198. Memorandum of Discussion at the 283d Meeting of the National Security Council, Washington, May 3, 19561

[Here follow a paragraph listing the participants at the meeting and items 1–4.]

5. U.S. Policy Toward Spain (NSC 5418/1; Progress Report, dated March 28, 1956, by OCB on NSC 5418/1)2

Mr. Anderson briefed the Council on the contents of the reference Progress Report, noting among other things that the view of the Treasury Department, expressed in the OCB, that the United States should not proceed with the forthcoming military discussions with Spain until we were sure, in the light of the economic implications of the contemplated force goals for Spain, that we were not going to commit ourselves for anything that had not been previously fully authorized. In concluding his briefing, Mr. Anderson pointed out that the Bureau of the Budget believed that it would be desirable to apply universally, in all negotiations with foreign nations regarding U.S. assistance programs, the principle that the Treasury Department was making in the case of Spain—namely, that the United States make no commitments for additional military or economic assistance to foreign nations unless we knew what the economies of those nations could stand and until we knew that funds were available or would be authorized to cover [Page 568] commitments of additional assistance. (Copy of Mr. Anderson’s briefing note filed in the minutes of the meeting.)3

The President agreed that the suggestion made by the Bureau of the Budget was a wise one. [less than 1 line of source text not declassified]

Secretary Hoover informed the Council that the Departments of State and Defense had just concluded extensive discussions regarding the forthcoming military conversations between the United States and Spain. The discussions between State and Defense had eventuated in a mutually satisfactory agreement as to the character of these conversations with the Spanish. The agreement was set down in a memorandum, portions of which Secretary Hoover said he would read to the members of the Council. Accordingly, Secretary Hoover pointed out some six agreed statements with respect to the limits of the conversations, as follows:

The discussions will be limited to broad strategic questions.
With respect to Portuguese participation, discussion of Portuguese problems will be limited to those areas of necessary Portuguese-Spanish mutual defense concern.
Discussions on any economic aid questions are to be avoided until the study on Spanish ability to support forces, now under way by the Prochnow Committee, is completed.
NATO defense planning concepts will apply in the talks, although specific NATO plans will not be divulged.
Discussion of any U.S. political commitments to Spain will be avoided.
There will be no discussion at this time of any U.S. military commitments.

When Secretary Hoover had concluded, the President inquired how the plans for these military conversations with the Spanish had initially arisen. Admiral Radford replied that he could not quite remember, but that he believed that the conversations were called for by an NSC paper and initially they had been requested by the Department of State. Secretary Hoover added that the Spanish had been anxious to discuss with us how Spain fitted into our general European plans and strategy, in view of the fact that Spain remained outside NATO.

Admiral Radford warned that he was not absolutely sure that our U.S. military representatives in the forthcoming conversations could succeed in confining themselves strictly within the limits which had been set forth in the portions of the memorandum just read by Secretary Hoover. While he, Admiral Radford, approved of the plan for [Page 569] holding these conversations, he must point out that our military representatives could not simply refuse to listen to anything that their Spanish opposite numbers might want to bring up. Secretary Wilson added that it was important who “master-minded” these conversations.

[1 paragraph (8 lines of source text) not declassified]

The President stated that as of now there was apparently no severe inflation in Spain, though there was always a fear that inflation would develop. Certainly we could ruin the Spanish through an inflation caused by our spending in Spain or, alternatively, by our trying to build up a larger military establishment than the Spanish economy was in a position to support. We must proceed, therefore, with very great caution.

At this point Secretary Humphrey said that he had a few words to say. Holding up a piece of paper, Secretary Humphrey provided statistics for the National Security Council on Spain’s budgetary situation in recent years. The figures included the balance of income and expenditure. There had been continual deficits over these years now amounting to over $400 million. Accordingly, there was no doubt in the mind of Secretary Humphrey that Spain was headed for real trouble. Moreover, said Secretary Humphrey, he wanted to think aloud about the situation of our assistance programs more broadly than as they affected Spain alone. We have gone into all these assistance programs, quite naturally, thinking only of what would be nice from our own point of view and what our allies thought would be good for them. If we persisted in approaching problems such as Spain without any thought for other things that we wanted to do in the interests of our national defense, we would presently find our budget completely out of balance, with terrific costs for ourselves, not to mention serious damage to the economy of Spain or some other nation in which we were interested. Accordingly, it seemed crystal clear to Secretary Humphrey that we have got to get ourselves better organized and placed on a much more businesslike basis than we currently had. It was essential that we place firm priorities on the funds that we are going to spend around the world for military and economic assistance. If we begin to do this, then we will not just sit around talking about what it would be nice to do and to obtain. Instead, we would have a clear idea of the total cost of these programs to ourselves. Furthermore, we will thus avoid getting our Government involved in commitments to foreign nations before we really know what we are doing. There is a desperate need for a more accurate budget basis, with dollar limitations built in, as the foundation for our assistance programs. Speaking with great warmth, Secretary Humphrey indicated his very grave concern about the course along which the Administration had been drifting. The previous Administration had been very bad in this respect, [Page 570] but the present Administration had a lot to answer for too. We had just had an example of what he meant in the discussion of the earth satellite program, and worse still, this kind of sloppy thinking and planning was going on all over the Government. Secretary Humphrey referred to the awful difficulties which we had been going through in order to get a decent B–52 program. We were certainly not going to have an adequate B–52 program if we had to keep spending vast sums of money on a lot of other programs. Finally, Secretary Humphrey certainly doubted whether our military representatives could be expected to listen sympathetically to their Spanish opposite numbers if they knew that they could not make additional commitments and could not respond to Spanish requests for such commitments. In any case, our representatives must clearly know the limits to which they were authorized to go in these discussions.

Secretary Wilson observed that he looked on the problem a little differently than Secretary Humphrey. It seemed clear to Secretary Wilson that it does not always strengthen an alliance to keep taking on more nations who cannot really help us. The United States must avoid taking on “losers” as allies. By that, Secretary Wilson said he meant economic deficit allies. How, asked Secretary Wilson, were we to unlatch ourselves from South Korea? We state that we are committed to assist the South Koreans and that we are likewise committed to Chiang Kai-shek and Formosa. Actually we are getting to a point where we can no longer afford “what I call colonialism in reverse”. By this phrase Secretary Wilson explained that he meant we were actually exploiting the people of the United States in order to bestow benefits on other nations, especially the underdeveloped countries.

Secretary Humphrey said that in any case our present system of administering foreign assistance simply wasn’t any good. It must be improved. In point of fact, at the present time this Government does not even know for certain what its foreign aid commitments really are. Gordon Gray was working like hell to try to unravel the facts. Secretary Wilson agreed that the Government must be more selective in its approach to assisting its allies, and the President countered with the view that it might be wise to encourage the development of more neutral nations as opposed to the policy of developing committed allies of the United States. Secretary Humphrey interrupted to say, on the subject of allies, that he would much prefer to have the United States possessed of two or three good strong allies than 45 weak ones, as at present. The President elaborated his argument in favor of neutrals by pointing out that if the Soviets attacked a declared neutral nation, public opinion throughout the world would be against the Soviets and sympathetic to the United States. Moreover, in the event of an attack on a neutral nation, as opposed to an ally of the United States, the prestige of the United States would not be engaged.

[Page 571]

The President then asked if the United States was at present firmly committed to engaging in these forthcoming military conversations with Spain. Admiral Radford replied that in a general way we were so committed, but that we had not committed ourselves to the detailed subjects which we would discuss. [5 lines of source text not declassified]

The President stated that in the last analysis all we were really interested in with respect to Spain was to secure the use of the Spanish bases. Accordingly, he could see no good reason why the United States should have to commit itself to assisting in the buildup of very high force levels and a great military establishment in Spain. All that Spain really needed was a good little army to keep the country stable.

[1 paragraph (13 lines of source text) not declassified]

The President said that all this “philosophizing” was well and good, but the heart of the matter was that our military people have engaged themselves to meet the military representatives of Spain, and the National Security Council had got to decide what to do about it. The President said he agreed with Admiral Radford that our representatives could not refuse to listen in these conversations to what the Spanish had to say. But the President also agreed with Secretary Humphrey that we should get all our ducks in a row before we make deals and commitments with any specific country such as Spain. The President went on to point out that the Spanish now claim that by virtue of permitting us to use bases in their country, they have now become a Soviet target, which they had not previously been. Accordingly, they claimed to need larger military forces. In this situation, and in the coming meeting with the Spanish, our representatives would simply have to say that they cannot talk about matters beyond the limits set forth in the memorandum earlier read by Secretary Hoover.

Admiral Radford said he felt constrained to point out that it was the United States which had taken the initiative in concluding military assistance programs and similar commitments, both with respect to Spain and to Turkey. Now, of course, the situation is changing, and we apparently don’t seem to feel the same urgency about Spain and Turkey. Nevertheless, they have a valid claim that we asked them for bases and for military agreements. Whatever the current situation, Admiral Radford stated that if there was any one country in the world which had failed to take a long hard look into the future, it was the United States.

After Secretary Wilson had reminded the Council of the role played by the Congress in the matter of U.S. assistance to Spain, the President inquired whether the Spanish bases could properly be looked on as a substitute for the U.S. bases in Morocco. Could we now say that we are going to get out of some, at least, of these Moroccan bases? Or, alternatively, should the Spanish bases properly be considered [Page 572] as having been added to the bases in Morocco rather than as substitutes for these bases? General Twining replied to the President that, as agreed at the time by the National Security Council, the Spanish bases were additional to rather than substitutes for the Moroccan bases. Secretary Wilson commented that it was always an “addon” program.

Secretary Humphrey expressed the view that all this money being spent on bases throughout the world would be much better spent on producing B–52 aircraft in the United States. Think of all the money that the United States had poured into Formosa. Think of what it would have brought us in terms of B–52 aircraft. In the last analysis, said Secretary Humphrey, the United States will stand or fall on how strong we are. We must begin to be selective in our assistance to our allies, in a way we have never even approached before.

The President replied that the matter of bases was nowhere near as simple as Secretary Humphrey indicated. We could do a lot more damage to the enemy with a small or medium bomber from the ring of nearby U.S. bases than we could inflict with much larger bombers based in the continental United States. It was unthinkable that we should abandon our bases around the periphery of the Soviet Union. Perhaps, speculated the President, what this Government should do is to set down and agree on the total amount of money to be allocated to the defense of the United States, and agree thereafter on the rational division of this total amount among the various competing claims.

Secretary Humphrey expressed absolute agreement with the President’s last thought. In his opinion we should decide precisely how much we can afford to spend for defense purposes, and then divide up the total on a carefully selected basis.

The President said that the heart of the foreign assistance problem was the question of the eventual cost to the United States of any given ally, and how much that ally was worth to us. This was something which we ought to be able to calculate and thus reach a conclusion on how many allies we can afford to have. But after all, said the President, we must still deal with the imminent problem of what our military representatives are going to say to the Spanish when these conversations occur. We cannot leave our representatives to fend for themselves without guidance.

Secretary Hoover observed that the Council seemed to be involved in discussions of rather discouraging facts. While on the subject, he had one other discouraging fact to report. We are finding that in several instances we are being obliged to buy back again bases which we have already paid for. Apparently the price for our retention of our bases in Morocco after that country gained its sovereignty, would be a fat economic assistance program. We had already been obliged to buy back our base in Libya. The President commented that [Page 573] the time will come when we will have to say, in this context, “OK, boys, we’re through.” Secretary Humphrey added the question: What about Iceland? All of these discouraging situations proved that we were trying to carry on an assistance program that simply would not work.

Admiral Strauss asked the President if he would not like to have the meeting close on a lighter note. He then said that in his recent visit to Rome he had been much entertained by one anti-Communist Italian election poster. This consisted of a group of pigs around a table, obviously depicting the members of the Soviet Politburo. One of the pigs, obviously a likeness of Khrushchev, was saying to the other pigs: “Comrades, I have discovered that Stalin was a pig.”

The National Security Council:

Noted and discussed the reference Progress Report on the subject by the Operations Coordinating Board.
Noted the President’s authorization for U.S.-Spanish military planning talks as proposed by the Departments of State and Defense, subject to the understanding that no new commitments for military or economic assistance will be made or implied during these talks, and that U.S. representatives will limit discussion to broad strategic concepts and that, if Spanish representatives insist on discussing force goals, make it clear that such discussions cannot imply or involve agreement on U.S. support.

Note: The action in b above, as approved by the President, subsequently transmitted to the Secretaries of State and Defense and referred to the Operations Coordinating Board as the coordinating agency for NSC 5418/1.

[Here follows item 6.]

S. Everett Gleason
  1. Source: Eisenhower Library, Whitman File, NSC Records. Top Secret. Drafted by Gleason on May 4.
  2. The Progress Report is not printed. (Department of State, OCB Files: Lot 62 D 430, Spain 1956–1957)
  3. The minutes of all National Security Council meetings during the Eisenhower administration are in the National Archives and Records Administration, RG 273, Records of the National Security Council, Official Meeting Minutes File.