Foreign Relations of the United States, 1964–1968, Volume IX, International Development and Economic Defense Policy; Commodities

46. Memorandum From the Director of the Bureau of the Budget (Schultze) to President Johnson¹

Washington, November 16, 1965.

SUBJECT

• A New Food Aid Policy

Last Thursday, and again today, Mr. Buddy spoke to you about a new approach to food aid.² Attached are:

• —a Presidential statement outlining a new set of policies³
• —a Presidential memorandum to agency heads instructing them to proceed with those policies.

The new approach contains the following major elements:

1. A strong emphasis is given to self-help measures by recipient countries to increase their own food production. Food shipments will not be used as a mere “hand-out,” keeping these countries dependent on U.S. gifts.

2. Food aid and other economic assistance are to be tied together and made conditional on such self-help measures.

3. Food aid will be gradually shifted away from sales for useless local currency to long-term dollar repayable loans.

By issuing the attached statement you can:

• —take the initiative in this field before the World Conference of the Food and Agriculture Organization starts in Rome on Monday⁴
• —pre-empt the New York Times and other papers who have been trying to make our food policies for us.

Two other alternatives you may wish to consider are:

1. Tying this statement to a Thanksgiving Day announcement.

2. Waiting to incorporate it in the State of the Union Message.

Charles L. Schultze

⁵

Attachment

MEMORANDUM FOR

• The Secretary of State
• The Secretary of Agriculture
• The Administrator, Agency for International Development
• The Director, Bureau of the Budget

SUBJECT

• Food crisis in underdeveloped countries

I have announced a new three-point policy to help meet the mounting food crisis in underdeveloped countries. The gap between the food demands of the less-developed countries and their ability to meet those demands is growing rapidly. Our interest in the stability and security of the Free World requires that this trend be reversed. A copy of my statement outlining the new policies is attached.⁶

I request that you undertake the following steps to carry out these policies:

1. The Secretary of State, the Secretary of Agriculture, and the Administrator of the Agency for International Development should review their programs; determine what changes can be made, within existing legislative authorities, to redirect their programs along the lines outlined in the attached policy statement; and initiate those changes immediately. You should make sure that each official charged with responsibility for carrying out food aid and economic assistance programs is thoroughly acquainted with the new policies. In particular you should convey to them my firm intention that all of our assistance programs encourage a rapid increase in efficient agricultural production among aid recipient countries.

2. In cooperation with the Director of the Bureau of the Budget, you should develop for my approval procedures to insure:

• —that food aid and other economic assistance are closely integrated.
• —that both forms of assistance are related to practical and vigorous measures to expand agricultural production in recipient nations.
• —that our food aid program is administered in such a way as to minimize its impact on our balance of payments.

In this connection negotiations with aid recipient countries should, wherever possible, encompass both forms of assistance in a comprehensive program.

3. Public Law 480, the basic authorizing legislation for our food aid program expires next year.⁷ You should develop proposals for extension of this legislation, together with such amendments as you believe necessary to carry out my policies.

By December 15 you should report to me on the steps you have taken and the procedures you have developed to reflect the new policy directives I have announced. By January 15 you should present to me the legislative proposals which you have developed.

1. Source: Johnson Library, National Security File, Subject File, U.S. Food Aid Policy [2 of 2], Box 15. No classification marking.
2. McGeorge Bundy and several other members of the President’s staff were with the President at the LBJ Ranch on Thursday, November 11, but no other record of this meeting has been found. (Johnson Library, President’s Daily Diary) On November 16, the President met with Buddy and Arthur Dean in the Oval Office from 5:16 to 5:45 p.m. to “discuss some matters affecting assistance programs.” No other record of this meeting has been found. (Ibid.)
3. Not printed. On February 10, 1966, President Johnson delivered a special message to the Congress on the Food for Freedom program in which the major points of this earlier statement were included and expanded upon. For text of his statement, see Public Papers of the Presidents of the United States: Lyndon B. Johnson, 1966, Book I, pp. 163–169.
4. November 22. The 13th Food and Agriculture Organization Conference met at Rome November 8–December 9.
5. Printed from a copy that indicates Schultze signed the original.
6. Not printed. Regarding the final policy proposal, see footnote 3 above.
7. On October 8, President Johnson approved the P.L. 480 extension legislation, P.L. 88–638 (78 Stat. 1035), which amended the Agricultural Trade Development and Assistance Act by providing a 2-year extension through December 31, 1966, for both Titles I and II. Titles I and II were to have expired on December 31, 1964. Under Title I, the principal authority for the Food for Peace Program, sales of agricultural commodities are made for foreign currencies. Under Title II grants of food and other agricultural commodities are made to needy people abroad.