar
circumstances which obtain in this city and
in the Congress with regard to the city simply
rule out a stoppage of the program if it is
once started?barring, as I have said, the re-
peal of the Federal authorizing statute or
failure to extend its life beyond 1967."
Answer No. 13. The program requires funds
from Congress each year. Congress can
change or end the program any year it
wants to.
Argument No. 14. "The District has a dif-
ficult financial problem now, and the AFDC-
UP program would merely compound the
problem."
Answer No. 14: The funds for this Program
were included in the District budget sub-
mitted by the President. In any event, the
District's financial problem is nothing com-
pared to the welfare and potential crime
problems caused by failing to provide basic
sustenance for these families.
Argument No. 15: "The AFDC-UP program
would siphon off much needed moneys from
other worthwhile programs dealing with edu-
cation, and so forth."
Answer No. 15: There is no fixed ceiling on
what Congress spends for the District. There
is no need to siphon this money off from
any other program.
Argument No. 16: "It could amount to a
back-door appropriation approach, in that
certain positions could be created without
prior authorization."
Answer No. 16: The Appropriations Sub-
committee is fully capable of making sure
that no unauthorized positions are created.
Argument No. 17: "This is an unemploy-
ment compensation matter, not a welfare
matter. Extend the period for unemploy-
ment compensation coverage, if you wish,
but let us not start a new welfare program
of such dimensions."
Answer No. 17: This is a popular miscon-
ception to which there are several answers:
(a) Most of the families in need of the
AFDC-UP program are ineligible for unem-
ployment compensation. Some have never
worked in covered employment. For others
the only jobs they can find even on a spo-
radic basis are with employers who fail to
make contributions to the unemployment
compensation fund.
(b) The unemployment compensation pro-
gram is designed to help those regularly em-
111 August 3
ployed during comparatively brief intervals
between jobs. Regardless of their personal
assets, they are entitled to the insurance
benefits which they and their -employers
have purchased. The AFDC-UP program is
for those who are hopelessly unemployed and
have no assets to fall back on.
(c) An unemployment compensation pro-
gram does not negate the need for AFDC-UP
in the District any more than it does in the
18 other States that have the program.
Argument No. 18: "Recipients would re-
ceive more, ordinarily, under this program,
than would those persons who draw unem-
ployment compensation."
Answer No. 18: First, most AFDC-UP re-
cipients are ineligible for unemployment
compensation and so the argument is not
true as to them. Secondly, the two kinds of
payment serve an entirely different purpose.
The unemployment compensation payment
is a modest payment to tide a family over
where the wage earner is temporarily unem-
ployed. The AFDC-UP payment is for a
family that has no other means of surviving.
Argument No. 19: "Only 19 States have
elected to participated and continue to par-
was suspended over a year ago. The State
of Kentucky 11m5 nine counties operating un-
der a pilot program. The State of Arizona
originally participated in the plan but it
was suspended over a year ago. The State
of North Carolina, from which the fine lady
commissioner of welfare, Dr. Ellen Win-
ston, comes, participated for awhile, but the
legislature refused to continue participation
as far back as 2 years ago. If the program
is so desirable, why do the other 31 States
not participate?"
Answer No, 19: The main reason the other
31 States do not participate is that most of
them can make some provision for the chron-
ically unemployed under their general assist-
ance programs. But here in the District if
a man or a woman is technically "employ-
able," the family is ineligible for any wel-
fare aid including general assistance regard-
less of how long the person has in fact been
without work.
Argument No. 20: "The incentive of re-
cipients to find other work would be im-
paired."
Answer No. 20: This is not so. Those re-
ceiving AFDC-UP payments would be re-
quired to report for available training and
to accept available work opportunities. If
they failed to do so, they would be disquali-
fied for assistance.
Argument No. 21: "The program will attract
to the District of Columbia more of the same
element which now constitutes a burden on
the taxpayers, which is driving taxpayers out
of the city into adjacent areas, which con-
tributes to increasing crime costs, to increas-
ing welfare and health costs, and to decreas-
ing property values and lower tax poten-
tial."
Answer No. 21: None of the 18 States with
the AFDC-UP program has experienced an
Influx of people. West Virginia in fact con-
tinues to lose population. And if likeli-
hood of crime is the worry, the answer is
certainly not to keep unemployed people
ineligible from funds that can mean the dif-
ference between life and death.
Mr. MORSE. Mr. President, let me
say to the Senator from Connecticut
that I shall continue to support the posi-
tion he has taken with regard to the
desirability of including the District of
Columbia in the aid-f or-dependent-
children program.
Mr. RIBICOFF. I do not believe that
the District has a more worthy champion
of these children than the Senator fro
Oregon [Mr. MORSE], because of the
sition he has taken as a member of the
District Committee and chairman oST the
Declassified and Approved For Release 2014/02/21: CIA-RDP66B00403R000300090022-7