Foreign Relations of the United States, 1955–1957, Western Europe and Canada, Volume XXVII

184. Memorandum From Robert B. Black to the Deputy Director of the Office for Program and Planning of the Foreign Operations Administration (Ohly)²

Washington, February 23, 1955.

SUBJECT

• Notes on the Spanish MDAP Program

You will recall that the terms of reference of the recent Evaluation Team for Spain did not include a review of the operations of JUSMAG. It was also General Ingles’ wish that the Team while in Spain refrain from concerning itself with specific military matters. Our report, therefore, only refers to MDAP tangentially except in one major policy issue, the impact of the present program on Spanish defense expenditures and the need for U.S. policy clarification on the role, if any, for Spanish forces in Western defense. (Most of the discussion on this point is found on page 6–8 of the Report.)³ The Team, however, did have an opportunity to receive a standard briefing by General Kissner, talk with General Barnes and his MAAG staff and peruse on an individual basis the purpose, effectiveness and import of the MDA Program. The following notes are my own personal observations:

1. Program Objectives. Both JUSMAG and Embassy are quite frank in indicating the prime purpose of the $350 million MDA Program, a simple payment for base rights. Beyond this, however, I found a variety of views as to what the Spanish should do with their forces. The official MAAG statement of objectives calls for the forces supported with U.S. aid to help defend the bases, which means defending the Iberian peninsula in the judgment of General Barnes. The three jet air wings scheduled can “augment” but not substitute for U.S. Air Force capability. Naval units will patrol coasts and help protect harbors, but the U.S. Navy will be standing by. For the MDAP equipped land forces, base defense, aside from minor security forces, means a defense line on the Pyrenees. This makes sense only with NATO forces contributing to that defense, and there is no immediate possibility of Spanish participation in NATO.

Embassy and USOM staff feel there is probably no specific role for Spanish forces to play, or at least one which should result in a major defense buildup. The present U.S. program, however, has already resulted in a buildup, presumably sparked from the Spanish military side. The Evaluation Team was impressed with the adverse effect of the added costs to an economy barely able to keep stable and lacking adequate capital development. An annex to the Report prepared by USOM/Madrid gives a summary of the 50% expansion in the Spanish defense budget ($150 million, perhaps one half in foreign exchange requirements) which can be largely traced to the Military Assistance Agreement. Already then, without a serious mission defined in terms of U.S. interests for the Spanish forces, there is developing a major impact on the economy not generally realized by the Spanish themselves. The NSC policy statement⁴ regarding adverse impacts on the economy seems to give a basis for aid programs to offset the buildup underway. In addition, some members of the JUS-MAG probably favor an expanded Spanish military system with an idea that the Iberian peninsula may be the real bastion of Europe.

Lacking a precise guideline on U.S. interests in the role of Spanish forces, the MAAG can hardly be blamed for the rather haphazard way in which end items are apparently presently being programmed. I personally saw little evidence of gross misuse of aid funds, but there is an obvious tendency to permit the $350 million to meet Spanish whims and generally to be dissipated over a wide area of forces and activities. General Kissner himself would like to see JCS define the military mission, but I think he is confident in a definition favorable to a major buildup when he requests visiting officials to plead the case for high level consideration of the problem. In addition to this pressure from some of the military for full buildup of the Spanish military (in my opinion costing hundreds of millions in additional MDAP beginning in FY 1958 and $50—$100 million per year of defense support or defense forces support beginning in FY 1957), I can see three other elements leading us in this direction:

a. The interest of the Spanish generals, including FRANCO himself, in larger forces.

b. The interest in some Congressmen in using the “latent strength” of Spain (c.c. Brownson Subcommittee Report, which stresses the buildup as a reason for economic aid).

c. A tendency within the Executive Branch sometimes to seize upon the factor of increased defense costs as a justification for assistance, the pressure for which really results from political or economic factors.

2. Recutting the $465 Million Pie. The Team, looking upon the MDA Program as a necessary “boondoggle”, considered the possibility of resplitting the $465 million committed to Spain in a note to the agreements. The 350–115 division apparently is the result of some collusion between U.S. and Spanish military personalities. On several occasions the USOM has heard complaints from the Minister of Commerce that he did not consider the split satisfactory to him. The Team recommends that when the matter is again raised by the Spanish in connection with a request for further aid.⁵ This is a good tactic, but my personal view is that the coalition which originated the division is still a potent force. Until a policy decision is made here as to the role of Spanish forces, there is little basis for initiating a review of the dollar commitment.

3. OSP. The Team did not investigate the ramifications of this program in Spain but held the opinion that as for defense budget support and projects aiding the munitions industry, the U.S. interest did not lie in the direction of strengthening the Spanish military machine, at least until a mission is defined. Spain has had $10 million in OSP contracts for delivery of ammo to the Spanish forces and has received some economic aid to improve production facilities in connection with those contracts. It now develops that the Spanish shipyards will probably get the $25 million contract for modernizing naval vessels. This directed contract probably makes sense, but I agree with my colleagues that there is little point in compounding the $350 million error, if it is one, with further directed contracts or economic assistance to munitions industries at this time.

[1 paragraph (7 lines of source text) not declassified]

2. Source: Department of State, Military Assistance Program Files: Lot 59 D 448, MAP—Spain (FY 1955). Secret. Robert B. Black was the Officer for Europe in the Office for Program and Planning,FOA.
3. Not found in Department of State files. Despatch 78 from Barcelona, January 28, describes the January 25 visit of an FOA evaluation team which arrived to investigate the effects of FOA’s program in northeastern Spain. In Barcelona, the team went to factories, the American Chamber of Commerce, and the Spanish Regional Productivity Commission. The team then went on to Madrid for a 2-day program. (Ibid., Central Files, 752.5–MSP/1–2855)
4. Reference is to NSC 5418/1, June 10, 1954; see Foreign Relations, 1952–1954, vol. VI, Part 2, pp. 1980–1985.
5. the GOS be asked to reduce the MDA portion. [Handwritten footnote in the source text.]