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You are now subsidizing with the $70 billion that you have induced the people to pay in tax money to these nations to buy our goods. We are overproducing many goods in this country and they are buying the goods with that $70 billion and building plants over there to compete with us under this virtually free trade policy that we have.

Congress took it. I do not blame you. I do not blame the investors. I blame the Congress, because what they do not vote for you cannot do. That is right, isn't it?

Secretary DULLES. That is right. Senator MALONE. You understand what Mr. Benson is up against, don't you? He is your confrere and I like him very much and I like his policy. He is trying to get down out of this tree, doing the best he can. But his problem is what? It is to sell the goods that he buys at a high price or a stabilized price or a price established by Congress to foreign nations at a world price, isn't that his problem?

Secretary DULLES. Yes. Senator MALONE. Well, then, who puts up the money in between? And I am not complaining about this because at least this subsidy stays in America. The taxpayers put it up.

Secretary DULLES. That is appropriated to the Commodity Credit Corporation.

Senator MALONE. But the taxpayers put up the money.
Secretary DULLES. That is right.

Senator MALONE. It does not make any difference which one of you spends it, does it?

Secretary DULLES. Excuse, me, it does not what?

Senator MALONE. It does not make any difference what Cabinet officer spends it. It still comes from the taxpayers, doesn't it?

Secretary DULLES. The money goes back to the farmers and they spend it.

Senator MALONE. Yes: but what becomes of the money that all the taxpayers put up and that is lost when you sell it at the world price?

Secretary DULLES. The money the taxpayers put up, Senator, goes back to the farmers.

Senator MalONE. That is right; and I do not object to that. I Foted for Mr. Benson I think because he has been doing the best he can. But that does stay in the United States. Where does the $70 billion go? Where did it go? Secretary DULLES. What $70 billion?

Senator MALONE. Since World War II that we appropriated directly. I think it is $344 billion this year.

Secretary DULLES. That money has been used primarily to buy goods in the United States which are exported abroad.

Senator MALONE. Don't tell me where it has been spent because I know, and I am not going into that today because we haven't the time. But who paid it, and where did it go? It went to the foreign countries to do something with, didn't it?

Secretary DULLES. To buy goods in the United States. Senator MALONE. Well, my friend, I can show that you are wrong in about 75 percent of the cases, but here is what I want to say to you. They also built plants with this money over there, didn't they? Secretary DULLES. Yes, sir. Senator MALONE. To build plants for manufacturing and mines to compete with us, didn't they?

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I know what your propaganda is. That is all over the Nation, but they buy goods here.

Secretary DULLES. I do not know whether it is propaganda or not, Senator.

Senator MALONE. Well, I do.

Secretary DULLES. But the fact is this. That history has demonstrated consistently that when you raise the level of living of other countries, you create an increased market for American goods. You take Canada Canada used to be a purely rural agricultural country. It has now been largely industrialized with help of American capital. You can say in a sense it competes, but also it creates the biggest market we have ever had in Canada.

There has been an enormous increase of American welfare through that development of Canada.

Senator MALONE. Do they have tariffs or are they proposing now or are they protecting their industries with a tariff in various ways?

Secretary DULLES. They have tariffs like we have.

Senator MALONE. No; they do not have tariffs like we have, and you know that, too.

Secretary Dulles. We both have tariffs. I do not know how they соmраrе.

Senator MALONE. But we do not have tariffs that keep anything on an equal basis and they do. And they also, most of these nations you are talking about, have import permits, exchange permits, and manipulation of their money—and Canada's money is now worth more than ours, because of some of these foolish policies that we have. But the other nations manipulate their money in terms of the dollar for trade advantages. You do know that; do you not?

Secretary DULLES. I know that our exports have been steadily rising to new highs and that we now export nearly $20 billion a year, so that these things you talk about, while certainly they do have an inhibiting effect in some respects, overall by and large there has been a steady increase of American exports to the great advantage of the American economy and to industry and labor.

Senator MALONE. What you are allowed to do under this act, is to decide if you want to protect an industry you can, we have established that if you want to trade an industry, you can, so you can to a large extent remake the industrial map of the United States, can't you?

I am talking now about the administration under this act.

Secretary DULLES. I pointed out, Senator, in my opening statement that almost everything that Government does, whether it is our defense program or anything else, has a competitive impact on the American economy.

Senator MALONE. But isn't this the first time that we have ever given the Executive the right to trade an industry to further the foreign policy? Under this act, isn't it the first time it has ever been done?

Secretary Dulles. Yes.

Senator MALONE. Good. Now I am going to ask you and I am not going into this any further—to refer to a table that I put into the record while cross-examining Secretary Weeks. It contains all the information I have been able to get from all of your departments, and you seem a little bit reluctant to give out much information. I hope you can improve that. I am sure you can. It shows that if you deduct the amount of money we give these nations and deduct the amount of the subsidies as you subsidize the wheat you sell Cuba-every hundred pounds of wheat you sent there cost the taxpayers $1.35 2 years ago. I do not know the cost now, but it has not been reduced much, because we pay support price for the sugar we import from them and they pay the world price for the wheat we export to them-if you deduct all of these subsidies and things that could come under the head of "subsidies" and deduct the money you give them, you are exporting today no greater a percentage of your exportable goods than you were in any year prior to 1929. Would you like to go into that with me as we go along after this is all settled, of course, and see if we couldn't arrive at a proper figure? I know what the propaganda is all about, and I also know that you are saying that there are 4 million men employed who are all going to lose their jobs tomorrow if we do not pass this, which of course is poppycock, too, because there are 6 million partially unemployed people on the street by virtue of this act of yours, and there will be 10 million on the street by next spring.

I want you to remember I said that.

Secretary DULLES. I will remember you said it, Senator, but I respectfully reserve the right totally to disagree with that.

Senator MALONE. Of course you do.

Secretary DULLES. The people who you talk about on the streets because of imports.

Senator MALONE. I think they are. Secretary DULLES. I think I can demonstrate to the contrary. Senator MALONE. All right, go ahead. Secretary DULLES. The Secretary of Labor has estimated that of this number of 6 million you talk about-I haven't got available, I'm sorry, here at the moment, the figure, but I have the very distinct impression that of the unemployment today, only a very small percentage, less than 10 percent, can possibly be attributed to imports.

Senator MALONE. Well, let me just give you an idea or two. You have here these estimates. They are all estimates. Unless I could get the information that I have asked your Department for and asked the Department of Commerce for and asked—what do you call this organization that gives the money away now down here that is under you? What is it called, the $37 billion that they are going to give away next year?

Secretary DULLES. We have no organization to give away $342

billion.

Senator MALONE. What are you going to do with that $32 billion we just gave you?

Secretary DULLES. Well, a good deal of it we are going to use to give some of our allies military equipment with, some of it we are going to loan, and I do not consider that loans are giveaways.

You perhaps do.
Senator MALONE. Do you ever get any back?
Secretary DULLES. Yes, sir.
Senator MALONE. Do you get it back under this organization?
What is the name of it, if you don't mind putting it in the record?

Secretary DULLES. Are you talking about the ICA, the International Cooperation Administration?

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Senator MALONE. Yes. It started out as the Marshall plan, didn't it?

Secretary Dulles. I think you can call it that, yes.

Senator MALONE. Well, that is pretty good because Mr. Marshall, not knowing, I believe, that there was any such paragraph in the Harvard speech, just read it without changing expression, but the Government in London took it on the first bounce and in 30 days that was my second year in the Senate-told us just what it was going to cost us. And that is what it did cost us, too.

There was a little argument. It is like Mr. Macmillan coming over here at a very opportune time to increase the economic interdependence and it is fine propaganda. He is a very fine man. I met him in England in 1947. He is much smarter than most of us as Mr. Churchill was—they win. They had a colonial system for 300 years.

I am doing to say for the record, we are a greater economic colonial today than we were in 1776, when we declared our independence.

What we need more than anything on earth is another Declaration of Independence.

Anyhow it is the ECA. It has changed its name 3 or 4 times to kind of keep out of the line of fire of people.

Secretary DULLES. ICA?

Senator MALONE. ICA. International Cooperation Administration. I guess we do most of the cooperating; don't we?

Secretary DULLES. No.

Senator MALONE. Do you know of any other nation who is putting up money for us or any of these other nations besides Russia?

Secretary DULLES. I know of plenty of other nations that are putting up money for our common program of defense against the Soviet Union; most of this, as you know, Senator, goes to building up military establishments in the areas around the Sino-Soviet bloc. We have a common program and to that program they contribute very, very largely

Senator MALONE. Well, how much did they contribute in Koreaall these allies that we have?

Secretary DULLES. Well

Senator MALONE. All we learn from history is we do not learn anything from history. I understand that. But you might go into that if you want to.

Secretary DULLES. They contributed very substantially.
Senator MALONE. In what way?
Encouragement behind the lines?
Secretary DULLES. No; fighting and dying.
Senator MALONE. Who contributed in a large way?

Secretary DULLES. The British Commonwealth had very important forces over there.

Senator MALONE. How many soldiers did they have over there? How many? I wish you would just get the record with all the forces that were there and enter them into the record here, since we have gotten to this business of cooperation. You will find there were very few comparatively.

You will find most of the nations did not help at all and you will find that what we did was lose a war and murder those kids out there, that is what we did. You would not let them win, you would not let them lose, and if anybody else ever goes into one of those little

wars and does it that way they should be impeached and I think they will be. Will you furnish that record as to the money and the troops? Secretary DULLES. Certainly. Senator MALONE. And troops put up by each of your allies? Secretary DULLES. Certainly. (The information is as follows:)

APPENDIX 1.—CONTRIBUTIONS TO KOREAN ACTIVITIES Summaries of military and relief assistance for Korea as of January 15, 1952

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