144. Letter From the Secretary of State to the Secretary of the Treasury (Humphrey)1

Dear George : With further reference to your letters of January 262 and March 5,3 I certainly agree that we must manage our foreign economic aid in such ways as will best serve our national interests. No element of foreign policy could possibly be built on any other premise.

At the present time it is vitally important that the impulse towards economic development in many lands should neither be channelled in directions prejudicial to our security nor frustrated so as to make the aspiring peoples easy prey to the illusory promises of those hostile to us. Our capabilities of furthering our objectives along this line by sheer argument or diplomatic intervention are limited. For this reason, among others, we have resorted to economic programs of both a bilateral and multilateral nature. We have achieved some measure of success and have obtained much credit and goodwill from both types of programs.

The increasing impatience of many Afro-Asian peoples to achieve rapid economic development and their corresponding receptivity to the new Soviet tactics have made it all the more urgent that we seek the instruments or methods most likely, on the one hand, to build internal political and economic institutions oriented toward the free world and, on the other, to imbue in these countries the desire and the will to resist Communist subversion.

I believe that the present Soviet economic offensive requires a general reexamination of our aid programs to determine whether [Page 378] they are as effective as they might be. As part of this reexamination, we should consider the question of whether any economic aid should be provided through a development institution within the framework of the United Nations. Ambassador Lodge believes we should announce our willingness to participate in a multilateral aid program and presents a number of arguments which he feels we should consider.

I mention these matters not because I believe we should at this time accept any particular plan, but because I feel we need a careful review of all the factors involved. A study of this matter is, therefore, being undertaken in the Department with a view to presenting the findings to the Council on Foreign Economic Policy for its consideration.

Sincerely yours,

John Foster Dulles 4
  1. Source: Department of State, Central Files, 398.051/3–556. Drafted by Phillips.
  2. Document 139.
  3. Not printed. (Department of State, Central Files, 398.051/3–556)
  4. Printed from a copy which bears this stamped signature.