Mr. STASSEN. Before I ever suggested his name to the President, I consulted the Secretary of State and the Secretary of Defense about him, so we have a man that they would like to see take hold of these problems, too, and that is the way we are working to get results.

Mr. VORYS. That sounds fine, because this was our concept-and as I say, we did this on our own. This was homemade, in our little subcommittee.

Mr. STASSEN. You showed a lot of wisdom.

Mr. VORYS. Our concept was to get one fellow who would have all the strings in his hands in some way or other.

What you say is encouraging to me.

Mr. BATTLE. Mr. Chairman, I have a lot of other questions, but we obviously cannot cover everything in one day, so this might be a good time to adjourn.

Mr. STASSEN. Thank you very much.

Chairman CHIPERFIELD. The meeting is adjourned.

(Whereupon, at 1:03 p. m., the committee adjourned, to reconvene at the call of the chairman.)

MUTUAL SECURITY ACT EXTENSION

TUESDAY, MAY 5, 1953

CONGRESS OF THE UNITED STATES,

SENATE COMMITTEE ON FOREIGN RELATIONS AND HOUSE OF REPRESENTATIVES COMMITTEE ON FOREIGN AFFAIRS,

Washington, D. C.

The committees met, pursuant to call, at 10:05 a. m. in the caucus room, Senate Office Building, Senator Alexander Wiley (chairman of the Senate Committee on Foreign Relations) presiding.

Present: Senator Wiley, Representative Chiperfield (chairman of the House of Representatives Committee on Foreign Affairs), Senators Smith of New Jersey, Hickenlooper, Taft, Ferguson, George, Green, Fulbright, Sparkman, Gillette, Humphrey, and Mansfield; Representatives Vorys, Bolton, Merrow, Judd, Fulton, Javits, LeCompte, Morano, Adair, Prouty, Richards, Battle, Carnahan, Zablocki, and Hays.

Chairman WILEY. May we have quiet, please?

This joint meeting of the Senate Foreign Relations Committee and the House Foreign Affairs Committee is for the purpose of hearing the directors of the responsible agencies of the Government present the mutual security program for fiscal 1954.

I venture to say that there will be no more important single piece of legislation before the Congress at this session. The decisions which we make on the proposals about to be presented to us will have a very important impact upon the future of the world.

It is not exaggerating to say that they may mean the difference between peace and war.

How much can we afford to spend in this vast enterprise, from the point of view of the soundness of our economy and the heavy tax burdens which our people bear? How much can we afford not to spend, from the point of view of our survival as a free people? Those are the basic questions which we will be trying to answer in the weeks ahead.

Our procedure this morning has been adopted so that both committees, with primary legislative authority and responsibility, would hear the initial presentation of the program simultaneously.

Because of the limitation of time, there will be no opportunity for members of the two committees to ask questions of the witnesses this morning.

After this first session, however, each committee will continue its hearings separately, and each of the witnesses testifying this morning will return for questioning later.

The first witness today is Secretary of State Dulles, who will be followed by the Secretary of the Treasury, Mr. Humphrey, the Sec

retary of Defense, Mr. Wilson, and Mutual Security Administrator Stassen.

Before Secretary Dulles begins his statement, I want to extend on behalf of the members of the Senate Foreign Relations Committee cordial greetings to our colleagues from the House of Representatives. We are glad to join with them in this session this morning.

As you will note, the seating arrangements under such circumstances always constitute a difficult problem. I am sure the members of both committees appreciate the difficulty, and will bear with us.

Now I would like to ask Chairman Chiperfield of the House committee if he desires to make a statement. Chairman Chiperfield? Chairman CHIPERFIELD. No; I do not desire to make a statement at this time.

Chairman WILEY. We will carry on. Since the room is crowded, we will ask you all to be as quiet as possible in order that everyone may hear the testimony of these distinguished representatives of the executive branch of the Government.

At this time we shall hear from the Secretary of State, the Honorable John Foster Dulles. Mr. Dulles.

STATEMENT OF HON. JOHN FOSTER DULLES,
SECRETARY OF STATE

Secretary DULLES. Chairman Wiley, Chairman Chiperfield and members of the Foreign Relations and Foreign Affairs Committees, I am extremely happy to have this opportunity to appear before you in support of President Eisenhower's mutual security program for the fiscal year 1954.

The President is himself sending a communication to both Houses this morning which will be available as soon as either House has convened.

Mr. Stassen, Mr. Wilson, and Mr. Humphrey are all personally here with me, and will join in describing the program to you. My own discussion will deal primarily with the foreign-policy aspects of the projected program.

A main purpose of the program is to get the most security for the least cost, and the way to do that is to cooperate with others. The mutual program will produce more real security for the people of the United States than we could get by spending the same amount of money on a purely national program.

I want to make clear at the beginning that this program has nothing to do with pure charity. It is based upon solid considerations of self-interest. It is, in fact, an inescapable part of our own national security program.

Let me, if I may, describe some of the basic principles which underlie the program as a whole. First, our country is confronted with a very grave threat. There is not yet any evidence that this threat has diminished or will diminish within the foreseeable future.

Our Government stands ready to seize every honorable and practical opportunity for a peaceful settlement of international differences. But, as President Eisenhower said in his recent message to the NATO Council, "Until the conditions for genuine peace have been firmly established it would be foolhardy for us to delude ourselves about the dangers confronting us."

We, of course, have no aggressive purpose ourselves, but we want to increase the likelihood that any aggressive intent of others will be curbed by the knowledge that the cost of aggression will be greater than any possible gain. That is not yet the case everywhere. But where it is the case, there is more security.

Second, we recognize that the safety of the United States cannot be assured by the strength of the United States alone, indispensable as that strength is.

When any nation falls a victim of Soviet aggression, whether internal or external, the Soviet Union becomes stronger, and United States safety is lessened. It is as simple as A, B, C.

Aside from the tragedy to the peoples concerned who are conquered, Soviet domination means that these people and their resources will be harnessed to the Soviet war machine, and maybe turned against us. If Soviet communism is permitted to gobble up other parts of the world one by one, the day will come when the Soviet world will be so powerful that no corner of the world will be safe, including our corner. On the other hand, if the free nations retain their freedom and develop their strength and unity, they can continue to make a vital positive contribution to peace and security. Their soldiers will continue to stand beside our soldiers, their factories will continue to work with our factories, in deterring and resisting aggression.

Third, other free peoples will only continue to develop their strength and unity effectively if the United States is prepared to provide positive leadership.

We cannot, of course, assume exclusive responsibility for the security of the whole world, and there are areas where those who are directly concerned should exercise, we believe, greater responsibility. But unless the strongest nation of the free world takes an initiative, others can scarcely be expected to do so.

Fourth, this program of mutual security has been planned on a global basis. Why is it? That is because we cannot safely see only one area and be blind to the others. All parts of the world are interdependent.

Fifth, our mutual security planning must be and is long-range planning. We cannot afford to exhaust ourselves by spasmodic efforts designed to meet ever-recurring emergencies. We cannot operate on a day-to-day, hand-to-mouth basis. Instead, we must think in terms of policies and programs that we can afford to live with for what may be a very long time.

Sixth, this program is based upon the principle that we and our allies alike must maintain an essential balance between our economic health and our military effort. The American economy is the very heart of the strength of the free world, but our resources are not unlimited, and we dare not endanger our fundamental economic stability. The same is true of our allies. If economic stability goes down the drain, everything else goes down the drain.

Seventh, this program is designed to get maximum value for all the money spent. The burden of this program is too great for us to finance boondoggles.

This program represents prudent investments in concrete projects which will benefit the United States as well as other nations.

And finally, this program is aimed at retaining the initiative for peace which was seized by President Eisenhower's great address of April 16. We are not dancing to any Russian tune; we are taking the lead in the search for peace.

There are some indications that the Soviet leaders have already begun to react to the growing strength of the free world. It is imperative that we continue to increase this strength, and thereby increase the chances for the success of our policies.

The principles which I have stated relate to the mutual security program as a whole. I would like now to discuss briefly the program proposed in relation to the various parts of the world.

A large part of the total amount is being requested for the European area. Most of this assistance is for the purposes of the military defense within the framework of the North Atlantic Treaty Organization.

Let us consider for a moment why this area is so important. As I mentioned in my recent report to the American people on NATO, the United States and its NATO allies now have approximately a 3-to-1 lead over the Soviet bloc in the production of steel. But if Russia should take all of Europe, then the ratio would drop to about 50-50.

Today, the NATO countries, as a whole, have a 5-to-2 lead over the Soviet bloc in the production of coal. But if Russia took all of Europe, the Soviet empire would then have a 3-to-2 advantage in this vital fuel.

It is clear-and these illustrations could be repeated many timesthat American security could be gravely imperiled by Soviet conquest of Europe.

Now, let us look at the other side of the coin. While our European allies remain free and strong, they can make a positive substantial contribution to the defense of the free world, including the United States.

Since the beginning of NATO we have delivered to Europe in economic and military aid combined over $10 billion, a large sum; but during this same period they have spent about $30 billion from their own budgets for the same defense purposes. So, the total is $40 billion, of which we have contributed one-quarter.

The principle is the same to which we have resort at home when we seek to get protection against fire. We, all of us, contribute to a fire department, and we get better protection more cheaply than if each tried to get his protection by himself.

Today there are approximately 75 NATO divisions in existence across the Atlantic, plus sizable air and naval forces. It is true that many of these troops need more training and equipment before they can be fully effective.

However, let us not underestimate their value. The NATO forces already represent a significant deterrent to Soviet aggression, and a real contribution to the protection of all NATO people, including the people of the United States.

If these forces did not exist we would need a much larger security establishment in the United States, with an immense increase in costs, and hundreds of thousands more Americans in uniform.

As you know, the NATO Council met a few days ago in Paris. All agreed that it was vital to maintain NATO strength, not only to maintain it but to build it up.