U.S. AID ALLOCATION TO BRITAIN IS “ABSOLUTE MINIMUM”

Gisborne Herald, Volume LXXVI, Issue 22883, 1 March 1949, Page 5

U.S. AID ALLOCATION TO BRITAIN IS “ABSOLUTE MINIMUM”

(N.Z.P. A. — Reuter—Copyright.) (11 a.m.) WASHINGTON, Feb. 28. The proposed 940,000,000 dollars in new aid to Britain was a “tight fit”—the absolute minimum needed —Mr. Paul Hoffman, head of the Economic Co-opera-tion Administration, told the Senate Foreign Relations Committee today.

1 The committee had called Mr. Hoffman and a group of advisers to justify Britain’s share of new aid funds, and to explain the “wide discrepancies” in the estimates

of Britain’s recovery progress

Mr. Hoffman said that any reduction in the allocation to Britain would adversely affect recovery in both the United States and Western Europe.

"Until Britain’s earnings of dollars through exports ana services to the United States and other hard currency areas are sufficient to pay for essential imports, she will still need American aid,” he said. “We are convinced that the salvation of Western Europe depends upon the joint economic effort of all participants and can only be achieved by mutual aid and close economic co-operation. Any setback to a country so important _as Britain would be bound to have the most serious consequences.” Adverse Effect of Cuts

Mr. Hoffman expressed concern lest the British progress be reversed and “a stultifying and generally demoralising influence on the whole pace and vigour of British recovery be substituted.”

Mr. Paul Hoffman

. He said the question of cutting the programme by at least 200,000,000 dollars had been explored. In addition to the adverse effect this would have on British economy, it might cut into the United States exports of cotton foods, tobacco and industrial goods. It would mean that Britain would have that much less to spend in the United States, Canada and other markets where goods could be bought only for dollars. Mr. Hoffman claimed that Mr. Christopher Mayhew, the British Undersecretary for Foreign Affairs had been "needled by the Russians” into making a statement before the United Nations last week that the United Kingdom had already achieved recovery. “Purely Political”

He characterised this and a statement by Mr. Hector McNeil that Mr Mayhew had been “telling the truth? as “purelv political.” Mr. Hoffman insisted that “we in the Economic Co-operation Administration are just as anxious as anyone else to save every dime of the Government’s funds. At no time have we relied on any British politician for arriving at the figure of what Britain needs.”