Nations on Surplus Commodities have been from our State Department rather than from the United States Department of Agriculture.

4. We must realize that the economic strength of the United States is absolutely essential to the success of all our military plans.-The United States cannot continue to support the people of the world economically, without seriously depleting its resources and risking the destruction of its own economy. We must find out that it is better to sell than to give away-better on the trade, the recipient country, and ourselves. We help needy countries more by making what we have available to them than we do by holding such commodities in warehouses in the United States.

I found that our representatives abroad had too little awareness and understanding of the fact that we had a serious economic problem at home, particularly with respect to agriculture. Every opportunity was taken to bring this matter to the attention of the United States representatives, ambassadors, generals, and others contacted.

May I repeat, protecting the economy of the United States is absolutely essential if we are to carry out our military plans for the future.

Economic recovery of Europe is not the complete answer to communism for they have economic recovery.

American agriculture must be represented in future international agreements, for those now making concessions for the United States do not know the subject. The United States does not help needy people by holding back what they need. The Government weakens the American economy by cutting American farmers back to set people up in business in foreign countries.

American farm-support laws are essential to offset costs of other laws, but any farm program to succeed must use authority of present law to sell what we produce and do not need on a competitive basis to the people of the world.

SUMMARY SCHEDULE OF WHITTEN TRIP

Left New York City aboard U. S. N. S. General Rose, September 23. Arrived Bremerhaven, Germany, October 1. Met by Jack Haggerty, agricultural attaché at Bonn, and Bruce Lancaster, economic counselor at Hamburg.

GERMANY

October 1: Dinner at Hamburg with Consul General Timberlake and Herr Alfred C. Toepfer, one of largest wheat importers in Germany.

October 2: Meetings at Hamburg with Herr Blessing, importer of fats and oils, and several cotton importers. These people generally of opinion that (1) present United States agricultural surpluses are a constant threat to world markets; (2) that handling of United States surpluses through normal channels of trade would be far better than present United States policy of holding prices high and then giving commodities away; and (3) most countries would prefer United States products if prices were competitive and dollar exchange available. Drove to Kassel in afternoon.

October 3: Drove to Frankfurt.

October 4: Meeting at Heidelberg with Gen. Wm. M. Hoge. Lunch and tour at Schloss-Heidelberg Castle. Flew to Berlin in late afternoon.

October 5: Briefing in Berlin by General Honnen, his staff and representatives of HICOG. Attended HICOG staff meeting. Heard special report on unemployment problem in Berlin. Meeting with Dr. Conant, High Commissioner of Germany. Visit to Russian sector of Berlin in afternoon.

October 6: Visit to refugee camp in Berlin. Flew to Frankfurt in late afternoon. Took train to Paris in evening.

FRANCE

October 7: Meeting in Paris with Lt. Gen. C. V. R. Schuyler at SHAPE headquarters. Pointed out need to keep United States economy strong at home to support apparent long-range military effort in Europe. Visit to Versailles and Notre Dame in afternoon. Reception at home of Agricultural Attaché Omer W. Herrmann.

October 8: Attended conference of agricultural attachés from European area. Discussed in detail problems related to agricultural policy and marketing of United States commodities in Europe. Meeting with Ambassador C. Douglas Dillon.

October 9: Drove through agricultural area southwest of Paris, including Chartres. October 11: En route Paris to Madrid by train.

SPAIN

October 12: Visit to "Los Caidos" monument near Madrid (Franco's memorial), being built in memory of fallen soldiers of Spanish civil war. Visit to EI Escorial near Madrid, monastery-monument built by Philip II.

October 13: Meeting with Ambassador James C. Dunn. Meeting with Edward L. Williams, minister of economic affairs and FOA Director. Briefing by Maj. Gen. August W. Kissner on construction of airbases in Spain. Visit to Torrejon Airbase near Madrid.

October 14: Reception at home of agricultural attaché Burl Stugard.
October 15: Flew Madrid to Rome.

ITALY

October 16: Visit to land reform project north of Rome, an example of attempts by Italian Government to break up large landholdings and enable small "peasant" farmers to settle on and purchase small farms from 15 to 20 acres. Similar to resettlement projects in United States.

October 18: Conference in Rome with Mr. Henry J. Tasca, Chief of FOA mission, and staff on economic affairs in Italy. Meeting with Minister Dubrow and military officials on military and political problems. Luncheon with Dr. Vincent Cardon and FAO officials. Brief tour of FAO. Meeting with Ambassador Clare Booth Luce.

October 19: Drive to Florence.

October 20: Drive to Milan.

October 21: Meeting and luncheon with officials of Italian Cotton Association, cotton merchants, and textile trade people. Consensus of group much the same as in Germany, although prices of United States cotton not out of line at present time.

SWITZERLAND

October 22: Visit to United Nations building at Geneva-Palais de Nations (formerly League of Nations headquarters).

October 23: Visit to Caux, location of headquarters of moral rearmament movement, an organization dedicated to spreading the message of the free world. Its principal means is through presentation of theatrical productions in various countries. Is supported by private subscription and by financial sacrifice and dedication of people actively engaged in its work. Flew to Paris in evening.

BELGIUM

October 25: Drove Paris to Brussels. Visited Belgian farm. Reception at residence of Ambassador F. W. Alger.

NETHERLANDS

October 26: Drove Brussels to The Hague, traveling through some of the area flooded in February 1953. Area appeared to be completely recovered and restored to agricultural production. Dinner at home of Agricultural Attaché George J. Dietz.

October 27: Meeting with Ambassador H. F. Matthews and his deputy. Luncheon meeting with Minister of Agriculture Mansholt and several members of his staff. Herr Mansholt's position on United States agricultural policy was similar to most governmental officials of competing nations encountered in Europe on two points: (1) That the United States could afford to hold its products off the markets in order to help the smaller nations build up their agricultural economy and (2) that it would be unfair for United States to sell its products in world markets at less than domestic United States prices. The claim that United States agriculture is subsidized is used generally throughout Europe by competing nations to put our representatives on the defensive. Flew to London in late afternoon.

LONDON

October 28: Meeting with Ambassador Winthrop W. Aldrich and FOA Chief Lincoln Gordon. Meeting with British Minister of Finance. Question of subsidized United States agriculture again brought out. Lunch at Farmers' Club

of London with Minister of Agriculture and his associates and representative of Liverpool Cotton Association. Visit to House of Commons. Reception at home of Agricultural Attaché Eric Englund.

October 29: Dinner at American Embassy with American and British agricultural officials, given by Dr. Fred Motz, Department of Agriculture representative in London.

October 30: Further meeting with Ambassador Aldrich. Drive to Southampton in afternoon.

Left Southampton on U. S. N. S. Rose on October 31; arrived New York City on November 8.

Source: From "Foreign Agricultural Trade"-U. S. Department of Agriculture.

2. SHIPMENTS UNDER AID PROGRAMS

1945. 1948. 1952

1953..

[Millions of dollars]

Source: From Foreign Agricultural Situation-U. S. Department of Agriculture.

3. FOREIGN COTTON PRODUCTION

1,365 2,309

429 360

Source: From Foreign Agricultural Service-U. S. Department of Agriculture.

4. UNITED

STATES FEDERAL EXPENDITURES IN EUROPE (INCLUDES MILITARY,
DEFENSE SUPport and ofFSHORE PROCUREMENT)

5. TECHNICAL ASSISTANCE IN EUROPE, INCLUDING GREECE AND TURKEY

[Millions of dollars]

1953. 1954. 1955.

Source: From 1955 Budget justifications-FOA.

21.0 13.6

9.4

Mr. WHITTEN. The Department is trying to dispose of these commodities through this channel of Public Law 480. I think we should insert at this point in the record a copy of the President's message on this subject.

(The message is as follows:)

To the Congress of the United States:

I transmit herewith my first semiannual report on the activities carried on under Public Law 480, 83d Congress, as required by that law.

Public Law 480 is an expression by Congress of its determination to deal with the abundance of our agricultural production in a constructive way. Despite the problems created by this abundance, we may be thankful we live in a land which is able to produce plentifully rather than one which suffers the affliction of food shortages.

The enclosed report includes the dollar value of the foreign currency for which commodities exported pursuant to section 102 (a) of the act have been sold, as well as the estimated order of magnitude of the total country programs which have been generally agreed on but not fully negotiated, together with the cost to the Commodity Credit Corporation of such sales. The report also contains a summary of the policies and operating techniques evolved for the administration of the act during the first 6 months of its existence.

THE WHITE HOUSE,

January 10, 1955.

DWIGHT D. EISENHOWER.

REPORT ON ACTIVITIES UNDER PUBLIC LAW 480

INTRODUCTION

The Agricultural Trade Development and Assistance Act (Public Law 480) combines many different purposes. It affects many aspects of both our domestic and foreign economic policies. It directly involves participation by five departments and agencies and affects the area of interest of several more. Public Law 480 is the result of long congressional consideration of many bills designed to contribute to the solution of our problem of agricultural surpluses through expansion of the movement of such commodities abroad. It combines features of many bills providing for acceptance of foreign currencies in payment for surplus commodities and includes provisions of the Famine Relief Act of 1953.

For these reasons I deem it desirable, before delineating activities under the act, to review briefly its principal provisions and indicate its relationship to the total agricultural problem in the United States, our foreign economic policies, and other agricultural disposal programs of the Government

PROVISIONS OF THE LAW

The act declares it to be the policy of Congress "to expand international trade among the United States and friendly nations, to facilitate the convertibility of currency, to promote the economic stability of American agriculture and the national welfare, to make maximum efficient use of surplus agricultural commodities in furtherance of the foreign policy of the United States, and to stimulate and facilitate the expansion of foreign trade in agricultural commodities produced in the United States by providing a means whereby surplus agricultural commodities in excess of the usual marketings of such commodities may be sold through private trade channels, and foreign currencies accepted in payment therefor." It further declares it to be the policy of Congress to use foreign currency accruing under the act "to expand international trade, to encourage economic development, to purchase strategic materials, to pay United States obligations abroad, to promote collective strength, and to foster in other ways the foreign policy of the United States." Title I authorizes the President to enter into agreements with friendly nations providing for the sale of surplus commodities for foreign currencies. In negotiating

such agreements the President is required, among other things, to take reasonable precautions to safeguard usual marketings of the United States and to assure that sales for foreign currencies will not unduly disrupt world prices, to take appropriate steps to assure the use of private trade channels, and to give special consideration to the development and expansion of demand abroad for agricultural commodities.

The President is authorized to use, in agreement with the country concerned, foreign currencies accruing from sales for eight separate purposes. Foreign currencies may be used for these purposes without regard to section 1415 of the Supplemental Appropriations Act of 1953,1 except that section 1415 is required to be applied to the use of at least 10 percent of the total foreign currency proceeds of sales and to all use of currencies as grants for financing the purchase of goods or services for other countries, for promoting economic development and trade, or for payment of United States obligations abroad. The President may, however, waive the applicability of section 1415 in any case in which he finds that such applicability would be inappropriate or inconsistent with the purposes of the title.

Title II of the act authorizes the President to furnish, out of Commodity Credit Corporation stocks and on a grant basis, surplus agricultural commodities to friendly governments or peoples to assist in meeting famine or other urgent relief requirements or to "assist programs undertaken with friendly governments or through voluntary relief agencies."

Title III amends and liberalizes the Agricultural Act of 1949 by providing additional authority to dispose for various purposes of commodities owned or controlled by the CCC. It authorizes the CCC to pay reprocessing, packaging, handling, and transportation charges on donated commodities up to time of delivery to a designated agency or domestic distribution or to shipside in the case of distribution abroad. Section 303, while containing no new legal authority, establishes a policy of encouraging the barter of surplus commodities for strategic materials or for goods required in the foreign assistance program or offshore construction.

Appropriation.-Transactions over a 3-year period under title I are limited to an amount which would require an appropriation not to exceed $700 million to reimburse the CCC for its losses 2 in the commodities disposed of or for its cost of disposal. Costs of transfers under title II for the 3-year period are limited to $300 million, including the CCC investment in the commodities. No transactions under either title may take place after June 30, 1957.

EXECUTIVE ORDER 10560

Executive Order 10560, September 9, 1954, delegates authority vested in the President for administration of Public Law 480. Primary responsibility for sales for foreign currency is assigned to the Secretary of Agriculture. All functions conferred on the President by title II of the act are delegated to the Director of the Foreign Operations Administration.

INTERAGENCY COMMITTEE

Because of the complexity of the act and the interdepartmental interest, it is imperative that the administration of the act be effectively coordinated. To this end I directed, by letter dated September 9, 1954, that there be established an Interagency Committee on Agricultural Surplus Disposal "to assist the agencies concerned in bringing into harmonious action, consistent with the overall policy objectives of this Government, the various agricultural disposal activities vested in them by, or assigned to them pursuant to, the act." It was directed that the committee should be composed of a representative of the White House Office as chairman and one representative of each Government department or agency designated by the chairman. The chairman was made responsible for advising the President concerning policy issues. The committee now consists of the Chairman, Mr. Clarence Francis, and senior officials of the Departments of Agriculture, Commerce, Treasury, and State; the Foreign Operations Administration; and the Bureau of the Budget.

1 Section 1415 provides that foreign currencies owned by the United States can be used only as authorized through the appropriation process. In practice this generally means that appropriated funds must be used to purchase such currencies from the Treasury when they are to be used.

2Dollars received through the purchase of foreign currencies by any agency of the United States for its use abroad reduce the CCC loss on sales for foreign currencies. However, currencies received from sales but which are used by such agency without purchase are not an offset to the loss to CCC of its investment in the commodities disposed of under the act.