If there is some question mark about what we are going to do forever in Europe, that might be more of an encouragement to them than this business of saying, "Well, we have tried to urge them to get together but they won't do it, but we are willing to go on and on and on." It is most difficult. An 8-year program is proposed here.

General BRADLEY. Your point is to tell them that unless they get together on this we will just quit appropriating. I believe there is some sentiment to that effect.

I believe that would be unfortunate, if I may say so, because what you are really doing then is dictating to a sovereign nation as to what they will do, and I am not too sure that it would have the effect that you outline.

They are pretty stubborn people, some of them, and I am not too sure but what it would have the opposite effect.

You must remember that the Communist conference last October announced that one of their objectives was going to be to split us from our allies.

I think this sort of an action while you attempt to take it might be playing right into that propaganda line and helping them accomplish what the Communists set out to do, in other words, break us off from our allies.

I think you would have to give that serious consideration as to how you did it because the effect might be the opposite of what you think it ought to be.

Mr. VORYS. I was low man on the totem pole at my own request, so I have overstayed my welcome.

Mr. GORDON. I am happy to see you, General, and I want to congratulate you on the fine work you are doing in your assignment.

I note in your statement that the military aid in the Mutual Security Program is most important to the collective security of all the free world and countries. I certainly agree with you that our security is dependent upon the security of all NATO countries.

I have no questions, but I certainly agree with the General on that statement.

Mr. VORYS. My deep apologies to you Mr. Gordon. I thought I was last.

Mr. GORDON. It was most interesting, so I listened.

Mr. VORYS (presiding). Are there any questions on a second round? Mr. PROUTY. Mr. Chairman, I would like to just ask one question. Is somebody from the Defense Department going to discuss these various recommendations made by these evaluation teams?

General STEWART. We had not planned in the Defense Department to discuss those recommendations."

Mr. PROUTY. There are a lot of questions that I think some of us would like to have answered by you people, but there is no time now, sir.

Mr. VORYS. Are there other questions?

If not, the meeting is adjourned until tomorrow at 10:30.

At 3 o'clock Ambassador Dunn will be here before the European subcommittee, and any who care to attend are welcome.

(Whereupon, at 2:10 p. m., the committee adjourned, to reconvene at 10:30 a. m., Friday, May 8, 1953.)

MUTUAL SECURITY ACT EXTENSION

FRIDAY, MAY 8, 1953

HOUSE OF REPRESENTATIVES,
COMMITTEE ON FOREIGN AFFAIRS,

Washington, D. C.

The committee met in executive session, pursuant to call, in room G-3, United States Capitol, at 10:40 a. m., Hon. Robert B. Chiperfield, chairman, presiding.

STATEMENT OF HON. CHARLES E. WILSON, SECRETARY OF

DEFENSE

Chairman CHIPERFIELD. The committee will come to order. We are glad to have you here, Mr. Secretary. You may proceed in any way that you desire. If you want to talk to us a few moments and then answer questions, or if you wish to tell us a little about what you have been doing, or if you have a statement, you may do so.

Secretary WILSON. Mr. Chairman, I have no special statement for this meeting. I did have a statement, as you will recall, for the joint meeting of the Senate and House committees.

I might say, as you all know, I have just returned from 3 busy weeks in Europe where I made a great effort to cover as many of our bases and depots and headquarters as I could and get acquainted with our American military people and the Secretaries of Defense of the different countries with which we were dealing.

I did come back encouraged to know that there was a great effort being made by men of all nations to cooperate in the common defense of the free world.

As you all know, there are a good many past sources of friction and past conflicts between nations in the whole NATO area, and the men were obviously trying to bury the past and look ahead toward the future.

I think it is our American leadership that is making that possible. In spite of all the difficulties and the big money expenditures, I think we can all feel that progress is being made. I think I might also say that our military people think that progress has been made. We have estimated that roughly there has been a 30 percent improvement in combat effectiveness in this last survey of the NATO meetings as compared to a year ago.

It is also a common opinion that there is no real evidence as yet that the danger has been removed or appreciably lessened. It is also true that the military men of all nations would like to have a stronger defense posture than exists, but the critical weakness that existed 2 or 3 years ago has largely been overcome. It seems fair to say now

that we can give proper weight to the ability of the NATO nations, including our own, to contribute to our military preparedness and defense, and our economic ability to do it.

With those few remarks, I think I would like to try to answer any questions that any of you have to ask me.

Chairman CHIPERFIELD. Mr. Vorys, you just came in. The Secretary has informally reviewed what he had said before at the joint session and referred to the general situation. I am sure you would have some questions that you would like to ask him, even though he has not made an elaborate statement.

Mr. Vorys

Mr. VORYS. Mr. Secretary, how much do you intend to spend this year on this program?

Secretary WILSON. Do you mean actual money paid out?

Mr. VORYS. Yes.

Secretary WILSON. Roughly, $5 billion. You are talking about fiscal year 1954, now?

Mr. VORYS. I was thinking first of fiscal year 1953.

Secretary WILSON. About $3.8 billion. It might be a little more than that, depending on how much we can step up our deliveries in the fourth quarter of the fiscal year.

Mr. VORYS. We have been supplied with figures for the first three quarters. We find that there has been spent $2.2 billion, and you feel that that will go up?

Secretary WILSON. I thought it was about $2.7 billion.

Mr. VORYS. Your part of it, according to this, is $2,165 million up to March 31.

We do not have a separate figure here for the Department of Defense. I find what I was giving you was simply the figure for military assistance to Europe, in title I.

Secretary WILSON. Military assistance is shown as $2.7 billion.
Mr. VORYS. Is that all spent by the Department of Defense?
Secretary WILSON. Under our general supervision.

Mr. VORYS. The $2,737 million, then, is all spent by the Department of Defense?

Secretary WILSON. That is right, under our supervision.

Mr. VORYS. And you expect to spend $1.1 billion in the quarter remaining?

Secretary WILSON. That is right.

Mr. VORYS. Just looking for a minute at that same column, we find $3,367 million unobligated at present.

What is your expectation as to obligations of that between now and the end of the fiscal year?

Secretary WILSON. We think we might obligate somewhere between $1.8 billion and $2.8 billion, in the fourth quarter.

My figure on the unobligated amount is $2.7 billion.

Mr. VORYS. Our figures were prepared by the committee staff.
Mr. BULLOCK. That is Mr. Stassen's figure. We just copied his

table.

Mr. VORYS. This is the table submitted by Governor Stassen, on May 6.

Secretary WILSON. What figure is that? We talk about military assistance only and none of the other things that are in the mutual aid program because this is our part that we are responsible for.

Mr. VORYS. On the same line there, page 3, where we have the figure for expenditures for fiscal year 1953, of $2,737,600,688, that unobligated balance is reported as $3,367,264,375.

STATEMENT OF HON. FRANK C. NASH, ASSISTANT SECRETARY OF DEFENSE

Mr. NASH. I think if the Secretary gave this tabulation here it would represent what we have allocated to defense, what has been obligated, what remains to be spent, and so forth. These are our best figures.

Mr. VORYS. These figures that you are giving now, are they secret in any way?

Secretary WILSON. There is no reason why they should be.

Mr. VORYS. We can be furnished with a table.

Secretary WILSON. The total allocated to defense, which is about $15 billion, and the total obligated as of the 31st of March, was $12 billion, leaving an unobligated balance of $2.7 billion.

Mr. VORYS. You are giving us to the end of March?
Secretary WILSON. That is right.

We have 3 months more to wind up the different projects which are in the mill. The complications of getting these things all finalized soundly are pretty great abroad, what with some of the offshore procurement and the details of the business arrangements which you have to make. We cannot tell exactly how much we will do in the 3 months. We have estimated there will be somewhere between $1.8 billion and $2.8 billion unless we had more funds allocated to us out of this total. This $15 billion has been allocated to the Department of Defense for specific things.

Mr. VORYS. You gave it in round figures, $15 billion. What is the allocation to the Department of Defense?

Secretary WILSON. That is it.

Mr. VORYS. $15 billion?

Secretary WILSON. About $15 billion from the beginning of the program. And the amount which has been obligated is $12.3 billion, leaving $2.7 billion still unobligated, but that has been allocated to the Department of Defense.

Now there are some funds that are sufficiently flexible that some additional millions of dollars could be allocated to us.

Mr. VORYS. That is under the 10 percent and the 5 percent?

Mr. NASH. They are in the hands of the President and they are released through the Bureau of the Budget. There was a total of $600 million which the Bureau of the Budget holds now that they could allocate to us if we could prove a legitimate chance of obligating it. you see.

Mr. VORYS. Just looking at this table that Mr. Stassen furnished us, the total available for obligation for military assistance was $15.9 billion. It would appear that there was about $900 million that was available for military assistance that had not been allocated.

Mr. NASH. The $15 billion figure we used there was as the Secretary said initially, about $15 billion. We will confirm that after getting together with Mr. Stassen. It could run as high as $15.4 billion.

Secretary WILSON. Does he say that whole $900 million would be allocated to defense? Your figure is only $325 million more.

Mr. VORYS. I have a line in this chart furnished by Mr. Stassen, March 31, 1953: "Total available for obligation, Military Assistance, $15,904,605,556."

Then I am perplexed by this: "Cumulative obligations, March 31, Military Assistance"--and you tell me all of that is in your Department-$12,537,000,000, but you give me the figure of $12.3 billion which is a difference of a couple hundred million dollars there, which is not a small amount.

Mr. NASH. The table was put in when we were on our way back from Europe and we have not had a chance to compare the figures. We will compare them and reconcile them for you.

(The information referred to is as follows:)

1. In discussing the status of funds for military assistance on May 8, 1953, the Secretary of Defense confined his remarks to the status of funds, that is, allocations, obligations and expenditures of military assistance funds which had been allocated to the Department of Defense as of March 31, 1953. The figures he quoted were correct for such funds and are repeated on line 5 of the table.

2. The figures quoted by Congressman Vorys from the committee print "Fiscal Status of Mutual Security Funds" referred to the status of all military assistance funds, exclusive of those devoted to administrative purposes, available for all agencies participating in the Mutual Security Program. Military assistance funds are used not only by the Department of Defense but also by the Office of the Director for Mutual Security, Mutual Security Agency, Department of State, and others. The figures quoted were correct for such funds and are reproduced on line 4 (a) of the table.

Analysis of status of funds for military assistance
[In millions of dollars, as of March 31, 1953]

Secretary WILSON. I would like to explain what the thing is. Our commitments that we make are in specific end items. We say, "So many guns, so many rounds of ammunition, and so forth."

Now, the amount of that obligation in money gets to be at times sort of a complicated accounting thing because it depends on when we take it out of our existing stocks, and so forth, so there are some controversies there as to what the amounts are.

Do you understand what I mean? If we take it out of World War II stocks, that is one thing. If it is newly obligated contracts where we have not received anything on them yet, but have just made a