Economic Cold War

Report Outline
Foreign Aid Competition in the Cold War
Economic Resources of East and of West
Balance Sheet of Foreign Aid in Key Areas
Special Focus

Foreign Aid Competition in the Cold War

The budget message to be sent to Congress on Jan. 16 will contain detailed requests in support of the administration's already disclosed plan to seek a substantial increase in foreign aid appropriations. The purpose of the increase is, not to expand current outlays by an equivalent amount, but to fill the depleted foreign aid pipeline and make it possible to keep military and economic assistance flowing to other nations at approximately the present rate.

The administration's desire to keep foreign aid spending at present levels for a more or less indefinite period comes as a shock to members of Congress, who had expected a tapering-off of economic, if not military, assistance to countries abroad. However, President Eisenhower said in his State of the Union message, Jan. 5, that “We must sustain and fortify our mutual security program.” Foreign aid recipients needed “assurance of continuity in economic assistance for development projects and programs which.,. require a period of years for planning and completion.”

To assure continuity, the administration is asking not only for replenishment of the foreign aid pipeline but also for a grant of “limited authority to make longer-term commitments for assistance to such [development] projects.” The latter request seems clearly to apply to projects like the high dam which Egypt is planning to build on the Nile at Aswan.