Under Secretary’s Meetings, Lot 53 D 2501
Memorandum of the Under Secretary’s Meeting, Prepared in the Department of State
UM N–354
[Here follow sections of the memorandum which summarize discussion of the Kem Amendment and of tin purchases from Bolivia.]
Report by Ambassador Cowen
6. Ambassador Cowen stated that there are 1600 people in the American diplomatic and Consular establishments in the Philippines. This number has increased and will increase further because of the USIE program. In addition, Manila is becoming more and more of a regional operations center, especially for the USIE program. He [Page 1544] pointed put that the country was falling apart about two years ago despite expenditures of over $2 billion by U.S. Government. However, he emphasized that this money was not sent as an aid program. He gave the breakdown of the expenditures. Ambassador Cowen stated that the fault for graft and corruption in the Philippines is partly ours with respect to the disposal of surplus property. We did not give adequate protection to this property. However, he pointed out that much of the property is now being used effectively in the Philippines.
7. Ambassador Cowen stated that we have two navy bases in the Philippines, one at Cavite and the other at Subic Bay. We also have a jet base at Clark Field. He stated that the Defense Department, some time ago, was not sure whether the Philippines should be included in our defense periphery. When he reported this to the President, the President disagreed with Defense thinking and later the Secretary of State included the Philippines as part of our defense periphery in one of his speeches.2 The reestablishment of the Seventh Fleet has been a great help in our diplomatic relations with the Philippines.
8. Ambassador Cowen described some of the financial difficulties of the Philippine Government. He pointed out that some time ago their foreign exchange had dropped considerably. We insisted upon an expansion of the import control laws but they were badly administered. The administration of these laws, however, has now improved. Exchange controls are also better administered. Ambassador Cowen pointed out that he took issue with the Department on the question of devaluation of the peso, and he was relieved of carrying out the obligation of the Department’s instructions. The foreign exchange situation has now improved. Ambassador Cowen reported that an economic survey of the country was badly needed and the Bell Mission was appointed to do this. This Mission did an excellent job. The Foster–Quirino agreements were helpful. New taxation has been worked out. From now on, aid will not be for budgetary support but for rehabilitation of the Philippines. He stated that we have given the Philippines everything that they can reasonably expect. The Hukbalahap situation is not unmanageable. We have insisted on placing the constabulary under the armed forces which is an important improvement. Our JUSMAG has been a great success. These improvements in the Philippines now provide a sound basis for a good ECA program.
9. Ambassador Cowen stated that there is a need for intelligent coordination in the Far East on a country and area basis. He stated [Page 1545] that our ambassadors are not adequately briefed before they go into an area. In addition, he felt that we should not send people to the Far East who are not interested in going there. These officers, and especially their wives, reflect their unhappiness, and this affects our relations with the country. The Ambassador emphasized that language training is extremely important and we should insist upon it. For example, in the Philippines a knowledge of Spanish is essential. He also felt that our officers should spend some time in other countries. He suggested, for example, that instead of sending officers to the Philippines on a boat, which takes 18 days, they should be sent by air through Europe and other countries so that they would have an understanding of the area and problems of those countries.
10. Ambassador Cowen asserted that there is an important need for a better economic staff. He stated that he has not been able to recruit an economic staff and this is one reason why we had to have a Bell Mission. The technical advisers necessary are important not only to us but to the individual countries. He stated that one reason for the collapse of the Philippine economy and its financial system was that we did not have good economic advisers available. He also pointed out that the political officers needed a better background in reporting. They are good draftsmen but they do not know how to go out and get news and information. He suggested that a year or two of experience on a newspaper would be excellent training for these political reporters.… Mr. Webb suggested that the embassy might require an inspection. Ambassador Cowen stated that the embassy has not been inspected in over two years, but he felt that his operations had improved considerably over recent months. Mr. McGhee stated that the problem on need of officers was an overall one. He felt that there was a general shortage in the middle and upper brackets of personnel. He stated that there were not more than three good economic people in the entire NEA area. He also pointed out that no one wants to be assigned to the FE and NEA areas, which places those posts under a severe handicap.…
11. Ambassador Cowen reported that many of his business friends have stated that our embassies are not interested in their operations. He has now instituted the system where our Embassy in Manila follows the planes and ships, and welcome businessmen to Manila and offer them services of our establishment there. The reaction of the businessman has been excellent. Mr. Webb raised the question of getting people from business to go into the area for two or three years. Ambassador Cowen agreed that this would be a good idea and expressed a willingness to canvass various businesses for volunteers.
- These Meetings, held as often as twice a week, considered important policy papers and heard oral presentations on outstanding issues. The Meeting regularly included all the officers in the Department of Assistant Secretary rank and above (or their representatives) with the exception of the Secretary, as well as a number of people of somewhat lower rank who held key positions.↩
- Apparent reference to Secretary Acheson’s address before the National Press Club of January 12, 1950. “Crisis in Asia—An Examination of U.S. Policy”. For text, see Department of State Bulletin, January 23, 1950, p. 111.↩