to have that in mind. for change in price levels. It is a straight dollar chart and you have I should emphasize that this is in dollars and there is no adjustment (A chart entitled "Trade of Certain Countries With the Soviet Bloc" was shown as follows:) SOURCE Commerce Department Mr. STASSEN. On the right are the exports to the Soviet bloc, and on the left are the imports from it. The first is 1951 and the second 1952, for each country. The first country up there is Finland. You get on the right the 2 years of exports and on the left the 2 years of imports. Now remember, this is gross trade of all kinds. You will see the United Kingdom is next, then Sweden, Pakistan, Benelux, Hong Kong, West Germany, Egypt, Italy, Malaya, India, and finally the United States, on the bottom. These are selected countries of special interest or of importance. Mr. ROOSEVELT. On the Pakistan one, that represents mostly raw cotton, does it not? Mr. STASSEN. That is right. Mr. ROOSEVELT. And the exports of the Soviet bloc I assume are mostly of cotton to China. It went up in 1952 over 1951. Mr. STASSEN. That is right. Mr. ROOSEVELT. And the Malaya one represents a very substantial decrease in their export of rubber. Is that what that indicates? STATEMENT OF KENNETH R. HANSEN, ACTING DEPUTY ADMINISTRATOR FOR THE MUTUAL DEFENSE ASSISTANCE CONTROL ACT Mr. HANSEN. Yes sir, rubber to the Soviet bloc but not to China. They do not ship to China. Mr. ROOSEVELT. This represents a reduction in their exports of rubber to the Soviet bloc. Is that what this represents? Mr. HANSEN. That is right. Mr. STASSEN. The United Kingdom is up. It is a question of whether you handle the item under United Kingdom, or Malaya. Mr. ROOSEVELT. That is what I was going to ask. Mr. STASSEN. We can give you the rubber figures. Rubber of course is embargoed by the free countries with Communist China but not with the Soviet bloc as a whole as you know, and we can give you the figures on rubber movements to the Soviet bloc as a whole, here in a moment. Mr. ROOSEVELT. In brief, has Malaya rubber been going to England, from England in processed form to Russia, and from Russia to China? Have they bypassed what was originally a direct transaction? Mr. STASSEN. Mr. Hansen can give you further information on that. Mr. HANSEN. That has partially occurred. It is not a matter of reprocessing through the United Kingdom, it is actually brokerage. It is actually transshipped from the United Kingdom physically. There is some fairly direct shipment however from Malaya to the Soviet bloc excluding Communist China. The rubber figures are as follows: From the United Kingdom, reexports in 1951, in the total Soviet bloc, 43,000 tons. That is 43,000 tons. For 1952, the reexports from the United Kingdom of rubber were 89,000 tons. The reason however for the high figure for 1952 is that the United Kingdom licensed around 60,000 to 65,000 tons in 1951. There was a shortage of shipping that delayed many of these deliveries until 1952. Their licensing for the 2 years is approximately the same. At the present time they are licensing on a quarterly basis since the Soviets are also only licensing or approving imports of wheat and timber on a quarterly basis. Mr. ROOSEVELT. I see. Mr. VORYS. Could I ask one more question: The United Kingdom, does that include the increased shipments from Ceylon? Mr. HANSEN. Ceylon is completely separate shipments. Six thousand tons in 1951 and 30,000 tons in 1952. Mr. ROOSEVELT. Those are direct to China? Mr. HANSEN. Those are all China. Ceylon has not exported any to the satellite countries or to the USSR, in 1952. Mr. VORYS. These are selected ones. Are there any others besides Ceylon where there has been a fivefold increase in one year of shipments to the Soviet bloc? Mr. HANSEN. No, sir. It is constantly decreasing. (A chart entitled "Index of Volume of Trade between Western and Eastern Europe" was shown as follows.) Mr. STASSEN. This is all types of trade compared to prewar. It is quite difficult to work out these statistics, but as nearly as we can work them out, you will see that prewar Western Europe imported in the order of 350 percent of what it now imports from Eastern Europe and it now ships-that is prewar it shipped, exported to Eastern Europe in the order of 150 percent. You take 1950 as 100 and that shows the direction of the overall trade between East and West Europe. (Discussion off the record.) Mr. STASSEN. When the Battle Act embargo provisions went into effect on January 24, 1952, there were already in existence certain agreements between countries to ship items that were placed on the Battle Act embargo list. After an intensive review, some of the projected shipments were eliminated. Some of the items have been shipped and exceptions granted under the previous administration. I think the committee is quite familiar with those. They are estimated at $5,816,376. But most of these prior commitment items are not yet shipped or canceled. In other words, a pending problem of prior commitments. (Discussion off the record.) Mr. STASSEN. This is a good point to mention: Our National Security Council is now engaged in a study of this whole question of East-West trade, strategic, nonstrategic, relative strength of the two areas, and China and Russia and Eastern Europe, and they are in the process of trying to analyze all these facts with reference to the broad, national security policy of our country. (Discussion off the record.) Mr. BATTLE. Mr. Chairman Chairman CHIPERFIELD. Mr. Battle Mr. BATTLE. As a matter of fact we have been under the eight ball because the precedent has been set on these prior commitments up to this point and certain exceptions have been made for this country and the next country and the neighboring country and so forth and that will put us in a very difficult situation not to go ahead with those exceptions and make the rounds. Is that not true? Mr. STASSEN. We have some chance though now that a new administration can reexamine, and while a precedent obviously applies from one administration to another, it does not apply with quite the sameforce, so it is being restudied to see whether we can establish a new policy at this time or to what degree you can tighten up and what its effect is upon your own friends overseas and so forth. Mr. BATTLE. I hope we can establish some new precedents. If I can help you, I will be glad to. (Discussion off the record.) Mr. STASSEN. I might just conclude, Mr. Chairman, by saying that we are endeavoring in every way we can, through the coordinated. activity of the departments in the executive branch, with the various leadership of departments as I indicated in my opening statement, to move. There has been some significant progress made in these last few months. Under the outstanding leadership of the Secretary of State, Mr. Dulles, a series of successful negotiations have been consummated in recent weeks by the State Department to tighten up on this EastWest trade situation. You will recall that the United Kingdom and the United States talks were concluded on March 7. The communique was as follows: The two Secretaries of State also considered the Far Eastern situation. They reaffirm the importance of preventing the shipment of strategic materials to the mainland of China. Mr. Eden stated that Her Majesty's Government in the United Kingdom, in addition to the system of controls already in force, had decided: (a) to introduce a new system of licensing vessels registered in the United Kingdom and colonies so that strategic materials from non British sources could not be carried to China in British ships; (b) to take additional steps designed to ensure that no ships of the Soviet bloc or other nationality carrying strategic cargoes to China should be bunkered in a British port. This past week the French officials agreed and the communique reflected that, and the Greek Government has taken a new action of a shipping control law that has been promulgated, which tightens up on the Greek flagships, and these negotiations are being pressed forward under State's leadership with reference to other western nations. Mr. ROOSEVELT. I hope McCarthy is not invited to sign these commu nications. Chairman CHIPERFIELD. Mr. Vorys Mr. VORYS. Mr. Stassen, on administration of this law, you may or may not know that the committee in attempting to devise some method of administration rather than the absolute prohibitions involved in the Kem amendment felt that the important thing to do was to have one responsible official who was to be confirmed by the United States Senate, with plenary power and with personal responsibility to administer this thing. Now we find that there are a dozen agencies in the administrative structure and that Commerce has control of exports. You have spoken of the importance of the State Department. I wonder if you have been at this long enough to speak frankly on what you think of the administrative structure we attempted to set up as it lives in real life in Washington, today. Mr. STASSEN. Well, I would say this: There are many different ways that you can do these tasks and whatever way you devise, you must still have the cooperation and coordination of the principal departments of the executive branch of the Government. I would say my observation has been that there has been very close cooperation and coordination during these last 2 months and I think by each recognizing the lead of the other in the right circumstance you can get the best results. For example, in these British and French and Greek matters, everyone who had information and recommendations has come into the picture and then there has been the lead in the negotiations by State, which is really the only place that you can have the lead in the negotiations with another government. Of course, when you come to a matter of export controls over things going out of continental United States, I think it would be unwise to have that any place but in Commerce. When you come to a special matter like atomic matters you cannot have anybody saying what can go out except the Commission that is responsible for atomic matters. You inevitably, I think, get into a situation where you do have to have coordination, and then your main leverage is the economic aid phase, and so you place in my Department that coordinating responsibility and the responsibility of reporting to the President for his determination in questions of whether or not to terminate aid. Mr. VORYS. You feel then that this is a satisfactory setup, the way it is? Mr. STASSEN. I would say in these 2 months it has worked out reasonably satisfactorily. I would not say it could not be improved. In fact, I think you could set it up in many different ways. It would still require coordination. I would say if you wanted to put on some other emphasis rather than the stoppage of aid, it could well be in some department other than my own. |