MUTUAL SECURITY ACT EXTENSION WEDNESDAY, MARCH 25, 1953 HOUSE OF REPRESENTATIVES, COMMITTEE ON FOREIGN AFFAIRS, Washington, D. C. The committee met, pursuant to call, in room G-3, United States Capitol, at 2:30 p. m., Hon. Robert B. Chiperfield, chairman, presiding. Chairman CHIPERFIELD. The committee will come to order. We have before us this afternoon, the Honorable Harold E. Stassen, Director for Mutual Security and the Honorable Livingston T. Merchant, Assistant Secretary of State for European Affairs. Mr. Stassen, we will be glad to have you proceed in any way you wish. We are glad to have you back. STATEMENT OF HON. HAROLD E. STASSEN, DIRECTOR, MUTUAL SECURITY Mr. STASSEN. Thank you, Mr. Chairman. I appreciate the opportunity of meeting with you and I would like to consult with you and discuss with you a bit this afternoon, the questions of European organizations, European economic integration, and I am pleased that the chairman agreed that Mr. Livingston T. Merchant, Assistant Secretary of State for European Affairs, who has been the Deputy for Political Affairs in General Draper's office in Paris, could be here and he will follow through on certain aspects of the EDC situation and certain things on the political side as related to the economic side. We are emphasizing through the Mutual Security organization that we are the operating agency in the economic field taking our foreign policy guidance from the Secretary of State and our defense policy guidance from the Secretary of Defense and the Joint Chiefs of Staff and are operating in a coordinated way to implement those policies. It is in both that spirit as well as in our actual conduct of our offices that we appear before you here jointly. I am pleased to report in the first instance to the committee, that there has just been concluded in Paris what I would consider to be a highly successful meeting of the Organization for European Economic Cooperation. This OEEC session has resulted in what we consider to be very constructive results for the overall objectives of our country and of the free nations. We are aware that the combined economic strength of the free nations is both the underpinning for the progress of the peoples and the military defensive strength. split the Western European and other free nations. and it is the top objective of the Communists to try to separate and to foster working together and cooperation in every way in Europe, Congress, and it is at present of General Eisenhower's administration It has been a clearly established policy of this committee and of the (A chart was shown, entitled "European Organizations," as foldiscussion to put up a rather basic outline chart of the members of I thought it might be well for a background in this first part of our OEEC and relative organizations. lows:) March 23, 1953 OEEC-April 16, 1948: On this date 16 CEEC members plus the occupying powers for Western Germany signed an agreement establishing OEEC (June 1950 United States and Canada became associate members). NATO-August 24, 1949: The date North Atlantic Treaty entered into effect with deposit of necessary number of ratifications. Council of Europe-May 5, 1949: The date on which the statutory agreement setting up the Council of Europe was signed by the 10 original members. EPU—July 1, 1950: The date on which the accounting period for EPU commenced. On September 19, 1950, the actual EPU agreement was signed by respective members making retroactive to July 1, 1950, the accounting period. CSC July 25, 1952: The date of ratification of the Coal-Steel Community. EDC: No date is given because the EDC has not yet been ratified. On May 27, 1952, the EDC Treaty was signed by the six nations. Mr. STASSEN. This is what we have in mind in the different organizations. You see, the OEEC was the earliest organization for European Economic Cooperation, April 16, 1948. It has the entire group with the United States and Canada being associated members. Of course, the two dollar area countries are associate and not full members. NATO, as you there see, does not have Germany in it, it does not have Austria or Switzerland, Sweden or Ireland, but it does have the United States and Canada as full members, and not as associate members. The Council of Europe is the organization which Mr. Merchant may discuss a bit more with you, but it is in a relatively early stage of development. It does not have Portugal, it does not have Austria, it does not have Switzerland, but it does bring in Sweden and Ireland, who are not in NATO. The EPU has exactly the same membership as OEEC but it does not have United States and Canada as associate members. The European Payments Union, an organization of the nondollar nations is working together on a clearinghouse basis, and therefore the United States and Canada are not in it but do sit in from an observation and cooperating standpoint. The Coal and Steel Community, and the EDC, have the six central or western European nations, France, Germany, Italy, Netherlands, Belgium, and Luxembourg. With this background, and the OEEC meeting_just concluded, which had as one of its main subjects the European Payments Union and its continuation, we might look at the next chart which is the up-to-date status of this clearinghouse approach. (A chart was shown entitled "European Payments Union" as follows:) Mr. STASSEN. This meeting that has just been held has renewed EPU for another year. This European Payments Union chart shows the status of the clearinghouse operation between the OEEC members in their trade. Two observations can first be made. The top line is Belgium-Luxembourg, in the strongest position so far as its clearinghouse position is concerned. In other words, they are exporting much more to the rest of the members than they are importing from them. They are getting a very favorable balance. This line is Germany coming up with their increased production, increased export to other countries and up into this position. 83064-53 |