zil, as well as the two articles from the New York Times of September 11 and 12, dealing with the Argentine situation, be printed in the RECORD at this point, with the permission of the Senator from Ore

gon.

There being no objection, the articles were ordered to be printed in the RECORD, as follows:

[From the New York Times, Nov. 12, 1963]

THE CONSTITUTION KEEPS GETTING IN THE WAY

(By Arthur Krock) WASHINGTON, November 11.-The Secretary of State, who is a man mild of manner and speech but as they say in his native State of Georgia-"sot in his ways," last week supplied one of the two reasons for Congress' sharp reduction in the foreign aid budget when he said he doesn't "understand it."

Merely by reading the Senate speeches of the self-named liberals who are leading the fight for the budget cuts the Secretary could readily discover the first reason. It is, that the Executive proposes to give President Nasser of Egypt the aid which pays for the military force he is using to back his refusal to withdraw his troops from Yemen; and to continue to provide aid to President Sukarno of Indonesia, who is sworn to destroy the new state of Malaysia, and to Brazil, where President Goulart is dissipating the aid by failing to control inflation. The second reason is that the only effective means Congress has to show disapproval of Executive policies it disapproves is through the appropriating powers that the Constitution reserves exclusively to Congress, foreign policy not excluded.

The Senate, led by the Members who have been the staunchest supporters of foreign aid, simply has turned to the use of this means to impose on the Executive budget for the next fiscal year the revision and rationalization of the foreign aid program that long has been overdue. Rusk's statement to his November 8 news conference that he disapproved of this "tendency to legislate foreign policy" is not at all surprising. What is surprising is his other statement that he doesn't "understand" the why and wherefore; and seems not to realize that with this assertion he was furnishing the general explanation of the situation he "does not understand."

Until and unless the President and the Secretary of State comprehend, if they really do not, what is so clear, the part of Rusk's news conference that states a sound principle of government will not have the desired beneficial effect on Congress. This principle the Secretary phrased as follows:

"I am very much concerned about the tendency in the Congress to legislate foreign policy as it might apply to specific situations or specific countries.

"It is not possible for the Congress to anticipate ** * what the circumstances are going to be in any given situation. *** These are responsibilities carried by the President [who is] the one the country will hold responsible if things go wrong."

FLEXIBILITY IN DISUSE

But support in Congress of this sound precept in foreign policy is impaired when the Executive continues disuse of the "flexibility" in judgment it admonishes Congress not to impede by perpetuating aid programs, such as those for Egypt, Indonesia, and Brazil. These are automatically self-defeating of the plain and declared objective of foreign aid. The eventual consequence, as is now being demonstrated, is that Congress will go too far in its efforts to restrain Executive flexibility.

An example was the Senate vote denying aid to any nation interfering with American Aishing vessels in what the United States CIX-1358

unilaterally decrees to be international waters. Diplomatic negotiation is the proper means, instead of legislation requiring other nations to accept U.S. charting of the seas. conduct diplomatic negotiations. And only the Executive, not Congress, can

Congressional foreign policy support by appropriation is also impaired when the Executive assumes leadership for this Government in coercing another to yield to military blackmail, and in violation of the United

Nations Charter. Yet the administration, in concert with Secretary General Thant of the U.N., did precisely this to assure the success of Indonesia's threats of seizure of west

New Guinea from the Netherlands.

This helped to build up the revolt in Congress. And in furthering the revolt Congress, of course, is using its constitutional power to cut authorizations and grants from the revenues contributed by American taxpayers. Thus again the Constitution annoys one arm of the triune Federal Government

SÃO PAULO, BRAZIL, November 11.-President João Goulart has challenged the validity of the Alliance for Progress as a workable remedy for Latin America's economic problems. He called on the Latin American countries today to unite in defense of their common interests in trade and aid.

In welcoming delegates to the second annual review meeting of the Alliance for Progress, Mr. Goulart did not once mention the United States and he referred to the Alliance only once.

The Alliance is a 10-year program proposed by President Kennedy to accelerate Latin America's economic and social development with the help of at least $20 billion in foreign aid.

The Latin countries, in return, are expected to strive for democracy and fair distribution of wealth.

SELF-SUPPORT STRESSED

Mr. Goulart's speech stressed an improvement in Latin America's trade position with the rest of the world. He condemned trade barriers affecting raw material exports to industrialized countries.

Present trade conditions, the Brazilian President added, "represent a bleeding of our economies."

"Our irreducible needs for imports, combined with falling export receipts, are in large measure responsible for the inflationary process that destroys the values of our national labors," Mr. Goulart added.

The speech was heard by delegates from the 20 participating countries in this weeklong conference. W. Averell Harriman, Under Secretary of State for Political Affairs, heads the U.S. delegation.

HARRIMAN MEETS GOULART

Mr. Harriman was introduced to Mr. Goulart after the speech, and they exchanged a friendly handshake. But U.S. officials were privately disappointed with Mr. Goulart's speech. There was no official American com

Mr. Goulart indicated that Latin America was a victim of its own divisions and common weaknesses. "Reality can no longer tolerate that Latin America remain an archipelago of nations, implacably separated by the sea of frustrations of our own difficulties," he said.

"Today, and each day more so, Latin America should present to the world a

united, solid, and cohesive front in the collective defense of our common interests," Mr. Goulart added.

All the Latin-American countries; he went on, are facing the same problem: "Breaking an agrarian structure that is manifestly archaic, in which the barriers of feudalism and intolerable privileges suffocate our effort for development, industrialization and diversification."

PALLIATIVES DERIDED

Deficits in the balance of payments-excesses of exports over imports-force the Latins to negotiate loans or to obtain refinancing of debts in conditions that do not meet their interests, Mr. Goulart said.

The answer, he added, will not be found "in palliatives or false, superficial concessions" by the industrialized, capital-exporting countries.

"Our objectives must be the establishment of a new international division of labor, just and remunerative prices for our exports of raw materials, expansion of our exports of manufactures and semimanufactures," Mr.

Goulart said.

The audience included, besides the delegates, representatives of international agencies, observers from a score of foreign governments and several hundred guests. Mr. Goulart spoke in the recreation hall of São Paulo University.

The conference is sponsored by the Economic and Social Council of the Organization of American States.

FUNDS DISPUTED IN BRAZIL

Mr. Goulart repeated many views he had been expressing in the context of Brazil's national politics. The country's extreme inflation, raising prices at an annual rate of more than 70 percent, and policy disagreements over the use of U.S. aid funds here have sharply reduced Brazil's access to Alliance for Progress aid.

In the preliminary, or technical, stage of this conference, which ended last week, Brazil disagreed with the United States and with a Latin-American majority on the formation of an Alliance for Progress coordinating committee. Such a body would give the Latin nations a policy voice in the alliance, without giving them control of aid funds.

Carlos Carvalho Pinto, Brazil's Minister of Finance, was elected president of the conference, Edgard Seoane, First Vice President of Peru and leader of his country's delegation, called Mr. Goulart's speech "very good." He added that he would propose the creation of an inter-American agrarianreform cooperative bank to finance production and equipment for landowners who are settled under national agrarian-reform programs.

[From the New York Times, Nov. 11, 1963] HARRIMAN WARNS ARGENTINA REGIME ON OIL CONTRACTS-SAYS PLAN TO CANCEL PACTS OF AMERICAN COMPANIES PERILS AID PROSPECTS (By Edward C. Burks)

BUENOS AIRES, November 10.-W. Averell Harriman was understood today to have warned Argentina that her plan to cancel contracts with U.S. oil companies could sharply impair her prospects for future American help.

The grave turn in United States-Argentine relations became clear after a series of weekend meetings between the highest officials here and Mr. Harriman, U.S. Under Secretary of State for Political Affairs. Under discussion was Argentina's announced intention to cancel contracts with U.S. companies, which have more than $300 million tied up in producing oil for the Argentine Government.

Argentine officials, from President Arturo Illia on down, are understood to have been told that cancellation of the contracts would

imperil both Government and private investment from the United States.

Mr. Harriman left this afternoon to head the U.S. delegation to the Inter-American Economic and Social Council meeting in São Paulo, Brazil. He still had received no assurance from Argentina's new Government that the American oil contracts would not be canceled.

POSITION MADE FULLY CLEAR

One authoritative U.S. source said: "What the Argentines are going to do I can't tell you. But the American position has been made fully clear to them. They are under no illusions as to the American point of view."

High American sources noted that the Argentine Government "has been unwilling" to explain in full its position to the oil companies.

The Argentine Government maintains that the oil contracts are illegal, because they were negotiated under the government of Arturo Frondizi. The Illia government says President Frondizi bypassed Congress in negotiating the contracts.

The oil companies say the contracts were made with a legal government.

The American source also said the Argentines had not made clear that the companies would receive prompt and adequate compensation in the event of expropriations.

Mr. Harriman's unexpected visit here was ostensibly for talks about general problems and the Alliance for Progress. But it was obvious that the oil contract dispute was the main issue.

The Argentine position, as explained to Americans during the talks, was that the companies will be compensated in accordance with Argentine justice.

POSITION UNSATISFACTORY TO UNITED STATES

This was unsatisfactory to the United States, since no indication of the amount of compensation or of the promptness of payment was indicated. The U.S. position is that Argentina has a right to take over the companies if payment is prompt and adequate. But Argentine officials have indicated that payment, if any, will be small.

For instance, while the companies contend that the Government petroleum authority owes them more than $100 million for delivered oil, some Government officials say that the companies owe Argentina.

It has been argued by some in the Government that since the contracts are regarded as illegal, the tax-exemption incentives in the contracts are also void. Therefore, these officials say, the companies owe back taxes.

When the contracts were signed by companies with the Frondizi government, they went into effect by decree, without congressional ratification. In Argentina, Congress has frequently been bypassed by executive power.

Mr. Harriman's position seems to be that he is not here to defend the oil companies or bring about proper procedure in resolving such a controversy.

The explanation of the U.S. position goes much further than the question of contracts with the oil companies. Essentially, it is this: the United States wants the Alliance for Progress to work with private investment as far as possible.

Dr. Illia's Popular Radical Party opposed the contracts when they were signed several years ago and campaigned in elections last July on a platform of annulling them.

The companies maintain that with their aid production has been virtually tripled since 1959 and that Argentina has nearly attained economic self-sufficiency.

The American companies involved include Pan American-Argentina, a subsidiary of Standard of Indiana; Esso; Tennessee Gas Transmission (Cities Service); several drilling companies, and other producing companies.

[From the New York Times, Nov. 12, 1963] ARGENTINA BARS OIL-PACT ACCORD-HARRIMAN MISSION IS CALLED FAILURE-AIDE SAYS U.S. COMPANIES OWE TAXES

(By Edward C. Burks)

BUENOS AIRES, November 11.-Argentina newspapers said today that W. Averell Harriman, Under Secretary of State for Political Affairs, had failed in his mission to persuade Argentina to soften her stand against U.S. oil companies.

Hints that the American companies involved might get relatively little compensation when Argentina took them over were also printed.

The leading afternoon paper La Razón quoted Antulio Pozzio, Fuels and Energy Secretary, as having said the companies owed a huge amount of back taxes.

The compensation to them would thus be sharply reduced when they are taken over. The Argentine Government intends to cancel the contracts under which the American companies have been working here soon, probably this week.

COMPENSATION IS AT ISSUE

The major point of dispute is whether the companies will receive prompt and adequate compensation. They say they have invested more than $200 million here and that Argentina's State Petroleum Authority owes them more than $100 million for delivered

The dispute has caused the severest strain in United States-Argentine relations in years. There are reports that both the Italian State Oil Authority and the Russians are active trying to enter petroleum production in Argentina when the Americans leave.

The issue has taken on highly nationalistic tones in a number of newspapers.

SIGNED WITH FORMER REGIME

The companies involved signed contracts with the Government of President Arturo Frondizi to drill wells and produce oil here for the State Petroleum Authority, and in one case to operate a distribution system including service stations. The Government contends that the contracts are illegal, having gone into effect without ratification by Congress. The Frondizi government put the contracts into effect by executive decree.

But Mr. Pozzio and others go further and maintain that since the contracts are illegal, the tax-exemption clauses in them are, too.

Mr. Pozzio has been quoted in the press as having said it is now a question of "who owes whom."

Mr. Harriman left yesterday after having warned Argentine officials that cancellation of the contracts without adequate and prompt compensation would severely impair Argentina's prospects for aid under the Alliance for Progress.

Mr. Harriman is heading the U.S. delegation to the Inter-American Economic and Social Council Conference at São Paulo, Brazil.

The press here is printing articles to the effect that the American companies knew the severe risks they were taking in signing the contracts with the Frondizi government.

The companies say Dr. Frondizi was a legally elected President and that the procedure for the contracts was legal.

President Illía has said the companies will receive "just compensation under Argentine law." Mr. Harriman, however, seemed to be dissatisfied with what he heard from government officials on compensation or the possible renegotiation of the contracts.

Since the American and other foreign companies began their operations in 1959, Argentine oil production has nearly tripled and the country has almost attained economic self-sufficiency.

But there were many complaints from Argentine officials that the country had to pay too much.

Government sources were quoted today as having said that Dr. Illia has succeeded in getting a high-level Washington negotiator like Mr. Harriman to come here, whereas Dr. Frondizi, despite all his friendly overtures to the United States, had never had such success.

PERIL TO ALLIANCE FUNDS SEEN WASHINGTON, November 11.-Administration officials suggested today cancellation of Argentina's contracts with United States and European oil companies could upset efforts to get Congress to vote more funds for the Alliance for Progress.

The Argentine proposal and a similar one in Peru strike at the heart of the administration's policy to encourage private capital, in both the United States and Western Europe, to supplement Government financing of Alliance programs.

Aware of the trend toward nationalization, the Senate is considering a provision in its foreign aid bill that would require the President to suspend economic assistance to any country that decides to "repudiate or nullify existing contracts or agreements" with American companies.

Senator HUBERT H. HUMPHREY, of Minnesota, the majority whip, who last week led a drive to restore $75 million to bring Alliance funds back to $525 million, was dismayed at the developments in Argentina.

"Congress is no longer in a mood to give lending authority to the administration so that the money can be used by our Latin American friends to expropriate private American properties."

President Kennedy can be expected to express this concern in Miami next weekend to Argentina's Vice President, Carlos Humberto Perette, diplomatic officials disclosed today.

Mr. Kennedy is scheduled to attend the annual convention of the Inter-American Press Association. Mr. Perette will be in Miami for an “Argentine Friendship Week."

Diplomatic sources said it was virtually certain that the President would take advantage of Mr. Perette's presence in Miami to emphasize the administration's problems as a result of the proposed Argentine action.

Mr. Perette is considered to be among those advising President Illía to assume an intransigent attitude on the cancellation of the contracts. The Vice President has denounced the contracts as unconstitutional and harmful to the Argentine economy.

It is understood that the Vice President and a group of officials in the recently inaugurated Argentine administration would like to turn over the assets of the private companies to the Government Petroleum Authority. To keep payments for compensation to a minimum, the officials were said to have suggested that the companies pay heavy retroactive taxes for the 5 years they have been in operation.

Under the administration of President Arturo Frondizi, the companies were promised special tax concessions and participation in profits.

Mr. GRUENING. Mr. President, I should like to emphasize, for the benefit of our critics, including, especially, the Washington Post, who have designated those of us who are trying to reform the program as "Secretaries of State," that if they would only study the program, it might be manifest to them that in trying to eliminate extravagances and follies and correct past and continuing errors, we wish to save the program, not to destroy it.

Mr. MORSE. I thank the Senator from Alaska very much for the remarks he has made. I appreciate his support.

I wish to make some quick comments about Brazil and Argentina. The Senator has referred to the New York Times article and to Brazil, raising a question as to whether the Alliance for Progress program is of sufficient merit to be of any aid to that country.

place of local effort and initiative.

This is not a case of Americans becoming tired of the burden, which is the favorite phrase of the President. It is a question of whether the indigenous people are ready and willing to do what must be done to elevate their own living standards. A people described by the President as having wealth and

It is disappointing to find those comments coming from spokesmen of two countries which have been such great beneficiaries under the Alliance for Progress program, to whom the President of the United States has given so much out of his contingency fund to help shore up their monetary policies and, in some instances, to give them contingency fund money with which to pay off some American creditors. That is another example of the misuse of the contingency fund. I do not believe that the American taxpayer should have that money given to Argentina for the purpose of having that Government pay off American creditors.

Mr. GRUENING. Of course not.

Mr. MORSE. I speak with complete respect, as a great supporter of my President. I am a strong supporter of the President. Although my support may not be needed, I will do everything I can to assist him in any way I can in the great historic campaign of 1964, because the country and the world need his continuation in office. But merely because I feel that way is no reason why I should agree with him when I think he is wrong and when I am satisfied the facts have proved him to be wrong. I believe the facts have proved him to be wrong in this case. He ought to make it perfectly clear to Brazil and Argentina that they, too, will have to meet the terms and conditions of the Act of Bogotá and the Act of Punta del Este; that they will have to help themselves; and that they will have to adopt some of the reforms that we are entitled to have them adopt, before we pour more money into the Argentine and Brazil. That is the position I take. The President will receive the support not only of the United States, but also of many other parts of the world if he takes that position.

American capital cannot bridge the gulf between rich and poor. If I thought that gulf could be bridged by the expenditure of American money, I would favor it. But I believe that a continuation of our expenditures in the present manner would only make the rich nations richer and the poor nations poorer. To prevent that, it is necessary to effectuate the kind of reforms I have been talking about

in my speech today.

The decisions upon which industrial and agricultural growth must be based must be made by the people of those countries. They cannot be replaced with foreign aid. In too many countries, we

gation to help the rest of mankind than the rest of mankind has to help itself. I do not regard this as a moral issue, but as a practical one. I am satisfied that in too many countries our aid is continued only because it is part of the executive machinery of the U.S. Government, not because it is promoting any economic growth or social progress.

One might also ask whether foreign aid is not a burden that all economically developed countries need to share. Yet the President avoided mentioning the hundreds of millions of dollars this year's bill contains in aid to those very same economically developed countries. Our failure to cease aiding them and their failure to undertake their own aid programs makes a mockery of the President's contention that this is a case of the obligation of rich nations to poor nations. We have allowed foreign aid, rather, to become an American obligation to everyone else.

In commenting on the President's speech of Friday night, I would also point out that whereas he talked mostly about health, education, and housing as objectives of foreign aid, a good third of the whole program is military aid, which has nothing to do with health, education, or housing. In too many places, in fact, military aid is undermining our social and economic programs.

So also do we send hundreds of millions of dollars abroad for purely political purposes. We give it, almost literally, to buy up foreign political leaders. Sometimes we think that by so doing we are keeping them out of the Communist camp; in other cases we are anxious to obtain or maintain military anxious to obtain or maintain military bases. Our aid programs to Sukarno in Indonesia, to the Kingdom of Jordan, and to Ethiopia, Morocco, and Libya have had that purpose. I am skeptical in the extreme of their usefulness. Above all, extreme of their usefulness. Above all, aid for that purpose is the most difficult to terminate, except when it is terminated by an overthrow of the recipient government by its own people.

Finally, I am most disturbed of all by the President's defense of foreign aid for the jobs it creates for American citizens. If this argument becomes intrenched in defense of foreign aid, it is going to be raised, too, in support of continued defense spending, because it is infinitely more applicable there. If we need Federal programs to reduce unemployment, there are many that are far more worthwhile to the American people than foreign aid. But if the work

itself becomes more important to us than its product, then our defense economy is going to be immune from any cuts in the future, no matter what turn the cold war may take. I very much regret that this justification has become so central to the case of the aid advocates.

We need to take a long, hard look at the need for so large a defense expenditure and so large an aid expenditure, and consider the wisdom of spending a good deal of that money in our own country, to meet some of the important domestic issues that confront us that are disturbing millions of American people.

Mr. CHURCH. Mr. President, will the Senator from Oregon yield?

Mr. MORSE. I yield.

I

Mr. CHURCH. First, I commend the Senator for the great service he has rendered in the course of the past 2 weeks in his intelligent opposition to certain features of this bill which ought to be questioned. Much credit is due him for the improvement that has been made in the bill. The Senator knows that I have sympathized with his efforts. have done what I could, both in committee and on the floor of the Senate, to support amendments that I believed were fully justified. So I have listened with deep interest to the excellent address the Senator is making. Earlier, I heard him say that if another $40 million could be cut from the bill, all things considered, he would be satisfied. I want the Senator to correct me if I misunderstood his statement.

Mr. MORSE. May I interrupt to explain my remarks?

Mr. CHURCH. Yes.

Mr. MORSE. I said I had made clear

to administration spokesmen this morning that they should take a look at the pending amendments and suggest where a $40 million reduction could be made, which would round the amount out to $500 million.

But I also made it very clear that I thought the bill ought to be cut more than that, and that I proposed to offer an amendment that would bring the amount down at least to the House figure. I believe the amount should be cut to the House figure. But we ought to proceed to see if we cannot at least make a $500 million reduction, instead of the $460 million now provided for. That does not mean that I will not try to bring about more than a $500 million reduction.

Mr. CHURCH. I share strongly the feeling of the Senator that a further cut could be made in the bill, particularly with respect to those countries with respect to which we have assumed a kind of frozen position. The Senator has mentioned some of those countries in his address today.

For example, I think of South Korea. I visited South Korea in December of last year. I was appalled to find it a garrison state, so laden with military equipment, ammunition dumps, and motor pools that one wondered why the peninsula had not sunk under the weight of the vast quantities of equipment and material we have furnished South Korea over the years.

It has been 10 years since the fighting ended in South Korea. During that time, we have been spending approximately half a billion dollars a year in aid to the government of South Korea. We have fully equipped a crack army there. Fifteen Republic of Korea divisions are on the line at the 38th parallel.

If, after 10 years of the pouring of our treasure into that peninsula, if after all our massive effort to train and equip the South Korean Army, the Koreans are still unprepared to assume the responsibility for the defense of their narrow frontier, perhaps the American people have a right to ask, "When will they be ready?"

The same objection can be made with respect to our policy in Formosa. Again, we find a frozen attitude that still calls forth a quarter of a billion dollars a year in foreign aid expenditures to that country. To what end? For what purpose? To maintain there an army that is twice as big as necessary to defend the island, but not one-tenth big enough to threaten the continent? The American people have a right to expect that the flow of foreign aid dollars will be tailored to the realities in these countries, and in certain other countries, as well, where we persist in spending a disproportionate amount of our foreign aid money. think that here is where a further cut could readily be made.

Mr. MORSE. So do I.

I

Mr. CHURCH. I suggest that the Senator from Oregon give some consideration to an amendment that I have been discussing with the distinguished Senator from South Dakota [Mr. McGOVERN] and other Senators, an amendment which would call for another $40 million cut, limited to the four or five countries which receive the largest amounts of American aid, which would leave it to the discretion of the President to decide how to allocate the cut, among countries where the program is inexcusably large, and where the United States has been guilty for many years of assuming a fixed position which has not kept pace with the times.

Mr. MORSE. I shall support the amendment. In fact, I shall shortly be discussing an amendment, and in the course of my speech I shall refer in several places to the contributions which the Senator from Idaho has made in connection with the very point he is now making. We have a good case in that respect. But I made the suggestion to the administration spokesmen this morning because I thought we ought to be receiving some cooperation from the administration, in consultation, concerning where the administration thinks it can make some savings, because, as I pointed out in my remarks earlier, in my opinion, the appropriation will not go beyond $3 billion, and I think it will end with less than $3 billion. The administration ought to be consulting with the opponents of the bill and the proponents of the bill, to see if there is not some area in which our differences could be reconciled in what could be a conscionable compromise.

Mr. CHURCH. I suggest that this might very well prove to be the proper area in which to make a final cut. The five countries receiving the largest amounts of our military assistance are Vietnam, Korea, Turkey, China, and Greece. I recall that 4 years ago, when I first became a member of the Foreign Relations Committee, we were assured

that our aid program to Greece was about to end, because it had gone on so long, and been so generous, that the administrators felt it had about accomplished its objectives. But here we are, But here we are, 4 years later, still talking about aid to Greece, and still saying that Greece will soon be eligible for removal from the list. So I believe the President could decide how to allocate another $40 million cut, as between the countries which get the biggest slice of our military aid. I commend such an approach to the Senator. I believe it might furnish a proper formula in connection with the allocation of a further $40 million cut, so that we could then proceed to a final vote on the bill.

Mr. MORSE. I thank the Senator from Idaho. I want him to know that I have pending an amendment which would cut $50 million from the authorization for supporting assistance which is proposed to be given to some of the countries the Senator has discussed, and would cut $5 million from the authorization for development grants. These changes would result in a substantial saving. I do not care which way we proceed to attain that goal. That is why I think we need to take an inventory of the pending amendments and determine which ones are overlapping or which ones seek to attain the same ends, and then reach an understanding as to which amendments will be offered, and in what order they will be offered. I am perfectly willing to do that. So I want the Senator to know that I have at the desk amendments which seek to accomplish the same purpose, but I would welcome an opportunity to support his amendment.

Mr. McGOVERN. Mr. President, will the Senator from Oregon yield?

The PRESIDING OFFICER (Mr. McNAMARA in the chair). Does the Senator from Oregon yield to the Senator from South Dakota?

Mr. MORSE. I yield.

Mr. McGOVERN. I have discussed with the Senator from Idaho the matter he has mentioned in the last few minutes. I think his suggestion would go a long way toward attaining the objective the Senator from Oregon has in mind.

Earlier today he referred at some length to the attitude of the American people in regard to foreign aid, and called attention to the fact that among the American people there is increasing opposition to foreign aid. I believe-although I could be mistaken-that the American people are strongly in favor of a considerable portion of the foreign aid program. I think there is in our country a great humanitarian tradition-which the Senator from Oregon praises and shares-which leads us to be concerned about the welfare of people in other parts of the world. I know that during the time I was privileged to work with the food-for-peace program, there was almost unanimous support of the program, insofar as we were able to evaluate the sentiment, in terms of our mail and our conversations with people all over the country. They do not want human beings anywhere in the world to

be hungry. They are concerned about disease, illiteracy, and the other really basic problems which disturb the progress and the peace of the world. However, I believe they are also concernedand if I am mistaken about this, the Senator from Oregon can correct me— with some of the things the Senator from Oregon has mentioned and is concerned about-among them, the sterile aspects of the aid program, including a sizable portion of the military aid program which we have been maintaining in the countries enumerated by the Senator from Idaho.

I have hoped we could make the sort of reductions suggested by the Senator from Idaho in the military aid program, and thus perhaps satisfy the Senator from Oregon and expedite final action by the Senate on the bill.

Mr. MORSE. I am sure that would be the result. I have said all along that I believe the American people would support a good, fair foreign aid program— but not the wasteful, inefficient programs which have come to characterize much of our foreign aid. The people of the United States are fed up as is indicated by the editorial from the Washington Star which I have placed in the RECORD-with much of the present program; they feel that much of it is highly wasteful and should be stopped. That is why I believe we have the responsibility to rewrite this bill. I believe that thus far we have had remarkably good success with our amendments; but I believe now we have reached the point where we should hold consultations, to determine what can be done toward arriving at some acceptable compromises, thus speeding the bill on before the week is over.

Mr. GRUENING. Mr. President, will the Senator from Oregon yield?

Mr. MORSE. I yield.

Mr. GRUENING. I commend the Senator from Idaho for his statement.

As I have previously suggested, I believe the proper approach is not to make the kind of blanket cut the other body made, but to go through the program country by country. This process really was begun several years ago in the committee by the Senator from Idaho, when he urged that the countries of Europe and Japan which have become prosperous and no longer need our aid should be removed from our aid program.

If we total the savings which will be made by eliminating from the aid program our aid programs for France, West Germany, Belgium, The Netherlands, Japan, and also Taiwan, Brazil, and Argentina, as well as the aggressor nations, it is apparent that we could easily cut from the bill authorizations in the amount of $1,500 million, and perhaps more. In each case, such a cut can be justified.

For example, when I visited Taiwan, several years ago, I was amazed to observe the variety and abundance of our aid programs there. Our funds were being used for almost every sort of program the human mind could conceive of. The projects included power plants, paper plants, fertilizer plants, jute plants, fac

tories of various kinds and the rebuilding of their fishing fleet-and of course tremendous military aid. Of course, the original purpose of our aid to Taiwan was to help that island defend itself from attack by the Red Chinese. But that objective was attained long ago. If, after we have poured billions of American dollars into that little island, it is not yet self-sufficient, I believe it is well for us to ask how much longer we intend to do for Taiwan what we would not dream of doing for ourselves.

As for the countries of South America, it is clear that Brazil and Argentina are more or less in a condition of instability; they do not live up to their commitments, and do not even attempt to follow the prescriptions which we think desirable in connection with our aid. They have not followed the principles adopted at the Punta del Este Conference and which President Kennedy has wisely prescribed.

In each case, the cuts, now contemplated can be justified.

When I visited Iran, I was very favorably impressed with what the Shah and our AID administration there were attempting to do with our aid; the Shah is deserving of the highest praise for the reforms he is attempting to carry out; but I doubt very much that the large amounts we are pouring into Iran, to help build up an army for Iran, would ever stop the Russians if they determined to move into that country-in which case the military forces of Iran would offer little more defense than a paper wall. In my opinion, we should end or at least diminish our military aid there, and should devote the money thus saved to economic development, with which, as the Senator from South Dakota has said, the American people are in sympathy. Of course, we wish to help other nations get rid of illiteracy, ill health, poverty, and other conditions which encourage communism; but I believe it apparent that we can still save a vast amount of money by eliminating some of the military aid. We have pointed out that in Latin America our military aid has not served defense, but, instead, has served to support military juntas which seek to overthrow constitutional governments.

I believe we should go into the military program also country by country, just as we should do in respect to the economic program. Then I believe we should come forth with a cut that would be justifiable and defensible, and that would be substantially larger than anything that has yet been considered.

(At this point Mr. NELSON took the chair as Presiding Officer.)

Mr. MORSE. Mr. President, I now

wish to say a few words about my amend

ment numbered 306. At the outset I

wish to make it very clear that if any

Senator has any suggestions for a modification of the amendment which would improve it, I should be very glad to consider modifications. I believe that when Senators hear me through, my objective will be perfectly clear. I have been told that a rumor is being circulated that the amendment would prevent sales on the part of people in the United States,

and that if a country desired to buy equipment from the United States, it could not do so under the Morse amendment. If my amendment is subject to such an interpretation, it will be modified before I finally call for a vote on it. But in my judgment, the objective of the amendment is one that deserves the support of the Senate.

The amendment would prohibit further aid of any kind to economically developed countries, other than what is necessary to fulfill firm commitments made prior to July 1, 1963. Even in the case of these prior commitments, the amendment directs the President to terminate them at the earliest practicable time and to report to the House and Senate by July, 1965, on what progress he has made. The committee bill bans only grant aid to these countries, and it also makes an exception of $1 million per country in grant aid for military training expenses.

I understand that some think that the restrictions upon the President are too great. If they believe that the language should be modified in some respect in regard to those restrictions, I am open to suggestions for modifications in that respect. But what I wish to do is to accomplish the main objective of the amendment, which I now proceed to discuss.

The "economically developed countries" referred to in the amendment are those nations listed as exceptions to the definition of "economically less developed nations" contained in the United Nations General Assembly Resolution 1875 (S.IV) and in addition, West Germany and Switzerland. These latter countries are not U.N. members and hence are not listed as exceptions to the General Assembly definition.

Although the amendment does not list the countries by name, they are Australia, Austria, Belgium, Byelorussian S.S.R., Canada, Czechoslovakia, Denmark, Finland, France, Hungary, Iceland, Ireland, Italy, Japan, Luxembourg, land, Ireland, Italy, Japan, Luxembourg, Netherlands, New Zealand, Norway, Poland, Rumania, South Africa, Sweden, Ukrainian S.S.R., Union of Soviet Socialist Republics, and the United Kingdom. ist Republics, and the United Kingdom. Of course, the United States is also listed by the U.N. resolution as an economically by the U.N. resolution as an economically developed country.

Hence, the effect of my amendment would be to prohibit any form of aid under this Foreign Assistance Act to these nations except for existing commitments, and existing commitments to them are to be renegotiated downward as quickly as possible.

It was as long ago as 1960 that the began pressing for language in the forSenator from Idaho [Mr. CHURCH] first eign aid law that would bring about a

termination in aid to the economically well-off nations of Western Europe and Japan. Even at that time, the Foreign Relations Committee and the Congress Relations Committee and the Congress were met with the self-contradictory answer that aid to these nations was being swer that aid to these nations was being closed out and besides, the aid still being sent was necessary to afford a certain amount of flexibility to the President and

That was where things stood in 1960 when Members of the Senate began expressing increasing displeasure with continued aid to these nations. That was when the assurances were poured in that their programs were being terminated, and that if Congress would just refrain from putting anything into the law about it, the administration would take care of the matter.

So the figures came in for the next fiscal year-1961. They They showed that Western Europe that year received $569.4 million from us in all forms of aid, plus another $115.8 million for Japan. That was a net reduction of a little more than $300 million. But it was not enough for our friend the Senator from Idaho [Mr. CHURCH] and many of the rest of us.

It was in 1961, as I recall, that the Senator from Idaho offered an amendment on the Senate floor calling for a more specific termination of aid to developed countries. But that was the year of the Berlin crisis. How well I remember the argument made here on the Senate floor that to cut our aid to our Western Allies at that critical time would appear to be an expression of lack of American interest in the welfare of Europe. Of course, we had already put over $41 billion into Western Europe as an expression of our concern for its security; but as we are hearing today from France in particular, there is never enough that America can do to satisfy the Europeans that we mean what we say. That is a hopeless cause. There is not enough money and there are not enough American troops in our whole country that we could put into the continent of Europe to satisfy a great many of its people that the United States means to fulfill its treaty obligation to consider an attack on a NATO member as an attack upon the United States. Yet just a few days ago, President Kennedy told us that we had to send additional American troops to Germany that year because of the unfulfilled commitments of our allies-chiefly France.

So in fiscal 1962, another $436.3 million went into the economically developed countries of Europe, plus another