231. Notes of the Legislative Leadership Meeting0
[Here follow a list of participants and discussion of unrelated matters.]
Mutual Security—Mr. Dillon first noted indications in recent months of a toughening of communist attitude in the Middle East, Quemoy, and Berlin which he regarded as a testing of the free world’s will to resist. He also noted the intensification of communist activity in world markets, making specific reference to the recent action on aluminum and tin.
Mr. Dillon believed that to meet this competition there was needed a greater cooperative effort from the free world, not just the United States. He noted that West Germany and Britain are stepping up their efforts.
He referred again to the increased authorizations needed for the International Monetary Fund and the World Bank.
Mr. Dillon then presented in some detail the specific mutual security program, pointing out that 65 countries were included of which 31 would receive both military and economic aid, 23 would receive economic aid only, and 11 would receive military aid only. The request for FY 60 would be $3.93 billion as compared to $3.95 billion requested in 1959 and $3.3 billion appropriated. After going over the seven categories of programs, he pointed out that the pipeline had been reduced from $8.5 billion in 1953 to $2.6 billion in 1959, and it would stand at $2.3 billion at the end of 1960. Beyond this he thought it could not be reduced without affecting deliveries.
Mr. Dillon stressed that the Development Loan Fund would all be committed by January, that more than $1.5 billion worth of applications were still under consideration, hence it would be necessary to ask for an additional $225 million for operations in the remainder of FY 59. He said it was hoped that operations under the Fund would be continued into the future at a level of about $700 million per year.
The President asked Mr. Quarles about the JCS views on the mutual security program. Mr. Quarles said they regard it as a very essential part of the over-all defense effort. He thought the JCS would prefer, if reductions were necessary anywhere to cut certain domestic programs than to cut our military assistance program. The President noted the current studies of the Draper Committee.
[Page 445]Sens. Dirksen and Bridges hoped that Department officials would set up a bookkeeping account to cover items committed but not technically obligated so as to overcome the inevitable criticism from Rep. Passman. Sen. Saltonstall hoped that the mutual security message might be sent to Congress earlier this year, even earlier than March. Mr. Dillon thought this not possible. The President remarked that Congress always seemed to hold this program anyway until the end of the session, perhaps to use it for bargaining power even though it was part of our national security.
[Here follows discussion of unrelated matters.]