Therefore, I strongly believe that the Senate should request, formally by resolution, if necessary, that the agreement with the Czech Government now under consideration not come into effect until the Senate has offered its advice and consent thereto.

It may be said, even by those who accept this principle, that the foreign aid bill is not an adequate vehicle for this amendment. On the contrary, I believe it is most appropriate because, should we accept $11 million as recompense for the seizure of what amounts to $113 million, that in my view is substantial aid and assistance to the recipient nation, even if that country is not mentioned in this bill and receives not 1 cent from the Agency for International Development.

Last year, as I recollect, the Congress adopted, over the objections of the Department of State, the Hickenlooper amendment to ban aid to nations expropriating U.S. property. Although not applicable in these instances, it clearly defined congressional sentiment in the matter of expropriations. During the hearings this year, Secretary of State Dean Rusk admitted that, although he opposed the amendment last year, he had since come to favor it. It had been extremely useful in strengthening the hand of the U.S. Government in dealing with foreign governments that were tempted to expropriate U.S. property. And I note that the committee has recommended further strengthening of it this year.

In this instance also, I believe, the knowledge that the Senate would be reviewing these treaties, would greatly strengthen the hand of our negotiators. What is more, even the Czechs, who now plead poverty, might think twice if they expected such an argument to be weighed by the Senate, which is well aware of Czech foreign aid to Cuba and other nations around the world.

In short, Mr. President, I believe the constitutional prerogatives of the Senate are involved here. To determine the direction of foreign policy is not the proper role of an executive agreement. Moreover, without review by the Senate, the approved claims of thousands of Americans stand to be virtually nullified-without consideration or appeal. A precedent would be established that would handicap U.S. citizens and firms for generations to come. The overall result The overall result would not only be the loss of millions of dollars owed to us, but undoubtedly an additional reluctance on the part of many U.S. interests to undertake oversea operations in the knowledge that our Government would not insist upon fair treatment, should the property be seized.

Mr. President, I am unfortunately under no illusions that we here in the Senate could force the Czechs or Hungarians or Russians to pay 100 percent of U.S. claims. But unless we exert our constitutional duty, we can be sure that U.S. citizens will not get any meaningful compensation whatsoever.

The most astonishing factor in this whole situation is that the United States today holds in frozen Czech assets over $82 million. Therefore, if the Czechoslovak Government agrees to pay $11 million, that would mean the only addi

tional funds required from the Czech Government would be $22 million.

Moreover, right now the United States, Britain, and France hold in a tripartite arrangement some $20 million of what is known as looted gold-$9 million is in New York; $11 million is in London. This is gold rounded up by the Allies at the end of the war from hiding places where end of the war from hiding places where it was placed by the Germans when they occupied most of Europe. This $20 miloccupied most of Europe. This $20 million, it has been determined under the terms of the Paris Reparations Agreement of January 24, 1946, probably came from Czechoslovakia and would no doubt be slated to return to the Czech Government if it is not needed to pay valid claims. Thus, as a result of the settlement now under consideration, as much as $172 million could conceivably be returned to the Communist government in Czechoslovakia. First and foremost, I would like to see that money be used to pay American claims, but if the Department of State cannot make that point in negotiations, I for one would rather see the money be used as a part of a tripartite foreign aid effort, than simply turned over to a hostile Communist government. I am deeply concerned over the fact that over $100 million in legitimate U.S. that over $100 million in legitimate U.S. claims for property nationalized by the Czechoslovak Government may well be junked in an essentially political agreement with a Communist regime. This is not, as the State Department may wish to suggest, a one-way agreement, with all benefit to the United States, that should be considered merely an executive agreement. It is a final settlement tive agreement. It is a final settlement of a complex issue. Very probably also a sizable trade deal with the United States will be involved in the final settlement, whether formally stated or not, ment, whether formally stated or not, because that is the way the Communists like to operate.

Mr. LAUSCHE. Mr. President, the record shows that the impounded assets of various countries in the United States have been used to pay the claims of American citizens against the countries which now impound assets. For instance, Yugoslavia paid 91 percent of the stance, Yugoslavia paid 91 percent of the claims of American citizens for property taken from them during World War II. Panama paid 90 percent. Bulgaria paid 50 percent. Rumania paid 30 percent. 50 percent. Rumania paid 30 percent. Italy paid 100 percent. No agreement Italy paid 100 percent. No agreement for settlement has been reached with the Union of Socialist Soviet Republics, and nothing has been paid.

With respect to Czechoslovakia, which is the country contemplated by the amendment of the Senator from New York, there are 2,630 claimants. The awards made as legitimate amount to $113 million. The amount supposedly available to pay claims is $8,541,000, with available to pay claims is $8,541,000, with $2 million more promised, making a total of $10,541,000, or about 9 percent of the claims. An additional $8 million is impounded in the United States, but this amount is not to be used to pay off the Czechoslovak claims.

Eleven million dollars is impounded in London under what are supposed to be London under what are supposed to be "lieu" funds that are not being used. The $8 million and the $11 million will be returned to Czechoslovakia, and about 9 percent of the claims paid.

The amendment offered by the Senator from New York, in which I have joined as a cosponsor, merely provides that before the awards that have been made are approved by our Government, a report shall be made to the Senate, so that the Senate may give its advice and consent. I cannot see why we should return to Czechoslovakia any moneys that might be available, and that are impounded in the United States and in London, when Czechoslovakia is paying off only 9 percent of the claims in the United States. I yield the floor.

Mr. FULBRIGHT. Mr. President, I am opposed to the amendment. The amendment was not submitted to the committee. The committee had no opportunity to study it.

Whether some of the allegations made regarding any proposed settlement with Czechoslovakia are correct, I am, of course, in no position to answer. A serious question is involved-one that has troubled our relations with several countries with regard to claims. What is involved is a question in law concerning claims by nationals of the United States against the government of Czechoslovakia. The amendment does not state whether the persons were nationals at the time of confiscation or not. This problem problem has complicated settlements that have been attempted with some of the other countries, because it is a question of great controversy in international law whether a citizen of a country at the time the loss occurred has any right to go to the United States or any other country and become a national of that country and enter a claim.

The problem of ascertaining whether a claim exists is a difficult one. The amendment would appear to authorize or require-I am not sure which-that all persons who are now citizens of the United States, regardless of whether they were citizens at the time of the loss, would be entitled to claim.

Mr. KEATING. Mr. President, will the Senator yield?

Mr. FULBRIGHT. The Senator has

made his speech. I am making a reply. But I will yield.

Mr. KEATING. I point out to the Senator that every single one of the 2,630 claimants whose claims have been adjudicated and allowed by the Foreign Claims Settlement Commission was a citizen of the United States. There is no question of after-acquired citizenship. This requirement is clearly established in the International Claims Settlement Act of 1949.

Mr. FULBRIGHT. That does not appear in the amendment as printed. It would seem to apply to nationals of the United States as of the moment. It does not provide as of the time of loss.

Mr. KEATING. We are discussing claims determined by the Foreign Claims Settlement Commission. These are all, by law, claims of U.S. nationals at the time of loss. They number 2,630. The total amount of the claims are $113 million. The Foreign Claims Settlement Commission threw out 1,300 claims. We are discussing only claims allowed by the Commission.

Mr. FULBRIGHT. The next question I was coming to is the question of the

International Claims Settlement Act of 1949. Congress passed this act for the specific purpose of settling claims with various countries. The claims that have already been referred to by previous speakers involve Yugoslavia, Poland, and Italy, and were settled in accordance with the International Claims Settlement Commission.

I see no reason why the usual procedure should not be followed in this case. The custom clearly is to submit such claims to the Foreign Claims Settlement Commission, as provided by law; and we are always given a report in regard to the settlement. But under this But under this Act such matters have not been handled by treaty. The one exception of which I know involved a case in Panama, but our relations with Panama are on a different basis from our relations with many other countries.

I see no reason whatever to depart from the custom, and in this case to require a treaty. In my opinion, that would be likely to interfere with a settlement, rather than to promote one, because this matter has already been before the Claims Commission.

the case of claims against Italy was that the claims of U.S. citizens against Italy were paid 100 cents on the dollar. The claims of U.S. citizens against Yugoslavia were paid 91 cents on the dollar. The claims of U.S. citizens against Panama were paid 90 cents on the dollar. The claims of U.S. citizens against Rumania were paid 24 cents on the dollar; and U.S. citizens' claims against Bulgaria were paid 40 cents on the dollar. The settlement in the case of such claims against Rumania was the lowest up to now.

There can be no question that the plan now contemplated in the Department is to pay less than 10 cents on the dollar on claims of U.S. citizens who have had their claims adjudicated by the Foreign Claims Settlement Commission and whose claims have been found valid— 2,630 claims of that sort, involving a total of almost $114 million. In other words, if the owner of a cigar store there had his property taken from him by the Communist government, and if the store was valued at $3,000, he is asked to accept less than $300 for his claim. These claimants are scattered all over the

Mr. HOLLAND. Mr. President, will country. the Senator from Arkansas yield?

The PRESIDING OFFICER (Mr. RIBICOFF in the chair). Does the Senator from Arkansas yield to the Senator from Florida?

Mr. FULBRIGHT. I yield.

Mr. HOLLAND. Have we any greater obligation to protect citizens who have such claims against Panama than we have to protect citizens who have similar claims against Yugoslavia, Poland, or any other country, as to which such claims have been settled by the usual procedure?

Mr. FULBRIGHT. I see no reason, on principle, to provide for any different treatment. We have had no serious complaint. For example, in the case of claims against Yugoslavia, I believe the Senator from Ohio stated that 91 percent of the amounts claimed were paid, under the usual procedure. So I see no reason why special, different treatment should be provided for a citizen who has such a claim against Czechoslovakia or a citizen who has such a claim against Yugoslavia.

Certain allegations have been presented to us, but we do not act on the basis of allegations. I am not in a position to refute some of the statements which have been made; but they were not brought before the committee, and I have no information about the nature of the claims, other than what is contained in the pamphlet and what my staff knows in general.

The usual procedure is that after the Claims Commission considers the claim, implementing legislation is proposed. The point is that the Commission is not trying to secrete something from Congress; and thus far all matters of this sort have been handled in accordance with the customary procedure.

It is true that the amendment did not come to my attention when the committee considered the bill; but I submitted the amendment to the staff, to the chairman, and to the ranking minority member; and I think they have at least had an opportunity to study it.

I am sure the State Department is opposed to the amendment, because it does not want any interference in regard to the amount for which it can settle such claims of U.S. citizens against other countries. But there is precedent for the amendment.

I concede that five of the six cases were settled without any reference to the Senate; but such claims against Panama were treated in the same way a treaty is treated, and the agreement was submitted to the Senate for ratification. Ninety percent of those claims were paid.

So I hope that if these claims are submitted to the Senate, the settlement will be something more than on a 10-percent basis. If the Department can make a case for settling these claims of U.S. citizens for 10 cents on the dollar or less, that can still be done under the provisions of this amendment, which only provides that it is the sense of Congress that it should look into this matter.

Mr. FULBRIGHT. But Congress will have an opportunity to look into such legislation, when it is proposed. The Italian claims, which have been referred to, were dealt with by implementing legislation-namely, Senate bill 947; and those claims will be considered in connection with legislation, rather than in connection with a treaty. I do not know how a treaty would result in larger payments than those which would be made under the usual procedure.

Therefore, Mr. President, I hope the New York is seeking to require that a amendment will be rejected.

Mr. KEATING. Mr. President, in response to the question asked by the Senator from Florida, let me state that the reason why no complaint was made in

The point is that the Senator from treaty procedure be followed; but, as I have stated, that would be contrary to the usual procedure. Furthermore, this agreement will be submitted to the Senate, when and if an agreement is

reached; but the negotiation of the agreement is traditionally left to the Claims Commission, and I see no particular reason why such claims against some particular country should be excepted-although there may be some reason. There is no reason why such a provision should be included in the foreign aid bill, which has nothing to do with such claims. do with such claims. These items relate to claims resulting from the last war and from the confiscation of assets of American citizens. If there is merit to the claims, they should be handled by means of a separate bill or resolution. However, there seems to be a growing practice of attaching to the foreign aid bill an amendment on any little issue in which a Member of Congress may be interested. The result is that the foreign aid bill is becoming a vehicle for every miscellaneous, irrelevant measure which has nothing to do with foreign aid.

Why was not this matter handled in a separate resolution? I see no reason why this provision should be allowed to clutter up the foreign aid bill. Goodness knows, it is already cluttered up enough.

Mr. KEATING. Let me ask the Senator how the Senate will have an opportunity in connection with proposed legislation to vote either up or down a proposed settlement after it is made with a different country. S. 947 deals only with Poland and provides for a determination of claims by the Foreign Claims Settlement Commission. This has already been done in the case of Czechoslovakia.

Mr. FULBRIGHT. The Senate could reject the implementing legislation which thus would be submitted to it. I admit that that would not be likely to happen, but it could be done.

Mr. KEATING. This amendment only seeks to say, "Let us have a look at this now, to see whether the proposed settlement is advantageous to our country and is fair or is not fair." It is an effort to strengthen the hands of our negotiators.

Mr. PASTORE. Mr. President, will the Senator yield for a question? Mr. KEATING. I yield.

Mr. PASTORE. Would the Senator's amendment require a two-thirds vote for ratification of the agreement?

Mr. KEATING. Yes, it would, except I wish to point out that the amendment, like so many others, is one which the State Department would have a right to ignore if it wished to do so. It is a senseof-Congress amendment. As I read the amendment, it would provide that we think we should have a look at the question as a treaty, as we did in the case of Panama, rather than in the four or five cases in which we did not have a look at the question at all.

Mr. PASTORE. What if the administration chose not to do it?

Mr. KEATING. There is very little that we could actually do about it.

Mr. DOUGLAS. Mr. President, adoption of the Keating amendment now pending may prevent a serious injustice to a number of American citizens who have been awarded claims for the Foreign Claims Settlement Claims Settlement Commission. The Commission has already approved these claims based on losses due to the

nationalization by the Communist Government in Czechoslovakia of the property of these United States citizens. The Commission has awarded a total of $113,645,000 to 2,630 claimants. But it is my understanding that the State Department, now negotiating several issues with Czechoslovakia, may settle this may settle this claim of over $113 million for only $11 million or about 9.7 percent of the approved total. In effect, the State Department would give up 90 percent of these approved claims, severely undercutting the determinations of awards which have been made by the responsible U.S. agency. This reduced settlement would be effected without allowing these claimants either a hearing or an appeal.

The Senator from New York [Mr. KEATING] has proposed an amendment to the Foreign Assistance Act which would require Senate ratification of any claims settlement reached with Czechoslovakia. The amendment is sensible and deserves strong support.

Not only would the settlement proposed by the State Department constitute an unjust treatment of the claimants, who would receive less than 10 percent of their already greatly reduced claims, but also it would, as the Senator from New York [Mr. KEATING] has pointed out, provide assistance of over $100 million to the Communist Government of Czechoslovakia. Surely this would be contrary to the spirit expressed in recent Senate votes on the pending bill.

Moreover, it is my understanding that similar settlements are still outstanding or in progress with other countries. In the case of some countries the settlements have been 90 percent or more of the total claim, and in no case has a settlement as low as 10 percent been agreed to. We should consider the effect of a 10-percent settlement with Czechoslovakia on the attitude toward further payments or settlements to be made by other countries such as Hungary, Cuba and the Soviet Union.

I do not think this amendment interferes improperly with the responsibilities of the Department of State. We do not ask for a 100 percent settlement, merely for Senate review of the settlement the State Department asks that we accept. Perhaps a case can be made that other considerations among the issues at stake justify a less than 100 percent settlement. But in a case in which the decision of the responsible agency is threatened with almost complete contradiction by another agency, I think we can properly insist on Senate review to provide an opportunity for the protection of legitimate interests of citizens.

I urge the adoption of the amendment, and I congratulate the Senator from New York [Mr. KEATING] for proposing it.

Mr. KEATING. Mr. President, will the Senator yield?

Mr. DOUGLAS. I yield.

Mr. KEATING. I appreciate the remarks of the Senator The points which the Senator has made are very important. If we allow a settlement of 10 cents on the dollar in the present case, I call attention to the fact that there

Mr. PASTORE. As I understood, the Senator from Illinois has said that the Senator from Illinois has said that the proposal would be a mandate to come to Congress. As I understood the Senator from New York, he said that the amendment is merely an expression of the sense of the Senate. There is a distinction.

Mr. KEATING. There is a distinction. I hope, and would expect, that the Department of State would be in accord with our wishes if we declared it to be our sense, but they would not be required to do so. I believe the Senator from Illinois would concede that.

Mr. DOUGLAS. Yes, that is true. Mr. KEATING. I hope that they would treat it as a mandate but, strictly speaking, it would not be one.

claimants as were U.S. citizens at the time of their loss are awarded valid claims. The Senator is correct in respect to his suggestion that there has been discussion about extending the benefits to those who have later acquired citizenship, but such a position has never been written into the law. The only ones who would be eligible are those who were citizens at that time.

I would have no hesitancy in writing into the language of the amendment a provision, on line 6, so that the amendment at that line would read as follows:

"Claims Settlement Commission, by nationals of the United States who were such at the time of their losses."

Mr. HICKENLOOPER. If the language is properly drafted, I would have no objection. As I understand, the Senator's position is sincere. The language no doubt means what he says it means. If it does, there is no reason for not putting the language in the amendment clearly and understandably.

Mr. KEATING. Mr. President, the yeas and nays have been ordered. I ask unanimous consent that my amendment be modified so that on line 7, after the word "States," that there be added the words "who were such at the time of their losses." Therefore, the amendment would read:

PART V-MISCELLANEOUS

Mr. HICKENLOOPER. Mr. President, the spirit of the amendment has my approval as an individual. I am concerned about the language of the amendment. I do not believe that it makes sufficiently clear that the claimants must between the Government of the United

have been citizens of the United States at the time of the expropriation, seizure, or confiscation. I believe that point or confiscation. I believe that point should be absolutely clear.

SEC. 501. It is the sense of the Congress that any agreement hereafter entered into

States and the Government of Czechoslovakia relating to the settlement of claims, determined by the Foreign Claims Settlement Commission, by nationals of the United States, who were such at the time of their losses, against the Government of Czechoslovakia for losses resulting from nationaliza

nationals, shall be submitted to the Senate for its advice and consent.

I am in sympathy with the theory that a settlement of 10 cents on the dollar in the present case might set a precedent tion or other taking of property of such for some other cases. I believe that Congress ought to have a look at the amounts of the proposed settlements, especially in relation to the Iron Curtain countries. I hope that the Senator will modify his amendment to make it absolutely clear that the amendment would not apply to persons who came over to the United States and thereafter acquired American citizenship.

The reason I make that statement is

that some amendments along that line have been proposed. Persons who have come to this country and later acquired American citizenship could make claims against the foreign countries in which their property was seized while they were under the sovereignty and jurisdiction of the seizing country. We may not like that. We may think that is morally wrong. But from a legal standpoint, it appears to me that the country under whose sovereignty the person was at the time the property was seized might have a position.

Mr. KEATING. Mr. President, will the Senator yield?

Mr. HICKENLOOPER. I yield. Mr. KEATING. The 2,630 claimants who have had their claims adjudicated to the extent of $113 million were, each and every one of them citizens of the United States in 1945 when their properties were taken.

Second, the International Claims Settlement Act requires that only such

The PRESIDING OFFICER. Is there objection? The Chair hears none, and it is so ordered.

The question is on agreeing to the modified amendment of the Senator from New York [Mr. KEATING] to the committee amendment, as amended. On this question the yeas and nays have been ordered, and the clerk will call

the roll.

The legislative clerk called the roll. Mr. HUMPHREY. I announce that the Senator from Virginia [Mr. BYRD], the Senator from West Virginia [Mr. BYRD], the Senator from Louisiana [Mr. LONG], the Senator from Washington [Mr. MAGNUSON], the Senator from Minnesota [Mr. MCCARTHY], the Senator from Georgia [Mr. RUSSELL], the Senator from Mississippi [Mr. STENNIS], and the Senator from Missouri [Mr. SYMINGTON] are absent on official business.

I also announce that the Senator from California [Mr. ENGLE] is absent because of illness.

I further announce that, if present and voting, the Senator from California [Mr. ENGLE], the Senator from Louisiana [Mr. LONG], the Senator from Washington [Mr. MAGNUSON], and the Senator from Minnesota [Mr. MCCARTHY] would each vote "nay."

On this vote, the Senator from Virginia [Mr. BYRD] is paired with the Senator from West Virginia [Mr. BYRD]. If present and voting, the Senator from Virginia would vote "yea," and the Senator from West Virginia would vote "nay."

Mr. DIRKSEN. I announce that the Senator from Arizona [Mr. GOLDWATER] is necessarily absent.

The Senator from Kentucky [Mr. COOPER] and the Senator from California [Mr. KUCHEL] are detained on official business.

If present and voting, the Senator from Arizona [Mr. GOLDWATER] and the Senator from California [Mr. KUCHEL] would each vote "yea."

assessments and/or contributions to the United Nations, no assistance shall be furnished under the provisions of this Act (other than supporting assistance under chapter 4 of part I, assistance from the contingency fund established under chapter 5 of part I, and military assistance under chapter 2 of part II), or any other law authorizing assistance to foreign countries (other than military assistance, supporting assistance, or assistance from the President's contingency fund), to the government of any nation which is more than one year in arrears in its payment of any assessment by the United Nations for its regular budget or for peace and security operations, unless the President determines that such government has given reasonable assurance of paying (independently of such assistance) all such arrearages and placing its payments of

Byrd, Va.

Byrd, W. Va. Cooper Engle

Humphrey

Inouye

Jackson

Jordan, N.C.

Kennedy
Long, Mo.

Mansfield

McGee

McGovern

McIntyre

McNamara

Metcalf

Monroney

Thurmond
Tower

Williams, Del.
Young, N. Dak.

Morse Moss

Muskie

Nelson Neuberger Pell Randolph Saltonstall Smathers Smith Sparkman Walters Williams, N.J. Yarborough Young, Ohio

NOT VOTING-12

Goldwater

Kuchel Long, La. Magnuson

McCarthy Russell

Stennis Symington So Mr. KEATING's amendment, as modified, to the committee amendment in the nature of a substitute, as amended, was rejected.

Mr. FULBRIGHT. Mr. President, I move to reconsider the vote by which the amendment was rejected.

Mr. HUMPHREY. Mr. President, I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. MILLER. Mr. President, I call up my amendment No. 249, and ask that it be stated.

The PRESIDING OFFICER. The amendment offered by the Senator from Iowa to the committee amendment, in the nature of a substitute, as amended, will be stated.

The LEGISLATIVE CLERK. It is proposed, on page 48, in the committee amendment, to strike out the quotation marks at the end of line 3, and between lines 3 and 4 to insert the following:

(k) In order to encourage preservation of the financial solvency of the United Nations which is being threatened by the failure of some member nations to pay currently their

termines that such government, by reason of unusual and exceptional circumstances, is economically unable to give such assurance.

Mr. MILLER. Mr. President, on each Senator's desk are two mimeographed tables. I propose to discuss these tables after my preliminary remarks.

My amendment was presented to the Foreign Relations Committee during the hearings on this bill last June. My statement appears in the hearings report commencing at page 349. A list of the various members of the United Nations, showing their total arrearages-regular budget dues and assessments for the emergency force in the Middle East and the Congo-and receipts of grants, loans, and military assistance from the United States appears at pages 352 and 353. In the printing of the report, Mauritania and Sudan were erroneously omitted.

At the desk of each Senator are two mimeographed tables updating the information contained in the hearing report. The hearing report table was based on the report of the U.N. Secretariat as of May 31, 1963. The mimeographed tables are based on the Secretariat report as of September 30, 1963.

I

This amendment is designed to gear our foreign aid policy into our policy with respect to the United Nations. invite attention to the statement in section 502 of the main bill which "reaffirms the policy of the United States to achieve international peace and security through Most assuredly, the United Nations." this basic policy of our country cannot be carried out if the United Nations goes out of existence because of bankruptcy. And, Mr. President, the U.N. is headed for bankruptcy. The temporary relief afforded by the U.N. bond issue is rapidly coming to an end. As of September 30 of this year, total arrearages of member nations amounted to almost $104 million. This situation has become progressively worse. As of September 30, 1961, arrearages totaled $44.7 million; as of September 30, 1962, the total was $80.9 million.

Mr. President, I ask unanimous consent to have inserted at this point in my remarks an article from News Front for October 1963, entitled "What Price Peace? United Nations Depends Heavily on the United States To Meet Mounting Costs of Its Activities. Continued Refusal of Some Nations To Pay Their Share of Peace Operations Poses Serious Threat to Future of U.N."

There being no objection, the article was ordered to be printed in the RECORD, as follows:

WHAT PRICE PEACE?-UNITED NATIONS DEPENDS HEAVILY ON THE UNITED STATES TO MEET MOUNTING COSTS OF ITS ACTIVITIES. CONTINUED REFUSAL OF SOME NATIONS TO PAY THEIR SHARE OF PEACE OPERATIONS POSES SERIOUS THREAT TO FUTURE OF THE U.N.

The United Nations is suffering from a bad case of "financial nerves." Continued refusal of certain nations to pay their share of assessments for emergency U.N. operations is sapping the economic lifeblood out of the international peace organization.

In December 1961, as the U.N. teetered on the brink of bankruptcy, the General Assembly authorized flotation of a $200 million bond issue. By October 1963, 73 percent of the bonds had been purchased and an additional $1.3 million was still on the books in pledge form from 10 member nations. To date, the United States has purchased $72 million of U.N. bonds, 50 percent of the total subscription.

(A new law enacted by Congress in October 1962 authorized the President of the United States to match bond purchases of other nations with the total loan not to exceed $100 million.)

The U.N. spends about $90 million annually for its regular administrative and peacekeeping activities. Associated U.N. agencies such as the Special Fund for Economic Assistance, the World Health Organization, and the U.N. Children's Fund add another $250 million to U.N. expenditures.

Member nations are assessed for the regular budget according to "ability to pay," i.e., per capita and total national income and ability to acquire foreign currency. Because the United States ranks high on all counts, it pays 32 percent of the regular budget compared to 15 percent paid by the U.S.S.R. and 0.04 percent paid by smaller nations such as El Salvador and Ivory Coast. The United States also contributes over 40 percent of the affiliated agencies' expenses.

The negative attitude of a handful of nations in supporting the costly Congo and Suez operations forced the bond issue. But this economic bailout offers the U.N. only temporary relief.

In 1962, the International Court of Justice, official U.N. judicial organ headquarters at The Hague, Netherlands, ruled that expenditures authorized by the General Assembly for peacekeeping operations were legitimate expenses of the organization and that, under the charter, members who fell in arrears in the Assembly. 2 years or more would lose the right to vote

eral Assembly in September 1964, when the Between now and the opening of the Gennew ruling will become effective, the U.N. will have to stumble along as best it can. Belgium, which in the past has refused to support the U.N. Congo operation, recently decided to pay her $192,000 share of the $16 million it will cost to keep the force there during the first 6 months of 1964. The Belgians, however, have made no decision regarding payment of the $3.3 million in back assessments which have accrued since the operation began in July 1960. But the sudden change in Belgian strategy sparks some hope that other nations may follow suit.

The Congo force (ONUC) costs about $120 million annually and the U.N. Emergency Force in Suez (UNEF) about $20 million. In view of the serious financial crisis, Secretary General U Thant recently proposed a drastic cutback in U.N. assistance to the Congolese Government.

Forty-nine member nations are $29.9 million in arrears for the UNEF operation. SoViet bloc nations and Cuba owe $21.1 million,

69 percent of total back payments. Current UNEF debt, including second quarter 1963 payments, is $36 million.

But it is the Congo which has driven the U.N. to the brink of disaster. Fifty-six nations owe $83.4 million in back payments. France and the U.S.S.R. collectively owe $59.3 million, 71 percent of the total. The overall debt outstanding for the Congo exceeds $100 million.

Most members have willingly paid their share of assessments for U.N. administrative activities. Possible loss of vote in the General Assembly strengthens the incentive to do so.

Root of the U.N.'s financial malaise rests in trying to enforce payment for peacekeeping operations. The Russians refuse to pay for the UNEF and Congo forces claiming the expenses are not for regular peacekeeping activities of the organization, contrary to the ruling of the World Court. They maintain the "aggressors"; i.e., Great Britain, France, and Belgium should pay.

Latin American countries feel underdeveloped nations cannot afford to underwrite costly peacekeeping operations such as the Congo. They say the Big Powers should pay at least 70 percent of the total cost.

The financial straightjacket that delinquent members have put on the U.N. has forced the organization to take drastic steps to finance its activities. In the running Yemeni civil war, the U.N. sent a watchdog mission to make sure the United Arab Republic and Saudi Arabia would not intervene. Because the U.N. lacked funds to finance the mission, the United Arab Republic and Saudi Arabia have agreed to pay the $200,000 monthly upkeep of the U.N. Force

whose primary purpose is to assure nonaggression by these two countries.

The future of the U.N. is precarious. If member nations continue to vote for action and then refuse to accept the financial consequences, it will be forced into total inertia. If, on the other hand, votes of nonpaying members are taken away until they pay, the Soviet Union would in all likelihood boycott the U.N. Should the organization be reduced to little more than a conference of Western Powers, the original purpose of the U.N., to brings friends and enemies together, will be defeated.

Increased revenue from independent U.N. activities such as the sale of stamps, publications and TV services is one way out of the

dilemma. But net income derived from these sources amounts to $2 million, 4 percent of the regular budget and any increase would not go far in covering the costs of an operation similar to the Congo.

Other ambitious proposals would have the U.N. collect dues from international canals, international mail or exploit the resources of

the ocean beds or Antarctica.

Most of these proposals are farfetched and chances for their adoption appear slim. weakness, claims "they require for their One observer, pointing to their inherent adoption conditions within the U.N. which do not prevail at this stage of the organization's development."

The current difficulties plaguing the U.N. are really political. They stem from the divergent views the United States, underdeveloped countries, and the Soviet Union hold about the function of the U.N.

Russia wants the U.N. to be a standing conference which takes little action but serves as a perfect propaganda forum. The Soviets can certainly afford to pay the $60.7 million they owe the U.N. if they can afford to spend $50 billion on armaments. They do not contribute to U.N. peace operations because actions taken in the Congo and Suez do not serve Russian interests.

Underdeveloped countries want a vigorous U.N. organization primarily because they hope it will help them get rid of colonial regimes and provide them with badly needed technical assistance. However, they are often neither willing nor able to assume financial responsibility for their votes.

The United States favors a strong U.N. actively engaged in promoting the cause of peace. In the past, much of the U.N.'s success has rested on U.S. ability to muster enough votes to make sure that free world views prevailed, or at least to blockade any action inimical to our own interests. It is doubtful the United States would be willing to put up money for causes that went against American interests. In a test case 2 years ago, Washington refused to abide by a U.N. decision calling for the United States to pay $1 million for technical assistance to Cuba.

Naturally, the U.N. can ill afford to incur the wrath of the U.S. Government by its decisions. If the United States refuses to pay its huge share, the U.N. might as well collapse in the murky waters of New York's East River.