FOREIGN-RELATIONS, 1950, VOLUME I


   A third alternative might be the proposal of one title for military
end items and another. for all forms of economic assistance to the
NATO and ERP countries. This would have the advantage of per-
mitting one logical justification of the amounts requested without
an artificial distinction between types of economic aid and would at
least to some extent minimize the purely military character of the
aid. It would, however, hamper transferability between economic
aid for production of military end items abroad and for procurement
of U.S. end items (unless broad transferability provisions could be
inserted in the legislation). 1It might also cause confusion in Congress
to establish a new category of aid when existing legislation and pre-
vious discussions have firmly implanted the two concepts of military
support and economic recovery. It also presents the danger that many
existing-conditions and restrictions attached to the ERP legislation
would be placed on the aid in support of the military effort abroad.
   All of the other programs ,are for the purpose of aiding in the
 development of economically underdeveloped areas. With the excep-
 tion of the .two programs (Korea and Palestine refugees) which are to
 be conducted under U.N. auspices and which will need special legis-
 lative justifications and legislative provisions, it seems desirable to
 place these programs in one title of the bill. All of the programs have
 common political and economic objectives. In general they center
 around the development of agriculture, transportation and light in-
 dustry and improvement in health and basic education. They all have
 a large element of technical assistance. They must be closely related
 to activities for the stimulation of international private investment and
 for public loans. Common legislative policies and provisions should
 be applicable to them all. It is difficult to discuss such a program in
 one country or area before Congressional committees .without im-
 mediately being questioned about similar programs in other areas. The
 problem of the underdeveloped areas has already been considered as
 a whole in connection with public discussions on Point Four and it is
 treated as such in the report of Mr. Gordon Gray.5 Furthermore,
 maximum flexibility of funds between countries and areas is desirable.
 A strictly regional approach to these aid programs would have un-
 fortunate political repercussions in countries or regions which felt that
 their programs were small in comparison with those in other regions. It
would be difficult to justify continuation of a separate Point Four
program in the vast area of the world between the Philippines and the
shores of the Mediterranean for which other programs containing so
many similar elements are proposed. Appropriations under the

  "For documentation on the report on foreign economic problems by Gordon
  Gray, Special Assistant to the President, see pp. 831 ff.


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