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hold of it. The result is then that a good manufacturer who could expand, cannot get the credit with which to expand; so you stop the expansion of the production base and of your economy in the whole country. It becomes a vicious circle.

We are in the process, we believe, with the policies we have just been working out and that we are putting into effect with the approval of Congress, we trust, in France, and in other countries, of dealing successfully with that situation. These policies would be based on not overextending them in military requirements, but keeping them building up in their military strength at such a rate as will make it possible to put their economies on a foundation which we feel will result in an expansion of their gross national output. As a result, they can carry more divisions in the future than they can if you keep them in this straitjacket with too high a goal right now.

Now this is a very intricate and a very difficult series of moves. I would be the last to say to you today that we are going to get it done. I will say that we are on the road toward getting it done and will keep you advised as to how it works out.

Mr. HARRISON. It is a question of some years, at any rate?
Mr. STASSEN. That is right.

(Discussion off the record.)

Mr. STASSEN. Now obviously this is a matter that is distinctly for expert military advice, so let me give you simply my impression from the standpoint of the Mutual Security program, of where we are. I understand that we are at a point where we have enough divisions of good, combat readiness in Central Europe so that the Soviet could not just jump off on any given morning and come across Europe, that they would have a real fight on their hands.

Consequently, they would have to first, if they were to be successful, concentrate a forward concentration of divisions, more than they now have there.

As they move to concentrate in a forward position, we would have a warning from intelligence.

(Discussion off the record.)

Mr. STASSEN. I think it must be apparent to the men in the Kremlin today that there are no places in the world where they can with impunity walk on through as they thought they could when they started across the North Korean border.

Mr. BATTLE. Will the gentleman yield?

Mr. HARRISON. That answers my questions.
Thank you.

(Discussion off the record.)

Mrs. BOLTON. We were certainly not alert in Korea as to what has been going on and we were not ready for it. What of our knowledge of activity in China near the southeast border.

Apparently the Chinese had put rather heavy forces down north of Laos, and so on. We were told that there has been knowledge for some 3 or 4 months, from January on, relative to this matter, that they had known, yet nothing was done.

That is the rumor side of the picture.

There seems to me to be another side of the picture that naturally one does not put too much confidence in. It would be a reasonable thing to suppose that with all the satellites she has now acquired into

which she has had to put armies, there is such a thing as history repeating itself.

Rome did this and the armies got pretty comfortable in their placesand though they may not be as comfortable as the Roman legions were in England, still it is a different life from that in Russia and they are not loved by the satellites.

If there were movement forward, is it not conceivable that they could not perhaps count too well on some of their own groups, and that these divisions which are in Russia ready to come forward, would have not a friendly satellite to come through?

They would have to come through their own problem first. And perhaps isn't that one of the reasons that Russia does nothing?

Mr. STASSEN. That is a very wise observation. You could not count in your calculations on any given satellite country in fact rising against them, but you can certainly have it in mind as one of the possibilities.

Likewise, we know that in the early part of the war between Russia and Germany there were great defections on the part of the Red Army itself, and that really it was not until they reached the point where the Germans were committing atrocities in the Ukraine and the Soviet shifted its line from support of communism to the defense of mother Russia that they got the loyalty of the Red Army that was needed in order to be able to hold the Germans.

Again there is a matter you cannot calculate on in your military plans. For example, Ridgway cannot say, "I calculate that of the 250 divisions opposite me, 60 of them are going to defect." He cannot make that calculation. That may, if you come to the ultimate tragedy, be the kind of thing that would save the world picture right in Europe rather than the longer drawn-out struggle that might otherwise occur.

Mrs. BOLTON. That does not seem to you to be an unreasonable point of view?

Mr. STASSEN. No; it does not. I think it is a very wise observation on your part.

Mrs. BOLTON. Thank you.

I have no real questions except that.

Thank you.

Chairman CHIPERFIELD. Mr. Crawford has an announcement which will take but a second.

Mr. CRAWFORD. Mr. Chairman, I want to let the commitee members know that at 2:30 this afternoon in the caucus room of the House Office Building Mr. Thruston Morton and Mr. Grant, of the State Department, will have a briefing meeting for the freshmen Members of the House.

If any members of this committee would like to come they would be more than welcome, but it is primarily for the new members. Mr. STASSEN. There is to be an open hearing tomorrow morning at 10:30 on East-West trade?

Chairman CHIPERFIELD. That is my understanding.

Mr. Battle has talked with Mr. Wood and they have made arrangements.

Mr. STASSEN. If it is still your wish to do it, I have this situation: A special meeting of the National Security Council has been called

on a special matter at 10:30. Would it be possible to defer the meeting until 11:30, at which time I could come up?

I think this is a rather short matter, but I really should be there unless you want to make some other arrangements. If nothing else can be done, I can send someone else to the National Security Council. but on this special item I would much rather be there.

Chairman CHIPERFIELD. We will set it at 11:30, then.

Mr. ROOSEVELT. Or even 12:00.

Mrs. BOLTON. The House is in session tomorrow.
Mr. STASSEN. I will try to be up at 11:30.

Mr. VORYS. Mr. Stassen, before you leave I would like to try to find out where we stand on infrastructure.

This committee that was abroad recently was given a cost for the infrastructure programs based on a basis of $969 million. The first three slices, they were told, amounted to $739 million, of which the United States already had made appropriations to cover of $288 million.

Now, does the $750 million-do you add that to the first three slices, or how do you get at the figure that is going to be the total?

Mr. STASSEN. The $770 million you add as the last half of the fourth slice and the entire fifth slice. That is the conclusion of the total program.

Mr. VORYS. Then you talk about $969 million plus $770 million. Mr. STASSEN. I have not verified your $969 million, but whatever the figure is up through December last year you then add $770 million, and that is what you have.

Mr. VORYS. Then the only forward agreement that was made this is $770 million beyond anything that has been talked of before? Mr. STASSEN. That is right.

Mr. VORYS. And brings the total to $1,749,000,000, of which we paid nothing on the first slice, but are to pay what, roughly, $319 million? Mr. STASSEN. We did not participate in the first slice, since it was agreed prior to the advent of the SHAPE command. It was not put into the slice situation. We paid forty-two and a fraction percent of this balance. I think you will find that those tables, if you have the same tables I think you have, show, first, nothing and then up a very high percentage and then various 40 percents. Is that the one? Mr. VORYS. This is from the committee's report, and it is the latest thing I could lay my hands on.

It is information, as I understand, which was secured in Europe? Mr. BULLOCK. That is from the Pentagon people, that particular

one.

Mr. VORYS. The first slice was nothing. The next was 48 percent. The next was 43 percent. The next was-this first instrument of the fourth was 40. That is all.

That goes clear across here and totals $969 million, with the United States paying $380 million, of which $288 million has been already appropriated.

Now, I was trying to figure whether this was added on.

Mr. STASSEN. This is added on. This is $770 million added to what you have read there.

Mr. MORANO. To the $288 million?

Mr. VORYS. No; it is added on to $380 million.

Mr. STASSEN. You add 42.5 percent of $770 million to whatever we paid over there.

Mr. MORANO. In other words, the whole thing will be $388 million plus $315 million, roughly.

Mr. STASSEN. Yes; that is right; but we did not contribute to the first slice.

Mr. MORANO. But it is not in there?

Mr. STASSEN. It is an additional amount.

Mr. VORYS. Do the contributions of other countries include cost of land?

Mr. STASSEN. No.

Mr. MORANO. No land and no taxes?

Mr. STASSEN. No; it is hard-money contributions to the central fund.

Mr. MORANO. There is a prohibition, I think, in the law against acquiring infrastructure where we have to pay taxes.

Mr. STASSEN. That is right.

Mr. MORANO. We are prohibited by law from entering into anything like that.

Mr. VORYS. Yes; I know. I put that in there.

Thank you.

Chairman CHIPERFIELD. Thank you very much.

Mr. STASSEN. If you would like, I can have that table checked and see if it relates to the same thing we have.

Chairman CHIPERFIELD. The committee is adjourned.

(Whereupon, at 12: 15 p. m., the committee adjourned, to reconvene at 11:30 a. m. Thursday, April 30, 1953.)

MUTUAL SECURITY ACT EXTENSION

THURSDAY, APRIL 30, 1953

HOUSE OF REPRESENTATIVES,
COMMITTEE OF FOREIGN AFFAIRS,

Washington, D. C.

The committee met, pursuant to call, Foreign Affairs Committee Room, United States Capitol, at 11:40 a. m., Hon. Robert B. Chiperfield (chairman of the committee) presiding.

Chairman CHIPERFIELD. The committee will be in order.
You may proceed, Mr. Stassen.

STATEMENT OF HON. HAROLD E. STASSEN, DIRECTOR FOR
MUTUAL SECURITY

Mr. STASSEN. Mr. Chairman, I would like to apologize for being delayed.

As I told you yesterday, we had a special meeting of the National Security Council. While I could have sent an alternate, it was quite important that on this matter I be personally present. We just concluded, and I came right up here.

May I say in this special hearing of this committee that I am pleased to respond to the invitation of this committee with its able Members of Congress, with its constructive interest and definite responsibility in foreign affairs, for a frank discussion of East-West trade controls, a field in which I am aware you have had both pioneering and follow-through interest of very major significance.

It is an important program, and it is a complex and difficult pro

gram.

I say to you, in the first instance, that President Eisenhower's new administration will carry out its statutory responsibilities under the Battle Act with scrupulous care. You may be sure of that.

I am sure you recognize further that trade controls are not an isolated activity.

They cannot be operated in an airtight compartment of their own. They are only a part of a major policy objective of our Government. President Eisenhower described that objective in his state of the Union message in the following words:

Application of our influence in world affairs with such fortitude and such foresight that it will deter aggression and eventually secure peace.

The President also made it plain that the foreign policy we pursue will recognize and here are his words

will recognize the truth that no single country, even one so powerful as ours, can alone defend the liberty of all nations threatened by Communist aggression from without or subversion within.

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