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December 15, 2016
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April 13, 2004
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July 24, 1967
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iC '-t! i (11-, e '2- ''7..e-(fi- d' Approved For Release 2004/05/05 :.( The >mnority Ieader. of the) LEADER IN HOUSE louse committee, William - Widnall, Republican of New Jer- sey, said the bill to increase the f ACIS .ll,mo COMPF14 contribution to the Inrl to ican Bank from $760-million ion to $900-million over the next three ARMS SAhE S1Yyears should be paned is the Administration n clarified d its arm sales policies. Widnall Seeks to Bar Rise in Latin Aid and Force a Weapons Review SYMINGTON JOINS FIGHT Says He Will Support Move to Drop Pentagon's Fund That Helped Purchases Excerpts from Senate hearing .will be found on Page 2. Action Due Tomorrow The House is scheduled to act on the bill Wednesday. President Johnson wants the increase to support a pledge made at the Punta del Este Conference in April that he would seek more American aid to help in forming a Latin- American common market. Mr. Widnall noted state- ments Senator Symington made at a news conference this morning that the Administra- tion might have used "back- door" financing to circumvent Congressional limitations on arms shipments to Latin Amer- ica. "Unless final House floor By NEIL SHEEHAN debate on the Inter-,Aingriegni Special to The New York Times B -ak `bill is delayed pending WASHINGTON, July 24-The minority leader of the House f*lnued on Page 2, Column $ Banking and Currency Commit-clarification of this question, tee' sought today to force'aMr. Widnall said in a state- policy review of United States meat, "I have serious doubts arms sales by attempting to whether the Administration delay an Administration bill tclwill find a majority of the increase economic aid to Latir. America. The move in the House came as Senator Stuart Symingtor announced his support fol abolition of a $383-million re, volving credit fund that the Defense Department has been using to guarantee loans for the purchase of American arms by underdeveloped countries. Mr. Symington is chairman of the Senate Foreign Relations) Subcommittee on Near Eastern). and South Asian Affairs. Yes-'i terday the subcommittee re-'. House ready to vote for a sub- stantial increase in long-term development lending through the Inter-American Bank." Bank Is Supported Mr. Widnall also said he was r" of the In o t p n " r e ch su p stau a ter-American Bank and that he would "hate to see it threatened by debate over recent Export- Import Bank arms sales to Latin America." Mr. Widnall already has forced a delay on House action to extend the life of the Export- Import Bank for another five years and, to increase its lend- ing authority. He won the delay after senior Administration officials ac- knowledged in closed hearings before the committee last Mon- day that the bank had indirectly lent $591-million in the last two fiscal years to 14 under-devel leased testimony by Administra tion officials and the world's leading private arms merchant. It disclosed that United States controls over surplus American weapons in the hands of Euro- pean nations were breaking) down. oped countries to buy American arms. ; Subsequently, Mr. Widnall called fora Congressional re- view of aims. sales. It is under- stood that` he is attempting to delay both bills to force the review. -F? 6A PR~? 0a1W,24003lr ian Plans Cited fending the arms sales program The Senator cited the report' vigorously. Last week Secret that Peru intended to purchase tary of Defense Robert S. Mc' supersonic Mirage jet fighters Namara called on Mr. Widnal froFrance as support for, his and today Deputy Secretary o amendment to empower the Defense Paul Nitze visited Rep President to reduce or elimi- resentative Henry S. Reuss o nate economic aid to nations Wisconsin. making large arms purchases Mr. Reuss, a senior Democra from third countries. on the banking committee an Peru, he said, is a "poor coun- a respected liberal, has sharpl try" that has no need for such criticized the arms sales. ircraft d hi ti t . e a ca s sop Mr. Nitze also told the banl= "If they are going to buy ing committee last week the them I don't think we should the sales were good for Amer continue economic aid," he !said. ican industry. The Senator cited India and Senator Symington said toda: Egypt as examples of countries that he had presented ai that had been able to spend for- amendment to the Senate For sin 'exchange for armaments eign Relations Committee tha, because they were receiving would empower the Presidem conomic aid from the United to reduce or to cut off Unitec States. States economic aid to count India has obtained its aircraft tries such as India. that make largely from Britain and the large arms purchases from thirc Soviet Union, while, Egypt has countries. -eceived its planes entirely from The Missouri Democrat ac; Woscow. cused the Administration of Senator Symington con- trickery in financing arms sales, r and other tremendous eco- through the Export-Import anmooununt" of that food d "the eco Bank. t "We were assured," he said, nomic aid "we've given India has made it possible for her " the Central and South that Anerican development was eco-1 to have the largest air force in that part of the world." He " nomic-not an arms race. "Then we find there's this trick of back-door financing through the ex-int bank. All ;I can say is that we [Congress] have been taken.'.' Informants have disclosed that about $100-million of the $591-million in so-called "Coun- try-X" arms loans from the Export-Import Bank in the 1966 and 1967 fiscal years went to five Latin-American coun- tries - Brazil, Argentina Venezuela, Chile and Peru. Under the Country-X proce~ dure, the bank simply open: a line of credit to the Defens( Defense Department arm! salesman, Henry J. Kuss Jr Mr. Kuss then lends it to th( country involved for the arm: purchase. The loans are guaranteed b3 the Pentagon's $383-million re volving fund under a law tha~ requires that only 25 per cep of the loan must be coverer from the fund. Congress has imposed limita? tions of $30-million a year it arms sales to Latin AmericE and $55-million a year in mill tary assistance grants. The rat( of loans, however, indicate that the Administration ha been selling about $50-milliol ica. Mr. Symington said the eco nomic aid programs, for Lath America ? "have. been sold [tc IGong_ressJ on the basis that thi: Is where we're not going tc, have another arms race." ! said the thing had resulted from American food shipments to Egypt. can't help but believe; that if we hadn't given the aid' there wouldn't have been wars' in those areas," he said. An amendment to abolish the Pentagon's revolving arms sales credit fund, which Senator Sy- uington said he would support, is scheduled to be presented to ,he Senate Foreign Relations .ommittee later this week'by rank Church, Democrat of daho. Approved For Release 2004/05/05 : CIA-RDP69B00369R000100240021-6