REMARKS OF THE HONORABLE JOHN LODGE, M. C. FOURTH DISTRICT, FAIRFIELD COUNTY, CONNECTICUT, ON THE FLOOR OF THE HOUSE OF REPRESENTATIVES ON MARCH 26, 1948, IN SUPPORT OF THE EUROPEAN RECOVERY PROGRAM.

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80M01009A000100120114-0
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 9
• Document Creation Date: December 23, 2016
• Document Release Date: July 11, 2013
• Sequence Number: 114
• Publication Date: March 26, 1948
• Content Type: MISC

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FOR REVASE UPON DELIVERY
lRKS OF THE HONORABLE JOHN 7-J4 LODGE, K. C. FOURTH DISTRICT, FAIRFIELD
2.:11:TY, CONNECTICUT, ON THE FLOOfi. CiF THE HOUSE OF REPRESENTATIVES ON MARGE
1948, IN SUPPORT OF THE EUh)9EAN RECOVERY PHOGJIAM.
Mr. Chairman, The measure which we are now considering is the
product of many minds; it is the result of much searching thought. Like
all of man's creations, it is not perfect. Like most of the measures
which come before us, it does not represent in every respect precisely
what each member of the Committee on Foreign Affairs desired. It is
the result of compromise. It is an able symbol of the effective and
efficient functioning of our constitutional process.
Millions of words of testimony have been written and spoken in connection
with this vast project. Hundreds of minds have applied themselves to the
gather!_nt; of iformation, to the elaboration of detail, and to the exploration
of the many intricate implications of this huge undertaking.
And now it is before us. It is before us at a time when the threat to
peace and freedom which many thought had been disposed of at the end of
World War II has become more formidable and cumulative than ever. It is
before us at a time when even the wisest are incapable of complete answers.
It comes before us at a time when expeditious action is imperative.
Many vital questions are dealt with in that part of this legislation
which is concerned with the economic recovery of Europe. The members of
your Committee on Foreign Affairs have given a great deal of study and thought
to such questions as the vital needs of the American people, the use of the
foreign assets in this country, our requirements in strategic materials, an
effective export controls policy, guarantees of the convertibility of foreign
currencies, loans, shipping, the protection )1'. American rights abroad, the
dismantling of German plants, the use of foreign currencies, reciprocal self-
help among the European nations, the paramount problem of administratipp, and
many other matters.
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Mindful of the fact that thesri n-;)1-)lems have already received considerable
atGention and that they will pc., 4.rther discussed when the bill is read for
amendments, I should like briefly to discuss the European Recovery Program
as a part of our nation's foreign policy.
There has been a natural preoccupation in the minds of many of us
arising from our desire to obtain a composite rather than a piecemeal view
of the international dilemma: The European Recovery Program will depend for
its success on the early evolution of these other segments of our foreign
policy. These must be brought forward on a concurrent front in order that
this program shall operate under the most propitious circumstances possible.
In order to create such a favorable economic, social, ?and political
climate, we should, it seems to me, take steps to fill in the many gaps ih
our peacetime strategy. Peace is achieved through strength. War is
usually a derivative of weakness.
Accordingly, I should like to venture a few suggestions which, if acted
on, would, in my opinion, serve to buttress the forces of freedom.
1. It may be said that although the United Nations Organization has so
far failed of its objectives, it can nevertheless 'provide the framework for
the useful purpose of spreading international responsibilities and integrating
the efforts of those nations which are seeking to defend their freedom and
their independence against the brutal onslaughts of Communist tyranny.
Accordingly, it is my considered view that a meeting of the United
Nations should be called under Section 109 of the Charter in order that this
organization should be strengthened; with Russia if possible, without Russia
if necessary.
2. Instruct our representatives to the International Monetary Fund, to
which we make a huge contribution, to recommend that an International Monetary
.Conference be called for the purpose of effecting a planned devaluation of
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the currencies of the siVen nations participating in thUuropean Recovery
Program, and in order that this may be accomplished with a minimum of economic
dislocation and a maximum of benefit for "Western Europe and for the American
taxpayer. The amount involved in the European Recovery Program is based on
the estimated balance of payments aeficits. Because the dollar has become
the basic currency in the world today, the needs of the participating
countries are estimated in terms of dollar deficits. Since these foreign
currencies are artifically pegged, the Marshall Plan constitutes to a
considerable extent an attempt on our part to bridge the gap between the legal
and the real value of these currencies. A devaluation of these currencies
would make European commodities cheaper to buy. It should be expedited in
order:
(a) that these countries may increase their exports and thereby
reduce their dollar deficits;
(b) by reducing their dollar deficits, reduce the load on the
American taxpayer; and
(c) increase American imports and thereby reduce the cost of living
in America.
3. The President should decide on a policy with respect to export
controls, and with particular reference to Soviet Russia and her satellites.
Here we must recognize that a revival of trade between Eastern and Western
Europe is. important to European recovery. It is to be hoped that when we
have helped the ERP countries to create a capital goods surplus, the
agricultural surpluses of Eastern Europe will flow into Western Europe/ in
spite of the Iron Curtain. On the other hand, it should be our policy and
the policy of the nations receiving our aid not to help Russia to defeat
ERP. Any other policy is unthinkable. Furthermore, our government should
impose an export controls ban on shipments to Russia and her satellites of
munitions, airplane engines, certain types of electrical equipment and
machine tools and any other articles which can be used directly as war
potential. This entire aspect of our foreign policy should not be allowed
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asse
from day to day on an i*ovised basis. It should be cYfully considered,
orified, and synchronized with the European Recovery Program in order that
it can help to implement its major intentions.
L. Whether or ,not Western Europe can recover without a revival of trade
with Eastern Europe we know that European recovery is impossible unless
Germany is enabled to contribute. To isolate Germany from Western Europe
is to compromise European recovery and add enormously to the burden of the
American taxpayer.
Under Section 115 (e) "The Administrator will request the Secretary of
State to seek to obtain the agreement of those countries concerned that
such capital equipment as is scheduled for removal as reparations from the
three western zones of Germany be retained in. Germany if such retention
will most effectively serve the purposes of the European recovery program."
It is my hope that the Administrator will, as soon as possible after
his appointment, look into this vital matter. The question of dismantling
has been a source of considerable worry to many of us. It is enormously
complex. Suffice it to say that Western Germany is now being administered
under directives which bear no relation to European recovery but which are
based on the vain and futile premise that Western Germany should be treated
as a viable economic unit. The criteria adopted with respect to reparations
and. dismantling should be revised and adapted to the European Recovery
Program. To the objection that this will strike fear into the hearts of
those nations which have suffered from German aggression, I would reply that
this fear will be mitigated to the extent that we give evidence of our
intention to sustain these nations in their efforts to preserve their
freedom and independence. It is caused largely by their apprehension
regarding support from the United States,
5, Instruct our representatives to the International Bank for
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L.)
Reconstruction end Deve5_opment, to which we make a predominant contribution)
call a meeting of the members of the Bank in order that the activities
cf this organization should be co-ordinated with the purposes of the
opean Recovery Program. For instance, I have been informed by Stanislaw
Mikolajczyk, former leader of the Polish Peasant Party, that every dollar
we spend in Poland goes to Russia, Former Ambassador Lane's arresting book
tends to bear this out, Yet it is rumored that the World Bank is about to
make a loan of LO million dollars to the Communist Government in Poland. If
Mr. Mikolajczyk is right, and his opinion is certainly entitled to a great
deal of weight, we would, in contributing to such a loan, be helping the
Russians to defeat the Marshall Plan,
6. Provide for a military establishment adequate to meet the urgent
threat to our national security. Our power should be commensurate with our
commitments, We must assume a military posture which will discourage
external aggression. Since internal aggression is greatly facilitated by
fear of external aggression, American armed might can also do much to
combat internal force.
7. It is my conviction that the United States and the nations
participating in the recovery program, including China, should enter into
regional multilateral military, agreements pursuant to Article 51 of the
United Nations Charter with a view to creating political and economic
conditions which will assist the recovery of these nations, for the purpose
of protecting their freedom and independence from external and internal
aggression, and in order that the military dispositions undertaken by them
shall be predicated on European rather than on national considerations,
thereby effecting important economies in the military establishments of
these nations while achieving greater overall strategical strength.
8. We must learn to operate in the twilight zone in which Communism
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).c.es its greatest gains: Wo must adopt effective counter measures to
-.2-Ltvalize and roll back the subversive minority elements which by
1..:dation, bribery, and corruption are thwarting the spontaneous forces
-ri*ch are the lifeblood of freedom. We must have a peacetime OSS. Such an.
ofA,rt on our part would Cost but a fraction of the vast program which is
contemplated here. It would help to assure its success and, by diminishing
riots and strikes, would. substantially diminish the cost to the American
taxpayer. We are not reluctant to use flame throwers and atom bombs when we
are at war.
We are willing to furnish economic aid and to embark
information and cultural program in time of
what is necessary to fill in this vacuum in
cold war. We must learn to operate in this
peace.
upon an
We must decide to do
our strategy in order
to win the
no man's land in order to block
the insidious and treacherous attempts of these purveyors of terror to use
freedom for the purpose of destroying freedom. Respect for law does not
require us to stand supinely by while these laws are perverted and
demolished. Equity looks to the substance. We must intervene in order to
protect these nations from Soviet intervention -- from Soviet domination.
"Intervention for non-intervention" the great Hungarian patrictLouis Kossuth
advocated almost 100 years ago. Let us heed his advice. It can be done.
It must be done; and the sooner the better. If we do not help the police
in these countries they will become police states.
9. The State Department's information and cultural program must be
stepped up to the realm of psychological warfare. Newsprint Must be
provided to those who are resisting the red fascists and on-the-spot radio
broadcasts inaugurated. We must also make full use of word-of-mouth
propagation ofinformation'in this battle for men's minds.
There should be a drastic reorientation in the entire program. While
Russia is telling lies about us we must tell the truth about Russia. Here
it is interesting to note that the percentage of Communists in countries
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behind the Iron Curtain a.s far less than the percentage YCommunists in
countries outside the Iron Curtain. For instance, former Premier Mikolajczyl-
has informed me that in Poland but 3 percent of the population are Communis
Tn Czechoslovakia at the last election there wore 38 percent. I dare say
that now that the Republic of Czechoslovakia has suecumbed to the Red
infection, the number of Czech Communists is closer to 3 percent than to 38
.?
percent. The vaunted Communist paradise is in fact a Red hell. But when
people are exposed to the distressing conditions caused by a great war it is
perhaps natural that they should think that a change will be an improvement;
it is human nature to believe the reckless and deceitful promises, the
malicious distortions and lies sl.yly made by the panderers of the Politburo.
We must present the constructive alternative. It is our mission to sell
America to foreigners aseffectively as Palmolive is sold to Americans.
I believe that the many responsible and patriotic leaders in the American
labor movement can do a great deal to help toward an understanding of this
grave choice. They have already done much and I know that they willdb a
great deal more.
10. And finally, it is clear to me that our nation's policy should be
to encourage the participating nations to engage in an European economic
federation which will sere as the basis for d.United States of Europe,
thus fulfilling the hope once expressed by George Washington. If they do
not voluntarily federate for freedom they will have.a Soviet federation
imposed upon them.
A chief object of this great effort is to spread freedom by extending
the free trade area. A world contracted by science must be united by freedom
if peace is to prevail. If the objective of ERP were to restore Europe to
its 1938 condition, if its purpose were to put Humpty Dumpty together again,
then wo would be wasting our time and our treasure.
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U Cm)
Our predominant purpose must be related to the relentless realities of
the period in which we live. Many historic forces, economic, social,
political, and military have wrought irremediable changes in the structUre
of the European complex of nations.
On our part we must give a vigorous demonstration that we understand
the portentous challenge of this precarious peace as fully as we have always
understood the grim challenge of war. We must make full use of the
felicitous flexibilities of our free system. We can and we must distill out
of the confusions, disappointments, and apprehensions of this postwar period,
not only the physio-11 mean but the spiritual resolve to persevere in this
terrible battle until the concept of the brotherhood of man under the
fatherhood of God has spread its inneffable blessings among the godless
hordes who are seeking to enslave us.
Let us have faith.
The secret of our unequalled standard of living is that the precepts
on which America is founded are timeless in their validity; they are never
obsolete. The doctrine of freedom is the most modern, the most flexible,
the most dynamic, the most truly revolutionary force that the world has
ever known.
We must understand what are the great motive powers which have
propelled 'America on the successful adventures which she has undertaken.
We must translate the American idea into terms so persuasive, so contagious
that the freedom-loving peoples of the world will recognize the chojee with
which they are confronted.
Mr. Chairman, I have attempted in these-few remarks to touch. on some of
the highlights of what, in my opinion, should be done to create a coordinated
and effective foreign policy. Had the true challenge been recognized at
Yaltal Teheran, or Potsdam, we would not be in our present predicament. Had
this dread menace been understood two years ago, we could have done much to
8
ON.
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redeem our pledges and thereby preserve for millions of people the blessings
earned for them in large part by the blood and valor of our fighting men.
But it is idle to lament over an irretrievable past. Whatls done can't be
undone. If the diplomatic blunders of appeasement can spur us on to militant
action in the inexorable present they will at least have served some purpose.
If we pass this unprecedented law, it will in the eyes of the world
be a measure of our intentions to support the forces of freedom. We will
have provided them with a constructive alternative. In particular, it can
have a most salutary effect on the valiant souls in Italy, who, while we
deliberate here, are enduring their great Gethsemane, locked in mortal
conflict with the evil minions of Communist reaction.
"Once more unto the breach, dear friends,"
Let it be said by future generations that Italy, the cradle of Western
civilization, the seat of the Vatican, the source of much of our precious
inheritance, was saved for posterity not only by the determination of the
Italian people, but also by the understanding and resolve of the people of
America.
Let us take action "against a sea of troubles and by opposing, end
them."
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