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Often, as a result, AID has found it Some small progress has been made We do so because it is in our nature, virtually impossible to fill vacancies in toward this goal. But it has been “too our character, our tradition; it is part principal health posts in key countries. little and too slow."

of all of the religions by which we worPublic Health Service officers have AID and the State Department need ship. sometimes felt that their acceptance of not surrender in the slightest their basic I serve notice, therefore, of my conan oversea AID assignment might prove obligations for policymaking and policy

tinued intention to help make certain a detriment, not an aid to their own ulti- supervision. But they should not try to that these objectives which I have exmate career development. And there do, in day-to-day technical management,

do, in day-to-day technical management, pressed, time and time again, will rehave been other interagency shortcom- what the so-called domestic U.S. agen- ceive appropriate attention by the ings as well.

cies are far more competent to do. Agency for International Development, TRIBUTE TO HEALTH PROFESSIONALS Oversea health aid requires, in the

by the Department of State and the U.S. Notwithstanding these conditions, I final analysis, not only money, equip- Public Health Service. . want to say that this Nation can be proud ment, and other physical resources—it FOREIGN AID NOW CONDITIONED ON

PERFORMANCE of the humanitarian accomplishments requires trained people. There is ceroverseas by federally employed doctors, tainly not an unlimited number of Amer- Mr. President, what kinds of condinurses, malariologists, pharmacists, and ican citizens with adequate training in tions are now being agreed upon by the other members of the health team, just public health type skills who are willing United States and the recipient governas it can be proud of aid rendered by non

or able to take oversea assignments for ments, and how do these conditions governmental groups like CARE, Medico, 2 or 3 years at a time and who are effec- work? Project Hope, medical missionaries of tive in working with foreign nationals. There are two categories of conditions. various religious faiths, and other pri

We need more such Americans and we First, there are conditions based on the vate sources.

need to make the best possible use of performance of an entire country, and ABLE TOP TEAM AT AID those we already have.

applied to all aid programs and projects

Similarly, we need to give every pos- in that country. Second, there are conFrom the standpoint of the U.S. Gov

sible encouragement to the much larger ditions for specific programs or projects ernment, the time for improved team

number of American professionals,

professionals, in a country, even where the country work is nonetheless long overdue.

skilled in medical specialty services like as a whole does not have to take certain Fortunately, as AID's Assistant Ad

surgery, ophthalmology, cardiology, neuministrator for Human Resources, sery

agreed upon self-help steps.

Under the Charter of Punta del Este, ing with the able Administrator, David rology, and psychiatry, to accept tem

porary assignments with private organi- which established the Alliance for ProgBell, there is a very competent physician porary assignments with private organi

ress, every country in Latin America is in charge, Leona Baumgartner. This zations, to serve abroad. Survey after

survey has shown that literally thoudistinguished doctor has a long and out

committed to undertake certain self-help sands of private M.D.'s are indeed will- measures. It is explicitly recognized in standing interest in public health measing to serve in developing countries for

the charter that U.S. assistance to Latin ures, at home and abroad. I do not have the slightest doubt but modus operandi for tapping this great at least short periods. The necessary

American development will be condi

tioned upon the necessary structural rethat Dr. Baumgartner seeks to work out talent must be worked out.

forms and measures for the mobilization the closest collaboration with the U.S.

of internal resources on the part of rePublic Health Service and with private


cipient countries. organizations. However, the sometimes We can do so. We must do so. There

The recent United States-Brazilian rigid mechanisms of the Agency for In- is no reason why we should not do so.

agreement, which conditions further ternational Development have tended There is every reason why we should do

U.S. aid to Brazil upon the taking of certo discourage greater initiative and re- so.

tain steps by the Brazilian Government, sponsibility on the part of other Fed- We have a great U.S. Public Health

was made in accordance with the chareral agencies, such as the constituent Service. We have a dedicated organiza

ter. Under this agreement, which is the units of the Department of Health, Edu- tion for foreign aid-AID. We have an

first of its kind, Brazil was to cation, and Welfare. outstanding multilateral organization

First. Increase revenue by reforming Here, I refer to both medical and non- the World Health Organization-whose

the tax system, as well as improve tax medical units of HEW; that is, to the regional collaborator is the famed Pan collection and administration. U.S. Office for Education, for example. American Health Organization. We

Second. Reduce Government budgetWhat I seek is to encourage the domes- have enormous interest among private

ary deficits by eliminating subsidies on tic U.S. agencies with technical assist- professionals and laymen.

wheat and petroleum, eliminating defiance competence-for example, in such We have an American Council of Vol

cits on publicly owned enterprises infields as in housing, agriculture, and so untary Agencies for Foreign Service, cluding transportation and power sysforth-to become genuine partners—in uniting the major religious and nonsec- tems, and curbing public pay increases. fact, not merely in name—with AID. tarian aid groups. And we have other

Third. Control inflation by limiting NEED FOR A CAREER POOL OF EMPLOYEES outstanding assets to do the job.

the expansion of credit by the banks, by Such cooperation and coordination is

The job must be done--not just in the

establishing better central banking main the interest of both economy and effi- teeming cities, with their crowded slums, chinery, and by appealing to unions and ciency. For example, in health, the U.S. but in the hinterland, in the country- businesses to hold the line on wages and Public Health Service has the best side, in the jungles, in the mountains, prices. trained experts in the executive branch in the tiny villages which have never

Fourth. Reduce the balance-of-payand the best access to still more of the seen a doctor or drunk clean water or ments deficit by establishing a realistic best experts in private life, in schools of been free from disease, infected flies or exchange rate and by adopting specific public health and elsewhere. Meansnails or mosquitoes or other carriers.

measures to increase exports. while, AID has the mandate and at least HELP NOT JUST TO "COMBAT COMMUNISM” BUT Fifth. Stimulate economic growth by limited funds to assist in health.


adopting measures to encourage outside A happy union of the two is indispen

Finally, it is my hope that we will private investment. sable. By "union,” I refer to the estab render technical assistance in health to

Sixth. Increase agricultural growth lishment, in effect, of a unified pool of

a greater degree not because we are and productivity by seeking a broad procareer medical experts who could serve concerned that the desperate native gram of agrarian reform. not in one agency, but in all agencies

masses will turn to communism, but be- In addition, it was understood that with health activities—the Peace Corps,

cause it is morally and ethically sound Brazil should arrange with the InternaAID, NIH, other units of the Public that we do so. ,

tional Monetary Fund to defer payment Health Service, Defense Department pro- No people has acted from greater hu- on an IMF obligation, as well as secure grams overseas, and so forth. They manitarian zeal that the American peo- a standby arrangement under which the would rotate as the needs of the Nation ple. No nation in all of history has done IMF would make

IMF would make temporary credits and as their professional interests made more or wanted to do more to relieve available to offset Brazilian export advisable.

human suffering than has our Nation, losses. It was also understood that CIX -1383

Brazil would secure additional aid from Soil Conservation Service specialists and carefully coordinated with other forms other free world countries. junior level technicians, and the coop

of assistance to insure that our help gets In several other cases development erating government guarantees the pro- to the people. loans for Latin American countries have vision of cash wages for 60,000 workers. In many countries a small number of been made contingent upon acceptable Establishing conditions for aid is one

devoted Americans are working among arrangements with the International thing; enforcing those conditions, espe- the people to transfer American knowMonetary Fund for exchange rate re- cially when political considerations are how and skills. They are not living in form and an economic stabilization pro- involved, is another. Flexibility in en- luxury as is often charged. Rather, they gram.

forcing foreign aid conditions is just as are working side by side with the people One example is the recent $35 million

essential as flexibility in enforcing the of the developing countries getting a job development loan to Chile which is con- conditions of a commercial contract. done. It is a challenging, often frusditional upon a satisfactory stabilization Up to a certain point, exigencies must be trating profession. program. The loan will be disbursed taken into account. The problem, of

These are people from the backbone of at a rate corresponding to the rate of course, is knowing where to draw the America—from Vermont, Indiana, CaliChile's budgetary performance. Better line.

fornia, from all over the United States. budgetary performance will speed up the

In agreements on conditions, espe

These are people with the kind of piorate of loan disbursement, and vice versa.

cially those involving an entire country neering spirit which built America. In some cases there is a condition that program, it would be a mistake to ex

Because of them, and the rest of our the borrowing nation secure aid from pect the line always to be drawn where

aid effort, U.S. foreign assistance is other donor nations before the United

it was marked out originally. But al- reaching the people of the underdevelStates will promise assistance. A stabi- lowing for reasonable adjustments, it is

lowing for reasonable adjustments, it is oped world. It is making a constructive lization loan for Egypt, and the con

reasonable to expect conditions to be impact. sortia arrangements for Pakistan and carried out, as nearly as possible, as

The evidence of this impact is not India, and more recently for Turkey, are

agreed upon.
Otherwise agreements on

often dramatic. Nevertheless, change is examples of this type of condition. conditions will not be taken seriously.

occurring at an increasingly rapid pace. There are numerous examples of

The difficulty in carrying out condi

For every constructive change in the specific types of conditions required by the United States on development grant broader foreign policy interests can be tions while at the same time serving traditional way of life that is visible,

there are many others that are spreadand development loan projects.

seen in the case of Brazil. U.S. aid to ing more slowly but which will ultimately In one Middle East country the government undertook to reorganize the because the Government of Brazil has Brazil is being held up at the moment transform the society of the underdevel

oped nations in the decades to come. port administration, to establish separate not met the conditions agreed upon stantial development in these nations it

It is clear that if there is to be suborganizations for the goods handling earlier this year. Since the Braziland customs functions, and to finance United States agreement was signed, the

will have to come from changes generthe timely completion of complementary Brazilian Government has done little, of their own societies. This is what self

ated and accepted within the framework requirements such as connecting roads.

in fact, to live up to its pledge. InflaManagement, organizational, financial, tion increased by more than 25 percent in help really means-not simply that we and budgetary arrangements for the port the first half of 1963, and probably will

would like to have developing nations satisfactory to the United States were

increase by more than 50 percent be- pay a fair share of the cost of developmade conditions of an AID loan.

ment, but rather that we and they realfore the end of the year. The GovernIn another Middle East country, spe

ize that lasting development must be ment of Brazil has loosened rather than cific conditions were set forth in a U.S. tightened credit. The Brazilian budget

built from within. loan made for the purchase of construc

It is within this framework that U.S. deficit has gone up rather than down. tion equipment. Because several govern

technical assistance plays such a basic Government pay raises, rather than bement departments were involved, one ing held to the announced 40 percent, helps the individual in an underdevel

and vital role. Technical assistance condition of the loan was that a new

have been increasing by 70 percent. central agency be established to handle

oped country to help himself and to help

What happens next? From the standthe equipment. Employment of qualified

build his society. It enables the campaforeign advisers and the establishment Point of general foreign policy consider- sino, the peasant, the tribal farmer to

ations, Brazil must not be allowed to adapt the technical know-how and exof an acceptable spare parts and main

flounder. If the enforcement of condi, pertise of the modern world to the realitenance system were other conditions of

tions on our aid program were predicted ties and confines of his own primitive the loan.

to have that effect, it would be very conditions. A home savings program in a Latin

difficult to make the conditions stick. American country requires that the U.S.

Modern communications, independOn the other hand, if the conditions are contribution of $7.5 million to the sav

ence, the education of a few native leadings bank be matched, and that there

modified to the point of being substan-
tially softened or virtually removed, it veloping countries. In some places it is

ers are causing an awakening in the debe established a National Housing Institute to administer the program. would be very difficult in the future to

an emotional demand for modern social Conditions to insure repayment of persuade any government to live up to legislation or educational facilities; in U.S. loans, including government guar

other places it is a less articulate but somewhere in between. But even if antees of loans to private or semipublic there should have to be some adjust, health practices or for the right to own

no less pressing demand for improved institutions, are common practice. In

ments in the original agreements—and the land that the people work; in still one such case, the United States insisted upon the financial reorganization of a they certainly should be kept to a min

other places-perhaps the majority-it is imum-we will at least have made a start truck company to open up prior mort

a slowly growing realization that things on establishing, together with the host gage bonds so that AID would be ratably

need not necessarily be as they have alinsured, the sale of common stock rather government, performance standards for

ways been. This, for many, is the one à country receiving U.S. assistance. dynamic new idea: That change is posthan of senior convertible debentures as

This is one of the most encouraging sible; that the pattern of life of the last proposed by the company, establishment

improvements made in foreign aid since 2,000 years need not be the pattern of of a ratio of debt to net worth not to ex

the new program was established in 1961. life for the next 2,000 years. ceed 2 to 1, and a limitation on dividend payments.

American technical assistance is helpA normal condition of cost sharing

ing to insure that the changes which will between the United States and a re- Mr. President, a key element of the inevitably occur in the developing councipient country in a grant project is U.S. foreign aid program is the technical tries are changes for the better; that all exemplified by a recent work relief proj- assistance effort going forward in many people share in the opportunity for a betect emphasizing rural reconstruction. emerging countries around the world. In

ter life. Under this agreement, the United States some 21 countries technical assistance

How effectively are we achieving this provides surplus agricultural commodi constitutes almost our entire foreign as- goal? Let me give you a few examples ties for food, hand tools and equipment, sistance effort. In other countries it is from one area of our foreign assistance



program-agriculture. These examples

These examples WHY DID AID NOT USE ALL ITS FISCAL YEAR 1963 AID's development lending operations, could be repeated many times in other


like those of a bank, depend a great deal areas such as public health and educa- Mr. President, development loans on mutual confidence. The United tion.

make up the major AID contribution to States has not assumed the posture of In Nigeria, 170,000 farmers will be the Alliance for Progress. Over $340 a hardhearted lender. Congress has reached by AID assisted and trained ex- million in development loans was used in placed tight restrictions on AID loan tension workers in 1963. More than 100 fiscal year 1963. Total commitments procedures, however. The loans must reYoung Farmers Clubs with a total mem- for development loans and grants were flect careful feasibility studies and a bership of more than 7,000 Nigerian $465 million.

clear capacity for repayment. AID, youth have been organized under the

It was and is impossible to state therefore, has acquired many aspects guidance of a single AID technician.

precisely the need for loan funds. The of a full-fledged banking operation. It In the Sudan, 325,000 people are be- level of the Alliance lending program is has, moreover, insisted that the Latin ing reached this year by agricultural ex- contingent upon many factors. Most Americans live up to their own committension programs sponsored by AID. are beyond the control of the United ments on reforms. If we did not do so

In South Korea, counterpart funded States. The uncertainty stems from the money we lend would neither benefit loans from members of the National the fact that no lender, no bank, can the borrower nor further our Alliance Agricultural Cooperatives Federation predict the amount it will lend in the objectives. On the other hand, to raise provided more than 724,000 individual future and still remain a sound insti- hopes and aspirations, to achieve worthagricultural credit loans for crop pro- tution.

while bootstrap efforts and then not be duction during 1962. Fifteen thousand

Based on the most careful analysis of

able to back them up with marginal exloans were made to village cooperatives the probabilities, AID has stated that it ternal lending causes a loss of confidence to assist in procurement of materials and will need a minimum of $550 million for among our Latin American neighbors marketing.

new development loans and $100 million and a sense of alienation from the AlliIn Ghana last year, 180,000 farm fam- for development grants this year. This ance. ilies were reached directly by AID-spon- amount is designed to meet the Latin Right now, today, finance minister and sored agricultural extension farm pro- American countries increasing need for development experts from the Alliance grams. These programs included dem- marginal external assistance as the Alli- countries are meeting in São Paulo, onstrations and training in livestock deance progresses.

Brazil. This meeting of the Intervelopment, vegetable production, con

AID's commitment of development American Economic and Social Council struction and use of minor irrigation works, and the uses of fertilizer and loan funds for the Alliance in fiscal year is devoted to an analysis of reform ef

1963 gives us a clear idea of how the pro- forts, to methods for improving the adpesticides. In Turkey, 31,000 of the total of 40,000

gram operates. Two years of Alliance

Two years of Alliance ministration of the Alliance, and to rural communities will be reached this experience back up the method, which strengthen that spirit of mutual con

has to meet two key U.S. objectives. fidence which is the true revolution in year by AID trained and assisted agri. These involve the assurance that the this hemisphere over the past 3 years. culture extension workers. In the last

The democratic leaders

leaders in Latin 2 years, 246,000 new acres of farm land self-help and reform requirements of the have been prepared for irrigation. Al- Alliance must be met and, at the same America today count on us. At the very most 17,000 potential farm leaders from time, the need to capture the confidence moment when they have gained con3,500 villages have received water and

and imagination of the Latin American fidence in us and are exposing themsoil conservation training under a propeople.

selves to grave political hazards in the gram financed by Public Law 480 com

AID, therefore, has acted on these firm expectation of timely and effective modities. principles: First, it has refused to com support from the United States, we must

come through. In Chile, 215,000 farmers were reached mit or spend unless convinced that the last year by AID-sponsored extension outlay is clearly in the U.S. national in


PROVED BY THE SENATE activities. Twenty rural training cen- terest, promoting development and freeters are reaching 2,000 students each dom in Latin America; and, second, it

Mr. GRUENING. Mr. President, I year in basic agricultural techniques.

has been prepared to offer assistance wish to pay tribute to the majority leadIn Taiwan, 80,000 agricultural credit whenever a Latin American nation ini- er [Mr. MANSFIELD] for the wise and skillloans were made last year under the tiates the social and economic changes ful manner in which he handled the desponsorship of AID-supported National the Alliance calls for. On a per capita bate on the foreign aid authorization Agricultural Cooperatives Federation; basis, countries like Chile, El Salvador, bill. The action of the Senate on this 637,000 farmers are benefiting directly Colombia, and Panama received much bill was tantamount to the Senate acting from AID-generated farm and home eco

more aid than did Paraguay or Haiti, as a Committee of the Whole in working nomic extension work. More than 80 for example.

its will upon the bill. It was an operapercent of farm families in Taiwan are In fiscal year 1963, aid was concen- tion which I hoped to avoid by supportnow being reached by extension workers. trated in the countries which performed. ing the motion to recommit. When that

In Vietnam, in the midst of a shooting It was reduced or held up where self- motion failed, there was no alternative war, rapid strides are being made in in- help and reform efforts were shunned or but to rework the bill right here on the creased agricultural production–300,000 lagging. You will recall that the United floor of the Senate. people are being reached by extension States spent almost nothing in Peru. That we have now done. work in basic agricultural techniques. Funding for Brazil and Argentina was

The guidance of the majority leader A million and a half people have been much lower than expected. Brazil had in that action was eminently successful reached by a plant production program not met her self-help commitments, nor and has now produced a bill which, in designed to provide training and demon- had it reached the stage of political my opinion, is a much stronger bill than stration in the protection of plants and and, particularly, financial stability the one reported by the Senate Commitharvests from rodents and insects. which would make worth while all of the

tee on Foreign Relations. In reporting, These specifics are impressive and I lending which was previously estimated. even that committee in its report exam afraid not very well known; but they Argentina's political problems prevented pressed its dissatisfaction with the bill are not unusual. They are typical of any clear focus on development.

and the conduct of the program. the way in which the U.S. foreign as- This year, Peru's new constitutionally

I would also express my appreciation sistance effort is getting directly to the elected Government has put that hither- and admiration for the work of the senior grassroots of the developing nations. to politically stagnant country on the Senator from Oregon [Mr. MORSE) in

Our foreign aid program is effective; Alliance road to reform. Argentina has leading the debate on the floor of the it is doing a job.

a constitutionally elected government Senate during these past weeks to This is no time for us to slacken our and the prospects are good for stability strengthen the bill and thereby, we hope, efforts.

after a year of turbulence. Further de- the foreign aid program. His skillful, I urge that the Senate approve the velopment opportunities are evident in learned presentation of each point in the Foreign Assistance Act as reported by Central America and Chile, among oth- debate is greatly to be admired. If, as a

, the Foreign Relations Committee. ers.

result of the action here on the floor in

strengthening the bill, the foreign aid program it is willing to support. It is Actually-upon analysis—those who program itself is strengthened, then the now up to the administrators of that have been critical of some of the direccredit in no small measure must go to the program to adhere to those guidelines tives written into the bill worked on in senior Senator from Oregon. He astute- and steer the foreign aid program in that the Senate are critical because of the ly guided the perfecting and strengthen- direction. And to those administrators content of the directives rather than ing amendments to the bill through the I will give this one bit of advice: I for because they believed that Congress shoals of opposition-opposition which, one—and I am certain there will be should hand the administration a blank I must say, at times was blind opposition others—will be watching the administra- check in the field of foreign assistance. to any change whatsoever, however tion of the foreign aid program closely They have sought to cloak their critimeritorious and justified that change in the months ahead to see to it that cisms under learned phrases about the might be.

the congressional administrations are Executive having a free hand in foreign Mr. President, it is my intention to heeded. And I for one-and here, too, I policy determinations. They overlooked

, , vote in favor of final passage of H.R. know that I will be joined by many of my their own silence over the restrictions ap7885 as amended.

colleagues—will not hesitate to fight for proved and recommended by the SenThe cuts in the amounts authorized stronger action if these warnings go ate Foreign Relations Committee. were relatively unimportant. It is my unheeded.

There is nothing sacrosanct about the firm belief, Mr. President, that if action In that connection I would point out recommendations of that committee. by the Congress a few years back had one fact dealing with interest rates on They are still only recommendations of kept the lid on the ever-increasing au- development loans.

that committee. They are still only recthorization for our foreign aid program On November 8 I called up my amend- ommendations to be accepted, rejected or that program today would be in a much ment to increase rates of interest on amended by the Senate and the other stronger position and would not have development loans to the amount paid body. aroused the criticism of the people of the by the United States to borrow money. That is precisely what the Senate has United States from coast to coast. If That amendment was defeated by the been doing these past weeks-accepting, the AID administrators had been forced vote of 30 to 44.

rejecting, or amending the recommendato count their pennies rather than their On November 13 the Senate rejected tions of its Foreign Relations Committee. millions, they would have put the U.S. a second amendment raising the interest

a second amendment raising the interest That is its duty. For the Constitution dollars where they would do the most rate to 2 percent. That amendment was states not only that the appropriating good. The program needs greatly to rejected by a vote of 41 to 47.

power lies with the Congress, but it consupplant largess with frugality and om- The point I make in this admonition tains the further limitation that: niscient presence with selective leader- to the administrators of the AID pro- No money shall be drawn from the Treasship where it counts the most. gram is just this: There are at least 41

ury, but in consequence of appropriations Two amendments which I offered have Senators who are dissatisfied with the made by law; and a regular statement of been adopted and are included in the custom of granting development loans at account of the receipts and expenditures of bill. three-fourths of 1 percent interest. They all public money shall be published from

time to time. One amendment deals with withhold- want it raised to at least 2 percent. So ing all aid-except the Peace Corps and when the foreign aid authorization bill During the course of the debate on Fulbright educational grants—from na- for fiscal year 1965 comes before the the foreign aid bill-H.R. 7885—two protions found by the President to be ag- Senate not many months from now there posals for changing the program have gressors or preparing for aggression. will be many of us who will be watching been advanced which should put all This amendment should not have been to see whether the minimum written into Members of Congress on the alert. necessary. For years now either the the fiscal year 1964 authorization has The repeated statements portending Senate has adopted "sense of the Con- become the maximum. If so I am certain proposals to be put before the Congress gress" resolutions or Members have

Members have they will be willing to join with me in an bode ill for the retention of even the taken the floor to denounce this or that attempt once again to make these real

attempt once again to make these real small amount of congressional control aggressor nation squandering our money loans rather than combined loans and over the foreign aid program. to prepare to engage in aggression. But grants.

If this is the future "new look” of these warning signs of a rising tide of Mr. President, much has been written

the program it is only more of the opinion on the part of the people of the and spoken in the past weeks about the same. United States have gone unheeded by role of the U.S. Senate in the realm of

The first proposal I expect to be adthis and past administrations. And now foreign policy. Much of what has been

vanced is that we should delegate to the Congress has acted with clarity in written has been hastily conceived and international organizations more and setting forth the guidelines of how it not thought through.

more of the conduct of our foreign aid expects the foreign aid program to op- Now every foreign aid authorization program—with our money, of course. erate. bill has contained restrictions on and

This trend I will also resist. The ConThe second amendment relates to mildirectives to the Executive in administer

gress should seek in more and more ways itary aid to Latin American countries. ing the foreign aid program.

ing the foreign aid program. If this to regain control of the foreign aid proThis too is an amendment which should were not so, the foreign aid authoriza

gram-control which it has in the past not have been necessary. There have tion bill could be expressed in a single years weakly permitted to be taken from been plenty of hints in the Congress dur- paragraph such as the following:

it. It is essential that this control be ing the past years which should have There is hereby authorized to be appropri- regained by the Congress. You will recall given the military program administra- ated the sum of $

—for the fiscal year the action a few years back when the tors clear indication that the policies to be used for carrying out a foreign aid

World Bank approved a large loan to they were pursuing in giving military as- program.

Egypt for improving the Suez Canal at sistance to each and every Latin Amer- Some who have spoken and written on the very time when Egypt was refusing ican country did not follow the wishes

the role of the Senate seem to set such a to adhere to its international commitof the Congress. However, those hints

wide open authorization as their goal. ments and permit free passage through and even some of the restrictions writ- With the advent of the AID program the canal. ten into foreign assistance program au- as an instrumentality of U.S. foreign This lack of firm control over who, thorizations-went unheeded. So, fi

policy, the Congress—which alone can where, and how U.S. dollars are to be nally, there was no recourse but to write

appropriate funds—has become—wheth- spent should not be transferred to inthe restriction into the bill this year. er it wants to or not truly enmeshed ternational organizations. The siren's Many other amendments offered by in foreign policy determinations. These

in foreign policy determinations. These call of anonymity in foreign aid decisions other Senators have been adopted and can be of a positive or negative type. should not be heeded. It is true that should result in a much stronger bill. Negatively by continuing to appropriate such anonymity dissipates blame for for

Will it result in a much stronger for- funds for ongoing programs the Con- eign aid fumbles. But more important, eign aid program? That remains to be gress acquiesces in the policies being if we are building up the U.S. image in seen.

pursued; postively by writing into the the countries aided, we should be there Congress can but set down broad gen- authorization bill certain directives and to take the credit when our foreign aid eral guidelines describing the type of limitations.

program proves to be a success.

Although I shall vote in favor of the categories: First, procurement with for- priate for private investment. After final passage of the foreign aid authori- eign aid dollars; second, assistance to these opportunities have been identified, zation bill, because of the improving private U.S. business in locating and fi- efforts are made to match them with poamendments which the Senate adopted, nancing profitable investment opportu- tential U.S. investors. Full use is made it should not be taken to mean that I nities in less-developed countries, and,

nities in less-developed countries, and, of industrial and publications resources am completely satisfied with the bill or third, strengthening the local foreign of the Department of Commerce, consulwill, without attempting further to im- business community.

tations with trade associations, banks, prove the foreign aid program, docilely As part of a deliberate policy to tight- and management consulting firms, and vote to approve whatever appropriations en procurement procedures in order to

en procurement procedures in order to ultimately direct contact with individmay be recommended by the Senate Ap- protect U.S. balance of payments and to ual companies. propriations Committee. On that point, stimulate the U.S. economy, our foreign Second. Through the investment I shall wait and see.

aid program is increasingly based on guarantee program approved by ConNEW EMPHASIS ON DEVELOPING PRIVATE ENTER- procurement of American goods and gress, the U.S. Government pays up to PRISE THROUGH FOREIGN AID

services. Of the $2.4 billion committed 50 percent of the cost of over 50 surveys Mr. HARTKE. Mr. President, in his during fiscal year 1963, $1.9 billion or being undertaken by U.S. private busiforeign aid message to Congress last 80 percent will be spent in the United nessmen to survey such investment opspring, President Kennedy declared: States.

portunities as castor bean processing in

This has had a dramatic impact on Thailand, and manufacturing preThe primary new initiative in this year's program relates to our increased efforts to several major U.S. industries, particular

several major U.S. industries, particular- stressed concrete in Argentina. Use of encourage the investment of private capital ly the chemical industry and the iron this special program has been increasin the underdeveloped countries.

and steel industry. In 1960, 17 percent

In 1960, 17 percent ing as more businessmen have learned of Private investment is now being of the fertilizer financed by foreign aid the availability of this form of assistance. heavily stressed in our foreign aid pro- came from the United States; in 1963

came from the United States; in 1963 Forty-five surveys were approved during gram for four basic reasons.

that percentage will be 97 percent. the past year, and 28 more are now being First. The United States has a vital In the first 9 months of 1963, for ex- processed. interest in encouraging private enter- ample, Chemical Week magazine reports Third. Between January 1, 1962, and prise and initiative in countries receiv- that foreign aid funds financed $34 mil

that foreign aid funds financed $34 mil- June 30, 1963, 70 dollar and local curing our assistance.

lion in exports of chemical products rency loans to private business amountSecond. Achievement of industrial such as fertilizer, pesticides, and basic ing to over $70 million were approved.

$. and agricultural growth in the less-de- industrial chemicals.

In September 1963, the largest Cooley veloped nations requires the develop- Similarly, in iron and steel products in loan was approved-$17.5 million in ment of technological and managerial 1960, 11 percent came from U.S. mills Indian rupees to a private fertilizer comskills in the private sector of their econ- while in 1963, 87 percent of such prod

while in 1963, 87 percent of such prod- pany in India in which the California omies.

ucts came from the United States. At Chemical Co. and the International MinThird. Economic development of the the present time more than one-half of

the present time more than one-half of erals & Chemical Co. are major particiless-developed countries cannot be all U.S. iron and steel exports are fi- pants. achieved through Government assistance nanced out of the foreign aid program.

Fourth. Processing of specific risk inalone. There is not enough money in

Just in recent weeks, for example, vestment guarantee contracts has been all the public treasuries to supply the there have been foreign aid orders for

there have been foreign aid orders for accelerated. There are now over $1 bilneeded capital. Foreign aid can pro- $630,000 for steel billets to Pakistan from

lion of such insurance contracts outvide some of the capital required for the Bethlehem Steel, $1.5 million for hot

standing. first stages of development, but only rolled aluminum steel sheet to India from

The number of guarantees issued anthrough private enterprise can a coun- McLouth Steel, $563,000 for coke tin plate

McLouth Steel, $563,000 for coke tin plate nually has jumped six times in the last try achieve eventual economic independ- to Taiwan from Wheeling Steel, and 2 fiscal years from $53 million in fiscal ence. $255,000 for steel wire rods to India from

1960 to over $300 million in 1962. It is Public funds are, of course, still neces- Colorado Fuel & Iron.

estimated that the dollar volume in fiscal sary for large public utility type projects, In addition to using 8 out of 10 for

1964 will exceed one-half billion dollars. such as dams, transportation networks, eign aid dollars for buying American

The geographic coverage of the proand irrigation systems. These facilities, goods, special efforts are now being made

gram has also been enlarged-this year while essential to support the private sec- to increase the role of U.S. private in

8 additional less-developed countries tor, are often not attractive to private vestment in the development of less

have agreed to implement the programinvestors, especially in the less-developed developed countries.

bringing the total of participating nacountries. Moreover, Government funds First. There is a special program for tions to 57. are necessary to provide the social prog- finding and drawing the attention of priress projects—the schools, for example, vate businessmen to investment opporvate businessmen to investment oppor- U.S. investor? Let me cite one example.

What does this protection mean to the from which private companies must draw tunities in less developing countries. The In 1960, the Pluswood Industries, of their educated managers and skilled first comprehensive listing and summar. Oshkosh, Wis., made an investment in facilities essential to a vigorous work opportunities identified in feasibility Political upheaval, along with foreign laborers, as well as the public health izing is now being made of investment what was then the Belgian Congo. force. studies conducted since 1960.

exchange difficulties, resulted in the Finally, as foreign aid succeeds in Four countries have been selected as firm's inability to transfer into dollars helping countries to reach self-sustain- showcase nations for private invest- the Congolese francs received as interest ing economic growth, private capital will ment—that is, specific target countries take the place of Government aid. Pri- in which to demonstrate the contribu- on a $200,000 loan, But since this investvate investment is therefore increasingly tion that private participation can make inconvertibility of currency, the U.S.

ment was covered by a guarantee against important not only to assist in the phase- to economic development. The four out of Government aid but also to pro- countries selected are Colombia in Latin in American dollars for the Congolese

Government paid Pluswood over $17,000 vide a continuing mutually beneficial America, Pakistan in the Near East, Ni- francs. Thus, the investor received his economic relationship when aid has geria in Africa and Thailand in the Far money at once and in dollars. The U.S. terminated.

East. These are all nations which are Foreign aid draws on the resources of regarded as friendly toward private in the francs and subsequently was able to

Government then became the holder of a broad segment of the private sector vestment from the United States, and recover $8,000 through selling the forboth at home and abroad. This is done countries in which substantial economic in part through universities, coopera- progress can be anticipated in the near

eign currency after the restrictions on tives, savings and loan associations, future.

convertibility were relaxed. credit unions, trade unions and similar In each country the U.S. Embassy and

Likewise, if a foreign government organizations. Relationships with pri

Relationships with pri- our foreign aid mission, together with should expropriate the assets of a guarvate business, United States and foreign the host governments, have selected a anteed investment without paying are also very extensive. These relation- small number of industries of a priority prompt, adequate, and fair compensation ships can be divided into three general nature that would be especially appro- to the American owner, he would be paid

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