119. Editorial Note

In the President’s May 28, 1969, message to Congress transmitting his foreign assistance legislation, he announced his intention to establish a Task Force to review the entire foreign assistance program. The Task Force was to be made up of experts from outside government. Internally, a parallel review process had been set in motion by NSSM 45 ( Document 111) to examine the objectives of U.S. economic assistance in relationship to overall U.S. foreign policy. Regarding the President’s May 28 message, see footnote 7, Document 8.

On June 18 AID Administrator Hannah, through Secretary of State Rogers, sent President Nixon a memorandum suggesting Terms of Reference for the Task Force and possible lists of candidates for its chairman and members. Hannah and Rogers recommended Pennsylvania Governor Scranton for chairman, with J. Irwin Miller, President of Cummins Engineering, as their alternate choice. William Blackie (Caterpillar) or Walter B. Wriston (First National City Bank) were other possibilities. Rudolph Peterson, President of Bank of America, was one of six persons from the banking sector on their list of candidates for members of the Task Force. They noted that Peterson had been a member of the Perkins Commission, which had reported to President Johnson on foreign assistance in the final months of his administration. (National Archives, RG 59, S/S Files: Lot 80 D 212, NSSM 45) Regarding the Perkins Commission Report, see Document 1.

On June 23 Hannah and Henry Kissinger met with the President to discuss the Task Force, and the President asked for their recommendations [Page 278]on a chairman and other members. As a result Hannah prepared a memorandum to the President on June 26 with, in order of preference, his and Kissinger’s recommendations for chairman: Ernest C. Arbuckle, Chairman of Wells Fargo Bank (also on the list of six banking candidates in Hannah’s June 19 memorandum); Rudolph Peterson; Arjay Miller, former President of Ford Motor Company and Dean-designate of the Stanford University Graduate School of Business; and J. Irwin Miller of Cummins Engineering. Hannah (and Kissinger) also included two lists of preferred and alternate prospective members and noted that Secretary Rogers concurred in their recommendations. (National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 193, AID Task Forces on AID)

On July 14 C. Fred Bergsten sent a memorandum to Kissinger to which he attached a memorandum for the President regarding the chairman and members of the Task Force. Bergsten noted that the memorandum reflected a consensus on Gabriel Hauge for chairman worked out with Arthur Burns, Peter Flanigan, the State Department, and AID. Hauge, President of Manufacturers Hanover Trust, had been suggested by Burns. The July 14 memorandum from Bergsten to Kissinger is attached to a July 21 memorandum from Bergsten to Kissinger forwarding for his signature a memorandum to the President regarding the Task Force, “incorporating the changes you instructed this morning. It recommends Hauge for the Chairmanship and Arbuckle as the second choice.” (Ibid.)

According to memoranda Bergsten prepared for Kissinger and the President reporting that Rudolph Peterson had accepted the post of Chairman of the Task Force on International Development, Under Secretary Richardson was responsible for recruiting Peterson. (Ibid.) On July 31 Peterson called Richardson from Panama with several questions about the Task Force. Richardson assured him that his membership on the Perkins Commission would not be an obstacle and that the chairman would have a substantial voice in selecting the other members of the Task Force and its staff. Richardson noted that the December 1 due date for the Task Force’s report was driven by the preparation of the FY 1971 budget submission and could be flexible; a firmer deadline was the Javits Amendment report due at the end of March. With these assurances, Peterson accepted the chairmanship. A transcript of their conversation is in the Washington National Records Center, Agency for International Development, AID Administrator Files: FRC 286 73 A 518, LEG 6 Presidential Task Force FY69. Richardson wrote Peterson later on July 31, expressing his and Hannah’s delight with Peterson’s decision, which he was sure the President would share, and providing him with materials, including the interagency Working Group paper prepared for the March 26 NSC meeting on foreign assistance (see footnote 2, Document 4). (National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 193, AID Task Forces on Aid)

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In an August 5 memorandum to Kissinger, Bergsten reminded Kissinger that the internal aid study needed to be staffed. He reminded him that in the 3 months since NSSM 45 had been issued, Richardson had not convened a meeting despite Bergsten’s reminders. In a July 16 memorandum Bergsten had suggested that the “entrenched bureaucracy” was unlikely to produce the kind of study the administration wanted, and AID would be mainly concerned with defending its existence. Bergsten recommended that the Ambassador to Chile, Edward M. Korry, be given the job with the freedom to select officials to work with him to provide him with the flexibility to recommend whatever he wished. Bergsten recommended that Kissinger respond enthusiastically to any State Department proposal to have Korry head up the internal aid study. The objective was to launch the Task Force as soon as possible and to have it readied for announcement when the President met with Peterson in San Clemente. Bergsten indicated his willingness to meet with Peterson, perhaps as early as the next week when he expected to be in San Clemente for a meeting of the Cabinet Committee on Economic Policy. (Ibid.) No record of a private meeting between Bergsten and Peterson in San Clemente has been found, but see Document 120. See also footnote 4, Document 111.

On September 12 Bergsten sent a memorandum to Kissinger informing him that Richardson had “sequestered” Korry for the internal aid study mandated by NSSM 45. Bergsten added that “Korry is a rather unusual ambassador. For example, he explicitly says that neither Chile nor South America as a whole is important to U.S. national security. He is agnostic about the whole State Department line on virtually every conceivable subject, which is one reason why he should be ideal for the aid study.” On Bergsten’s memorandum, Kissinger noted that he agreed with Bergsten’s recommendation to meet with Korry on the aid-foreign policy link.

On September 2 the White House Press Secretary announced that Peterson would be Chairman of the Task Force, and on September 24 the Press Office released the full membership. Peterson wanted Anthony Solomon to be the Executive Director, but Solomon declined. On October 2 Bergsten informed Kissinger that Edward Fried, a career Foreign Service officer, had accepted Peterson’s invitation to be Executive Director. (National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 193, AID Task Forces on AID) In an October 6 memorandum to Peterson, Kissinger noted the high priority the President attached to the Task Force and his direction that agencies cooperate with it and provide requested assistance. (Ibid.) Kissinger agreed to meet with the Task Force during its meeting on October 16; see Document 121.