FOREIGN ASPECTS OF U.S. NATIONAL SECURITY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP70-00058R000100110014-3
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 10
• Document Creation Date: November 11, 2016
• Document Release Date: July 16, 1998
• Sequence Number: 14
• Publication Date: February 25, 1958
• Content Type: NSPR

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Foreign Aspects of
U. S. National Security
'WASHINGTON, D.C.
FEBRUARY 25, 1958
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C:- 2tewa tJ
WHAT THIS REPORT IS ABOUT
At the request of President Eisenhower,
Mr. Eric Johnston convened a Conference on "For-
eign Aspects of United States National Security" in
Washington, D. C. on February 25, 1958.
Completely bi-partisan in character, the Conference
brought together leaders of both parties and out-
standing citizens from practically every state,
Alaska, Hawaii, and Puerto Rico. They came, as
Mr. Johnston said in opening the conference-
"to discuss the free world's mutual security-
the security of our own country in a troubled
world; to explore the root and substance of
America's security in this year of 1958 and for
the years ahead."
This record of the Conference,
which the President characterized as in many re-
spects the most unique occasion at which he had
ever been present, is divided into four parts.
Part One, a Summary Report, gives the background,
outlines the general trend of the discussion and
some of the factual material, and quotes statements
that highlight main points made by the speakers.
Part Two gives the full text of the addresses, be-
ginning with that of President Eisenhower, which
actually followed the dinner at the end of the
day's session.
Part Three gives a somewhat condensed record of
the afternoon question-and-answer panel headed by
Vice President Nixon. It also contains a brief ac-
count of the panel on Post Conference Education,
which concluded with the adoption of a motion
recommending formation of an independent citi-
zens' committee to encourage discussion and stimu-
late a further flow of information about the Mutual
Security Program.
Part Four gives the order of events in the day's pro-
gram, and lists those who participated and those
who assisted Mr. Johnston in organizing the Con-
ference.
For the sake of ease in reading,
the quotations in Part One do not indicate omis-
sions by the usual mechanical device of spaced
periods . . . The reader can readily compare the
extracts with the full text in Parts Two and Three
-a rich mine of thoughtful material, of which only
surface outcroppings appear in the Summary Re-
port.
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FOREWORD: What this Report is About
PART ONE: A Summary Report
PART TWO: Text of Conference Addresses
Security and Peace
Opening Remarks
The Free World and
Mutual Security
What Kind of World
For Our Children?
Military Assistance
The Soviet Economic
and Trade Offensive
Mutual Aid: A Program
of Massive Reconciliation
The Moral Foundations
of U. S. Foreign Assistance
Charity Begins Away
From Home
Introducing a
Valiant Warrior
HONORABLE DWIGHT D. EISENHOWER
President of the United States
HONORABLE ERIC JOHNSTON
Chairman of the Conference
HONORABLE JOHN FOSTER DULLES
Secretary of State
HONORABLE NEIL H. MCELROY
Secretary of Defense
HONORABLE ALLEN W. DULLES
Director of Central Intelligence
REVEREND EDWIN T. DAIILBERG
President, National Council of the Churches of
Christ in the U. S. A.
RABBI THEODORE L. ADAMS
President, The Synagogue Council of America
BISHOP FULTON J. SHEEN
Auxiliary Bishop of New York
HONORABLE DEAN G. ACHESON, Toastmaster
Former Secretary of State
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We Are Trustees Of HONORABLE HARRY S. TRUMAN
Democracy and Freedom Former President of the United States
Science, Technology and DR. JAMES R. KILLIAN, JR.
Free World Development Special Assistant to the President for Science
and Technology
PART THREE: Panel Discussions
Question and Answer Panel
HONORABLE RICHARD M. NIXON, Vice President of the United States
HONORABLE C. DOUGLAS DILLON, Deputy Under Secretary of State
HONORABLE MANSFIELD D. SPRAGUE, Assistant Secretary of Defense
HONORABLE JAMES H. SMITH, JR., Director, International Cooperation Administration
HONORABLE DEMPSTER MCINTOSH, Manager, Development Loan Fund
PAGE
56
HONORABLE ERIC JOHNSTON, Chairman of the Conference
MR. ERLE COCKE, JR., Co-Chairman of the Conference
MRS. J. RAMSAY HARRIS, Co-Chairman of the Conference
I-ION. A. S. J. CARNAHAN, Member, House of Representatives
I-ION. CHESTER E. MLRROw, Member, House of Representatives
PART FOUR: Program and Participants
The President's Letter
Program
Honor Guests at Luncheon
Honor Guests at Dinner
Directory of Participants
Congressional Guests
Conference Staff
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 A corps of volunteer hostesses handle the early morning task of registering the participants
from 42 states, Hawaii, Alaska and Puerto Rico.
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CPYRGHT
The SOVIET ECONOMIC
and TRADE OFFENSIVE
The Ikon. Allen W. Dulles
Director of Central Intelligence
The subject assigned to me this morning is the Soviet economic and trade offensive.
I shall broaden the term "Soviet" to include what we often refer to as the Communist Bloc,
that is, the Soviet Union, the European Satellites, and Communist China. Each plays a role
in the economic and trade offensive of international communism.
As Director of the Central Intelligence Agency, it is not my task to recommend policies.
It is rather to analyze as accurately as possible and present the facts as a basis for determin-
ing policy.
This I purpose to do in describing the Communist trade and aid offensive.
It is not always easy to get the facts regarding the Communist world. They throw a shroud
of secrecy and security around all sensitive areas of their policies and actions. In the field
of their trade and aid, however, many of the basic facts arc well known. Of course they try to
keep secret the details of the arrangements among the countries in the Communist Bloc. Also
they are not anxious for the facts to be known about some of their arms deals with countries
outside of their bloc.
However, as regards the Soviet's general aims and objectives in the field of economic and
trade penetration, their actions and the public assertions of their leaders are a helpful guide.
Too often people tend to ignore the statements of those whose credibility they may have
reason to question. Many years ago, Hitler in Mein Kampf wrote what he proposed to do.
He (lid it. Little attention was paid to his book until after he had gone to war.
In the case of the Soviet Union there has been an extraordinary consistency over the years
in basic policy declarations and subsequent actions of the Communist leadership.
The statement issued by the Soviet Union and their allies and satellites in Moscow last
November on the fortieth anniversary of the Bolshevik revolution might well have been writ-
ten by Lenin. The declaration of the recent Afro-Asian Conference in Cairo was on all fours
with the program of the Congress of the Peoples of the East which the Soviet held in Baku in
1920. Lenin himself predicted in 1923 that the outcome of the struggle would be determined
by the population masses of Russia, India and China.
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Changing Tactics
Tactics change-the timetable is altered as circumstances demand. The over-all objectives
and strategy remain much the same.
The evidence as we now see it indicates that the USSR, in striving toward their objectives,
do not propose to use their military power in a manner which would involve the grave
risk of war. They probably still estimate that our power of retaliation could more than
match their offense. They have a healthy respect for our nuclear capability and our means of
delivering nuclear weapons.
In any event they have now alerted us to the dangers which lie in their growing mili-
tary capabilities; they have shaken any complacency, and shown us that we could not
always expect to be first in all phases of military endeavor. They have the skills-scientific
and technical-to do in the military field what we can do. If they work on a particular project
for longer hours with more manpower and with more equipment-human and material-
than we, they can accomplish a particular objective before we do. This should have been
accepted as axiomatic because neither the United States nor any other country has any
monopoly on brains.
Their Sputniks and missiles have also taught us that we cannot afford to be second best
in any important military field.
This particular conference will be considering whether we can afford to be second to the
Soviet in supporting friends and allies and in our relations with the uncommitted newly
developing countries of the world which look abroad for help in their industrialization and
in all that goes to raising the standard of life.
The President in his recent message to the Congress cited the three major objectives of
our Mutual Security Program. One of these was the forestalling of Communist subversion or
massive economic penetration of other nations.
In pressuring for a period of relaxation of tensions and co-existence it seems clear that
the Soviet desires this for two purposes: first, to build their military strength and to develop
the highly complicated modern weapons-ballistic and nuclear-and, second, to press forward
in the area where they probably consider us most vulnerable; the winning of the allegiance
and eventually the control of the uncommitted nations of the world by trade and aid, and
by subversion.
Victory Without a Shot
They probably estimate that if they can induce us to devote our resources almost exclu-
sively to the military field, they can the more easily break our economic and cultural ties with
other nations and win them over.
Today, February 25, is the tenth anniversary of the takeover of Czechoslovakia by com-
munism. Not a shot was fired. It was not guided missiles but the so-called "guided democ-
racy" which did the trick.
In Prague last July, Khrushchev said, "We can fight without bombs and we are convinced
that our cause will be victorious." He added that he would not predict in which countries
communism would consolidate itself first but that once nations learned the advantages of
socialism they will "organize and achieve a change in the social order."
Our own grandsons, he recently predicted to an American correspondent, "will live
under socialism in America, too." Again, speaking at a reception at the Albanian Embassy
last year he laid down the challenge: "If the capitalist gentlemen wish to help the backward
nations as they constantly and clamorously declare, they are welcome to do this . . . The
underdeveloped nations, however, must bear in mind. that the capitalist never gave any-
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thing gratuitously because this contradicts the very essence of capitalism." And, last October,
he explained that the "wars are not necessary for the victory of socialism, capitalism will inevit-
ably vanish from the historical arena just as was the case of feudalism which made room for
capitalism."
These are the theories they openly preach to the world and they propose to go out into
the world with missionaries of trade and aid to spread this doctrine.
While the Communist leaders have suppressed and liquidated more peoples of alien
races and views within their area of control than any dictator or conqueror of the past, they
ally themselves abroad with nationalistic aspirations. While they deny freedom to their satel-
lites in Eastern Europe, they attack those countries which, like Britain, have voluntarily given
freedom to many more peoples than the entire population of Russia itself.
We would be negligent, however, to ignore the fact that their trade and aid programs
backed with subtle propaganda have had a significant impact. The farther removed a coun-
try is from any real appreciation of Soviet actions in their own area of domination, Hungary
or East Germany for example, the greater is the impact of Soviet propaganda and of their
deliveries of arms, of industrial products and "know how."
Target Areas
In effect, they will buy anything, trade anything, and dump anything if it advances
communism or helps to destroy the influence of the West.
They are careful to choose the countries where they can tailor their program to the
advancement of their political aims. But if this is demonstrable, the terms of trade and aid
are seemingly attractive. Interest rates are low and, with good Communist-type behaviour
on the part of the recipients, it may be entirely remitted.
The strings are invisible. They can move quickly. They have no budgetary limitations
or legislative restrictions. Their only "Battle Act" is the battle to advance Communist aims.
They have vast stores of obsolescent military equipment which looks new and shiny to coun-
tries in the infancy of military development. It can be given away without affecting the
Soviet's own military position. They will take in barter payment agricultural products and
raw materials which we, because of our surpluses, find it impracticable to accept.
Now, to get down to cases:
The total amount in credits and grants extended by the Sino-Soviet Bloc for economic
development and military aid to countries in the Free World outside the Bloc over the last
three years amounts to the equivalent of about $2 billion.
Over 95 per cent of this aid has been concentrated on six countries-Afghanistan, Egypt,
Syria, India, Indonesia and Yugoslavia. In these countries over the past two and a half
years Soviet programs in aggregate have been more than double those of the Free World.
Of course, many other countries have received attractive offers and many are today in the
throes of deciding whether to decide to seek aid from the West or from the Soviet Bloc.
The Soviet programs have also included a large scale movement of technical person-
nel from the Communist Bloc to the Free World countries where aid is extended. More than
2,000 Bloc technicians are now active in nine of the newly developing countries in which
United States comparable personnel number less than 1,000. Also large numbers of techni-
cians are going from these countries to Moscow, Prague and Peiping for their training.
From the viewpoint of the strain on the Soviet economy and to enable comparison
with the United States foreign aid effort, it is important also to consider Soviet aid to. other
members within the Communist Bloc.
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Over the past decade more than $1.6 billion has been pumped into China in the form
of military credits and military hardware and perhaps as much as $500 million has been
given to Red China outright.
In addition, in the form of non-military aid, some $3.7 billion has gone in loans and
grants from the Soviet Union toward the development and reorientation into the Commu-
nist system of the basic economic programs of Communist-dominated countries. Of this,
more than $900 million went to Poland, $650 million to East Germany, $450 million to Com-
munist China.
Bloc aid to North Korea since the armistice has totaled $586 million, not including
military materiel. This works out at $73 per North Korean which, on a per capita basis,
exceeds United States economic assistance to South Korea. A comparable effort has been
made on behalf of North Viet-Nam.
Any attempt at analyzing the bookkeeping in the trade relations between the Soviet and
the other Communist states is tricky business. The real value of the ruble is an unknown
quantity and transferring ruble amounts to dollars is at best an estimate. These figures, how-
ever, give the order of magnitude of the trade and aid. They do not take account of certain
other factors.
For example, the early stage of the relations between the Soviet and the Satellites and
China saw the moving of captured plants and materials from these countries to the USSR to
hasten Soviet post-war construction and rehabilitation. Many plants in these countries were
operated under direct Soviet control and the output siphoned off to the USSR. Then, too,
low prices were fixed by the Soviet on goods it purchased and high prices on the goods they
sold to the Satellites and China.
Soviet Economy
This was during the Stalin period and the post-war reconstruction. Then the Soviet saw
that they had to turn around and rebuild their subject empire, which was in partial ruins.
As a result, today, while no firm balance sheet can be drawn, the European Satellites and Com-
munist China represent a net drain on the Soviet economy and add somewhat to the financial
burden of their aid program in the Free World.
Nevertheless we believe the Soviets can and will continue their programs in Free World
countries at a scale at least as great as we now witness. Both intra-bloc and external programs
combined will require less than one per cent of their gross national product. The net eco-
nomic cost over a period of years will be even less than this because from this program they
will receive some needed raw materials and consumer goods.
I mentioned the appeal of the Soviet program to the newly developing countries of the
world. Many are too far away from Moscow to understand the meaning of Hungary, to
analyze the dangers which communism spells for their newly found freedom.
They see that Russia, which economically and industrially was a backward country a
couple of decades ago, has in some manner, mysterious to them, become in a relatively short
space of time the second greatest industrial and military power of the world. They do not
understand the cause. They do not realize that much of this has been achieved by profit-
ing from the industrial revolution of the West; that it has been developed at the expense
of the standards of living of the peoples of Russia; that housing and road building and con-
sumer goods have been sacrificed to heavy industry and weapons of war.
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Major Weapons of Conquest
They tend to feel that the American economic standards are too high - too distant - too
hard for them to attain. They are not overly impressed by the fact that last year we made
about sixty automobiles to the Soviet's one; or that there are wide disparities between the
Soviet and ourselves in the, standard of living. They do hope that they can eventually aspire
to something like the economic and industrial advancement of the Soviet Union. When the
missionaries of Soviet society appear with their offers, the temptation is great. If there are
no clear-cut alternatives the reaction is often favorable.
To leave the field open to this type of penetration presents us with grave dangers.
What use is it if we and our allies concentrate solely on building barriers against some future
military attack while the Soviet envoys of trade, aid and subversion get behind those barriers?
Then, too late, both we and the countries affected will know the true meaning of "Red Im-
perialism."
In this brief presentation, I have endeavored to give an appraisal as an intelligence
officer of the information available to us. I can summarize by stating that in our considered
opinion, the present strategy of the leaders of international communism as directed from
Moscow will not be based on military adventures or the direct use of military power. They
will not be likely at this time to take steps which they believe would involve the risk of
nuclear war, although Soviet military power will continue to be used as a threat against
weaker countries.
On the other hand, international communism will undoubtedly use the methods of eco-
nomic penetration and internal subversion as major weapons to advance their cause.
On this day, ten years since the takeover of Czechoslovakia, it is appropriate that you
should be considering the countermeasures which will be most effective in meeting these
threats to our national security. They most certainly can be met with the resources which this
country can command.
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