FOREIGN POLICY-TRADE WITH RUSSIA, CUBA, RUMANIA, AND HUNGARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP66B00403R000200170057-8
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 10
• Document Creation Date: December 16, 2016
• Document Release Date: January 3, 2005
• Sequence Number: 57
• Publication Date: June 2, 1964
• Content Type: OPEN

_/ 9 64
Whet the Armenian people won their
Independence, they wanted only to live
in peace with their neighbors. They en-
visiened a nation of integrity, with re-
speet for individual rights- flourishing
under democratic Institutions. These
expectations were as tight in 1918 as
they are today.
So, it is-with great respect that we send
our words of courage and hope to our
Armenian friends. We assure our fellow
Americans of Armenian descent, who are
_ concerned about the fate of their an-
? cestral home, that we shall never relax
in our efforts to secure freedom for every
man Who strives toward this goal. - As
long as the desire for freedom and inde-
Peridence burns in the hearts of the ,Ar-
median people, it shall burn in the hearts
of every American.
Approved For,RctWeRiOgg/MR:kttgRB66 Bggo
THE NEW *RAVEN ItAniftor, Arrb
MERGER PLANS
Mr. MMICOFE. Mr. President, the
corranutere using the New Trairen Rail-
road received a rude rebuff -yesterday
from the New York Central and the
Pennsylvania nailroids. These two giant
coMPAnfis, seeking ICC permission to
merge into a still larger combine, gave
the ICC three proposals for leaving the
, New fleven opt of their proposed merger
plans. Tinder bull of the proposed
merger plans, the New Raven is left out
in .the Cold, and So are the Ne* Raven's
comnititere,
If there is to be any Merger at all, it is
vital that the Nevillavenpaseerigir serv-
ice be included The New 'Stork -Central
and the Pennsylvania show a callous dis-
? regard. of the public interest by ignoring
'al.ii basic fact. Naturally, the sole con-
cern of these two major carriers is to
seek inclusion only of prohtable routes,
; regardless of the needs of passengers.
Fortunately, the ICC applies a higher
standard?that of making sure the pub-
lic intereet is served.
. Any merger that failed to include the
'New Haven's passenger service would
clearly not be in the public interest. I
, believe the- ICC recognizes this.; but
should it decision on the merger appli-
cation ignore this fact, I will initiate
whatever legislative action may be nec-
essary to block such a result.
The New York Central and the Penn-
sylvania must not be allowed to consoli-
date their position in the New 'pork Met-
ropolitan area without making provision
for the needs' el one Of the largest groups
a rail users in that area. The alterna-
tives, whip.' the major carriers suggested
yesterday are 'thoroughly -inirearStic.
They seek the benefits Of Merger, with-
out the responsibility of Service to corn-
` rkaters. They must not be permitted "to
have it both ways."
DA-O sricsg
nil OP ,VVORTall
Mr. rt;IBTCOPP. Mr. President, on
- May 19, I inserted in the CONGRESSIONAL
Ftgcoan a radio script about the urgent
need for day-pare services for the 5m11-
lion young children of working moth-
. isto 109-8
ers?almost half a million of whom are
left to drift on their own, each day. This
was one of the programs, entitled "Di-
mension of a Woman's World," by the
noted radio and television commentator,
Betty Furness.
Miss Furness has now followed up this
program with another on the services for
these children?and what they should
be. I ask unanimous consent that it be
printed in the RECORD.
There being no objection, the script
was ordered to be printed in the RECORD,
as follows:
DIMENSION OF A WOMAN'S WORLD
Day care for young children can be one of
the most important services a community
can offer. It can hold families together when
a mother is ill?or troubled, or most often,
has to work. (And today, millions of moth-
ers with young children, do have to work.)
Good day-care services can provide help for
children with problems, emotional or physi-
cal. It can bring out into the world, young
children who because they are blind or
handicapped might otherwise be absolutely
housebound.
Many communities have been reluctant to
supply day-care services on the grounds that
they are somehow a sweet but unnecessary
charity?kind of like an organized babysit-
ting club. But this is a very unrealistic point
of view.
We talked to people at the National Com-
mittee for the Day Care of Children and they
point out that year after year we spend
money trying to rehabilitate children, who
through neglect have gotten into trouble.
In corny, old-fashioned language, they've
simply had bad starts in life.
Why, these experts demand, do we have to
wait for a family to collapse before we move
In to help them? How can we allow almost
half a million children to wander around in
neglect?for whatever reason?
That day-care service Ls desperately needed
all over the country, is indisputable, that it
comes in many forms, however, is often not
known.
Most people are familiar with centers for
preschool children, and we'll get back to
these in a minute. But there are other
kinds of day-care services. For instance,
housekeepers are provided when parents are
sick and simply can't take care of their chil-
dren. Or sometimes when a mother has died
and a father is left on his own with little
children to cope with.
In these cases, a really good, trained-per-
son, can often held a family together until
the children grow older or the parents are
able to take over for themselves.
Sometimes a family can afford to help pay
for these services?sometimes they can't.
But even if an agency has to assume the full
cost of a housekeeper's salary for several
years, it is still far cheaper than breaking up
the family and sending the children to in-
stitutions or foster homes.
Cheaper in terms of money, and certainly
cheaper in terms of people's lives.
A similar service is provided by some agen-
cies for children under three. These babies
are simply too young to join a day-care
group. They do not do well thrown in
with a lot of other children, so instead they
are often pared for in private homes on a
daily basis. 'their mothers bring them in
the morning, pick them up at night, and are
With them over the weekend.
The day-care centers take 'are -Orthe-1-`
to 6-year-olds.
And researching this subject we discovered
that many people resist the idea of provid-
ing these facilities because they are against
women with young children going out to
200176057-8
12003
work. This is " also unrealistic; because
whether it is ideal or not, many of these peo-
ple have no choice. They work because they
have to. And this is where the communities
help is necessary.
How do you build a day care center? Well,
in most towns the first step is convincing
people that there is a need. And the Na-
tional Committee for the Day Care of Chil-
dren has all kinds of material designed to
help you do just that. They'll provide you
with sheafs of facts and figures, and the
reasons why.
They also sent us a book of standards
drawn up by the Child Welfare League de-
scribing precisely what good day-care service
should include. It goes into everything.
Food, staff, even lists necessary toys and play
equipment.
It is only some 8 pages long, but it is a re-
markable handbook that copes with the me-
chanics and philosophy of this business.
"Day-care service," it says, "is designed to
protect children by providing part-time care
and guidance, when their families are unable
to meet their needs without some assistance
from the community."
Then it goes on to say, "and to make it
possible for children to have healthy and
constructive experiences during the time
they require such care."
It seems to me this is a very small invest-
ment, when you consider that in 15 or 20
years these children will be part of the new
generation.
FOREIGN POLICY?TRADE WITH
RUSSIA, CUBA, RUMANIA, AND
HUNGARY
Mr. DOMINICK. Mr. President, I
wish to dliscusai subject which I be-
lieve to be of extreme importance both
to the Senate, as a body, and to the en-
tire country.
Last November, shortly after the trag-
gic death of President Kennedy, we in
the Senate had before us, for debate
and vote, Senate bill 2310, initiated by
the Senator from South Dakota [Mr.
MUNDT] and which I had the privilege
of cosponsoring. That bill was to pro-
hibit any guarantee by the Expert-Im-
port Bank or any other agency of our
Government of payment of obligations
of Communist countries.
All Senators wlio were present on that
oceaMorr will recall the discussion on the
floor and the agreement to have short
hearings held before the Banking and
Currency Committee, with a definite
date set, by which the bill would be re-
ported to the Senate. Not all Sena-
tors had a chance to attend the hear-
ings; and because of the short time in-
terval, practically no one had a chance
to review the hearings record.
Shortly after the bill was reported to
the Senate by a divided vote in the com-
mittee, debate ensued; and, with strong
administration pressures, the bill was
passed by an extremely close vote.
Mr. President, the bill was passed more
as a memorial to the late President Ken-
nedy and as a reaffirmation of faith in
President Johnson than as a carefully
considered and logical policy. The ob-
vious dangers, I believe, were glossed over
or were wholly ignored; but the results of
those policies are now coming home to
roost.
eft,
12004 Approved Fiar,ReInsAM5All/1A-RDP6613g1403R000200170057-8
KD ? SENA fE June 2
Let me give an example: Ever since
our Government broke diplomatic rela-
tions with Cuba, our country has been
4 engaged in a national effort to impose
on Cuba an economic quarantine; and
our Government has also been doing its
best to persuade our allies and other
countries to refrain from trade with
Cuba, so that Cuba's Communist govern-
ment might be more readily deposed by
the Cuban people. The need for this has
been stated on this floor again and again
and again. I have made more than five
speeches in which I outlined for the Sen-
ate the continuing dangers to this hemi-
sphere originating from this Communist
base; and only 10 days ago I pointed out,
here on the floor of the Senate, that in-
formation publicly available states that
the Cubans are in possession of under-
water missiles with a 1,200-nautical-mile
range?missiles designated as the Golan
/I. These missiles, if in existence, have
a range sufficient to enable their use to
decimate the entire eastern half of the
United States; and they are not subject
to inspection or discovery by aerial sur-
veillance, for they operate from the floor
of the ocean, and are movable by subma-
rines or trawlers. We all know from
news media of the operations of the Rus-
sian trawler fleet off Florida and the for-
ays of the Russian submarines off of our
coast. Keeping in mind our national
policy of cutting off trade with Cuba?
and we have added to that the thought
that we should try to prevent Cuba from
exporting subversion, which obviously we
have not succeeded in doing?what hap-
pened when we rejected the bill intro-
duced by the Senator from South Da-
kota (Mr. MUNDT] and agreed to sell
wheat to Russia on a credit basis, sup-
ported by the credit of the Export-Im-
port Bank, the capital of which is derived
from the U.S. taxpayers?
The very first thing that happened was
the diversion from Halifax of a ship
loaded with Canadian wheat initially
bound for the Soviet Union. Instead, it
was sent to Cuba. This, in turn, wai
followed almost immediately by British
agreements to sell buses to Cuba, thus
Increasing Cuban traipportation capa-
bilities; French agreements to sell trucks,
bulldozers, and locomotives, thus in-
creasing not only transportation facili-
ties but general industrial strength; and
Spain's agreement to sell fishing vessels
to a host of other countries, including
Portugal and Italy, negotiating to supply
Communist Cuba with the necessary
facets of a modern economy.
Mr. President, I ask unanimous con-
sent to have printed at this point in the
RECORD an article from the Christian
Science Monitor dated January 30, 1964,
detailing some of the negotiations then
going on between other countries and
Cuba. Keep in mind that this was only
some 60 days after we had originally
denied the validity of the bill introduced
by the Senator from South Dakota [Mr.
Mmorl and had embarked on the policy
of trading with, Russia.
There being no objection, the article
was ordered to be printed in the RECORD,
as follows:
CUBA ELUDES BOYCOTT
(Trade between Cuba and the non-Com-
munist world is continuing?and in some
cases even increasing?despite U.S. efforts to
prevent it. This is the principal finding of
correspondents of the Christian Science Mon-
itor in various countries asked to report on
trade between Cuba and their areas. As the
following dispatches indicate, most countries
observe the American ban on strategic ex-
ports to Cuba, but few discourage nonstra-
tegic trade.)
BRITAIN
(By John Beaufort)
Britain's position on Cuban trade is that
the United Kingdom maintains the same
peaceful diplomatic and commercial relations
with the Castro regime as with previous Cu-
ban Governments.
Britain has, however, voluntarily applied
to Cuba the North Atlantic Treaty Organiza-
tion Cocom list. (This list enumerates stra-
tegic goods and materials which NATO cowl-
tries agree not to export to the Communist
bloc.)
These restrictions apart, Whitehall sees no
military, political, economic, or ideological
reason for curbing normal trade with Cuba.
London does not feel compelled to modify
its commercial policies to meet Washington's
apprehension that any trade strengthens
Premier Fidel Castro's ability (a) to remain
in power and (b) to export Castroism to
Latin America.
The British rather take the line expressed
by Prime Minister Sir Alec Douglas-Home in
his recent U.S. television interview that peo-
ple become "less Communist when they are
more comfortable." The Labor oppoeition
agrees with the Conservative government on
this line.
FRANCE
(By Harry B. Ellis)
Three facts dominate the French Govern-
ment's attitude toward trade with Cuba:
I. France never has sold to Premier Cas-
tro's Cuba on credit, only for cash.
2, The Cuban Government recently opened
In Paris a permanent trade mission and
wants to buy French trucks, bulldozers, and
other heavy equipment. Reportedly the Cu-
bans-are seeking $10 million worth of French
credits to finance such deals.
3. Businessmen In the hard-hit, heavy-
equipment sector of the French economy
would like to boost their exports?and so
would the French Government.
From this melange emerges the following:
France, busy cultivating trade opportunities
throughout the Communist world, has no
moral objection to nonstrategic trade with
Cuba. Deals will be consummated if Paris
becomes convinced Cuba is a sound credit
risk.
This is apart from sales for cash. which
will continue. In the first 6 months of 1963
France bold Cuba $2.340,000 worth of goods
and bought $1.500,000 worth in return.,
CANADA
(By Bruce Hutchison)
Apart from strategic goods Canada will sell
anything to Ctita but it is not selling much.
Last year's sales amounted to about 44 mil-
lion, the smallest figure in modern times.
All exports to Cuba are controlled by strict
regulations that apply only to it and other
Communist countries.
The government's first "control list" in-
crudes all forms of military armaments and
their components. None of these things may
be shipped to Cuba.
A second list specifies goods produced in
the United States and shipped to Canada.
None of them may be exported to Cuba.
These regulations implement Canada's view
that trade with Communist countries M gen-
wally desirable provided it does :Int con-
tribute to their strategic strength.
NORTH AFRICA
(By John K. Cooley)
Ideology yields to necessity in North Africa
where about 27 million people use sugar com-
ing largely from Cuba as a basic food and
where governments are striving to escape
from economic dependence &a the former
colonial power, France.
Morocco. Algeria, and Tunisia are all buy-
ing more raw Cuban sugar and selling to
Cuba about half its value in phosphates,
cement, pipe, canned sardines, grains, and
cork products.
Of the North African counties only So-
cialist Algeria. which has the closest and
friendliest relations with Havana, evokes
ideology In what President Ben Bella has
called "an economic policy conforming to our
Socialist choice."
Anti-Communist Morocco has agreed to
purchase I millions tons of raw Cuban sugar
by the end of 1965, The prices Cuba offered
Morocco have been as much as 30 percent
below those ruling on the world market.
During the recent brief diplomatic rupture
with Cuba, Moroccan officials expressed ap-
prehension because no other major world
sugar Source Is presently available to this
country.'
Cuba is second only to France as a cus-
tomer for North African canned fish which is
increasingly hard to sell In competitive Euro-
pean markets.
WEST GERMANY
(By Ernest S. Piako) ?
Bonn's policy toward Fidel Castro's Cuba
largely parallels that of the United States.
The West German Federal Republic has no
diplomatic relations with Cuba; nor has it a
trade tqlat y with it.
There is no ban on private trade with Com-
munist countries?except for strategic
goods?but according to available earidence,
the total of West German exports to and
imports from Cuba appears to be very small.
According to a Voluntary agreement be-
tween the Bonn Government and the West
German shipping lines, West German vessels
will keep out of Cuban waters, The charter-
ing of West German ships to sail under
Cuban flags has been prohibited.
ITALY
(By Walter Lucas)
The Italian Government has adopted no
special policy regarding Italians trading with
Cuba. In practice, mutual trade between
Italy and Cuba is carried on freely on ordi-
nary commercial lines.
Permission for an export license from the
government is only necessary on exports in-
volving long-term credits in which normal
banking finance Is backed up by govern-
ment insurance. In such cases an applica-
tion for an export license would be approved
on its merits.
The decision is generally made on commer-
cial, not political grounds. Since, however,
the financial position in Cuba does not favor
long-term credit operation, few licenses are
given.
In any case Italo-Cuban trade is small. In .
1962 It amounted to only $1.7 million both
ways. This increased to $36 million both
ways In the first 9 months of 1963. Almost
the whole of this great increase was due to
large purchases of sugar after the failure of
the Italian sugar beet crop.
A certain number of Italian ships on long-
term charter contracts with the Soviet Union
and Poland make regular tripe to Cuba.
Over these the Italian Government has no
control.
Approved For Release 2005/01/27 : CIA-RDP66600403R000200170057-8
Approved For
1964
1,
, The Belii.an Government has ofAciaIly an-
nounced it is OpPOsed to-any ebonamic boy-
cott cif :Pitta'? will "en,pPOrt fidr cdrinnerbial
freedoin eiecept" tor 'Strategic goods, arid- Still
favors inaifinmn_poSsiblettf ado relations with
BelgiunfiS ahrthar IMP-OAS from'Ciiba, have
fallen_ froth 244 million Belgian francs ($5,-
280,900): before -the' 11.8:- itetion- to only: 23
inuiflon nOW, While exports have more than
halved to-Under-290-inillion: :Bid the Ter-
Sign' ltiniater -told "the 'Belgian Parliainent a
short time ago' that this decline was defi-
nitely not resulting from Political pressure
oil ATM,5 by the government, as such pres-
Vire wptildbe bontinry- to public 'freedom of
imfirtar,AilpS'
: (By H. G. Pranks)
:The United States has not approached
Holland directly to join in the economic
stranglehold on Cuba, except to give the gen-
eralwarning that ships engaging in Cuban
, ,
trade risk being blacklisted.
Nevertheless,. ' the comparatively small
'Dutch trade has been affected by the Cuban
struggle." ,Imports, mainly tobacco,, have
dropped by two-thirds to 13 Million guilders
(44,891,000), although exports, mainly mar-
garine and fats, have remained the same at
20 million:guilders. But the Dutch Govern-
Merit treats Cuban trade Only 'as an academic
problem not sUfficiently important to justify
nny Official pronouncement
(Ey RiChard Ivrovirer)
Spain's a titucle toward frading with Cuba
is that Premier CaStra's regime is commu-
nistic, and:therefore reprehensible: But the
- real source of the ?Coliamimiet threat to the
free:world is MoseoW, not fininna. _ Thus it is
eva0ing the 'issue to seek t-6' impose an ePo-
fiornic blockade on Cuba alone._
? a. Stepping up of trade between Cnba and
- Spain is expected; in the coming months.
iVegotiations toward an agreement on the
eAcharige of Cuban _sugar for Spanish fishing
vessels' is far adNinneed. 'Under th,:eProposed
- arrangement; Spain vionia receive between
$00,009 and 350,000 tons of Cuban sugar over
the next '2 years and in exchange build
$50 million worth of fishing vessels?perhaps
as many as 100?for the Castro regime.'
El Espafiol, a weekly published by the Min-
istry of Information in Madrid, says, '"Tb be
effective a: blockade, :Must bi complete, 'but
the blockade of Cuba decreed by Washington
Is not complete because, the Communist
r countries are left out of it, and it is they
Who help Castro the most."
- ,
'it fa also contended that .aie ttnited Slates
itself failed to set_ a blockade exnmpIe by
giving Premier 'Castro 6' million w?itli 'of
medieines:and?,food tO ranaorn, the pg:s, of
Pigs prisonere "and '1 -hiring Cuban 'labor
for the GUantanarnO base, *hese 'wngea-' are
ConVerted into dollars for Cuba at the rate
of $5 million annually. The feeling here is
that neither :Spanish trade nor the 40,000
Spanish nationals living in Cuba should be
penalized/or the Bay of Pigs fiasco and: the
falline of the Cubs, policy of the United
States.' -
Mr; D_OMINT6Ic o
hear-
ings before the Senate tt
tanking and Currency there waa a brief
oppbrtnnit to hear froni Prof.O.-War-
ren Njitter,, chairman of the
Wilson- oppArtiii-efit g JarneS
.1itripC111:Qarnicre'esogantitze"hde
expert on eSoviet fn'his
_
abatement tnt ,Dr. Nvtier a,de genie .Very
Important points' 'which unfortunately
were, overlooked by' many Senators in
se 2905/0//27 : CIAIR11008613-00403RO
CO CRESSIONAt RECORD -- SENATE 12005
200170057-8
the emotional catharsis surrounding the; These aie the two points that we give
bills when we took if up fin- debate. 'I3e- as argiiMents in favor of the sale of the
wheat; these are Dr. Nutter's comments
on those points:
Mass I believe it is so important, I
should like to outline for the Senate as
a whole and for the country some of the
statements which Dr. Nutter made at
the hearing They appear on page 68
of the hearing record. lie said:
As I understand it, the basic issue before
this committee has to do with the advisabil-
ity of making the credit insurance program
of the Export-Import Bank available for
underwriting private loans advanced to Com-
munist countries to finance their purchases
of products in this country. To place this
issue in a concrete setting, it seems reason-
able to begin by examining the matter of our
recent wheat sales to Communist countries
and how such an underwriting of credit risk
would affect them. As I understand it, the
bill under consideration arose out of circum-
stances surrounding these transactions. r
think it will be clear that the main line of
argument would apply to any comm&lity
other than wheat that might play a similar
role in the future.
Dr. Nutter then continued on page 69
of the hearing record:
The troubles being encountered by the
Soviet leaders are of their own making, and
they should find their own solutions. It is
idle to believe that any assistance we offer
will be rewarded with gratitude. Kindness
on our part will be taken merely as a sign
of weakness, the action of a degenerate ad-
versary contributing to his own destruction.
? The fOrm our response should take is clear.
If we decide that a one-shot sale of wheat to
the Soviet Union would bring us any im-
portant lasting benefit---which, incidentally,
is riot evident to me?then we should drive
the hardest bargain possible in making the
It is important to point out that these
benefits would accrue to us whether our grain
is sold by us directly to Communist countries
or indirectly through other countries. That
is to say, there is no substance to the argu-
ment that we should sell directly to the
Communist countries because, if we don't
they will simply buy the same commodities
from some dealer, say, a German firm, who
has bought them from us. If we sell the
goods indirectly, so the argument goes, we
merely let some other country, say, Germany,
make a profit in Rating as intermediary.
Hence, the argument concludes, we should
be willing to make some concessions to the
Communist countries in order to make a di-
rect sale.
The entire argument is, of course, fal-
lacious.
Professor Nutter continued:
Only if the sales are made on credit does
the American balance of payments have no
improvement for as long as the credit is
outstanding.
The moral is simple: If we decide to make
wheat available directly or indirectly to Com-
munist countries, we should sell ip at the
highest cash price we can get, regardless of
, who the immediate buyer is. Our best
chance of driving a hard bargain is to deal
directly with the Communist countries on
an all-or-none basis, provided we can control
the volume of indirect sales. In any event,
there is no sense whatsoever in setting favor-
able terms just in order to make a direct sale.
Granting special concessions to the Com-
munist countries would indeed be sadly
ironic.
sale, preferably exacting political conces- I believe this is an extremely impor-
tant point:
Dr. Nutter then said: We have given foreign aid to various coun-
tries in order to inhibit the spread of corn-
In dealing with such a system?
munism. This foreign aid has helped to
And he was talking about the Soviet bring about a deficit in our current interns-
system? tional balance of payments. We would then
we only harm ourselves in not chargfng the -Propose to correct that deficit by giving aid
highest price'possible. If we decide to sell to Communist countries.
whet to the Russians, let us sell it on our
own terms, on an all-or-none basis. They
are then free to take it or leave it, as other
countries normally are in dealing with the
Russians. We should also recognize that any financ-
ing of wheat sales by extension of credit in
dollars, no matter who extends the credit, has
So much for the situation if it is simply no effect in easing our deficit in the current
a temporary emergency. Suppose, on the international balance of payments for as
other hand, that Soviet imports of wheat are long as the credit is extended. This is an-
likely to be a regular event in the future, other reason for doing nothing to encour-
* ? * * * ? age credit financing of sales to Communist
countries.
I believe that is as clear an exposition
of the fallacy of that argument as we
have had. Dr. Nutter continues:
Dr. Nutter continued:
We have no solid ground for believing that
the nature and objectives of Soviet commu-
nism have changed in any significant degree
In recent times. Only the problems facing
that system have changed, and with them
the tactics followed.
One might well wonder whether this cen-
tral fact has not been forgotten by the ad- It seems to me that that is such a plain
ministration.
statement of fact that it must have been
overlooked by many Senators in the
process of trying to determine what posi-
tion they would take in relation to the
bill (S. 2310) introduced by the distin-
guished Senator. If we are to give
credit, and we do not wish to help our
position in respect to our deficit in the
international balance of trade, it seems
to me that is perfectly obvious. But
there are other things which I think are
equally important.
In order to make sure that no one
thinks that I have quoted the good pro-
He adds:
Of course, everything I have said this
morning would apply in greater or lesser
degree to trade in any other commodities
with Communist countries.
Continuing on page 70, in the same
Context, Dr.-Nutter said: ?
It is true that the public has been in-
formed of two benefits to this, P91111-try from
this sale of grain.
And I think these are extremely im-
portant points, Mr. President:
' First, our surplus stocks of grain, accumu-
lated as a result of the policy of subsidizing
agricultural production through price sup-
ports would be reduced. Second, the deficit
In our current international baUlep of pay-
ments would be reduced.
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12006 CONGRESSIONAL RECORD ? SENATE ? June 2
fewer out of context. I believe it would
be helpful to have the statement In the
RECORD. Therefore, I ask, unanimous
consent to have printed at this point in
the RECORD the statement made by the
professor, which is contained on 'pages
67 to 72 of the hearings before the Com-
mittee on Banking and Currency.
There being no.objection, the state-
ment was ordered to be printed in the
RECORD, as follows:
STATEMENT OP G. WARREN NIIITER, CHAIR-
MAN, SAM= WILSON DEPARTMENT OF EGO-
NOMIgl, UNIVERSITY OF VIRGINIA
_Dr. Norma. Thank you very much,
Mr. Chairman and members of the com-
mittee, it is an honor to appear before this
committee to offer my opinions on the im-
portant matters now being deliberated. So
that the committee will not be misled, let me
make it clear that my claim to competence
in discussing the issues before you is a
limited one. I am not an expert on Inter-
national trade and finance. And, although
/ have spent a number of years doing re-
search on the Soviet economy, this work has
been done in an academic environment,
which means that I normally consider my-
self fortunate if I have managed to catch _up
with happenings of 5 years ago. I have tried
in recent months to become better ac-
quainted with the current economic situa-
tion in Communist countries, but I would
not claim expert knowledge. What I have to
say this morning derives, therefore, more
from my broad views on the trend of events
over the 'rot 'decade than from detailed
knowledge of present conditions.
As I understand it. the basic issue before
this committee has to do with the advis-
ability of making the credit insurance pro-
gram of the Export-Import Bank available
for underwriting private loans advanced to
Communist countries to finance their pur-
chases of products in this country. To place
this issue in a concrete setting, it seems
reasonable to begin by examining the matter
of our recent _wheat sales to Communist
countries and how such an underwriting of
credit risk would affect them. As I under-
stand it. the bill under consideration arose
out of circumstances surrounding these
transactions. I think it will be clear that
the main line of argument would apply to
any commodity other than wheat that might
play a similar role in the future.
The Soviet Union, as we all know, has
historically been an exporter of wheat, not
an importer. This has been the case despite
the generally poor record of growth in agri-
culture, because Soviet authorities have pre-
ferred other products over food. Over the 4
years, 19441, Soviet exports of wheat
amounted to more than a tenth of the har-
vested crop, but annual exports; declined
from about 7 million metric tons in 1958
and 6 million metric tons in 1959 to 4.8 mil-
lion metric tons in 1961. Although I do not
have the figures at hand. I should imagine
that exports were even lower in 1962. Even
expo -Gs of this level have hung precariously
on successful production in substantial vol-
ume from the virgin lands in south-central
Asia, pleiwed up and put to seed over the
last decade.
This year there was a serious crop failure
of a magnitude yet to be accurately deter-
mined, but apparently primarily In the virgin
lands region. As a result, the Soviet Union
has already agreed to purchase about 6.5
million metric tons from Canada and is
negotiating with firms In this country for
perhaps 4 million metric tons. Enropean
satellites are apparently negotiating for an
additional 2.5 million metric tons. How
much of this Bum is destined for internal
consumption in the Soviet Union and how
much for fulfillment of export obligations,
Including those to its European satellites, is
still in doubt. But the fact remains that the
Soviet purchases alone amount to around a
fifth of the Soviet crop of the last few years,
and this suggests that the crop failure was
quite substantial,
As we deliberate over how we should act
in the situation that has developed, the first
question we should face is whether Soviet
Imports of wheat are likely to be only tem-
porary or whether they are likely to become
a normal occurrence over the indefinite
future.
If the situation is temporary?if the crop
failure this; year has been caused by extra-
ordinary events not likely to recur?then we
should view the wheat shortage as just an-
other 'editor causing severe economic diffi-
culties at the moment In the Soviet Union.
These difficulties have resulted from the
concurrence of several developments: a nor-
mal slowing down in the economic growth
rate, the inefficiency of the organizational
system in dealing with an increasingly com-
plex economy, and the heavy burden of the
military-space program.
If this is the situation, how should we
respond to it? The troubles being encount-
ered by the Soviet leaders are of their own
making, and they should End their own so-
lutions. It is idle to believe that any assist-
ance we offer will be rewarded with grati-
tude. Kindness on our part will be taken
merely as a sign of weakness, the action of
a degenerate adversary contributing to his
own destruction.
The form our response should take is clear.
If we decide that a one-shot gale of wheat
to the Soviet Union would bring us any Im-
portant lasting benefit?which, incidentally,
Is not evident to me?then we should drive
the hardest bargain possible in making the
sale, preferably exacting poltical concessions.
We should lay here the utter hyprocriey in
the indignant protests of Ehrushchev against
"discriminatory pricing." It is in the very
nature of the Soviet system to exploit each
trading partner as much as possible. Uni-
form, nondiscriminatory prices play no role
In Soviet trade except for the relatively email
purchases from the United States and a few
other countries. The great bulk of trade is
conducted on a bilateral, discriminatory
basis In dealing with such a system, we
only harm ourselves in not charging the
highest price possible. If we decide to sell
wheat to the Reaaiana, let us sell it on our
own terms, on an all-or-none basis. They
are then free to take It or leave it. as other
countries normally are in dealing with the
Russians.
So much for the situation if it is simply
a temporary emergency. Suppose, on the
other hand, that Soviet imports of wheat
are likely to be a regular event in the future.
This is by no means out of the question, for
there is a real possibility that the virgin
lands have been turned into an unproduc-
tive dust bowl for some time to come. How,
then, should our attitude differ? In this
ease we might well be more lenient in the
terms of sale that we exacted at the moment,
only on the condition, however, that a defi-
nite commitment were made for continuing
purchases over a reasonably long period of
time. Before reaching a decision on what
to do in this case, we should need to re-
examine our entire trading policy toward
the Soviet bloc and let our decision on the
sale of wheat derive from that general
decision.,
In neither case should we rush into agree-
ments, and our actions should be guided
solely by cold considerations of what is in
our best Interest. We have no solid ground
for believing that the nature and objectives
of Soviet corcununism have changed in any
significant degree in recent times. Only the
problems facing that system have changed,
and with them the tactics followed.
One might well wonder whether this cen-
tral fact has not been forgotten by the ad-
ministration. The admiqlstration has rushed
Into an agreement on the sale of wheat. It
has seemingly leaned over backward to make
sure the terms were not too harsh. /t has
responded to every objection raised by the
Soviet leaders against proposed terms by
denying that we were imposing conditions
in any way different from those imposed on
others. It has essentially put on kid gloves
to make sure that it treated Soviet negotia-
tors with special tenderness, for fear that the
sale otherwise might not go through. In
brief, an outsider would be justified in con-
cluding that, for some reason unknown to
him, the primary beneficiary of this transac-
tion is supposed to be the United States.
I speak, of course, as an outsider, unaware
of the host of factors being weighed by the
administration in negotiating this commer-
cial transaction with Communist countries.
Perhaps there are impelling reasons why the
administration is anxious to conclude an
agreement with the Soviet Union and its
satellites on terms less faekarable than could
be achieved through tougher and more pro-
tracted bargaining. But those reasons re-
main unexplained and therefore beyond, the
realm of discussion.
It is true that the public has been informed
of two benefits to this country from this sale
of grain. First, our surplus stocks of grain,
accumulated as a result of the policy of
subsidizing agricultural production through
price supports would be reduced. Second,
the deficit In our current international bal-
ance of payments would be reduced.
It is important to point out that these
benefits would accrue to us whether our
grain is sold by us directly to Communist
countries or indirectly through other coun-
tries. That is to say, there is no substance to
the argument that we should sell directly to
the Communist countries, because, If we
don't, they will simply buy the same com-
modities from some dealer, say, a German
firm, who has bought them from us. If we
sell the goods indirectly, so the argument
goes, we merely let some other country, say,
Germany. make a profit in acting as interme-
diary. Hence, the argument concludes, we
should be willing to make some concessions
to the Communist countries in order to make
a direct sale.
The entire argument is, of course, falla-
cious. The only matters of Importance are
whether we sell the wheat in the first place,
and how much we get for it in the second
place. It does not matter who buys the
wheat so far as the central Issue here is con-
cerned, as long as no additional goods are
imported into this country or no credit is ex-
tended by our citizens in connection with the
sale.
If we can sell to a German firm at an ac-
ceptable price. it would be folly to sell direct-
ly to the Communist country of ultimate des-
tination at a reduced price just to make a
direct sale. On this score, it also makes no
difference whether the payment Is In gold or
convertible currency. The effect -on sales of
surplus stocks and on the balance of pay-
ments is identical in both cases. Only if the
sales are made on credit does the American
balance of payments have no improvement
for as long as the credit is outstanding.
The moral is simple: If we decide to make
wheat available directly or indirectly to Com-
munist countries, we should sell it at the
highest cash price we can get, regardless of
who the immediate buyer is. Our best
chance of driving a hard bargain Is to deal
directly with the Communist countries on an
all-or-none basis, provided we can control
the volume of indirect sales. In any event,
there is no sense whatsoever in setting favor-
able terms just in order to make a direct
sale.
Granting special concessions to the Com-
munist countries would Indeed be sadly
Ironic. We have given foreign aid to
various countries In order to inhibit the
spread of communism. This foreign aid has_
helped to bring about a deficit in our cur-
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rent international' balance Of payments. We
would then iorOPoge tO-cOrracttliat 'deficit by
giving aid to Cothrinintst countries.
This brings me to the question before the
cOMUlittee this morning. The primary effect
of governmental underwriting, through the.
itqport-Irapd-rt Bank, of credit risks incurred
by Private lenders to Communist countries
is to reduce the cost of credit?to-those coun-
tries. Thera lano-readOn-for us to reduce the
cost of credit to' Communist CO-Untries unless
we 'Wish, as a general and. lOrigrun policy,
to encourage expansion of our trade with
them, If We are to embark on this course,
we should (IO so only after careful considera-
tion of its "full censecplenaes'2 'As 'far as I
can see, nobOdy in authority has argued that
the present_ negotiations of - *heat sales is
the first step in a general program of trade
. eXpansion with Communist countries.
The question of underwriting aside, we
should also recognize that ally financing of
Wheat sales by extension of credit in dollars,
no, Matter who extends the credit, has no
effect in easing our deficit in the current
international balance of payments for 'as long
, - _ , -,- .
as the credit is extended. This is another
. reason. for 'tieing nothing to encourage Credit
financing of sales to Communist countries.
Of course, ' everything I have said this
morning would apply in greater or lesser
degree to trade in any other commodities
with CommUniat countries.
Tile issue of gpireinfilantal iiiiiiirwritin
' of credit risks Involving ?CO-inin-iiiiist coun-
tries is likely to arise from time to time in
the future as transactions involving other
cominsclities come under consideration. In
the absence of a broad decision by Congress
to encOurage expansion of trade with Cern-
intiniat Countries; it ,would - therefore seem
'prudent to enact into law the bill now before
_ _ .. ..
' this committee.
- I thank you for the courtesy of your
attention.
TheCuanimax, Dr. Nutter, you have given
, ,
Us an interesting statement. I want to ask
one question. ? '
.
When I was a boy I used to hear about
black _bread . in czarist Russia; - that was , rye
bread; WasiA it?
? Dr. Nurrin:' Ye-a, sir.
The CHAIRMAN. And you can produce twice
Or three times as many bushels of rye out of
the same ground as you can wheat, and rye is
cheaper. They ate cheap bread and ex-
ported the wheat.
Lets a -eck the figures. I understand we
have ,in he Commodity Credit Corporation
1,200- riii lion bushels of Wheat. - And the '
Itusi-lans s, they would like tobuy 140
million bushels. If so, they want to buy
about 12 percent of can. surplus. Are those
? , ..,
figures in accordance with yours?
Dr. N'irrisi. I believe so, expressed in terms
, ? . , _
of tops. ,
' The anai4isiAn: They Were 'giiienrt-o-me'-as
substantially correct?It is, your contention
then, that if they shOhld be suffering froma
81104#ge due to drought, on 'a one-shot sale
we Will get rid of only 12 percent of our sur-
plus,' which won't solve that problem, and
. we Will - have violated our previous trade
.
policy, and is Cicero might say, CUL bon?. Is
- that your position? -
Dr.Islorrzu. 'That is essentially My position,
any change we Make in the conditions of
sale at this ,point involves a decision' on, our
lpngrun trade policy.
. 7'he CNAntiviAN._ So your contention is, if it
is going to be a one-shot iale,-Invii abut
taking the troops Out Of Cuba ass, condition,
how about tearing down the wall in Berlin,
how ahoilt easing ,up on competition in mill,.
tury respects? You 'think we -ii-e?init -ne-
gotiating hard enough if this-ts goirig-tii be '
4 ortealig( deal?.
= Dr, No717.,_ That i'..p.my Opinion, sir.
..;The .i-zAT#IgA.,15;, Any questions?
- (No response.)
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The CHARMAN. Thank you very much.
Now, I am going to ask the distinguished
Senator from New York if he won't present
and perhaps endorse the next witness from
his home State.
Senator J-Avrrs. If the witness will come
forward, Mr. Chairman, I will be happy to
present him, though not endorse his state-
ment. I don't think my position coincides
with the witness.
'The CHAIRMAN. I was just throwing that
out as a possibility. Dr. Gerald Steibel, He is
foreign policy director of the American Re-
search Institute. I know you want to com-
mend the research,
Senator JAVITS. That is a very distin-
guished organization in New York headed by
Leo Cherne and Carl Hubbard.
The CHAIRMAN. All right, you may proceed.
Senator JAvrrs. I know them both very
well, Mr. Chairman, and I am very glad to
introduce the witness to the committee.
Mr. STEIBEL. This is a challenge, Senator,
to see whether I can convert you.
Mr. DOMINICK. Mr. President, every
time we have protested to our friends
and allies about trading with Cuba,
we have been answered with the ir-
refutable logic, "Why should we cut off
trade with a satellite of Russia?Cuba?
when you are trading directly with Rus-
sia?"
As a side issue, I suggest that to trade
with Russia has enabled it to shift its
concentration from its own internal eco-
nomic problems and has freed it even
more to arm and supply its own satellites.
In December, 1963, I received a report
from Cuba which reads, as follows?and
I think this may be of interest to the
entire Senate:
Elias Rivero Bello, a communications chief
for Cuba's state-controlled merchant traffic,
Lineas Mambises, states that Red Chinese
commercial trade with Cuba is on the rise
with Russian shipping diverted to military
cargoes. Although Red China has only two
ships in direct trade with Cuba, its prod-
ucts are reaching Havana in ships of British
registry manned by crews from Hong Kong.
The two Red Chinese ships are Shien Foon
and Ho Fun. The British-chartered ships
most often plying the China-Cuba route are
identified by Rivero Bello as the Macao, East
Breeze, West Breeze, and the Suva Breeze.
Rivero Bello was in charge of the teleprint-
ers which handled clearance messages for all
ship traffic to and from Cuba. He fled Cuba
the end of November of this year (1963).
It seems obvious to me, from reading
these reports, and from the overall re-
sults we have had up to date in connec-
tion with trade with Cuba immediately
after our wheat sales to Russia, that we
have created a far more dangerous con-
dition than previously existed by virtue
of the fallacy in our foreign policy with
respect to trade with Communist Cuba.
In that same article is a brief state-
ment which reads:
There is the suspicion that the Russians
are again introducing strategic weapons into
Cuba.
Again I point out that he was the one
Who was in charge of taking all messages
for shipping in and out of Cuba?
The "special cargoes," states Rivero Bello,
"are unloaded in the greatest secrecy, and
not even the Cuban Communists are per-
mitted near them. All are unloaded, trans-
ported, and stored by Soviet personnel."
This is one more indicator, it seems to
me, of the point I just made, with re-
200170057-8
12007
spect-tO-the fact that there are reliable
reports that there are 1,200-mile missiles
now in Cuba which could decimate the
entire eastern coast of this country.
Going further, in the April 13, 1964, is-
sue of U.S. News & World Report there
appears the viewpoint of Prof. G. War-
ren Nutter, who is the James Wilson
professor of economics at the University
of Virginia, and a recognized authority
in connection with the Soviet economy.
He was discussing, publicly and in the
magazine, the Soviet economy and the
advisability of our trading with her,
much less guaranteeing credit for such
sales. There are a couple of items in the
article which I wish to emphasize.
The question asked was: Should we
help the Soviets try to adjust?
His answer to the question was:
It is a difficult problem. It's not easy to
know exactly what we ought to do. I think
it's a little easier to know what we ought not
to do.
I don't think we should help them out of
their current economic difficulties without, at
the same time, getting some change in either
the political climate or their internal sys-
tem. That much, I think, we ought to do.
We have to take advantage of these periods
of weakness if we're going to get any changes
started.
Question. Under those terms, was the
wheat deal a mistake?
Answer. The way in which it was done
was a mistake. We should have bargained.
I think that their internal problems are
really quite serious, very serious. Their
problems in relations with the East Euro-
pean satellites are serious and becoming
more and more aggravated all the time. In
addition, they've got the problem of China
and the whole splitting of the Communist
bloc.
Once again he says, in answer to the
same question:
Are you saying that as long as we bail them
out nothing will happen?
The questioner is talking about bail-
ing out the problems of the Soviet econ-
omy.
Answer. That's right. If we bail them out,
they will use the time at their disposal to
retrench, to build up their power and to
somehow manage the difficulties that they're
involved in. They'll find some way.
Question. If the Russians can drum up
support from capitalism to make socialism
work, do you think they're going to change
socialism?
Answer. They won't. That's quite unlike-
ly. That would be their own business and
nobody else's if it weren't for the aggressive-
ness, belligerence, and expansionism that go
along with Russian communism.
The next few points are very impor-
tant in the general context:
I'm afraid that our foreign policy is sheer
romanticism, without any real logic in-
volved in it. Our Government shies away
from anything which carries any immediate
risk at all, no matter how small, and then
rationalizes whatever course is left, even
though the ultimate risk is much greater.
In cold reality, this leads to nothing more
than a policy of appeasement, and I mean
this in the literal sense associated with
Neville Chamberlain. We know from dread-
ful experience what appeasement leads to.
The course being followed now is to be
nice and to be friendly, because it seems
least risky at the immediate moment. This
Is rationalized on the ground that fat Com-
munists are less dangerous than skinny ones.
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12008 CONGRESSIONAL RECORD ? SENATE
This may be true, If one is looking at a very
long sweep of history. Over a thousand
years or so, perhaps people will become more
liberal solely because they become more af-
fluent.
But if one's talking about what happens in
the immediate context of a system such as
Russia's, then exactly the reverse occurs: As
won as they become fat?or, rather, fatter?
they get more belligerent and aggressive.
What is the history of events in Russia?
As soon as Khnishchev thought he was fat
enough, be sent up a sputnik. He went all
out on rocketry and introduced a massive
armament program. That was his re-
sponse?not relaxation.
When did the relaxation come? It came
when they got thinner. My feeling Is that.
at the moment, our best allies are the thin
fellows, not the fat ones. Those are the ones
we have the most to gain from.
Question. Who are they?
Answer. They're all the people In these
Iron Curtain countries who have gotten thin-
ner in the last few years,
Who are they mad at? They're not mad at
us. Who are they dissatisfied with? They're
not dissatisfied with us. They're dissatisfied
with their system, and they're mad at their
governments.
It seems to me this is the kind of situation
we want to try to utilize the best we can. I
think we ought to put it up to them to work
out their own way to get fatter while leav-
ing the outside world alone.
There's a perfectly good solution to their
problems, a perfectly simple solution?and
that's to change the system.
It seems to me, as I have said, that this
is a clear recognition of the problems
that our policy is leading us into, not
only the longrun troubles we are going
to have with a Communist economy, but
perhaps even some shorter term ones.
There have been reliable indications
that a process has been developed by a
Russian?I do not know how to pro-
nounce the name of it, but it is spelled
L-e-b-e-d-j-i-w--under which the So-
viet Union can produce a ton of indus-
trial ethyl alcohol from 8 tons of wheat.
Under a 7-year plan, the Soviets plan
to produce 800,000 tons of this alcohol
from foodstuffs. This would require 6.4
million tons of cereal grains, which is
more than accounted for in their deal
with Canada alone, not counting the
amount of wheat they entered into a
Contract to purchase from this country.
It certainly does not make any sense
to me when this kind of a process is
presently in existence in Rnsaia for the
United States to sell surplus wheat on
credit?which is not going to help our
international balance of payments?
which will permit them to male ethyl
alcohol, which in turn can be used for
the production of armaments and ex-
plosives of all kinds. This is one of the
Immediate dangers, it seems to me, that
can come from the program.
What are the things that have been
happening in this trade field and the
problems that have arisen from it? Let
Me talk about one that has recently come
to light. The April 27, 1964, issue of the
Washington Evening Star contained an
article by Marguerite Higgins which re-
ported an oil strike in Manchuria of a
substantial nature.
Mats is a Red Chinese oil strike. Until
this time, the Chinese had been almost
ComPletely and wholly dependent upon
Russia TOT oil, for transportation, for
heating, and for any other uses that they
could rind for it. I think this is impor-
tant. The article reads as follows:
The U.S. intelligence community is con-
vinced It has discovered an important reason
why Peiping has greked the last year and a
half to let loose with increasing ferocity
against the Russians: A Red Chinese oil
strike in Manchuria.
According to reports reaching here, the
strike is of such size that it could make China
self-sufficient In petroleum products.
Oil has constituted the chain of black gold
that for more than a decade made Peiping
slavishly dependent on its relations with
Moscow. Until recently. Moscow has fur-
nished virtually all of China's oil. The peak
was reached in 1981 when Peiping bought
?28 billion worth of oil and aviation fuel
from Russia_
It continues, and because / think it is
Important, I ask unanimous consent that
the entire article by Marguerite Higgins
be printed at this point in the REcoltn.
The PRESIDING OFFICztt. (Mr.
BREWsTslt in the chair.) Is there objec-
tion?
There being no objection, the article
was ordered to be printed in the RECORD,
as follows:
!Prom the Washington Evening Star,
Apr. 27, 1964]
INTICIPRITIVIL REPORT: Panntro COCKY AT
On. Smoot
(My Marguerite Higgins)
The 17 S. intelligence community is con-
vinced it has discovered an important reason
why Peiping has picked the last year and a
half to let loose with increasing ferocity
against the Russians: A Red Chinese oil
strike in Manchuria.
According to reports reaching here, the
strike is of such size that it could make
China self-sufficient in petroleum products.
Oil has constituted the chain of black gold
that for more than a decade made Peiping
slavishly dependent on its relations with
Moscow. Until recently. Moscow has fur-
nished virtually all of China's oil. The peak
was reached in 1961 when Peiping bought $2.8
billion worth of oil and aviation fuel from
Russia.
It Is of significance that In the days when
the Sino-Soviet split was still a matter of
conjecture, the experts who argued against
the likelihood of a complete rupture invari-
ably cited Peiping's dependence on Moscow
for oil as a reason why Mao Tse-tung would
hesitate to make a total break.
Quite apart from giving Peiping greater po-
tential independence and therefore greater
license to thumb its nose at Moscow, the oil
strike will have an enormous impact on Red
China's economic destiny.
The exact date of the Manchurian discov-
ery is not known. But the first reports of it
began to filter to the West about 18 months
ago.
The most solid information has come in
the last few weeks from Japanese engineers
and businessmen engaged by the Chinese to
help in the drilling and in building all re-
fineries. It is the Japanese who are the
source of the estimate that the oil resources
discovered in Manchuria may be large enough
to make China self-sufficient.
There is an irony in this because the Japa-
nese, In all the years that they occupied Man-
churia, never were able to discover oil, even
though they did extensive exploring.
The Manchurian find helps explain the in-
crease in petroleum experts from Prance,
Britain and West Germany who have been
traveling to Red China via Hong Kong in
recent months.
There is a good case to be made that Red
Chinese stridency against Moscow has In-
- June 2
creased in almost direct proportion to Pelp-
Ing's confidence in the fact that its de-
pendence on Moscow for oil would end. 011
sennerlea are not of course built In a day.
But It apparently has been pretty heady
for the Chinese leaders to possess the knowl-
edge that it is only a matter of time until
the Chinese Army will no longer be vulner-
able to the threat of being immobilized by
a Kremlin decision to cut off oil exports.
It is not just the Western intelligence com-
munity that sees a close connection between
the oil discovery and Peiping challenging
stand against Moscow.
A spot check of Eastern European em-
bassies showed that Communist diplomats
were aware of the developments in Man-
churia and its impact on the Sino-Soviet
split.
Said one Eastern European: "In private
talks in Peiping with our officials, the Chinese
make no attempt to hide their exhilaration
over their economic liberation from Moscow
that will come as the result of the develop-
ment of their own oil.
"All of us have noted that the Red Chinese
waited until they were quite sure of their
oil potential before they took the risk of a
complete break with the Russians by attack-
ing them so violently. They have become
increasingly cocky about their future.
"The Chinese seems to feel that no matter
how many mistakes they make, destiny Is on
their side, and therefore the east wind will
prevail over the west."
Mr. DOMINICIC. Mr. President, it
seems to me that there are two important
points in this connection. The first is
that if China actually has found the oil
to the extent mentioned?and all the
Information leads us to believe that it
has?it is then free, as far as oil is con-
cerned, to continue its more aggressive
campaigns throughout Asia in order to
put the other Asian countries under
communism. The second point, and it is
equally important, is that if China is
freed from purchasing oil from Russia,
so, too, is Russia free from the obligation
of sending oil to one of its chief Com-
munist allies, thereby giving it far more
ability to use its oil supplies to increase
Its own industrial capacity within its
own country.
This leaves, then, only two major
points. The first is that this is one of
the remaining weaknesses in the Rus-
sian economy. The second is that the
oil strike in China can be used by virtue
of having the proper type of industrial
equipment for refining.
The other day I was consulted by a
very prominent person in one of the for-
eign embassies here in Washington. I
was asked, with regard to the latter ques-
tion I mentioned, to look at the Par East
Trade and Development magazine for
April 1964?at the same time the article
on the oil strike was published. It reads
as follows:
larousraud, EQUIPMENT ros Canis
Snam-Projetti. of Milan, a member of the
EN/ group, has won a Chinese contract for
a complete petroleum refinery, worth Elm.
Work is to be completed by 1968. This is one
of several large orders placed with Italian
firms recently. Last December the Chinese
signed three contracts for chemical equip-
ment worth about Elem., and Montecatini
Is shipping E7m. worth of machinery for
two fertilizer factories with a combined out-
put of 800,000 tons. The plants will prob-
ably be built near Luchow in Szechuall
Province, where natural gas is plentiful.
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CGNGRESSIONAL RECORD ? SENATE
Once again we are faced with a situ-
ation in which a free world, which is
doing its best to take the leadership in a
fight to dive self-determination rights to
all countries, by virtue of trade with the
ComMunist countries is increasing their
economy Onci bolstering the economies
wherever they are the Weakest. The
U.S. public is being told that this is nec-
essary because of a deficit in inter-
national payments, when we are doing it
on credit. It does not make sense.
Just yesterday, I understand, the For-
eign Relations Connnittee was informed
about the agreement with Rumania, the
agreement apparently having been
signed, as far as trade is concerned,
without benefit of consultation with the
House of Representatives or the Senate,
and without the advance knowledge of
the House of Representatives or the
Senate, or the advance opportunity of
the House of Representatives or the
Senate to do anything about it.
'in this morning's Wall Street Journal,
there is a very small comment on this
sub,ject which reads as? follows:
.
ports to Rumania Of most goods will be
allowed without individual licenses.
The United States clung to its refusal to
sell strategic materials to any Communist
bloc nation, but extended to Rumania trade
terms thsp are among the most liberal Of
those offered any Soviet Satellite.- The two
cOuntrieo als6 agreed to raise the level of
diplomatic representation from legations to
embassies arid exchange of ambassadors "at
an early date."
Its understood the Johnson administra-
tipn. is prepared to make available to Ru-
mania the facilities- of the Government's
Export-Import tank' to furnish credit guar-
antees of 14p to 5 years on Some of the in-
creased sales expected toresult from the
agreement.
,
So here we are, full circle, back 'again
into the November situation. We saY
to our allies, "Please do not trade with
tuba." We say this because if we can
give them an economic quarantine, we
can to reduce their economjp, slrength
that the Cubans themselves will have an
opportunity to upset their government.
On the other hand, we proceed to do ex-
actly the same thing, giving trade and
dealt to the head of the overall con-
spiracy, Rnssia, and then giving it to
one of its most praline/it satellites,
Ru-
ntaia, which is still governed by Mr.
Kadar, Mr. Radar having been One of
,the greatest- Communist butchers that
the Soviet, satellites ,eye.T had.
There is, an article dated today in the
Wall Street Journal entitled: "United
States, Rumania_ Sign Trade,. Political
Pik* Move May Loosen Satellite's So-
viet Ties." It reads in cart as follows:
TY.a, officials` declined to eiaborste, but the
Runinalans have been known to be In the
market for whole petrochemical plants, as
well as oil refinery machinery. Talks between
a Rumanian trade delegation and U.S. Indus-
trialists have been going on during the gov-
ernment-to-government conferences; and
some transactions already are said to have
been closed.,
_Nothing official was said about U.S. Gov-
ernrilent credits to help finance such trade,
but it isUn4erstood the Johnson administra-
tion is prepared to make available the facili-
ties of the Government's Export-Import Bank
to furnish credit guarantees of up to 5 years.
President Johnson is required by law to make
a determination that export-import credits
to a Communist country are in the national
interest; he hasn't yet done so, but the pros-
pect is that he will act shortly.
I want to make it crystal clear for the
RECORD that any guarantee by the Ex-
port-Import Bank is out of the taxpayers'
funds for guaranteeing the credit of
Communist countries. And if we are to
have a certain policy with respect to one
country, saying that we are going to cut
off the economy of that country in order
to overturn a Communist government,
what is the purpose of not only trading
with the head country and its other sat-
ellites in Western Europe, but also using
our own taxpayers' credit in order to
make sure that its sales go through, so
that we can be absolutely positive that
they are getting credit on the easiest
possible terms? -
It is a strange and peculiar type of
foreign policy for this country to be pur-
suing. Moreover, all satellite countries
will do exactly what Professor Nutter
warned they would do, in his article in
the U.S. News 84 World Report; namely,
they will interpret this policy as noth-
ing more than a sign of weakness in the
free world and, over a period of time,
nothing but appeasement of the Commu-
nist conspiracy, which is worldwide.
Mr. ALLOTT. Mr. President, will the
Senator yield?
Mr. DOMINICK. I yield.
Mr. ALLOTT. First of all, my distin-
guished colleague from Colorado has
made a very important contribution to
the subject, which we have been discuss-
ing for some 6 or 7 months, and which
was lost sight of when it was originally
discussed before the Senate.
Senators will recall that when the Rus-
sian wheat transaction was first pro-
posed to the people of America, it was
supposed to be a one-shot cash trans-
action. I am sure the Senator remem-
bers that.
Mr. DOMINICK. .1 certainly do.
Mr. ALLOTT. Many of us, upon first
blush, thought that upon those terms it
might be a favorable deal. Then we
found that we would start financing the
deal on a long term?or what I would
call long term, but which others thought
was an ordinary term?of up to 4 or 5
years by way of credits.
The point the Senator has made, which
is very important, is that we do not
change the balance of trade when we
finance such deals by providing credit.
The balance of trade is changed only
when the credit is finally paid off.
I should like to ask the Senator a ques-
tion with reference particularly to his
remarks about Rumania.
We are about to engage on such a deal
with Rumania. According to the morn-
ing newspapers, we will make the deal on
the "most favorable terms" to Rumania
and an other country. This means, first
of all, that we will not effect any change
in the trade plan of our country. Does
it not?
Mr. DOMINICK. That is correct.
Mr. ALLOTT. Second, does it not
mean that when we offer them the "most
favorable terms," we will ultimately build
up dollar credits in Rumania; then, go-
ing by the very naive attitude of the State
12009
Department and in accordance with what
Dr. Nutter calls the romantic concept of
the State Department, we will be called
upon, when it comes time for Rumania
to repay those dollars, to grant them
even more favorable trade terms? That
means that we will place the workers and
manufacturers?the producers?in this
country in an even worse position with
relation to the people of Rumania.
Mr. DOMINICK. Mr. President, I ask
unanimous consent that the article to
which I have referred, published in the
Wall Street Journal, be printed in the
RECORD at this point.
There being no objection, the article
was ordered to be printed in the RECORD,
as follows:
[Prom the Wall Street Journal, June 2, 19611
UNITED STATES, RUMANIA SIGN TRADE, POLITI-
CAL PACT?MOVE MAY LOOSEN SATELLITES'
SOVIET TIES
WAsxmarox.?The United States signed
new economic and political agreements with
Communist Rumania that are expected to
spur increased U.S. sales to that Soviet-bloc
nation and perhaps encourage a general loos-
ening of ties between Russia and her Eastern
European satellites.
The tw9 countries 019_ agreed to raise the
level of diplomatic representation from lega-
tions to embassies and exchange ambassadors
"at an early date." And agreement was
reached on an expansion of cultural, educa-
tional, and scientific links. But the big de-
velopments had to do with trade, said U.S.
officials in announcing a pact reached after
more than a week of high-level discussions
here.
These are the key elements in the agree-
ment:
The United States, while clinging to its re-
fusal to sell strategic materials to any Soviet-
bloc nation, has agreed to relax export licens-
ing requirements so as to eliminate the need
for individual licenses on "most commodi-
ties" shipped to Rumania.
Until this relaxation, generally each ship-
ment to a Communist bloc country has to be
licensed. With most other countries there
exists the general authority to export broad
categories of goods rather than seek licensing
of each individual shipment.
The United States agreed specifically to
grant licenses for what the joint communi-
que called a number of particular industrial
facilities in which the Rumanian delegation
expressed special interest. U.S. officials de-
clined to elaborate, but the Rumanians have
been known to be in the market for whole
petrochemical plants, as well as oil refinery
machinery. Talks between a Rumanian
trade delegation and U.S. industrialists have
been going on during the government-to-
government conferences, and some transac-
tions already are said to have been closed.
Nothing official was said about U.S. Gov-
ernment credits to help finance such trade,
but it is understood the Johnson adminis-
tration is prepared to make available the fa-
cilities of the Government's Export-Import
Bank to furnish credit guarantees of up to
5 years. President Johnson is required by law
to make a determination that Export-Im-
port credits to a Communist country are in
the national interest; he hasn't yet done so,
but the prospect is that he will act shortly.
Without such credits, officials said, the
prospects for any sizable boost in U.S. sales
to Rumania are slim. Because the whole
purpose of the agreement announced yester-
day is to spur such sales, there would have
been little point to all the fanfare surround-
ing the agreements if the United States
weren't prepared to allow the bank to guar-
antee normal private credit.
U.S. sales to Rumania have been averaging
less than.$2 million annually, and this coun-
_ , _
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CONGRESSIONAL RECORD?SENATE
try's purchases from the Eastern European
nation have been even skimpier. Yesterday's
agreement isn't expected to spur the U.S. im-
ports, chiefly because the country has little
that the United States wants to buy. Spe-
cifically. U.S. authorities firmly ruled out the
possibility of Rumanian oil entering the U.S.
market. Although /birnazin is a major on
exporter to Western Europe, the thinking
here is that it cannot ship oil economically
to the United States.
But there are high hopes for a significant
increase in U.S. sales to Rumania, whose
foreign exchange earnings from oil make it
perhaps the most promising customer in all
the Eastern European Communist bloc.
Asked what the United States hoped to gain
from the agreement, a top official said:
"Business." The United States, he argued,
has been unnecessarily inhibited from sell-
ing to Rumania on terms comparable to
those enjoyed by Western European com-
petitors.
Politically, the United States has wider
purposes. Rumania, experts have been
noting, has been a prime example of greater
independence among the satellites from Mos-
cow's controL It has refused to allow its
relatively rich economy to be tightly inte-
grated within the Soviet bloc, defied Mos-
cow's dictation on Communist Party doc-
trine, taken a neutral position in the Sino-
Soviet dispute and turned increasingly
toward Western Europe to trade.
The United States wants to encourage all
these trends, and not just in Rumania.
Yugoslavia and Poland have long been rated
the most independent minded of the Eastern
Europeans and the United States has tried
with aid and trade to encourage this loosen-
ing in bloc relations. The hope now is that
with Rumania looming as a more important
trading partner with the United States,
others, such as Hungary and Czechoslovakia.
may be increasingly encouraged to turn west-
ward.
U.S. diplomats, in fact, would like to add
another enticement to Rumania by con-
ferring upon her the most favored nation
arrangement under which this country treats
all its trading partners alike; trade conces-
sions offered tp any particular country are
automatically extended to all others. Only
Poland and Yugoslavia among, Communist
countries have been extended this arrange-
ment and the issue remains a touchy one
with Congress. So the administration Is un-
likely to press the matter on Capitol Hill this
year, .officials said yesterday, though it was
discussed in the talks with the Rumanians.
But yesterday's agreement almost certainly
will bring an effort hi Congress next year to
confer most favored nation status upon Ru-
mania.
By way of promoting greater United States-
Rumanian trade, the United States plans to
open a trade promotion office in Bucharest,
and the Rumanians have indicated an in-
tent to expand their New York City trade
office. Both countries will exchange tourist
promotion offices, too.
Officials said the U.S. arrangements with
Rumania are the most liberal for any East-
ern European nation, except for Yugoslavia,
which is treated practically on a par with
Western trading partners. Poland has a li-
censing arrangement which does away with
some individual licenses on U.S. exports but
experts said It isn't as far reaching as the
agreement with Rumania.
Mr. DOMINICK. In part, the article
reads as follows:
"U.S. diplomats, in fact. would like to add
another enticement to Rumania by con-
ferring on her the "most favored nation" ar-
rangement under which this country treats
all its trading partners alike.
That Is exactly what the Senator was
saying.
By doing this, we are granting a Com-
munist-governed nation?and it is only
about 3 percent Communist, with the
rest of the people being "thin" Commu-
nists, the ones who would like to get out
from under?the designation of a most
favored nation.
The only thing I can see in all this
Is the idiocy of this kind of arrange-
ment.
Mr. ALLOW. If my colleague from
Colorado will yield to me for one closing
comtnent I should like to say that I am
struck with the idiocy of the effect that
popular slogans have on our State De-
partment and on others. I cannot help
recall two facts. First of all, it was after
we started to make our wheat deal with
Russia that Great Britain, Italy, France,
and even Spain started to expand their
trade with Cuba.
Second, this shows the extent to which
slogans like "It is easier to deal with a
fat Communist than a lean one" have in-
fluenced the thinking of our State De-
partment.
It is about time for us to get down to
a realistic way of thinking, and stop ac-
cepting the concept that we can capture
and retain the leadership of the world
with slogans which come out of Madison
Avenue. That is what we have had for
the past 4 years.
Mr. DOMINICK. Mr. President, I sin-
cerely appreciate my colleague's addi-
tion to this colloquy. I know how
strongly he has felt about this subject
for a long time. .
I also wish to express my appreciation
to him for the leadership which he took
in trying to interest Senators to talk
about Cuba as long ago as last summer,
when a group of us came to the floor
with one idea after another on what we
.could do about Cuba. Certainly, trading
with Russia was not one of the ways by
which we thought we could liberate Cuba.
Exactly the opposite was true. I ex-
press my appreciation to the Senator.
Mr. MUNDT. Mr. President, will the
Senator yield?
Mr. DOMINICK. I yield.
Mr. MUNDT. First of all. I wish to
convey to the Senator from Colorado,
who has given us this very significant
address, my congratulations for the very
careful research and the great amount of
study and background material he has
brought before us and before the Ameri-
can public by his address this afternoon.
I believe he has put his linger on what
was before Congress last fall, and will be
again sometime next month, as one of
the real, basic decisions to be made by
America in connection with the cold war
It seems to me that history pretty -well
records now that America reached a
crossroads in its policy during the de-
bates alluded to by the Senator. That
was last October, November, and Decem-
ber. They started in the last few days of
October, as I remember. At that time,
America sharply changed a foreign policy
which had served it pretty well for nearly
17 years. At that point American pres-
tige and world leadership began to slide.
It has steadily fallen ever since.
Once we ceased to be constructive, once
we ceased to be consistent, and once we
-- June 2
began to ask others to do what we refused
to do ourselves, we appeared to the world
as hypocritical, mercenary, and incon-
sistent.
Second. lacking direction and leader-
ship from the United States, the free
alliance has been steadily falling apart.
We see examples of it in NATO, as well as
In Franco-American relations. We see
Indications of it in the failure of our allies
to follow any suggestions we make in con-
nection with Cuba. I believe that Pro-
fessor Nutter very prophetically and
properly related foreign trade, which the
Senator from Colorado has been discuss-
ing so effectively this afternoon, with the
problem of foreign aid, which will be
before us shortly after we dispose of the
civil rights bill.
It is now before the House of Repre-
sentatives. More and more Americans
are indicating by what they write and
what they say, including editors and
commentators by their expressions, that
we are indeed engaged in a completely
self-defeating program when, on the one
hand, as Professor Nutter pointed out
and as the Senator from Colorado [Mr.
DOMINICK] has emphasized, we propose
to trade increasingly with Communist
countries and, on the other hand, pro-
pose to continue a multibillion-dollar
aid program to non-Communist coun-
tries, justified exclusively on the concept
that by so doing we help to protect them
against aggression and potential aggres-
sion by communism.
Can the Senator from Colorado find
any logic oi any possibility of success in
such an inconsistent, self-defeating
trade-aid program as the one which this
administration has placed before the
country?
Mr. DOMINICK. I cannot think of
any possibility of reconciling the two pro-
grams at all, provided that our foreign
policy is to try to win. I am not a bit
sure that our foreign policy at this point
Is designed for that purpose. If it is not
designed for that purpose, if it is de-
signed merely to frame a platform upon
which we can hopefully exist for a little
while longer, perhaps the administration
is trying to keep everything quiet at the
same time. But if we are trying to do
something to support our former pro-
gram of saying that people should have
the right to determine their own form of
government, then aiding both sides, in-
cluding neutralists and the underdevel-
oped, with our foreign aid, to prevent the
Communists from taking over, and then
aiding Communists to strengthen their
economy, it is the most hopeless futility
lean think of.
Mr. MUNDT. There is no possibility
of success in that kind of program, by
seeking, on the one hand, to bail out the
Communists from the economic prob-
lems which their nefarious system has
imposed upon them, while using the
money of American taxpayers, through
the Export-Import Bank, to bail out
Communists, and then coming back to
the taxpayers and saying, "We want an-
other $3 billion installment in 1964 in
order to build up the non-Communist
world because it is threatened with new
aggressions from the Communists, whom
we have recently built up with American
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''APprov6d For
doliars and American trade." That--#1*eiriTeiiiatiOnal Idiocy. if does not
_
to
111,44Ery sense me
?
-$enal-prItoin South Dakota
'-doe?ndt,sp4 fisi) along With the Senator did not arise. "We reg_arded nuclear power- had followed them for 16 years. They
The board of trade said a Rumanian dele-
gation discussed the possible purchase of
a nuclear powerplant from Britain during
a visit to London which began last February.
The spokesman said the question of a sale
0200170057-8 ,
12011
tries, to shore up their defenses and their
economies and to give them greater re-
sistance in case of Communist attack."
Those things were fairly clear, and we
from-to-regal r - r:Moks-El In his discus- plant as strategic material and therefore had worked fairly well; and during those
:Vrlf IVIctlairia?ra's war and in his anal- embargoed for export to Communist coun- 116 years, we had not lost any decisive
s?1-S'o?1-the situation in Vietnam' , I be- tries," he said. economic battles with the Communists.
neve this -idininistration -could serve "We now consider the talks as dormant. I said to them, "Do you want to know
America '6 " us
k t
bac o .
ate-I:Ica-ay cr'ins-tead'of Dm_ v_- They could be revived if the Rumanians what our foreign policy is now? If you
4,1W-_ Our' : hi4-POWered- adifilinstrative comedo, I will state it for you."
It was evident that there was a sense of
brains meeting hillonolilIu, scheming up I should like to have the Senator from
disappointment if not of grievance among
rdOreiRilftaii? ad"veritilies and more pd- some officials here because the Americans Colorado state now whether he would
tefitial losses of' Hies in Vietnam, they look to be in a better position than the 'make any addition to or change in the
Were brought back to Washington and British to pull off a deal. --statement I made to them, because now
.
-awciato. wo. all the other available_ -we are facing the most recent and cur-
- in the *admlniatiation to hold a Mr. MUNDT. Mr. President, will the rent problems, in terms of our invest-
brains , 4-- .-w- - ---5.-- - - i- ----h? . -, Senator from Colorado further yield?
free world tfatiP-alg.00P.WetIP,in Which ments in our foreign policy.
? welvolild'trita Manifest" the smile 'lead- Mr. DOMINICK. I yield. I think our foreign policy Jhas so
Mr. MUNDT. This illustrates exactly badly and so seriously deteriorated that
-edhip, once again, in having the free _
,s,,,Torid del* abroikhici -9r trade-aid ap_ what we were saying last November, today we are engaged in a race with the
. preach to the Communist World. ' We will -when we were opposing the adminis- other three countries in the world which
tration's position to give the Export- have exporting capacity, in an attempt
not be able to defeat communism in
-Asia, With or without Ameilean troops,
while at the Sallie time w6-ale in the
-.Priketa Of strengthening commuhism all
"over, the "World With American supplies
-and products and guarantees by Amerf-
? Oat taXpaYers of Soviet credit.
.. 801 deplore the fact -that-We have this
AnY6016 approach of relying on American
amio1e, money nd military power with-
_ _
Import Bank power to grant credit to
Communist countries so that they might
purchase supplies in America. The par-
ticular product then being discussed was
wheat, although other products were
crowding all around it and were com-
ing. into the picture very fast. The Sen-
ator from South Dakota then said that
we talk about strategic supplies, and then
asked, "What in wartime is more stra-
Out si ping own a?d aa king ourselves,
call such an inconsistent, self tegic than food? What provides better
food than wheat? If wheat is declassi-
' defeating' policy ever ab anything more
_ _ _ -fled and is called nonsecurity material,
than serve the cause' of coinrminism?"
11r. nOivrn:Ticit before- then we shall have nothing left with
.-oticthon ?otiaTivie, Whieh the enator 8 'which we can restrict trade on the basis
from Do. pmuiso-Dri- kind
- - - of its being something of a strategic
. -Nir'a.?, :
enenigt to hand t6 me: -Ulna apiieared nature."
- - Now we see the same tortuous reason-
fl the ticker and is an example of ing, by which it was said that while
'TI Is the locy about w lc was speaking, wheat is the world's best food, and food
011 Associated -Press ClisPatali from is necessary in order to wage war, and is
-' London and reads as-fallOiiS:
- - therefore a basic strategic materiel, nu-
Erltish al.lthorities were, trlied clear reaction plutonium and atomic
today :by 'a tr.S. decision to eOnSider selling ' '
a iiudiaar ii?-c-warprafit toairaurigt-Rui. -energy are not strategic. That is a
...Ira - - - strange departure from the high-sound-
: - _asite4, hoW- the :trnited Ing -phrases to which we listened, from
4tafes ebuid sell a r,6&toir to tliritunib.nians the aelvocatds of the test ban treaty, who
.gtp4. tlic#,..c.oippldin about the sale of triiiih at that time were considering the pro-
,uses1? e-'41;.?a.? _ duction atomic energy. and plutonium
,
produce plutoniuni, -7111-6n arid the possibility of building up a' war
gives nbeTeal. 13?flii:16-their blast.' As war- structure based on atomic energy so seri-
' 'potential ecjuipthent they are "15-S-Itn--61 b
Amedpowbrs co-firoutur-fahr emu?: - *us- that they believed a test ban treaty
tries, -was essential. Ultimately, the Senator
_ _
In 41:10.qbeing that "special consideration" 'from South Dakota, agreeing with that
would be given to the Rumanian' request, the- 'viewpoint, for its support. .
4bbuson_sslinInistrstio9. ?stres,sed ,that any I ask the Senator from Colorado a
-dei .w-Q144,,Ps.-*Pfl.-vir-Aaim: OAP_ allied :question I Was asked 'on the campus of
04 ':?Pai#,..F.RI4p*s trade 7it1,1 state,College, South Dakota's great agri-
t4c 0:Fin _ , , ,cultural college at Brookings, 2 weeks
It Is interst1n tO obserii'e that, the ago` today, while delivering -a lecture
Onfinist:ration did hot even' inention the -there. The question was, "What is
fact that it -might come to Congress to America's foreign policy now?"
.ow congress feels. I continue I replied, "-That is a difficult question open the floodgates of trade with Com-
- to-read from the dispatch: to answer. It was possible during The munist countries, regardless of what the
It w-ss -,sti?Sssed that a ConditiOn f Truth-ail administration, during - the materials are, and regardclreesdsiotfowr hshetohret-r
_ ? _
Eisenhower "administration, and during -there is to be long-term
. r7P19'1. -1:494-e A. Imperative ior the nuclear the first year of the Kennedy administra- term credit.
1)bWerfilant to be made if.fbdt-td'iiitZina- -tion .to define it basically as a policy Mr. MUNDT. Let me addo ne word
pnpervision. The International . which relied upon two great thrusts, one about the future possibilities inthis
n
tnergy age-n.oy, ba:Sed-iii Vienna, Aus-
being a really determined, sincere, and nection. After all, the U.S. Senate still
an. reactors consistent effort to restrict trade with can, exercise a restraining hand, J. _ are, mot, trsnstormed to serve
military purposes.- Communist countries, in order to keep when it is confronted with such contra-
- the Communists from becoming too dictory and self-defeating policies as
-alVeArtd;rtd- thinli-that-Ythe' Americans were Powerful and too aggressive?' and the those which now confront us. I believe
iwpraabiling 't asf=Weit- friclifig-rulei from Other, a foreign-aid and military-aid that involved in the new consular agree-
s 0A0ii,oirif expediency. _program to, the non-Communist coun- ments with Ruinania there are changes
0. 1o0---0
to see which of us can sell to the Com-
munists the greatest amounts of sup-
plies which they most badly need, and
to deliver them to the Communists' doors
at the cheapest possible oceanic freight
rates, and to sell the materials to them
at the lowest possible prices, so that we
will get that business, instead of having
the other nations get it, and also to ex-
tend to the Communists the easiest and
longest possible credit terms. I think
that is our foreign policy. If that is our
foreign policy, certainly it is doomed to
failure, because only Communist coun-
tries can profit by means of such a
policy.
Mr. DOMINICK. I completely agree;
and I could not state the matter more
effectively, even if I tried 15 times to do
so.
About 1 year ago, members of our
State Department went to Western Eu-
rope, and tried to persuade the Western
European countries not to grant long-
term credit to the Russians, so as not to
enable the Russians to obtain the needed
materials with which to construct an oil
pipeline through Western Europe; and
we fought and fought against having
those countries give Russia long-term
credit in that connection, inasmuch as
the extension of such long-term credit
was the only basis on which Russia would
deal for such pipe.
But here we go, reversing our policy
and giving 5-year credit to Rumania?
and 5-year credit is long-term credit in
anyone's language?and doing the same
thing for Hungary, but saying to all these
countries, "You must stay out of Cuba."
It seems to me that we are seeing the
very beginning of a Johnson policy to
er4
12012 Approved FeblyulemsieReiliacifteDPgt,
which are so substantial that in all like-
lihood they will have to come before the
U.S. Senate, for ratification as a treaty.
So here is our chance to explore what is
involved in this business.
Furthermore, I know that soon the
Senate will be working its will on the
legislative authorization bill for foreign
aid. That bill has already been passed
by the House of Representatives. So
here, too, we have a chance, by means of
amendments?under the happy way the
Senate operates, by means of which no
amendment need necessarily be ger-
mane?to do something constructive
about this situation and to place a re-
straining hand on these "happiness
boys" who think communism has now
changed its purpose and its objective,"
and who believe we should now feed com-
munism and should encourage it and
should pat it on the back, instead of do-
ing as we did for 16 years?curtail and
check it.
Furthermore, Mr. President, before
Congress adjourns, the Senate will have
an opportunity to vote on appropriation
bills dealing with foreign aid; and then
Senators can raise the question of how
inconsistent our foreign policy has be-
come. If we really believe the cold war is
over, and that now is the time to kiss and
make up with the Communists and to
give them the benefit of an aid program
based on credit to them, then surely we
cannot believe there is any reason for ex-
tending a single clonar of credit aid to
the non-Communist world on the basis
of the argument that that is the only
way to keep them from going Communist.
So we are the custodians of the public
purse will face some rollcall votes on
these issues in the next few weeks. To
those who read the RECORD and to those
who have concern, let me say I hope they
will make their wishes and attitudes and
desires crystal clear to all Members of
the Senate before Senators face up to
those very significant rollcall votes, as
the amendments come before us.
Again, I salute the Senator from Colo-
rado [Mr. Doxibuck) on his masterly
presentation of a matter which is by far
more significant and important than the
question of what is happening in Laos or
in Vietnam, because in this case we are
dealing with the system which is being
operated from Milscow and Peiping, with
its tentacles spread all over the world;
and if we are to deal with it effectively,
we must deal with it at the center, rather
than at the periphery. Otherwise, what
we do will be love's labors lost.
Mr. DOMINICK. Mr. President, I
thank the Senator from South Dakota,
who from the very beginning, even as
early as last fall, has tried to have us
deal effectively with this problem.
Mr. ALLOTT. Mr. President, will
my colleague yield briefly to me?
Mr. DOMINICK. I yield.
Mr. ALLOTT. My colleague has spo-
ken of the proposed nuclear plant for
Rumania which is being discussed.
There are perhaps three main sources
of power, as my distinguished colleague
knows; they are coal, other carbonifer-
ous materials, and oil. So can anyone
suggest why we should be dealing with
Rumania, which has one of the richest
A 1
and largest and most extensive oil fields
in the world, for the supplying of nu-
clear power? Some States in our own
country have no method of providing
fuel except by means of nuclear power;
and that is understandable. But I am
sure no reasonable man could under-
stand why the Romanians would want a
nuclear plant, in view of their valuable
oil resources, unless they could sell the
oil somewhere else at a greater profit,
and unless they are in hopes of duping
the United States to build a nuclear
plant for them, or unless the Romanians
hope to acquire from the nuclear plant
strategic information or materials
which would be of benefit to them?
which again brings us through the cycle.
Today, Great Britain is greatly upset
over this matter.
Just last week, I placed in the Cox-
CRESSIONAL RECORD an article, from the
London Daily Express, which shows how
upset the British people were because we
had developed the A-11, without giving
them any of the information, whereas,
on the other hand, we had taken from
them all of the key details on the ultra-
secret information they had developed
from their new supersonic bomber and
its electronic equipment.
Since 1960, we have managed to topple
one government in Canada because we
were trying to force nuclear warheads
on the Canadians; and we have had our
own difficulties with France, because we
refused the same thing to De Gaulle.
How inconsistent we can be in connec-
tion with our foreign policy, I do not
know. The word "naive" has been used,
and the word "romanticism" has been
used: but I say this is a childlike ap-
proach to the problems of the world and
to foreign relations, because it does not
deal with reality. Instead, it deals with
matters entirely outside of reality.
Again I say to my distinguished col-
league that I am very proud of the speech
he has made this afternoon to the
Senate.
It has been a real contribution, be-
cause unless we somehow are able to
reverse the almost inevitable run to the
sea that the State Department has fol-
lowed for the past few years, we stand
In grave danger in this world. The Sen-
ator has contributed greatly.
Mr. DOMINICK. I was about to say
to my distinguished colleague that every
now and then I hear representatives of
the State Department say that our
foreign policy must remain fluid. If it
becomes any more fluid than it is now,
we shall all be washed out to sea in the
water they have created, without any
real substance to anything they have
been doing.
Again I appreciate my colleague's par-
ticipation in this particular colloquy.
CIVIL RIGHTS ACT OF 1963
The Senate resumed the consideration
of the bill (H.R. 7152) to enforce the
constitutional right to vote, to confer
jurisdiction upon the district courts of
the United States to provide injunctive
relief against discrimination in public
accommodations, to authorize the Attor-
ney General to institute suits to protect
3R000200170057-8
June 2
constitutional rights in .public PaCilitieS
and public education, to extend the Com-
mission on Civil Rights, to prevent dis-
crimination in federally assisted pro-
grams,? to establish a Commission on
Equal Employment Opportunity, and for
other purposes.
'THE CIVIL RIGHTS ISSUE MUST BE RESOLVED AT
THE COMMUNITY LEVEL
Mr. CASE. Mr. President, final reso-
lution of the civil rights issue will come
In the community. I wish to call atten-
tion to one example of such community
action in my own State of New Jersey.
In Newark, a group of young people
associated with the Congregation Wnai
Jeshurun have begun this year a reme-
dial tutorial program aimed at helping
about 20 Negro boys and girls in elemen-
tary and high school subjects. The
members of the temple youth group are
themselves high school students. They
give of their free time on Saturdays in
order to share the classrooms of their
temple with Negro children from the
neighborhood. The project has met with
a deservedly wide response, both in and
out of the State: and other such pro-
grams are now underway. For example,
in New Jersey alone, congregations in
Trenton, Teaneck, Bayonne, River Edge,
East Orange, and Elberon have begun or
plan similar tutorial programs.
I ask unanimous consent that two
newspaper articles describing the New-
ark program be printed in the RECORD.
There being no objection, the articles
were ordered to be printed in the RECORD,
as follows:
From the New York Times, Apr. 26, 19641
JERSEY NEGROES TUTORED SY JEWS?YOUTHS
SEEK A MEANINGFUL APPLICATION OF JUDAISM
NEWARK, April 25.?A group of Jewish
youths here have been tutoring some 20
Negro boys and girls in elementary and high
school subjects as part of a program for the
"meaningful application of the teachings of
Judaism."
The Jewish youths are members of the
Congregation B'Nai Jeshurun_ In explain-
ing the project, Rabbi Barry H. Greene, asso-
ciate spiritual leader of the congregation,
quoted Maimonides, the 12th century Jewish
philosopher and doctor, who wrote:
"The advancement of learning is the high-
est commandment."
"We are dedicated to the preservation and
the meaningful application of the teachings
of Judaism," Rabbi Greene said. "We are
translating our convictions into deeds."
Every Saturday morning from 9:45 to 12,
about 20 Negro boys and girls from the 4th
to the 12th grades share the classrooms of
the 118-year-old temple. On hand to greet
them and work with them are members of
the youth group, 15 to 18 years of age.
While other junior members of the con-
gregation are attending religious classes and
.Piaturday morning services, the Negro chil-
dren are tutored in simple arithmetic, spell-
ing, physics. Latin. English, geography, his-
tory, algebra, and reading.
The tutorial project was started 2 months
ago at the suggestion of Stuart Rosengarten
of South Orange, a junior at Columbia High
School. A member of the Mitzvah Corps, a
youth group sponsored by reform congrega-
tions. Stuart lived and worked last summer
among the needy in Puerto Rico.
The program was publicized in the area's
schools and the boys' club at Stella Windsor
Wright Home, a city housing project. The
response, Rabbi Greene revealed, was "spon-
taneous and heartwarming."
Approved For Release 2005/01/27 : CIA-RDP66600403R000200170057-8