840.00–FA/9–2451
The President to the Secretary of State
My Dear Mr. Secretary: It is of the utmost importance that the limited amount of Title I foreign assistance funds being made available be used most effectively for the building of the military strength of Western Europe. Accordingly, comprehensive and integrated policies must be developed for the utilization of all funds available for foreign aid purposes in Europe. This requires that we at once reexamine the estimated dollar assistance needs of the Western European countries, consider various possible means of providing such assistance, and develop a fully coordinated plan for military and economic aid to Western Europe during fiscal 1952. The results will be useful both in the allocation and apportionment process and in the effective operation of the program during the year.
[Page 285]I therefore request that the International Security Affairs Committee develop and submit to me through the Director of the Bureau of the Budget by October 12, 1951, the following:
- 1.
- Estimates of the minimum amount of total United States dollar assistance, exclusive of U.S.-produced end items, which is believed necessary to furnish each Title I country in fiscal 1952, in order to make its maximum realistic contribution to European rearmament. The estimates should include all dollar support felt necessary, regardless of whether in the form of economic assistance, offshore purchase of military equipment, U.S. financing of “common use” items and infrastructure, or other uses of available funds, including the pending MSP appropriations.
- 2.
- An evaluation of various possibilities for using military aid funds to supply dollar assistance to European countries. Any recommendations for such use should include an indication of the amount proposed from each source of financing. The recommendations would, of course, be tentative and subject to change as circumstances warrant.
- 3.
- A recommendation on the possibility of reducing the need for economic aid to Germany through transferring a portion of the burden of U.S. Armed Forces costs from the German budget to the U.S. Defense Department budget, with an indication of the magnitudes involved.
- 1.
- For each country, a summary of any financial commitments for fiscal 1952 which have been made to date on behalf of the U.S. Government by the various agencies, together with the reciprocal undertakings agreed to by the recipient countries.
- 5.
- A list of the specific U.S. goals to be sought in pending discussions with the various countries concerning U.S. assistance and European efforts. These lists should indicate relative priority of our various objectives so that adjustments can be made if necessary because of the limited availability of funds or other reasons.
- 6.
- A summary table showing the minimum aid needed for each country (1 above) and preliminary estimates as to the financial aid which might be supplied to it from the appropriation for economic aid and the available supplementary sources of dollar assistance mentioned above.
In case the Departments and Agencies in ISAC disagree on any of the above, I desire to receive a summary of the conflicting views and various alternative possibilities in order to make a decision on them quickly so that this key Federal program can go forward without delay.
Sincerely yours,