CUTS IN U.S. AID TO EUROPE

Press, Volume LXXXIV, Issue 25516, 9 June 1948, Page 5

CUTS IN U.S. AID TO EUROPE

BRITISH COMMENT ON HOUSE VOTE (Special Correspondent N.Z.P.A.) (Rec. 7 p.m.) LONDON, June 7. A grave view is taken in London of the vote in the American House of Representatives favouring the reduction by one-quarter of tne European Recovery Programme. The “Manchester Guardian” refers to the reaction as being one of “frank bewilderment and some bitterness,” and says that it is not disguised in London that if Marshall aid is heavily cut the result for Britain will be serious.

“It has already been made clear,” it says, “that to maintain even the present level of consumption, Britain needs the full amount of Marshall aid. Any cut in it will inevitably mean an equal cut in imports*” The “Observer’s” political correspondent ,says that if there is any reduction in Marshall aid, the Cabinet will order an immediate review of the import programme. He adds: “Even if the Senate restores all the appropriation cuts approved by the House of Representatives, Ministers will still- feel that import cuts may be necessary. The terms of trade are steadily turning against us, and the estimates of the economic survey have already had to be revised.

“It looks as if Britain is approaching a new period of difficulty. If there is any reduction in Marshall aid Britain will be involved immediately in an economic crisis which will inevitably have political repercussions.”