HOUSE CONFEREES BACK SENATE ON OAS FOREIGN AID BILL ROLE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP67B00446R000600130003-9
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 11
• Document Creation Date: December 16, 2016
• Document Release Date: June 30, 2005
• Sequence Number: 3
• Publication Date: June 24, 1965
• Content Type: NSPR

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-~ 2 Thursday, June 24,1965 THE WASHINGTON POST
House Conferees Back Senate
On OAS Foreign Aid Bill Role
Associated Press
House conferees agreed yes-
terday to a Senate provision
in the foreign aid bill designed
to give the Organization of,
American States an important
new role in channeling mili-
tary assistance to Latin Amer-
ica.
Sen. J. W. Fulbright (D:
Ark.), author of the provision,
said House conferees accepted
it with modifications in a two-
hour conference on conflicting
Senate and House versions of
the foreign aid legislation.
Action was put off for the
third time on major differ-
ences arising from the Sen-
ate's passage of a two-year,1
$3.24 billion-a-year authoriza-
tion, coupled with a clause
terminating the program in its
1present form on June 30, 1967.
The House passed a one-year
authorization with no cutoff
provision.
The amendment by Ful-
bright would authorize the use
of $25 million of the $55 mil-
lion available for military as-
sistance to Latin America to
help finance a permanent in-
ter-American military force
under control of the OAS.
In addition, it would require
that other future military aid l
to any American republic, i
even for internal security, be
furnished "to the maximum
extent" feasible "only" accord.
ing to joint plans approved by
the OAS.
In agreeing to the provision,:
the conferees eliminated the'
"only" and voted to give Pres-
ident Johnson more flexibility)
than the Senate provision
would have provided.
At the suggestion of House
conferees, it was modified also
to specify that the costs of cur-
rent peace forces operating in
the Dominican Republic will
not be charged against the $25
million available for a perma-
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House of Representatives
WEDNESDAY, AUGUST 18, 1965
The House met at 12 o'clock noon.
The Chaplain, Rev. Bernard Braskamp,
D.D., prefaced his prayer with these
words of Scripture: Psalm 121: The Lord
is thy keeper, the Lord is thy shade upon
thy right hand.
Almighty God, whose goodness never
fails and whose truth does not grow old,
we beseech Thee to sanctify us, cleansing
all the stains of sin from our hearts and
the darkness from our minds.
Order our whole life, our thoughts and
aspirations in accord with Thy will and
bring them into harmony with Thy holy
plans and create within us those desires
which Thou dost delight to satisfy.
May there arise within us strength,
healing, and victory, overcoming all con-
fusion of purpose and that self-love
which keeps us from the larger life of
service and sacrifice to which we have
been called.
Humbly we offer our prayer, asking
for nothing that we do not ask for others
whose lives are haunted by hardship and
struggle for the bare necessities that
they labor for.
In Christ's name we pray. Amen.
MESSAGE FROM THE SENATE
A message from the Senate by Mr.
Arrington, one of its clerks, announced
that the Senate agrees to the report of
the committee of conference on the dis-
agreeing votes of the two, Houses on the
amendments of the Senate to the bill
(H.R. 7765) entitled "An act making
appropriations for the Departments of
Labor, Health, Education, and Welfare,
and related agencies, for the fiscal year
ending June 30, 1966, and for other
purposes."
The message also announced that the
Senate agrees to the amendrient of the
House to Senate amendment No. 1 to
the above-entitled bill.
The message also announced that the
Senate agrees to the amendment of the
House to a bill of the Senate of the fol-
lowing title:
S. 1648. An act to provide grants for pub-
lic works and development facilities, other
financial assistance, and the planning and
coordination needed to alleviate conditions
of substantial and persistent unemployment
and underemployment in economically dis-
tressed areas and regions.
The message also announced that the
Vice President, pursuant to Public Law
170, 74th Congress, had appointed Mr.
MORSE in lieu of Mr. ROBERTSON, resigned,
to attend the 54th Interparliamentary
Union Conference to be held in Ottawa,
Ontario, September 9 to 17, 1965.
THE JOURNAL
The Journal of the proceedings of
yesterday was read and approved.
APPROPRIATIONS FOR DEPART-
MENTS OF STATE, JUSTICE, AND
COMMERCE, THE JUDICIARY, AND
RELATED AGENCIES FOR FISCAL
YEAR 1966
Mr. SLACK. Mr. Speaker, on behalf
of the gentleman from New York .[Mr.
ROONEY], I ask unanimous consent that
the managers on the part of the House
may have until midnight tonight to file
a conference report on the bill H.R. 8639.
The SPEAKER. Without objection, it
is so ordered.
There was no objection.
CONFERENCE REPORT (H. REPT. No. 8O+7)
The committee of conference on the dis-
agreeing of the two Houses on the amend-
ments of the Senate to the bill (H.R. 8639)
"making appropriations for the Departments
of State, Justice, and Commerce, the Judi-
ciary, and related agencies for the fiscal year
ending June 30, 1966, and for other purposes,"
having met, after full and free conference,
have agreed to recommend and do recommend
to their respective Houses as follows:
That the Senate recede from its amend-
ments numbered 1, 6, 7, 10, 15, and 18.
That the House recede from its disagree-
ment to the amendments of the Senate num-
bered 2, 4, 8, 9, 11, 16, 17, 19, 20, 21, 22, 23,
25, and 26, and agree to the same.
Amendment numbered 3: That the House
recede from its disagreement to the amend-
ment of the Senate numbered 3, and agree
to the same with an amendment, as follows:
In lieu of the sum proposed by said amend-
ment insert "$2,125,000"; and the Senate
agree to the same.
Amendment numbered 5: That the House
recede from its disagreement to the amend-
ment of the Senate numbered 5, and agree
to the same with an amendment, as follows:
In lieu of the sum proposed by said amend-
ment insert "$5,339,000"; and the Senate
agree to the same.
Amendment numbered 12: That the House
recede from its disagreement to the amend-
ment of the Senate numbered 12, and agree
to the same with an amendment, as follows:
In lieu of the sum proposed by said amend-
ment insert "$33,743,000' ; and the Senate
agree to the Same.
Amendment numbered 13: That the House'
recede from its disagreement to the amend-
ment of the Senate numbered 13, and agree
to the same with an amendment, as follows:
In lieu of the sum proposed by said amend-
ment insert "$69,038,250"; and the Senate
agree to the same.
Amendment numbered 14: That the House
recede from its disagreement to the amend-
ment of the Senate numbered 14, and agree
to the same with an amendment, as follows:
In lieu of the sum proposed by said amend-
meat insert "$11,536,000'; and the Senate
agree to the same.
Amendment numbered 24: That the House
recede from its disagreement to the amend-
ment of the Senate numbered 24, and agree
to the same with an amendment, as follows:
In lieu of the sum proposed by said amend-
ment insert "$3,150,000"; and the Senate
agree to the same.
JOHN J. ROONEY,
JOHN M. SLAcx,Jr.,
NEAL SMITH,
JOHN J. FLYNT, Jr.,
CHARLES S, JOELSON,
GEORGE MAHON,
FRANK T. Bow,
GLENARD P. Ln'scoMB,
ELFORD A. CEDERBERG,
Managers on the Part of the House.
JOHN L. MCCLELLAN,
ALLEN J. ELLENDER,
WARREN G. MAGNUSON,
SPESSARD L. HOLLAND,
JOHN O. PASTORE,
J. W. FULBRIGHT,
MARGARET CHASE SMITH,
LEVERETT SALTONSTALL,
KARL E. MUNDT,
Managers on the part of the Senate.
STATEMENT
The managers on the part of the House at
the conference on the disagreeing votes of.
the two Houses on the amendments of the
Senate to the bill (H.R. 8639) making ap
propriations for the Departments of State,
Justice, and Commerce, the Judiciary, and
related agencies for the fiscal year ending
June 30, 1966, and for other purposes, submit
the following statement in explanation of the
effect of the action agreed upon and recom-
mended in the accompanying conference re-
port as to each of such amendments, namely:
TITLE I-DEPARTMENT OF STATE
Administration of foreign affairs
Amendment No. 1: Appropriates $176,400,-
000 for salaries and expenses as proposed by
the House instead of $176,748,000 as proposed
by the Senate.
Amendment No. 2: Appropriates $19,125,000
for acquisition, operation and maintenance
of buildings abroad as proposed by the Sen-
ate instead of $18,125,000 as proposed by the
House.
International commissions
Amendment No. 3: Appropriates $2,125,000
for international fisheries commissions in-
stead of $2,025,000 as proposed by the House
and $2,300,000 as proposed by the Senate.
Educational exchange
Amendment No. 4: Appropriates $5,800,000
for the Center for Cultural and Technical
interchange between East and West as pro-
posed by the Senate instead of $5,500,000 as
proposed by the House.
TITLE II-DEPARTMENT OF JUSTICE
Legal activities and general administration
Amendment No. 5: Appropriates $5,339,000
for salaries and expenses, general administra-
tion instead of $5,289,000 as proposed by the
House and $5,389,000 as proposed by the Sen-
ate.
20131
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CONGRESSIONAL RECORD - I-LOUSE August 18, 1965
TITLE III-DEPARTMENT OF COMMERCE
U.S. Travel Service
Amendment No. 6: Provides a limitation
of $3,500 for representation expenses abroad
as proposed by the House instead of $4,000
as proposed by the Senate.
Amendment No. 7: Appropriates $3,000,000
for salaries andexpenses as proposed by the
House Instead of $3,200,000 as proposed by
the Senate.
International activities
Amendment No. 8: Inserts language for
mobile trade fairs as proposed by the Senate.
Amendment No. 9: Appropriates $10,-
750,000 for salaries and expenses as proposed
by the Senate instead of $10,400.000 as pro-
posed by the House.
Office of Field Services
Amendment No. 10: Appropriates $4,-
200,000 for salaries and expenses as proposed
by the House instead of $4,265,000 as pro-
posed by the Senate.
Coast and Geodetic Survey
Amendment No. 11: Appropriates $29.200,-
000 for salaries and expenses as proposed by
the Senate Instead of $29.000,000 as proposed
by the House.
National Bureau of Standards
Amendment No. 12: Appropriates $33,743,-
000 for research and technical services In-
stead of $33,000,000 as proposed -by the House
and $34,548,000 as proposed by the Senate.
Weather Bureau
Amendment No. 13: Appropriates $611,036.-
250 for salaries and expenses Instead of
$68,750,000 as proposed by the House and
$69,287.900 as proposed by the Senate.
Amendment No. 14: Appropriates $11.536,-
000 for research and development instead of
$10,786,000 as proposed by the House and
$11,786,000 as proposed by the Senate.
Maritime Administration
Amendment No. 15: Appropriates $132,-
150,000 for ship construction as proposed by
the House instead of $124,850,000 as proposed
by the Senate.
Amendment No. 18: Appropriates $180,-
000,000 for operating-differential subsidies
(liquidation of contract authorination) as
proposed by the Senate instead of 6190,000,-
000 as proposed by the House.
Bureau of Public Roads
Amendment No. 17: Appropriates $200,-
000,000 for repayable advances to the high-
way trust fund as proposed by the Senate
instead of $225.000,000 as proposed by the
House.
Amendment No. 1B: Deletes language pro-
posed by the Senate.
TITLE IV-THE JUDICIARY
Courts of appeals, district courts, and other
judicial services
Amendment No. 19: Appropriates $34,292.-
000 for salaries of supporting personnel as
proposed by the Senate instead of $34,220,000
an proposed by the House.
Amendment No. 20: Appropriates $3,000,-
000 for fees and expenses of court-appointed
counsel as proposed by the Senate Instead
of $3,500,000 as proposed by the House.
Amendment No. 21: Appropriates $4,910,-
000 for travel and miscellaneous expenses as
proposed by the Senate instead of $4,900,000
as proposed by the House.
TITLE V-RELATED AGENCI!S
Department of Health. Education. and Wel-
fare
Office of Education
Amendment No. 22: Appropriates $6,000.-
000 for civil rights educational activities as
proposed by the Senate Instead of $4,000.000
as proposed by the House.
Equal Employment Opportunity Commission
Amendment No. 23: Appropriates $2,750,000
for salaries and expenses as proposed by the
Senate.
Federal Maritime Commi rsion
Amendment No. 24: Appropria? es $3,150.000
for salaries and expenses Instead of $3.100.000
as proposed by the House and 13,180.000 as
proposed by the Senate.
U.S. Information Agency
Amendment No. 25: Appropria es $140,000,-
000 for salaries and expenses as proposed by
the Senate instead of $140.254 000 as pro-
posed by the House.
Amendment No. 26: Adds lane usge as pro-
posed by the Senate.
JOHN J. ROONI Y.
JOHN M. SLAcit, Jr..
NEAL SMITH.
JOHN J. FLYNT. Jr..
CHARLES S. JOSS SON.
GEORGE MAHON,
FRANK T. Bow.
GLENAaD P. LIP.iCOMs
ELVOR0 A. CtDiRsERG
Managers on the Part of the House.
ESTABLISHING DEPARTMENT OF
HOUSING AND URBAN DEVELOP-
MENT
Mr. FASCELL. Mr. Spef ker, I ask
unanimous consent to takt from the
Speaker's table the bill (H.R. 6927j to
establish a Department of F ousing and
Urban Development, and for other pur-
poses, with amendments of the Senate
thereto, disagree to the amen Iments and
request a conference with tho Senate
The Clerk read the title of the bill.
The SPEAKER. Is there )bjection to
the request of the gentleman from Flor-
ida? The Chair hears none, and ap-
points the following confers es: Messrs.
DAWSON, HOLIFIELD, FASCELL, REUSS,
ROSENTHAL, ERLENBORN. and WYDLER.
CORRECTION OF THE :i,ECORD
Mr. OLSON of Mini esota. Mr.
Speaker, I ask unanimous consent to
make a correction in my remarks In the
CONGRESSIONAL RECORD Of ye: terday Au-
gust 17. 1965, page 19947, paragraph No.
4, line 14, where it reads:
I think a transfer and selec ton base al-
lowed here Is going to result d ifinitely in a
kind of milk tax.
This line should be changed to read:
I think the transfer and rile of bases
allowed is going to result in what might be
referred to as a milk tax.
The SPEAKER, Without 5bjection. it
is so ordered.
There was no objection.
CORRECTION OF THE F,ECORD
Mr. FINDLEY. Mr. Spe iker. I ask
unanimous consent that the permanent
RECORD be corrected on page 19976 near
the bottom of the second column to read
as follows:
Mr. FINDLEY. The gentleman said that the
consumers have benefited under this cotton
program. Looking at the "Cot'o-n Situation
Report" from the Consumer and Marketing
Service of USDA I find that th I price on 20
cotton constructions-the Ing lex showing
product prices-has gone up each and every
single month since the so-cal ed one-price
cotton program went Into operation. On
the other side of this some sta tistical table
from USDA I And that each and every single
month the mill margin-that is the gross
profit of textile mills-has go:ie up. '['his
despite the fact they had the pr ce advantage
of this program, which is coaling the tax-
payers somewhere around $900 million a year.
I think it is shameful we have to consider
any variation of a program which so ad-
versely affects the taxpayers of the United
States.
And on the same page correct the line
reading "the buggy whip" to read "the
buggy whip industry."
The SPEAKER. Is there objection to
the request of the gentleman from
Illinois?
There was no objection.
CALL OF THE HOUSE
Mr. GRIFFIN. Mr. Speaker, I make
the point of -order that a quorum is not
present.
The SPEAKER. Evidently, a quorum
is not present.
Mr. ALBERT. Mr. Speaker, I move a
call of the House.
A call of the House was ordered.
The Clerk called the roll, and the fol-
lowing Members failed to answer to their
names:
[Roll No. 2411
Adair
Dowdy
Miller
Andrews,
Duncan, Oreg.
Moorhead
George W.
Dyal
Powell
Asplnall
Farnum
Relnecke
Blatnik
Oubser
Roudebush
Bonner
Irwin
Roybal
Brown, Ohio
Johnson, Pa.
Scott
Cabell
King, Calif.
Thomas
Cahill
King, N.Y.
Toll
Carter
Kornegay
Utt
Curtis
Lindsay
Younger
Dent
Martin, Mass.
Dingell
Mathias
The SPEAKER. On this rollcall 395
Members have answered to their names,
a quorum.
By unanimous consent, further pro-
ceedings under the call were dispensed
with.
AUTHORITY TO FILE CONFERENCE
REPORT ON H.R. 7750-FOREIGN
ASSISTANCE ACT OF 1965
Mr. MORGAN. Mr. Speaker, I ask
unanimous consent that the House con-
ferees may have until midnight tonight
to file a conference report on the bill
H.R. 7750.
The SPEAKER. Is there objection to
the request of the gentleman from Penn-
sylvania?
There was no objection.
CONFERENCE REPORT (H. REPT. No. 811)
The committee of conference on the dis-
agreeing votes of the two Houses on the
amendment of the Senate to the bill (H.R.
7750) to amend further the Foreign Assist-
ance Act of 1961, as amended, and for other
purposes, having met, after full and free con-
ference, have agreed to recommend and do
recommend to their respective Houses as
follows:
That the House recede from its disagree-
ment to the amendment of the Senate and
agree to the same with an amendment as fol-
lows: In lieu of the matter proposed to be
inserted by the Senate amendment Insert the
following: That this Act may be cited as the
"Foreign Assistance Act of 1965".
"PART I
"Chapter 1-Policy
"Sac. 101. Section 102 of the Foreign As-
sistance Art of 1961, as amended, which re-
)ates to the statement of policy, is amended
as follows:
"(a) Strike out the last sentence in the
seventh paragraph and substitute the fol-
lowing: 'It is the sense of the Congress that
in furnishing assistance under this part ex-
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August 18, 1965 CONGRESSIONAL RECORD -HOUSE
cess personal property shall be utilized
wherever practicable in lieu of the procure-
ment Of new items for United States-assisted
projects and programs. It is the further
sense of the Congress that assistance under
this part shall be complemented by the fur-
nishing tinder any other Act of surplus agri-
cultural commodities and by disposal of ex-
cess property under this and other Acts.'
"(b) Add at the end thereof the following
new paragraph:
"'It is the sense of the Congress that as-
sistance under this or any other Act to any
foreign country which hereafter permits, or
fails to take adequate measures to prevent,
the damage or destruction by mob action of
United States property within such country,
should be terminated and should not be
resumed until the President determines that
appropriate measures have been taken by
such country to prevent a recurrence there-
of.'
"Chapter 2-Development assistance
"Title I-Development Loan Fund
"SEC. 102. Title I of chapter 2 of part I of
the Foreign Assistance Act of 1961, as
amended, which relates to the Development
Loan Fund, is amended as follows:
"(a) Amend section 205, which relates to
the use of the facilities of the International
Development Association, to read as follows:
"'SEC. 205. USE OF INTERNATIONAL LENDING
ORGANIZATIONS.-In order to serve the pur-
poses of this title and the policy contained in
section 619, the President, after consideration
of-the extent of additional participation by
other countries, may make available, in addi-
tion to any other funds available for such
purposes, on such terms and conditions as
he determines, not to exceed 15 per centum of
the funds made available for this title to the
International Development Association, the
International Bank for Reconstruction and
Development, or the International Finance
Corporation for use pursuant to the laws gov-
erning United States participation in such in-
stitutions, if any, and the governing statutes
thereof and without regard to section 201 or
any other requirements of this or any other
Act.'
"(b) Add the following new section:
"'SEC. 206. REGIONAL DEVELOPMENT IN
AFRICA: The President is requested to seek
and to take appropriate action, in coopera-
tion and consultation with African and other
interested nations and with international de-
velopment organizations, to further and as-
sist in the advancement of African regional
development institutions, including the Afri-
can Development Bank, with the view toward
promoting African economic development.'
"Title II-Technical Cooperation and Devel-
opment Grants
"SEC. 103. Title II of chapter 2 of part I of
the Foreign Assistance Act of 1961, as
amended, which relates to technical cooper-
ation and development grants, is amended as
follows :
"(a) Amend section 212, which relates to
authorization, by striking out '1965' and
'$215,000,000' and substituting '1966' and
'$210,000,000', respectively.
"(b) Amend section 214, which relates to
American schools and hospitals abroad, as
follows :
"(1) Amend subsection (b) by atriking out
'treatment, education,' and substituting'edu-
cation'.
"(2) Amend subsection (c) by striking out
'1965, $18,000,000' and substituting '1966,
$7,000,000'.
"Title III-Investment Guaranties
"SEC. 104. Title III of chapter 2 of part I
of the Foreign Assistance Act of 1961, as
'amended, which relates to investment guar-
anties, is amended as follows:
"(a) Amend section 221(b), which relates
to general authority, as follows:
"(1) Amend the introductory clause to
read as follows:
"'(b) The President may issue guaranties
to eligible United States investors-'.
"(2) In paragraph (1), strike out '$2,500,-
000,000' and substitute '$5,000,000,000'.
"(3) Amend paragraph (2) as follows:
"(A) In the first proviso, strike out ', and
no such guaranty in the case of a loan shall
exceed $25,000,000 and no other such guar-
anty shall exceed $10,000,000'.
"(B) In the third proviso, immediately
after '$300,000,000' insert the following: ',
and guaranties issued under this paragraph
(2) for other than housing projects similar
to those insured by the Federal Housing Ad-
ministration, shall not exceed $175,000,000'.
"(C) In the fourth proviso, strike out
'1966' and substitute '1967'.
"(b) Amend section 221(c), which relates
to general authority, as follows:
"(1) Strike out 'actual earnings or profits'
and substitute 'earnings or profits actually
accrued'.
"(2) Immediately after 'guaranty' the
third time it appears, insert 'of an equity
investment'.
"(c) Amend section 222(b), which relates
to general provisions, by inserting after '(ex-
clusive of informational media guaranties),'
the words 'and to pay the costs of investigat-
ing and adjusting (including costs of arbi-
tration) claims under such guaranties,'.
"(d) Amend section 223, which relates to
definitions, as follows:
"(1) In subsection (a), strike out 'and' at
the end thereof and in subsection (b) strike
out the period and substitute '; and'.
"(2) Add the following new subsection
(c) :
'-(c) the term "eligible United States in-
vestors" means United States citizens, or
corporations, partnerships, or other associa-
tions created under the laws of the United
States or any State or territory and sub-
stantially beneficially owned by United
States citizens, as well as foreign corpora-
tions, partnerships, or other associations
wholly owned by one or more such United
States citizens, corporations, partnerships, or
other associations: Provided, That, the eligi-
bility of a foreign corporation shall be deter-
mined without regard to any shares, in
aggregate less than 5 per centumof the total
of issued and subscribed share capital, re-
quired by law to be held by persons other
than the United States owners.'
"(e) Amend section 224, which relates to
housing projects in. Latin American coun-
tries, to read as follows:
"'SEC. 224. HOUSING PROJECTS IN LATIN
AMERICAN COUNTRIES.-(a) It is the sense of
Congress that in order to stimulate private
home ownership and assist in the develop.
ment of stable economies in Latin America,
the authority conferred by this section
should be utilized for the purpose of assist-
ing in the development in the American
Republics of self-liquidating pilot housing
projects, the development of institutions en-
gaged in Alliance for Progress programs, in-
cluding cooperatives, free labor unions, sav-
ings and loan type institutions, and other
private enterprise programs in Latin Amer-
ica engaged directly or indirectly in the
financing of home mortgages, the construc-
tion of homes for lower income persons and
families, the increased mobilization of sav-
inV and the improvement of housing condi-
tions in Latin America.
"'(b) To carry out the purposes of sub-
section (a), the President is authorized to
issue guaranties, on such terms and condi-
tions as he shall determine, to eligible United
States investors as defined In section 223
assuring against loss of loan investments
made by such investors in-
" ' (1) pilot or demonstration private hous-
ing projects in Latin America of types similar
to those insured by the Federal Housing Ad-
ministration and suitable for conditions in
Latin America;
"'(2) credit institutions in Latin America
engaged directly or indirectly In the financ-
ing of home mortagages, such as savings and
loan institutions and other qualified invest-
ment enterprises;
"'(3) . housing projects In Latin America
for lower income families and persons, which
projects shall be constructed in accordance
with maximum unit costs established by the
President for families and persons whose in-
comes meet the limitations prescribed by the
President;
"'(4) housing projects in Latin America
which will promote the development of insti-
tutions important to the success of the Al-
liance for Progress, such as free labor unions,
cooperatives, and other private enterprise
programs; or
"'(5) housing projects in Latin America
25 per centum or more of the aggregate of
the mortgage financing for which is made
available from sources within Latin America
and is not derived from sources outside Latin
America, which projects shall, to the maxi-
mum extent practicable, have a unit cost of
not more than $6,500.
"'(c) The total face amount of guaranties
issued under this section outstanding at any
one time shall not exceed $400,000,000: Pro-
vided, That no payment may be made under
this section for any loss arising out of fraud
or misconduct for which the investor is re-
sponsible: Provided further, That this au-
thority shall continue until June 30, 1967.'
"Title VI-Alliance for Progress
"SEC. 105. Section 252 of the Foreign As-
sistance Aot of 1961, as amended, which re-
lates to the Alliance for Progress, is amended
by inserting immediately after 'fiscal year
1965' the following: 'and $75,000,000 in fiscal
year 1966'.
"Chapter 3-International organizations and
programs
"SEC. 106. Chapter 3 of part I of the For-
eign Assistance Act of 1961, as amended,
which relates to international organizations
and programs, is amended as follows:
"(a) Amend section 301(c), which relates
to assistance for Palestine refugees in the
New East, by adding at the end thereof the
following:' 'Contributions by the United
States to the United Nations Relief and
Works Agency for Palestine Refugees in the
Near East for the calendar year 1966 shall
not exceed $15,200,000.'
"(b) Amend section 302, which relates
to authorization, by striking out '1965' and
`$134,272,400' and substituting '1966' and
1$144,755,0001, respectively.
"Chapter 4-Supporting assistance
"SEC. 107. Section 402 of the Foreign As-
sistance Act of 1961, as amended, which re-
lates to supporting assistance, is amended
by striking out in the first sentence '1965'
and '$405,000,000' and substituting '1966' and
'$369,200,000', respectively.
"Chapter 5-Contingency fund
"SEC. 108. Section 451 of the Foreign As-
sistance Act of 1961, as amended, which re-
lates to the contingency fund, is amended
as follows:
"ta) Amend subsection (a) as follows:
"(1) Strike out '1965' and '$150,000,000'
and substitute '1966' and '$50,000,000', re-
spectively.
"(2) Add the following new sentence: 'In
addition, there is hereby authorized to be ap-
propriated to the President for use in South-
east Asia such sums, not to exceed $89,000,-
000, as may be necessary in the fiscal year
1966 for programs authorized by parts I and
II of this Act:'
"(b) Amend subsection (b) by striking
out 'this section' and substituting 'the first
sentence of subsection (a)'.
"PART II
"Chapter 2-Military assistance
"SEC. 201. Chapter 2 of part II of the For-
eign Assistance Act of 1961, as amended,
which relates to military assistance, is
amended as follows:
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CONGRESSIONAL RECORD - HOUSE August 18, 1965
"(a) Amend section 503(b). which relates "(3) Strike out the current applicable ation, fund, or account currently available
to general authority, by striking out the appropriation' and, substitute 'a separate for the same general purpose.'
words 'in foreign countries'. fund account'. "(b) Amend section 612, which relates to
"(b) Amend section 504, which relates to "(4) Strike out 'furnishing further milt- use of foreign currencies, by redesignating
authorization, by striking out '1985' and tary assistance on cash or credit terms' and subsection (c) as subsection (b), and by
$1,055,000,000' In the first sentence and sub- substitute 'financing sales and guaranties, striking out the first sentence of the second
stituting '1968' and '$1,170,000,000', including the overhead costs thereof. paragraph of such subsection and by adding
respectively. "(f) Amend section 509(b), wldch relates at the end thereof the following new para-
"(c) Amend section 505. which relates to to exchanges and guaranties, br Inserting graph:
utilization of assistance, as follows: '(excluding contracts with any agency of "'The President shall take all appropri-
"(1) In subsection (a), strike out the the United States Government)' in the sec- ate steps to assure that, to the maximum ex-
colon and add the following: ', or for the and sentence between the last w )rd thereof tent possible, United States-owned foreign
purpose of assisting foreign military forces and the period. currencies are utilized in lieu of dollars.
In less developed friendly countries (or the "(g) Amend section 510(a), which relates Dollar funds made available pursuant to this
voluntary efforts of personnel of the Armed to special authority, as follows: Act shall not be expended for goods and
Forces of the United States In such eoun- "(1) In the first sentence strike out '1965' services when United States-owned foreign
tries) to construct public works and to en- and substitute '1988'. currencies are available for such purposes
gage In other activities helpful to the "(2) In the second sentence, strike out unless the administrative official approving
economic and social development of such '1965' and substitute '1968'. the voucher certifies as to the reason for the
friendly countries. It is the sense of the //(h) Amend section 511, which relates to use of dollars In each case.'
Congress that such foreign military forces rrtstrictians on military aid to Latin Americxt, "(c) Amend section 613, which relates to
should not be maintained or establish its follows: foreign currencies, as follows:
solely for civic action activities and th "(1) In subsection (a), strike out 'a Est "(1) Strike out the section heading and
be used during each fiscal ,ear for es- substitute the following: 'AOCouNrxNO, VAL-
such civic action activities not signiflcan IS,
detract from the capability of the milita jiatstance In Implementing a feasible plan for STATION, REPORTING, AND ADMINISTRATION of
forces to perform their military missions to , regional defense, and insert'$25,li00,000 may FOREIGN CURRENCIES'.
be coordinated with and form part of the be used far assistance on a cast-al taring balls "(2) Add the following new subsection:
total economic and social development ef- to an inter-American military force under "'(d) In cases where assistance is to be
fort' the control of the Organization (f American furnished to any recipient country in fur-
"(2) Strike out subsection (b) and re- States'; and amend the proviso to read as therance of the purposes of this or any other
designate the proviso of subsection (a) as follows: ': Provided, That the tee; of defense Act on a basis which will result in the ac-
subsection (b). articles supplied for use by elect cuts of the crual of foreign currency proceeds to the
"(3) In redesignated Subsection (b), strike Inter-American Peace Force in tae Domini- United States, the Secretary of the Treasury
out 'Provided, That except' and substitute n Republic shall not be char led against shall Issue regulations requiring that agree-
'Except'; strike out 'or (2)' and substitute e $55,000,000 limitation provided by this menta, in respect of such assistance, include
or (2) for civic action assistance, or (3)'. subsection'. provisions for the receipt of Interest In-
"(d) Amend section 507, which relates to "(2) Amend subsection (b) to read as come on the foreign currency proceeds de-
sales, as follows: follows: posited In authorized depositaries: Provided,
"(1) In subsection (a), insert the follow- '-(b) To the maximum extent feasible, That whenever the Secretary of State deter-
ing new sentence between the second and military assistance shall be fc:rnisbed to mines it not to be In the national interest
third sentences: 'Notwithstanding the pro- American Republics In accordanci with joint to conclude arrangements for the receipt of
visions of section 644(m) (2), nonexcess de- plans (including joint plans reli.ting to in- Interest Income he may waive the require-
fense articles may be sold under this sub- ternal sectuity problems) apprc ved by the ment thereof: Provided further, That the
section at the standard price in effect at Organization of American States. The Pros- Secretary of State, or his delegate, Shan
the time such articles are offered for sale to ident shall submit semiannual reports to the promptly make a complete report to the
the purchasing country or International or- Speaker of the House of Representatives and Congress on each such determination and
ganization.' to the Committee on Foreign Relations of the reasons therefor.'
"(2) In subsection (b), strike out the the Senate on the implemental Ion of this "(d) Amend section 620, which relates to
period at the end of the first proviso, sub- Subsection.' prohibitions against furnishing assistance to
as follows:
and certain other countries
to C
h)
l
t
b
d
ti
512
"
,
a
ci re
a
es
u
sec
on
. w
(i) Amen
stitute a colon and add the following: 'Pro-
vided further, That the President may, when estrictlons on military aid tc Africa, as "(1) Amend the section heading to read
he determines it to be in the national In- ollows: as follows: 'PaoHlarrloxs AGAINST FURNISH-
terest, enter Into sales agreements with pur- "(1) Strike out 'programs cescribed in INC ASSISTANCE.-'.
chasing countries or international organize- tion 505(b) of this chapter' and substl- "(2) Amend subsection (e) (2), which re-
tions which fix prices to be paid by the pur- ute 'civic action requirements'. lates to the act of state doctrine, by in-
ht' each
words 'other ri
th
ft
ti
g
ng a
er
e
chasing countries or international organiza- "(2) Strike out 1985 and substitute sor
tions for the defense articles or defense serv- 1966'. time they appear the words 'to property', and
ices ordered. Funds available under this "PART us by striking out ', or (3) In any case in which
ed after Jan-
n
c
part for financing sales shall be used to re- "Chapter 1--General pros rises the proceedings are comme
nary 1
1968'.
,
imburse the applicable appropriations In the
amounts required by the contracts which ". 301. Chapter 1 of part III of the "(3) In section 620(1), which relates to the
exceed the price so fixed, except that such Foreign Assistance Act of 1961. is amended, prohibition against furnishing assistance to
reimbursement shall not be required upon which_ relates to general provisions, is countries which fail to enter Into agreements
determination by the President that the con- amended as follows: to institute the investment guaranty pro-
tinued production of the defense article be- "(a) Amend section 605. which relates to gram and providing protection against cer-
ing sold is advantageous to the Armed Forces retention and use of items, as follows: twin risks, strike out 'December 31, 1965' and
of the United States. Payments by purchas- "(1) In the section heading strike out substitute 'December 31, 1966'.
Ing countries or international organizations 'ITEMS' and substitute 'C RTAIr ITEMS .%ND "(4) At the end of such section 620, add
which exceed the amounts required by such FUNDS'. the following new subsections:
contracts shall be credited to the account "(2) Add the following new at, bsectione;: ?'(n) In view of the aggression of North
established under section 508. To the maxi- (c) Funds realized as a re salt of any Vietnam, the President shall consider deny-
mum extent possible, prices fixed under any failure of a transaction flnencc I under au- tag assistance under this Act to any coun-
such sales agreement shall be sufficient to try which has failed to take appropriate
thority of part I of this Act to conform to steps, not later than sixty days after the date
reimburse the United States for the cost of the requirements of this Act, or 0 applicable of enactment of the Foreign Assistance Act of
the defense articles or defense services rules and regulations of the United States ]965__
ordered. The President Shall submit to the Government, or to the terms of any agree-
Congress promptly a detailed report concern- ment or contract entered into u ider author- ?'(A) to prevent ships or aircraft under
ing any fixed-price sales agreement under Ity of part I of this Act, shall Levert to the its registry from transporting to North Viet-
which the aggregate cost to the United States respective appropriation, fund, or account Itam--
exceeds the aggregate amount required to be used to finance such transaction or to the ap- "'(i) any items of economic assistance,
paid by the purchasing country or interns- propriation, fund, or account cue rently avail- "' i lt) any Items which are, for the purposes
tional organization.' able for the same general purpose of title I of the Mutual Defense Assistance
"(e) Amend section 508, which relates to "'(d) Funds realized by the United States Control Act of 1951, as amended, arms, am-
reimbursement as follows: Government from the sale, transfer, or dis- munition and implements of war, atomic
?11) After 'this part' the first time it ap- posal of defense articles returned to the energy materials, petroleum, transportation
pears. insert'have been or'. United States Government by a recipient materials of strategic value, or items of pri-
"(2) After 'United States Government.' country or International organization as no mary strategic significance used in the pro-
the first time it appears insert 'receipts re- longer needed for the purposs s for which duction of arms, ammunition, and imple-
ceived from the disposition of evidences of furnished shall be credited to tic respective ments of war. or
indebtedness and charges (including fees appropriation, fund, or account used to pro- "'(lit) any other equipment, materials, or
and premiums) or interest collected'. cure such defense articles or to' be appropri- commodities; and
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August 18, 1965 CONGRESSIONAL RECORD - HOUSE
"' (B) to prevent ships or aircraft under
its registry from transporting any equip-
ment, materials, or commodities from North
Vietnam.
(o) In determining whether or not to
furnish assistance under this Act, consider-
ation shall be given to excluding from such
assistance any country which hereafter
seizes, or imposes any penalty or sanction
against, any United States fishing vessel on
account of its fishing activities in inter-
national waters. The provisions of this sub-
section shall not be applicable in any case
governed by international agreement to
which the United States is a party!
"Chapter 2-Administrative provisions
"SEC. 302. Chapter 2 of part III of the
Foreign Assistance Act of 1961, as amended,
which relates to administrative provisions,
is amended as follows:
"(a) Amend section 822, which relates to
coordination with foreign policy, as follows:
"(1) In subsection (b), immediately after
'military assistance' insert '(including any
civic action and sales program)'.
"(2) In subsection (c), immediately after
'military assistance program' insert '(includ-
ing any civic action and sales program)'.
"(b) Amend section 624, which relates to
statutory officers, as follows:
"(1) In subsection (b), strike out `para-
graph (3) of' and 'of the 'officers provided
for in paragraphs (1) and (2) of that sub-
section', and substitute for the latter `of one
or more of said officers'.
"(2) In subsection (d), Strike out 'Public
Law 88-735' wherever it appears and substi-
tute 'the Latin American Development Act,
as amended'.
"(c) Amend section 625(d), which relates
to the employment of personnel, by striking
out 'twenty' in paragraph (2) and substitut-
ing 'forty'.
"(d) Amend section 626, which relates to
experts, consultants, and retired officers, by
redesignating subsection (d) as subsec-
tion (c).
"(e) Amend section 630, which relates to
terms of detail or assignment, by inserting
'benefits' after 'travel expenses,' in para-
graphs (2) and (4).
"(f) Amend section 631, which relates to
missions and staffs abroad, by adding the
following new subsection:
"'(d) Wherever practicable, especially in
the case of the smaller programs, assistance
under this Act shall be administered under
the direction of the Chief of the United
States Diplomatic Mission by the principal
economic officer of the mission in the case
of assistance under part I, and by the senior
military officer of the mission in the case of
assistance under part II.'
"(g) Amend section 635(g), which relates
to general authorities, by inserting `and sales'
after `loans' in the introductory clause.
"(h) Amend section 638, which relates to
provisions on uses of funds, as follows:
"(1) In subsection (e), strike out 'section
2 of the Act of July 31, 1894, as amended
(5 U.S.C. 62)' and substitute 'section 301 of
the Dual Compensation Act (5 U.S.C. 3105)'.
"(2) In subsection (f), strike out 'Act to
provide' for assistance In the development of
Latin America and in the reconstruction of
Chile, and for other purposes' and substitute
'Latin American Development Act, as
amended'.
"(1) Amend section 637(a), which relates
to administrative expenses, by striking out
`1965' and '$52,500,000' and substituting
'1966' and '$54,240,000', respectivey.
"(J) Amend section 638 which-relates to
Peace Corps assistance, by striking out all be-
ginning with '; or famine' and substituting
a period. .
"(k) Add the following new sections:
"'SEC-'639. FAMINE AND DISASTER RELIEF.-
No provision of this Act shall be construed
to prohibit assistance to any country for
famine or disaster relief.
"'SEC. 640. MILITARY SALES.-EXCept as
otherwise provided in part II of this Act, no
provision of this Act shall be construed to
prohibit the sale, exchange, or the guaranty
of a sale, of defense articles or defense serv-
ices to any friendly country or international
organization if the President shall have
found, pursuant to section 503, that the as-
sisting of such country or organization will
strengthen the security of the United States
and promote world peace.'
"Chapter 3-Miscellaneous provisions
"SEC. 303. Chapter 3 of part III of the For-
eign Assistance Act of 1961, as amended,
which relates to miscellaneous provisions,
is amended as follows:
"(a) Amend section 642(a) (2), which re-
lates to statutes repealed, by striking out
'143,' and all beginning with '; Provided,'
up to the semicolon.
"(b) Amend section 644, which relates to
definitions, as follows:
"(1) In subsection (g), insert ', and not
procured in anticipation of military assist-
ance or sales requirements, or pursuant to a
military assistance or sales order,' after
'United States Government' and strike out
'as grant assistance'.
"(2) In subsection (m) (2), strike out
'Such price shall be the same standard price'
and substitute 'Such standard price shall be
the same price (including authorized re-
duced prices)'.
"(3) Amend the paragraph following the
numbered paragraph (3) in subsection (m)
as follows:
"(A) In the first sentence, insert 'and sales'
after `Military assistance'.
"(B) In the second proviso, strike out
'by the military assistance program'.
"(c) Amend section 645, which relates to
unexpended balances, by striking out 'Pub-
lic Law 86-735' and substituting 'the Latin
American Development Act, as amended,'.
"(d) At the end thereof add the following
new section:
"'SEC. 649. LIMITATION ON AGGREGATE Au-
THORIZATION FOR USE IN FISCAL YEAR 1966;
Notwithstanding any other provision of this
Act, the aggregate of the total amounts au-
thorized to be appropriated for use during
the fiscal year 1966 for furnishing assistance
and for administrative expenses under this
Act shall not exceed $3,360,000,000.'
"Chapter 4-Amendment to the Agricultural
Trade Development and Assistance Act of
1954
"SEc. 401. Section 107 of the Agricultural
Trade Development and Assistance Act of
1954 is amended by adding at the end there-
of the following new paragraph:
"'No sale under title I of this Act shall
be made to the United Arab Republic unless
the President determines that such sale is
essential to the national interest of the
United States. No such sale shall be based
on the, requirements of the United Arab
Republic for more than one fiscal year. The
President shall keep the Foreign Relations
Committee and the Appropriations Commit-
tee of the Senate and the Speaker of the
House of Representatives fully and currently
informed with respect to sales made to the
United Arab Republic under title I of this
Act.",
And the Senate agree to the same.
THOMAS E. MORGAN,
EDNA F. KELLY,
WAYNE L. HAYS,
BARRATT O'HARA,
W. S. MAILLIARD,
PETER H. B. FRELINGHUYSEN,
Managers on the Part of the House.
J. W. FULDRIGHT,
JOHN SPARKMAN,
By J. W. F.
MIKE MANSFIELD,
By J. W. F.
BounKE B. HICKENLOOPER,
GEORGE AIKEN,
FRANK CARLSON,
By B. B. H.
Managers on the Part of the Senate.
STATEMENT
The managers on the part of the House at
the conference on the disagreeing votes of
the two Houses on the amendment of the
Senate to the bill (H.R. 7750) to amend
further the Foreign Assistance Act of 1961,
as amended, and for other purposes, submit
the following statement in explanation of
the effect of the action agreed upon by the
conferees and recommended in the accom-
panying conference report:
The Senate amendment struck out all of
the House bill after the enacting clause and
inserted a substitute text.
The committee of conference recommends
that the House recede from its disagreement
to the amendment of the Senate with an
amendment, which is a substitute for both
the text of the House bill and the text of the
Senate amendment, and that the Senate
agree to the same.
Except for clerical and minor drafting
changes, the differences between the House
bill and the substitute agreed to in con-
ference are noted below.
AUTHORIZATION OF FUNDS
The following table shows the differences
between the House bill and the Senate
amendment, the sums agreed to by the com-
mittee of conference and the administration
appropriation request for programs author-
ized in this bill and in existing law:
Foreign Assistance Act of 1965 (fiscal year 1966)
[In thousands]
_
(1)
Executive
approprl-
ation
request
(2)
House
(3)
Senate
(4)
Conference
(2) and (4)
Adjustment
against
House
bill
(3) and (4)
Adjustment
against
Senate
amendment
Development Loan Fund--------------
Technical cooperation and develop-
) 1$790,250
p)
(2)
(I)
ment grants_________
For southeast Asia
z
________
2
109,000
000
$2(10z,000
,)
.$210,000
29
00
,000
$2102
American schools and hospitals abroad-
Alliance for Progress3
7,000
3
7, 000
,
0
9,
000
)
(
7, 000
(2)
-------
2 -$9, 050
000
-2
---
ants_____-_____ti_-onsa__-__nd -_-pro--___
International organiza
580,125
(85,000)
3
(35,000)
((3)
,000)
3
(75,000)
----
(-
$i0, 000)
,
X+5, 000)
grams____
Supporting assistance-__
F
145,555
369,200
144,765
309, 200
146,455
350
000
144,755
369
200
--- ------
-1700
or southeast Asia 2---------------
Contingency fund 2__ __ __ _
0
280,000
5
000
(2)
2 50
000
,
280,000
50
00
,
(2)
+19:
200
-80,000
Special authorization for southeast
,
,
,
0
, 50,000
Asia 2_._
Military
ex ex assistance- - expenses:
Administrative
(2)
1,170,000
2
()
1,170, 000
2
()
1,170, 000
289,000
1, 170, 000
z-'Sfl
, 000
2 -F89, 000
AID-- -- -- -- -- -- -- -- - -- - -- -- -- --
State Department-----------------
55, 240
+3
100
53 240
(4)
55, 240
(4
54,240
+
+1,000
-1 000
,
,
)
(
)
--
-----------
3,469,470
2,004,195
2,079,69B
2,094, 1.96
-[-9D, 000
-[-14, 50D
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t Existing law authorizes an appropriation of SI 500,000,000 for fiscal year 1966? Plus unaf~pra~r1ad d portions of
amounts authorized for fiscal years 1962-66. The Executive request for fiscal year 1966 is $78(12eu.On0-
^ The House bill contained an authorization for an appropriation for military and economic program f In southeast
Asia or such sums as may ho necessary in fiscal year 196(1. This was added to the section of the law ; elath1$ to the
contingency fund. The Senate amendment added $9,000,000 t,c the authorization for technical (operation sad
a.',000,000 to the authorization for supporting assistance to reflect the Executive request of 589,00(1600 for use in
southeast Asia. The conferees agreed to a special authorization of $,000,(00 for southeast Asia under the contin-
gency fund.
A Existing law authorizes an appropriation of 5500,000.000 For fiscal year 1966 against which the Bill cutive has re-
lu? ted total an appropriation t l or the of SM)), Alliance 225,0 for Neither Progress ethe ar House a year bill nor the tienato amendment made my change In
' Existing law contains a continuing authorization for such sums as necessary. The Executive ha ? requested an
appropriation of $3,100,000.
No'rE.-The Senate amendment contained a limitation on the aggregau- authorizatin, for use in i as year 156
of $3,243,000,000. The conferees agreed to a limitation or $3,300,000,000.
II1?tCAPITGLkT10N
Total amount or new authorizations contained In Ti. R. 771{..
Appropriations requested against previous authorization,'
Development Loan Fund...----_-_ ----
."
?"'?
12-k 010)
Alliance for Progress__. -.__ _--?--------- -. _.-
000
,;late L)epartineat administrative expenses-
.
Total authorized and requested for fisc:,l year 1960-_.--_-_ _- :;.457, r7o. CI)
Limitation on aggregate authorization for haul year 191;5___-.__-. - -- :(,31 W. (X). Ong
Reduction below total authorized and requester) fur fiscal year 19bi.. V;, otu, ux)
Reduction below Executive Drquest _ . _ _ - - -- - - - - - _ ~.r 470. (00
USE OF EXCESS PROPERTY--SECTION 101(aEN-
ATE-SEC. Iot(a))
The Senate amendment added a sentence
to section 102 of the act-statement of
policy-expressing the sense of the Congress
that in furnishing assistance under this part,
excess personal property should be utilized
wherever practicable in lieu of the procure-
ment of new Items for U.S.-assisted projects
and programs.
A sentence already in the statement of
policy dealing with this matter was modified
by changing the phrase "excess property" to
"excess personal property"
The House bill contained no language deal-
Ing with this subject.
The managers on the part of the House
accepted the Senate language, except that
the insertion of the word "personal" In the
lastsentence of the paragraph In the exist-
Ing statement of policy was deleted.
The managers for the House are convinced
that Congress already has Indicated that it
favors the use of excess property in lieu of
the procurement of new Items to carrying
out the foreign aid program, and that a fur-
ther and stronger statement of congressional
Intent on this subject would be desirable.
They did not regard the reference to "excess
personal property," rather than retention of
the phrase "excess property," as adding any-
thing to the meaning.
CHANNELING ASSISTANCE THROUGH MULTII.AT-
ERAL PROGRAMS AND INTERNATIONAL ORGA-
NIZATIONS-SECTION 102(S) (SENATE-SECS.
Ioi(b) AND 102 tc))
Section 101(b) of the Senate amendment
included a statement that Congress urges
that an increasing proportion of U.S. aid be
placed on a multilateral basis.
The House bill contained no comparable
provision.
Section 102(c) of the Senate amendment
included an amendment to section 205 of
the act to increase from 10 to 15 percent the
development loan funds which might be
,
r
s
g
made available to the International Develop- million of guaranties authorl:;ed to be !a- to 6350 million the total face amount of guar-
v lopm t. Bank for sued under that section not 1'$e than $160 antics that may be issued for Latin American
Rent Reconstruction and the International
Reconstruction aDevelopment, or the I er million could he issued only for housing proj- housing Investments and provided that the
ternatlonaf Finance Corporation, together acts similar to those Insured t y the Federal authority to issue such guaranties should
with a proviso stating that with respect to Housing Administration. continue through June 30, 1968.
any dollars expended pursuant to this an- The mate amendment did not contain a The goose bill Increased the issuing an-
poweryo vote United States shall use its voting comparable provision.
power to vfor disapproval of any Inter- thorlty for such guaranties from $250 to $450
national Development Association (MA) The managers on the part of the House million and continued the authority to issue
loan for any activity In a country to which agreed to a compromise, increasing the limit such guaranties through June 30, 1987.
assistance Is suspended pursuant to section on extended risk guaranties a hick could be The managers on the part of the -House
620(e) (1) of the act, which requires the used for purposes other than housing to $175 accepted a ceiling of $400 million on the face
suspension of U.S. aid to countries which million. This has the effect of assuring that amount of such guaranties, a figure which
expropriate U.S. property. $126 million of the $300 million limit cur- splits the difference between the $350 million
The Housebill did not contain comparable rently In effect on extended risk guaranties limit set di the Senate and the $450 million
provisions. will be available for housing projects aim- set b the House. The authority to issue
The managers on the part of the House liar to those Insured by the Federal Housing arantee Is continued uroogh June 30,
agreed to accept the Senate language lnereas- Administration. This would not preclude gu
ing the limit on the use of development loan the use of more than $126 mi' lion for bous- 1967.
funds by the International Dave opment As-
sociation, the International Ban] for Recon-
struction and Development or the Interna-
tional Finance Corporation from tO to 15 per-
cent, but refused to concur In L statement
that "Congress further urges tha. the United
States and other free world nathms place an
increasing portion of their ass stance pro-
grams on a multilateral basis and that the
United States continue Its effort) to Improve
coordination among programs (d assistance
carried out on a bilateral basis t y free world
nations."
The Increase from 10 to 15 percent is per-
missive only. No use has been nade of this
authority in the past, and tt a Executive
reports that no plan for allocating develop-
ment loan funds to these lntern(.tlonal agen-
cies is currently being consider ad for fiscal
year 1968.
Ing should a demand in excess of this total
for housing investments develop.
EXTENT OP INVESTMENT GUARANTY COVERAGE-
SDGTION 304 tb) (SENATE -SEC. 104(b))
The Senate amendment included an
amendment to section 221(c) of the act,
changing the existing limits on Investment
guaranty coverage from the value of the in-
vestment plus "actual earnings and profits"
to the value of the Investment plus "earn-
ings or profits actually received."
The House bill did not contain it compara-
ble provision.
The managers on the part of the House ac-
cepted a modification of the Senate lan-
guage, limiting investment guaranty cover-
age to "earnings and profits actually accrued"
rather than "received." It was the under-
standing of the committee of conference that
It has always been the intent and the prac-
tice of the investment guaranty program that
only earnings and profits actually accrued
were covered and that the added language
would further clarify this Intent.
LATIN AMERICAN HOUSING GUARANTIES-SEC-
TION 104 (e) (HOUSE-SEC. 103 (ei ; SENATE-
SEC. 104(e))
The House bill amended section 224(a) of
the act to continue the present program of
pilot or demonstration private housing proj-
ects and to broaden the purposes of guar-
anties for housing projects In Latin America
to Include (a) development of institutions
engaged In Alliance for Progress programs,
particularly cooperatives, free labor unions,
and savings and loan type institutions; (b)
construction of lower income housing; and
(c) increased mobilization of savings and
improvement of housing conditions in Latin
America.
The Senate amendment similarly broad-
ened the purposes of section 224(a) but de-
leted specific reference to cooperatives, free
labor unions, and savings and loan type
institutions.
In addition, the House bill added a new
subsection 224(b) (4) to the act, defining as
eligible for Latin American housing guaran-
ties Investments in "housing projects In
Latin America which will promote the de-
velopment of Institutions important to the
success of the Alliance for Progress, such as
free labor unions and cooperatives."
The Senate amendment contained a sim-
ilar provision, but did nut include specific
reference to free labor unions and coopera-
tives.
The managers on the part of the House
accepted amendments to the House language
which added appropriate references to "pri-
vate enterprise" and to "private Investment"
in each Instance in order to make clear that
it was not intended that the free labor
unions, cooperatives. and savings and loan
type institutions should have priority over
other private enterprise in the development
of housing In Alliance for Progress programs.
CEILING ON LATIN AMERICAN HOUSING GUARAN-
REGIONAL DEVELOPMENT IN A}f ICA-EECrION
102(b) (SENATE-SIC. iot(d))
Section 102(d) of the Senate amendment
added a new section 208 to the act relating
to regional development In Mica. The
House bill did not contain a similar pro-
vision.
The House conferees accepte t the Senate
language. The new language reflects the
view that. In promoting African economic
development. African regional development
Institutions. including the recmtiy created
African Development Bank, sh )uld be util-
ized. In accepting this language, the con-
ferees are of the opinion that the primary
responsibility for free world eccnomtc assist-
ance to Africa rests with Europe and that the
role of the United States, at most, Is that
of an Interested minority par Scipant.
EARMARKING OP EETENDF.n RISK 0' IARAN'rIR FOR
HOUSING-SECTION 104(a) (a) P) (HOUSE-
SEC.103(b)t3)IS))
Section 103(b) (3) (B) of ti: a House bill
amended section 221(b) (2) of the Foreign
Assistance Act, which relates to extended
to provide the t of the $300
uaranties
i
k
TIES---SECTION 104 (e) (HOUSE--SEC. 103 (e) ;
SENATE-SEC. 104(e))
The Senate amendment increased from $250
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August 18, 1965 CONGRESSIONAL RECORD - HOUSE
ALLIANCE FOR PROGRESS-SECTION 105 (HOUSE-
SEC. 104; SENATE-SEC. 106)
The House bill amended section 252 of the
act to authorize an appropriation of $600
million for fiscal year 1966 for the Alliance for
Progress of which not more than $85 million
may be used for technical cooperation grants.
The balance may only be used for dollar re-
payable loans,
The Senate amendment contained an
identical authorization but limited the
amount that may be used for technical co-
operation grants to $70 million.
The committee of conference agreed that
not more than $75 million of the $600 mil-
lion may be used for such grants. It was
recognized that technical cooperation funds
have financed a number of programs basic
to the development of the Latin American
countries. Among these are programs for
improved tax collection services conducted
by the U.S. Internal Revenue Service, sup-
port for educational programs for the Central
American regional integration system, and
programs for the improvements of savings
and loan and credit facilities in a number of
countries. It should be noted that the
figure agreed upon does not increase the
authorization contained in the bill; it is
an allocation made from the $600 million
which was in the House bill and in the Sen-
ate amendment. The reduction from $85
million to $75 million has the effect of
reserving a larger portion of the $600 million
for dollar repayable loans.
STANDBY AUTHORIZATION FOR SOUTHEAST ASIA-
SECTION 108 (a) (2) (HOUSE-SEC. 107 (a)
(2); HOUSE-SEC. 102(a); SENATE--103(a);
HOUSE-SEC. 106; SENATE-SEC. 108)
The House bill authorized for use in
southeast Asia such sums for economic and
military assistance as may be necessary in
fiscal year 1966. It required the President
to present to the Committee on Foreign
Affairs and the Committtee on Foreign Rela-
tions the programs to be carried out with
the appropriations requested by the Presi-
dent under this authority.
The Senate amendment did not contain a
comparable provision.
On June 1, 1965, the President sent a mes-
sage to the Congress, requesting the author-
ization of $89 million for the Agency for
International Development for expanded
programs of economic and social develop-
ment in southeast Asia. This message was
received after the passage of H.R. 7750 by the
House but prior to its consideration by the
Senate.
The Senate amendment authorized the
$89 million requested by the President (1)
by increasing the authorization for technical
cooperation and development grants from
the figure of $210 million contained in sec-
tion 102 of the House bill to $219 million,
and (2) by increasing the authorization for
supporting assistance by $80 million.
The committee of conference agreed to a
compromise according to which the man-
agers on the part of the Senate accepted the
figures for development grants and technical
cooperation and for supporting assistance in
the House bill, and the managers on the part
of the House accepted a limitation of $89
million on the special authorization for
southeast Asia contained in section 107(a)
(2) of the House bill.
In view of the fact that the House pro-
vision for an open-end authorization of
funds was replaced by a specific authoriza-
tion of $89 million for that area, the man-
agers on the part of the House agreed to
delete the requirements for a determination
by the President and for special reports to
the Committee on Foreign Relations in the
Senate and the Speaker of the House of Rep-
resentatives in connection with the use of
funds appropriated under this authority.
CIVIC ACTION PROGRAMS-SECTION 201 (C)
(HOUSE-SEC. 201 (0); SENATE-SEC. 201 (C) )
The House bill amended section 505 of the
act to include authority for assisting foreign
military forces in less developed friendly
countries to construct public works and to
engage in activities "helpful to the economic
development of such friendly countries." It
also recorded the sense of Congress that for-
eign military forces should not be main-
tained or established solely for civic action
and that civic action should not detract sig-
nificantly from the capability of the military
to perform its military function.
The Senate amendment was similar to that
contained in the House bill except that it
authorized assistance for activities helpful to
the "social" as well as economic development
of friendly countries and provided that the
statement of the sense of Congress should be
followed "insofar as practicable."
The Senate receded with an amendment
to the House bill that would authorize civic
action programs helpful to the social as well
as the economic development of the coun-
try. The inclusion of the word "social" will
remove an ambiguity that may exist as to
health and literacy programs carried on
within the limitations contained in the
House amendment.
DRAWDOWN AUTHORITY-SECTION 201 (g)
(HOUSE-SEC. 201(g); SENATE-SEC. 201(g))
The House bill amended section 510 of the
act to eliminate the requirement that the
appropriations making reimbursement for
defense articles and services used pursuant
to the special authority should be made to
the President, as are military assistance ap-
propriations, so as to permit making such
appropriations to the Department of Defense
or to the President or any other agency as
may be requested by the Executive.
The Senate amendment contained no com-
parable provision and retained existing law
which authorizes an appropriation only to
the President.
The managers on the part of the House
accepted the Senate version. Appropriations
for the various segments of the foreign as-
sistance program are voted to the President.
Acceptance of the Senate amendment retains
this policy, thus permitting all foreign assist-
ance appropriations to be contained in one
appropriation act.
RESTRICTIONS ON MILITARY AID TO LATIN AMER-
ICA-SECTION 201 (h) (SENATE-SEC. 201 (h) )
The Senate amendment to the House bill
amended section 511 of the act in two re-
spects. First, section 511(a) was amended
to provide that, of the $55 million annually
permitted for grant programs of defense arti-
cles for American Republics, $25 million may
be used for assistance on a cost-sharing basis
to an inter-American military force under
the control of the Organization of American
States. Second, section 511(b) was rewrit-
ten to provide that, to the maximum extent
feasible, military assistance shall be fur-
nished to American Republics only in ac-
cordance with joint plans (including joint
plans relating to internal security problems)
approved by the Organization of American
States. In addition, the President was di-
rected to submit quarterly reports on the im-
plementation of section 511(b).
The House bill contained no comparable
provision.
The managers on the part of the House
accepted the Senate provisions with amend-
ments.
Section 511(a) of existing law authorizes
during each fiscal year the use of "96 part" of
the military aid funds for Latin America "for
assistance in implementing a feasible plan
for regional defense." The present situation
in the Dominican Republic has pointed up
the need for more positive and clearer lan-
guage to encourage the establishment of an
20137
inter-American military force. Accordingly,
that language in existing law is repealed and
is replaced by the provision that up to $25
million of the $55 million may be used on a
cost-sharing basis for assistance to an Inter-
American force under the control of the Or-
ganization of American States (OAS).
. Two points should be emphasized: First,
the $25 million is a ceiling. It does not have
to be used only for this purpose should it
prove impracticable to establish such a force.
Second, it is required that the other Ameri-
can Republics contribute financially to the
inter-American force. No formula for cost
sharing is written into the law; this will be
a matter of negotiations. The language
makes clear that such a force will not be
financed entirely by the United States. If
an inter-American force can be created it
will relieve the United States of much of the
burden of trying to maintain peace in this
hemisphere.
The proviso added by the conferees to sec-
tion 511(a) stipulates that the costs of the
defense articles supplied by the United
States for the inter-American force in the
Dominican Republic shall not be charged
against the $55 million ceiling. The con-
ferees recognized that the continuing costs
of the operation in the Dominican Republic
cannot be determined. To charge these costs
against the ceiling imposed by the law might
make impossible any further bilateral or
multilateral programs during the fiscal year.
The amended language in section 511(b) is
a further effort to encourage the American
Republics to work out "Joint plans (includ-
ing joint plans relating to internal security
problems)." It is a logical sequel to the Spe-
cial Consultative Committee on Security
Against the Subversive Actions of Interna-
tional Communism, established at the Punta
del Este Conference in early 1962, and the
current efforts to deal with the situation in
the Dominican Republican. The new lan-
guage does not make military assistance to
the American Republics contingent upon the
adoption of joint plans; it is permissive.
Further, it does not depend upon unanimous
agreement by the members of the OAS. For
example, a group of contiguous nations may
be able to work out an acceptable plan to
cope with internal security problems com-
mon to those nations.
The committee of conference recognized
that progress in this field may be slow but
that the time had come to begin a serious
effort to share the responsibilities for hemi-
spheric peace and security. The President is
required to submit semiannual reports to
the Congress on the progress that has been
made under this section of the law.
In agreeing to the Senate amendment pro-
viding that $25 million authorized for mili-
tary aid to Latin America may be used on
a cost-sharing basis to create an inter-
American military force, the conferees de-
sired to make it clear that none of these,
funds is to be used to finance research con-
tracts for studies of opinion or attitudes
or other sociological or behavioral studies
unless such studies have the approval of
the Secretary of State,
USE OF FOREIGN CURRENCIES-SECTION 301 (b)
(SENATE-SEC. 301(e))
The Senate amendment Included an
amendment to section 612(c) of the act, sub-
stituting a new second paragraph which re-
quired AID administrative officials to certify
upon approving each dollar payment voucher
the reasons for use of dollars, instead of
local currencies, whenever U.S.-owned local
currencies were available.
The House bill did not contain a com-
parable provision.
The managers On the part of the House
accepted the Senate provision with an
amendment to retain the definition of excess
foreign currency contained In existing law
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CONGRESSIONAL RECOPD - HOUSE August 18, 1965
which had been repealed by the Senate
amendment. The House managers were con-
vinced that there had been too many in-
stances in which dollars were spent when
foreign currencies might have been used,
and that requiring a modification of existing
AID procedures would be more effective than
a further directive that maximum use should
be made of such currencies.
Officials responsible for approving vouchers
can make the required certification only
if they have at hand all of the necessary
facts. One of the reasons why, on occaslon.
foreign currencies have not been used has
been that officials responsible for procure-
ment or for making payments were not fully
informed as to their availability. It will be
necessary for the Agency for International
Development to give a higher priority and
to devote more man-hours than it has In
the past to making sure that in procurement
negotiations and in making disbursements,
the necessary data as to the availability of
foreign currency and guidance as to Its use
are In the hands of the responsible per-
sonnel.
In situations where foreign currencies
clearly are not available for procurement,
such as In buying products in the United
States, or procurement in countries where
the demand for local currency to meet U.S.
Government expenses considerably exceeds
the supply, certification of individual vouch-
ers should not be necessary.
HIGHEST RATE OF INTEREST OBTAINABLE ON US.-
OWNED FOREIGN CURRENCIES-SECTION 301
(C) (SENATE-SEC. 301 (d) )
The Senate amendment added a new sub-
section 613(d) to the act, providing that
wherever U.S. assistance agreements under
any act resulted In holdings of U.S.-owned
local currencies, the Secretary of the Treasury
should issue regulations that required, in all
such agreements, that the United States
should get interest Income at the "highest
interest rate lawfully obtainable from the
recipient country or agencies thereof In the
respective countries."
The provision allowed the Secretary of
State to waive the requirement if be deter-
mined that the receipt of interest Income was
not In the U.S. national interest. A report
to the Congress of each such determination
by the Secretary of State was required.
The House bill did not contain a compara-
ble provision.
The managers on the part of the House
recognize that the United States has on
deposit in foreign banks substantial amounts
of foreign currencies derived from the sale
of surplus agricultural commodities under
title r of Public Law 480 and from other
sources, and that under normal circum-
stances interest should be paid to the United
States on such deposits. Although the
Agency for International Development gave
assurance that It Is U.S. policy to collect
such interest, it has not always done so.
The conferees are of the opinion that a
legal requirement to this effect is necessary.
The language of the Senate amendment
was accepted, except that the reference to
"the highest interest rate" to be obtained
was deleted. The Committee of conference
strongly favors obtaining the highest rate
of interest possible and is opposed to the
acceptance of any "token" interest payment.
The committee recognizes, however, that
been violated. No hearings had been held
on the case in question, nor on the amend-
ment designed to alleviate It. Consideration
by the committee of conferen )e developed
that the Issues were much less dear and far
more complex and controversial than waI at
first supposed. The provision was deleted
with the understanding that, ah)uld circum-
stances warrant, the entire sub Oct could be
reviewed at length and a d )termina):ion
made during the next annual hearings on
foreign aid.
ACT Or STATE DOCTRINE- SECrICN 301 (d) (2)
(HOUSE ---- SEC- 301 (Cl (2); SENATE-SZC. 301
(e> (2) )
The House bill extended for nn additional
year the provisions of section 520(e) (2 i of
the act which provides that no court In the
United States shall decline on tae ground of
the act of state doctrine to make a deter-
mination on the merits or to tpply princi-
ples of international law in a case in which
an act of a foreign state Is Ileged to be
contrary to International law.
The Senate amendment made the Dro-
vision permanent law and in atdttion modi-
fled the text to make It clear ' that the law
does not prevent banks, ins trance com-
panies, and other financial last tutlons from
using the act of state doctrine as a defense
to multiple liability upon and contract or
deposit or insurance policy In aity case where
such liability has been taken over or expro-
priated by a foreign state."
The House receded.
The managers on the part (1f the House
accepted the Senate provisloc is with the
understanding that this would not preclude
either committee from review! ig the issues
a11d making a further determ- nation when
hearings are held next year o a renewal of
the foreign aid authorization.
SANCTIONS AGAINST U.S. I'18HIN( VESSELS AND
CONTROL OF SHIPPING TO NOR' 7I VIETNAM-
SECTION 301 (d) (4) (SENATE-sic. 301 (e) (s);
HOUSE-SEC. 301 (C) (4) )
The Senate amendment added a new sub-
section 620(o) to the act un(.er which no
assistance could be furnished ruder the act
to any country which (1) has extended, or
hereafter extends, Its jurisdicti la for fishing
purposes over any area of the high seat. be-
yond that recognized by the united States,
and (2) hereafter Imposes ar y penalty or
sanction against any U.B. fishing vessel on
account of its fishing activities In such an
area. The amendment did no' apply to ex-
tensions of jurisdiction pursua it to interna-
tional agreement to which the United States
is a party.
The House bill did not coats n a compara-
ble provision.
The House bill, however, included an
amendment to section 620 of t4 .e Foreign As-
sistance Act, adding a new s tbsection (n)
providing that, until the Pr(sident deter-
mines that North Vietnam has ceased all ef-
forts to overthrow the Bout 1 Vietnamese
Government. no funds authorfa ed to be made
available under the act (except under see.
214) may be used for assistane.> to any coun-
try which failed to take app: opriate steps.
not later than 60 days after enactment of
the bill, to prevent ships or air waft under Its
registry from transporting equipment, mate-
rials, or commodities to or fron North Viet-
nam. The Senate amendment contained no
such provision.
such a rate ought to be fixed by negotia- The managers on the part of the House
tion and that a general legal requirement agreed to a compromise which eliminates the
would not be appropriate because of vary- rigid prohibitions against sipplying U.S.
ing conditions in individual countries. assistance In both instances but require[ that
INVESTMENT GUARANTIES (SENATE-- consideration be given to the behavior of re-
sEC. 3o1(e) (1) AND (3)) ciplents of our aid with respect to these
The Senate amendment contained Ian- problems In determining th i nature and
guage added by a voice vote on the floor of amount of aid to be provided. Language was
the Senate, designed to prevent a repetition accepted. Indicating that consideration
of an incident which occurred In a develop- should be given to excluding from U.S. ag-
ing country in which It was claimed that sistance any country which !m )ores any pen-
rights of certain American Investors had aity or sanction against any U S. fishing ves-
sel on account of Its fishing activities in in-
ternational waters rather than a requirement
that aid be terminated under such circum-
stances. A modification of the provision in
the House bill relating to ships transporting
cargo to North Vietnam was also agreed upon
to the effect that the President shall consider
denying assistance to any country failing
to prevent its ships from transporting cargo
as provided in the House bill, Instead of pro-
hibiting U.S. aid to such countries regard-
less of other circumstances.
The managers on the part of the House
agreed that the United States should give
consideration to the treatment of U.S. fish-
Ing vessels by foreign governments in de-
termining the nature and amount of U.S. as-
sistance made available to such governments.
At the same time, they recognized that a
complete prohibition of aid to governments
interfering with U.S. vessels might in certain
instances prevent the attainment of U.S.
foreign policy objectives and adversely affect
the entire program of the Alliance for Prog-
ress.
In accepting a modification of the lan-
guage relating to assistance to countries per-
mitting their ships to carry cargo to and
from North Vietnam, the managers on the
part of the House recognized that the com-
plete withdrawal of free world carriers from
the North Vietnam trade, even if It could be
achieved, would have only a very limited
effect upon the North Vietnam economy and
military efforts. Military equipment and
petroleum products are brought into the
country on Communist-flag vessels. North
Vietnam's foreign trade Is already heavily
oriented toward Communist China and the
U.S.S.R. Free world trade amounted to only
about 17 percent of value of North Vietnam's
total trade for 1963. Although free world
ships carry 46 percent of North Vietnam's
seaborne imports by volume and 85 percent
of seaborne exports (principally coal to Ja-
pan), the Communist countries could, in
time, arrange It so that Communist-flag
vessels and planes and the rail link with
Communist China carried all the Imports
and exports Hanoi needed.
The language of the House bill afforded
little negotiating ' leverage because most of
the countries whose ships are still in the
North Vietnam trade receive little or no as-
sistance from the United States. The major
nation with ships In this trade-the United
Kingdom-no longer receives either economic
or military assistance from the United States.
The United States is making high-level dip-
lomatic representations to obtain free world
cooperation in getting ships and planes out
of the North Vietnam trade, and a number
of vessels have already left the trade because
of commercial and safety considerations.
The managers on the part of the House
accepted the argument that negotiations on
this matter would be more effective if there
was not a rigid requirement that aid be
terminated.
EMPLOYMENT OP FOREIGN SERVICE PERSONNEL-
SECTION 302(C) (HOUSE-SEC. 302(C);
SENATE-SEC. 302(b))
The House bill amended section 625(d) of
the act by increasing from 20 to 50 the num-
ber of Foreign Service Reserve officers who,
at any one time, may be initially assigned to
duty in the United States for not more than
2 years.
The Senate amendment increased the
limitation on such personnel from 20 to 30.
The Senate receded with an amendment
which increased the limitation on such per-
sonnel to 40.
ELIMINATION OF MISSIONS-SECTION 302(f)
(SENATE-SEC. 302(e))
The Senate amendment amended section
631 of the act by providing that in countries
where the economic and military assistance
program does not exceed $1 million in a fiscal
year. the AID mission staff personnel shall
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August 18, 1965 CONGRESSIONAL RECORD - HOUSE
be withdrawn, and the program administered
by economic officers and, where military aid
is involved, by military officers attached to
the U.S. diplomatic mission.
The House bill did not contain a compa-
rable provision.
The managers on the part of the House
receded with an amendment that removed
the criterion of a program of $1 million or
less in any fiscal year as the basis for the
withdrawal of personnel administering such
economic or military assistance programs.
In place of this rigid figure, the committee
of conference inserted a provision that re-
ductions in personnel should be undertaken
"wherever practicable, especially in the
smaller programs." The committee of con-
ference is emphatic in seeking to reduce
the size of our AID missions, particularly
those in the smaller programs. It recognized
that some progress has been made in this
direction but believes that further progress
is possible without impairing the effective-
ness of our programs and, at the same time,
resulting in a reduction of administrative
costs. By the removal of the $1 million
figure, the committee expects that the Ad-
ministrator of AID will examine programs in
all the countries, particularly the smaller
countries, with a view toward achieving fur-
ther economies in money and personnel.
ADMINISTRATIVE EXPENSES-SECTION 302 (i)
(HOUSE-SEC. 302 (h); SENATE-SEC. 302 (h) )
The House hill amended section 637(a) of
the act to authorize an appropriation of
$53,240,000 for administrative expenses for
fiscal year 1966.
The Senate amendment authorized an ap-
propriation of $55,240,000 for the same
purpose.
The Senate receded with an amendment
providing an authorization for an appro-
priation of $54,240,000.
MILITARY SALES-SECTION 302(k)
(SENATE-SEC. 302(j))
The Senate amendment added a new sec-
tion 640 to the act, excluding military sales
from several provisions of the act prohibit-
ing U.S. assistance.
The House bill did not contain a compara-
ble provision.
The managers on the part of the House
accepted the Senate language. They re-
garded the Senate provision as being a formal
statement of the policy that sales of military
equipment and services for dollars or on
credit terms within limits accepted as being
normal for commercial transactions were not
subject to certain restrictions applicable to
grant aid, which policy has always guided
the Department of Defense. Military sales
are subject to the restriction that sales may
be made only to friendly nations when the
President finds that such sales will
strengthen the security of the United States
and promote world peace.
It was the understanding of the managers
on the part of the House that this authority
would apply only to bona fide sales for value
as defined in section 644(m) of the act to
purchasers judged to be capable of making
payment in full under reasonable credit
terms. Any transaction, although techni-
cally a sale, where prospects of payment were
in doubt or for currencies not needed by
the United States would involve an element
of grant assistance and would be subject
to all of the restrictions relating to grant
aid.
It is in the interest of the United States
that the forces of friendly nations, on which
we rely either to contribute to the common
defense Strategy or to defend against internal
subversion, should be adequately equipped.
It is better that equipment be supplied on'
a sales rather than a grant basis. It is not
to our advantage to impose the same condi-
tions on nations ready and willing to buy
that we do on recipients of grant aid.
LIMITATION ON AGGREGATE AUTHORIZATION FOR
FISCAL YEAR 1868-SECTION 303(d) (SEN-
ATE-SEC. 303(d) )
The Senate amendment added a new sec-
tion 649 to the act, which limited the aggre-
gate authorization for an appropriation for
fiscal year 1966 to the sum of $3,243,000,000.
The House bill contained no comparable
provision.
The managers on the part of the House
receded with an amendment, limiting the
aggregate authorization for an appropriation
to $3,360,000,000.
This sum must be measured against the
Executive appropriation request for fiscal
year 1966 of $3,459,470,000. The latter figure
includes amounts specifically authorized in
this bill as well as the Executive appropria-
tion requests against sums previously au-
thorized for the Development Loan Fund,
the Alliance for Progress, and for State De-
partment administrative expenses. As a re-
sult of adjustments in amounts made in this
bill for specific programs, together with those
previously authorized and for which the
Executive is requesting appropriations, the
comparable figure is $3,457,670,000. The
effect of the ceiling imposed by this section
of the bill is to reduce the total Executive
program by $97,670,000. It is left to the
judgment of the Executive to effect reduc-
tions that will bring the programs funded by
this act within the limit imposed by this
section.
The managers on the part of the House
strongly objected to the imposition of an
overall reduction on the authorization for
foreign aid rather than cutting individual
authorizations. The committees of the Con-
gress as a result of their hearings on the pro-
gram should be sufficiently informed as to
the merits of the various segments of the
program to exercise judgment as to the places
where cuts are justified. To impose a reduc-
tion in the overall ceiling on the total au-
thorization, leaving discretion as to where
the cuts will be made, is an abdication of
responsibility by the Congress.
The individual authorizations approved by
the House and Senate differed by such small
amounts that there was no practicable way
to compromise, adjust, and distribute an
overall reduction of the magnitude of the
cut provided in the Senate amendment other
than to impose a similar limitation on the
funds authorized.
PROPOSALS FOR 2-YEAR AUTHORIZATION AND FOR
TEMPORARY PLANNING COMMITTEE
The two most troublesome issues in con-
ference arose first from a number of provi-
sions in the Senate bill which in totality)
had the effect of authorizing the aid pro-
gram for a period of 2 years; and, second,
from the so-called Morse amendment calling
for termination by June 30, 1967, of the for-
eign aid program as presently constituted
and for a thorough review by a Planning
Committee to determine the nature of any
aid programs that might be continued after
June 1967.
As conference discussions continued, it be-
came apparent that although the House con-
ferees could not agree to a blanket 2-year
authorization under present conditions, they
were not irrevocably opposed to authorizing
foreign aid funds for longer than a year re-
gardless of circumstances. There was gen-
eral agreement also that many of the short-
comings of the foreign aid program which
have evoked public criticism are basic and
cannot be corrected merely by improvement
in administrative procedures or in the qual-
ity of personnel.
It was the consensus of the committee of
conference that there have been so many
changes in the world situation since 1961
that a most careful, overall review of the
basic premises behind the foreign aid pro-
gram is overdue.
After protracted discussion of the issues
involved in the 2-year authorization and the
Senate provisions relating to termination of
the program as constituted and the creation
of a Planning Committee, the Senate con-
ferees reluctantly agreed to recede.
While appreciating that conferees cannot
bind their colleagues in subsequent sessions
of the Congress, the House conferees, In view
of the action of the Senate conferees agreed
to include the following expression of in-
formal understandings in the statement on
the part of the managers:
1. During consideration of the Foreign As-
sistance Act of 1966, House members of the
.committee of the conference will urge their
colleagues to examine with the greatest care
such proposals as may be submitted author-
izing foreign aid programs for 2 or more years.
The House of Representatives has approved
authorizations for various aspects of the
programs for periods of 2 years or longer on
a number of occasions in the past, and the
House conferees are prepared to suggest the
consideration of longer term authorizations,
taking into account the demands on the
U.S. budget and the nature of the world
situation next year.
If 2-year authorizations were made, the
authorizing committees of the House and
Senate might direct their attention in al-
ternate years primarily to a review of aid
policies and an evaluation of operations
rather than focusing on the programs sub-
mitted by the Executive for the year to come.
2. The conferees of both Houses urge the
President to inaugurate a review of the aid
program as presently constituted, seeking to
direct it more effectively toward the solu-
tion of the problems of the developing
countries.
3. Finally, the House conferees recognize
that the willingness of the Senate con-
ferees to recede on these provisions repre-
sents not an abandonment of the positions
taken by the Senate, but an attempt to reach
a reasonable compromise. This was done by
deferring for 1 year decisions on Senate
provisions calling for a long-term authoriza-
tion. There will thus be opportunity next
year for the Congress and the administra-
tion to examine in depth proposals for the
improvement of the foreign aid program.
THOMAS E. MORGAN,
EDNA F. KELLY,
WAYNE L. HAYS,
BARRATT O'HARA,
W. S. MAILLIARD,
PETER H. B. FRELINGHUYSEN,
Managers on the Part of the House.
FOOD AND AGRICULTURE ACT OF
1965
Mr. COOLEY. Mr. Speaker, I move
that the House resolve itself into the
Committee of the Whole House on the
State of the Union for the further con-
sideration of the bill (H.R. 9811) to
maintain farm income, to stabilize prices
and assure adequate supplies of agri-
cultural commodities, to reduce sur-
pluses, lower Government costs and pro-
mote foreign trade, to afford greater
economic opportunity in rural areas, and
for other purposes.
The motion was agreed to.
IN THE COMMITTEE OF THE WHOLE
Accordingly, the House resolved itself
into the Committee of the Whole House
on the State of the Union for the con-
sideration of the bill H.R. 9811, with
Mr. HARRIS in the chair.
The Clerk read the title of the bill.
The CHAIRMAN. When the Com-
mittee rose on yesterday it was agreed
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CONGRESSIONAL RECORD - HOUSE August 18, 1965
that title I of the bill would be consid-
ered as read and open for amendment
at that point.
The Clerk will now report the commit-
tee amendment as printed In title I of
the bill.
The Clerk read as follows:
Committee amendment: page 4, line 3,
strike out "Act" and insert "title".
The committee amendment was agreed
to.
Mr. JONES of Missouri. Mr. Chair-
man, I move to strike out the last word.
Mr. Chairman, I have been disap-
pointed, disillusioned, and somewhat sur-
prised at the turn that has been taken in
this bill. The House Committee on Ag-
riculture worked a long time trying to
arrive at legislation which would improve
the agricultural situation in this country.
I think that most of us admit it does
need some improvement. Now, particu-
larly in the cotton section of this bill,
which is, of course, one of the more con-
troversial sections, the bill that was re-
ported from our committee at least
started in the right direction to make
some corrections. One of the things that
has happened In the last several years
has been that we have had a program
which has produced more cotton than
we can use domestically or can have any
hope of selling in the foreign markets.
We passed a bill last year that, of course.
the proponents felt would help to Correct
that situation. I was one of the few
Members coming from a cotton section
who voted against the cotton bill last
year. At that time I made certain pre-
dictions. While I do not claim I am
smart or know everything that is to be
known about cotton. I think the predic-
tion I made at that time has come true.
At that time the bill was passed due to
the pressure and the influence of the
mills. They got a real bonanza out of
that bill. They had promised before our
committee-and the testimony in the
hearings will substantiate this-the mill
operators told us that the additional cost
of this bill would come back to the con-
sumer in the form of lowered prices.
They also told us that there would be In-
creased consumption. Well, they did
have some increased consumption in the
domestic market of around 600,000 to
maybe 800,000 bales of cotton, but on the
other hand we lost more in the export
market and came up with a net loss and
added 1 million bales to the surplus that
we have.
We have had an attractive program for
the-producer, and this last bill was very
attractive for the mills. I predicted more
than a year ago-and I stand on that
statement today-that by 1970 the peo-
ple that will be producing cotton will be
having to produce at least two bales of
cotton to the acre and they will have to
be willing to sell that cotton on the basis
of 25 cents. If they do not do that, they
are going to be out of the cotton business.
This bill we had which was reported
from the committe would have gone In
that direction. In the past we have had.
and for the benefit of those who are not
familiar with cotton production, we have
had what we call a release and reappor-
tionment procedure in the law permit-
ting people who had cotton allotments,
which were based on history--every per-
son who had grown cotton hs d an oppor-
tunity to have an allotment tnd to grow
it. Many of those people or a great num-
ber of people with small all )tments did
not want to grow cotton.
But their allotment was valuable to
them because It added to the value of
their land, so they would i elease their
allotment of cotton and thus ~ allotments
would go to people who had allotments
and who wanted to expand t:ieir produc-
tion. That might be all right, because
we confined the release to 'he State in
which the cotton allotment; were. We
did not allow them to cross State lines.
But we did have this situation, that in
many areas of the county in some
States, we would have cotto:i allotments
that were on land which yi !lded half a
bale of cotton to the acre. and when
they released the cotton allotment, it
was not grown in the county where re-
leased, but was reapportione I and grown
on land where the yields were much
larger.
(Mr. JONES of Missouri's time having
expired, he asked and was g ven permis-
sion to proceed for 2 additlor. al minutes.)
Mr. JONES of Missouri. In the Cot-
ton Belt, where cotton is 1 rown, there
are 1,049 counties-468 of those 1,049
counties released cotton wt ich was not
wanted by the growers In ;hat county,
and that cotton acreage was subsequently
released to the State committees and
was allocated to people wh3 wanted to
grow more cotton. In othe r words. al-
most 500 counties out of 1,049 had no
restrictions on how much cotton they
could grow. But in releasing this cot-
ton from low-yield counties, it was trans-
ferred to high-yield counties. Last year
there were V f12 million acr ss of cotton
allotments released and r( allocated to
producers in other countii s. I would
say that in every instance or at least
in practically every Instanc 3, it went to
higher producing areas. it some in-
stances, it went from areas that were
producing only half a bale and went to
a producer who was producing two and
three bales of cotton to the acre. That
cost the Government money in two ways.
In other words, we piled up this surplus
that we still have today; we have next
to the largest surplus we h the ever had
in this cotton area. We all o know that
every time the Government supports cot-
ton at a higher price than I; can be sold
for. It goes into loan and the Govern-
ment takes a loss; at least, it has In
many instances. During the early part
of the program, it was not true. When
we get to the amendments t: tat are going
to be offered to this sectior , I will have
more to say about it. But I want you to
think over this afternoon the amend-
ments that are going to lie offered to
this cotton section. They are going In
the wrong direction. They are not go-
ing to correct the situation one Iota.
They are going to make be situation
worse and I will tell you why when the
amendment to which I ha,-e referred is
offered.
Mr. JONAS. Mr. Chairman, I move
to strike the requisite num )er of words.
(Mr. JONAS asked and was given
permission to revise and extend his re-
marks.)
Mr. JONAS. Mr. Chairman, the bill
under consideration contains many pro-
visions which I do not approve and can-
not support. However, I understand
that amendments will be offered which,
if adopted, will substantially improve the
bill. I hope that the bill will be so im-
proved, following action by the Commit-
tee of the Whole this afternoon, so that
a majority of the Members of the House
can vote for it on final passage.
Mr. Chairman, I am not going to dis-
cuss the wheat title, the feed grains title,
or the other titles that are in controversy.
Considerable -debate occurred yesterday
on those titles and additional debate will
occur this afternoon as amendments are
offered.
Therefore, Mr. Chairman, I have
elected to confine my comments to a dis-
cussion of the effect which this bill will
have on one-price cotton.
Mr. Chairman. I do not believe many
Members contend that it is fair or equi-
table for the Federal Government, by
legislative enactment, to make it possible
for foreign competitors of domestic tex-
tile mills to buy American-grown cot-
ton at one-third less than the American
mills have to pay for that same cotton.
Mr. Chairman, in order to try and
bring into sharp focus the reason why I
think it is important for us to continue
to maintain a one-price cotton system, I
am going to reduce my comments to a
few specific points. I do not believe they
need elaboration or need argument, be-
cause I believe their mere recital makes
approval of one-price cotton compelling.
Listen to these points:
First. By any standard used, the cot-
ton textile industry is one of the most
important industries in the United States.
Approximately 1 million men and women
derive their livelihoods directly from this
industry, and if you include all allied ac-
tivities the number goes up to 9 mil-
lion-approximately one-eighth of the
entire work force of the country.
Second. Last year the outlay of capi-
tal for plant and equipment to modern-
ize and expand the textile industry
amounted to approximately 17 percent
total net worth, as compared to an aver-
age of 9 percent for other major indus-
tries. Textile mills last year spent
around $760 million for new plant and
equipment, and the Department of Com-
merce estimates that such expenditures
will be close to $1 billion in 1965. When
based upon net worth, the textile indus-
try is presently spending more for capi-
tal improvements than any other major
industry in the country.
Third. Since late 1963, there have
been three wage increases of 5 percent
each for textile workers, all attributable
to the conversion from two-price to one-
price cotton. The first increase came
in anticipation of one-price cotton and
the last two following the enactment of
the legislation which brought the new
system into effect. In the short period
of 18 months, textile employees have re-
ceived more than $500 million through
wage increases, and this does not take
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