RIG CUT PROPOSED IN U.S. FUNDS FOR FOREIGN AID

Gisborne Herald, Volume LXXV, Issue 22656, 5 June 1948, Page 5

RIG CUT PROPOSED IN U.S. FUNDS FOR FOREIGN AID

(10 a.m.) WASHINGTON, June 4. The House of Representatives Appropriations Committee, in reporting the bill carrying funds for the Marshall Plan and other foreign aid programmes, recommended a cut of 27 per cent from the figure proposed by the Administration.

The measure now provides a sum of 5,880,718,258 dollars for global assistance in the 15-month period ending July 31, 1949, whereas President Truman had asked for 6,553,710,228 dollars for the 12 months ended April 30, 1949.

The committee cut the amount for European aid to 400,000,000 dollars—a slash of 245,000,000 from the figure asked and said it was dissatisfied with the progress of the rehabilitation of Germany. The committee approved 400,000,000 dollars of the 463,000,000 requested for aid to China and agreed to the Administration’s request for 424,000,000 for the relief of Japan and the Ryukus and 107,000,000 in Korea. It completely erased 150,000,000 dollars for Japanese economic reconstruction which had General MacArthur’s support and expressed misgivings about further aid to China. Reinstatement Requested ' When informed of the committee’s action, the Economic Co-operation Administrator, Mr. Paul Hoffman, promptly requested the reinstatement of the full amount of 4,245,000,000 dollars for European aid. “The less money we have, the less recovery we can expect,” he said. The appropriations committee stipulated that wool bought under the Economic Co-operation Administration programmes should come from stocks at present held by the Commodity Credit Corporation instead of being bought in foreign countries. The chairman of the committee, Mr. John Taber, said the Economic Cooperation Administration had proposed to buy wool from other sources than the Commodity Credit Corporation at prices higher than the 42 cents per lb. which the C.C.C. paid for its stock of 240,000,0001 b. The committee also stipulated that the E.C.A. should not buy goods anywhere at prices higher than those in the United States.

Explaining the committee’s reductions, Mr. Taber said he was satisfied the E.C.A. could operate for 15 months on the money allocated and accomplish proper rehabilitation. Crops Near Pre-War Levels

The committee had eliminated one item of 288,000,000 dollars to meet the balance of exchange between the participating countries and the United States because the expenditure of such a sum would have meant that the United States would have been paying debts due to itself. Mr. Taber said that another reason for the reductions was that the European grain crops were estimated to be nearly at pre-war levels and, accordingly, large-scale relief should not be needed. , , “Any kind of prudent management should provide for the real needs of these countries without enormous expenditures which have been proposed, ’ he said. . , . . Mr. Taber said that any unbiased analysis of European production figures and the E.C.A. estimates gave substance “to a doubt about the foreign aid programme’s real aims/’ “If it is the purpose of the E.C.A. to raise production in the participating countries to a level far beyond the prewar standard, we are tackling a project which has been grossly misrepresented to the American public, he added.