Memorandum by Miss Eleanor E. Dennison of the Office of United Nations Economic and Social Affairs to the Director of the Office (Kotschnig)

Subject: Comments on Proposal to have ECA operate Point Four Bilateral Programs in South East Asia

1. Mr. Rusk’s conversations with ECA contemplate turning over Point Four funds to ECA to operate (Richard Brown).1

Planning would presumably be done jointly.
Projects would have to be approved by State.

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2. Chiefs of Mission (ECA) would report directly to ECA Administrator.

Missions would be expected to coordinate with Embassy but would not be responsible to it.
It is not clear why ECA should extend this pattern to South East Asia where the program is relatively small compared to its European operations.

3. Coordinating Committee in Washington to include:

  • State, Chr.
  • ECA
  • Defense

a. This leaves out all other civilian agencies.

The authorizing legislation leaves to the President the decision as to where the responsibility shall be lodged, and how it shall be operated.

It has been assumed that the President will place the responsibility in State for planning, control, and general supervision, and that the Federal Agencies will do the operating.
Presumably State could designate ECA in those areas in which ECA is authorized to operate.
It is believed that such a decision will cause trouble with the other agencies, since ECA operates directly and not through the agencies. The importance of this should not be overlooked.
ECA operations are identified with the cold war, and if ECA operates part of the Point Four program, the latter will certainly tend to lose its identity in the minds of the receiving countries. Mr. Hayes2 reports that countries have been sold on the Point Four program as a program for the people, and that this is a psychological factor of significance.
Technical assistance under Point Four has a very broad base which includes health, social welfare and education, and an emphasis which differs from other foreign aid programs. Both this broad base and this emphasis will be difficult to maintain when technical assistance becomes merged with the ECA program in which the straight technical assistance method of operation will have a low priority. In this connection it is essential to know whether it is contemplated that ECA will continue to be the operating agency for foreign aid programs in areas other than Europe at the close of ERP in 1952.
Since the ECA Chiefs of Mission will be independent of the U.S. Embassies in two countries under consideration, coordination with UN field missions will probably be handled directly between ECA mission chiefs and UN mission chiefs rather than through the Embassy. Coordination at this end might still be carried on through the Department, but with a different pattern of operation in the field for this area, and with the ECA Chief of Mission reporting directly to the ECA Administrator it would not be easy for the Department to maintain its role as coordinator with UN for this area.3

[Here follows discussion of “legislative considerations” relevant in light of the overlapping Point IV–ECA operations just described and the then-pending Congressional passage of the consolidated foreign economic assistance act.]

  1. Richard R. Brown, Executive Director in the Office of the Assistant Secretary of State for Economic Affairs.
  2. Samuel P. Hayes, Jr., Special Assistant to the Assistant Secretary for Economic Affairs. Hayes was a member of the Griffin Mission.
  3. A threatened impasse in Southeast Asia resulting from duplication under the STEM programs and Point IV was resolved by a State–ECA understanding on November 16, 1950. The newly established Technical Cooperation Administration was to be responsible for projects in the field of education and various governmental services not directly included in the economic programs of STEM. The latter were to encompass all defense-related economic assistance; for documentation related to these matters, see vol. vi, pp. 1 ff.