President Truman to the Acting Secretary of State

Dear Mr. Grew: It is a matter of deep concern to me that the economic situation of Italy be not permitted to deteriorate further. Our policy is to assist in the recovery of Italy as the only assurance against a resurgence there of the forces we have fought in Europe, and progress towards recovery in Italy will require substantial assistance from the United States for many months to come.

I am glad to learn that the War Department and the FEA are in agreement respecting the availability of $100,000,000 for imports to Italy from 1946 Lend-Lease funds. This should assure our being able to meet minimum supply requirements during the period of redeployment of our forces and into the winter. By that time I expect that additional funds will be available for Italy.

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Funds under the new program cannot be available at an early date, and, as a result, all agencies must make every effort to make fully effective such resources as are available. With this in mind it seems important to me that the War Department be alert to declare surplus in Italy property which is economically useful, but of doubtful continuing value to the armed forces, unless it clearly has a substantial disposal value in another area. Also, in the disposal of such property as surplus the problem of prices and terms should be approached in the light of our substantial interest in assisting recovery in Italy.

Another matter which may justify exploration is the possibility of eliminating shipping charges against funds made available for relief in liberated areas including Italy when Government shipping that can be used for relief to such areas would otherwise be a charge against the War Department for the return of American troops to this country.

Very sincerely yours,

Harry Truman