Future of Foreign Aid

Report Outline
Administration of Foreign Aid Programs
War and Postwar Aid to Foreign Countries
Defense Aid and Long-Term Economic Aid
Special Focus

Administration of Foreign Aid Programs

Coming Fight Over New Plan to Allocate Aid Founds

President truman's plan to give the Secretary of State power to allocate all foreign-aid funds, disclosed in a letter to Economic Cooperation Administrator Foster dated Apr. 5, is expected to kick up lively controversy in Congress when renewal of the legislation authorizing appropriations for military assistance and E.C.A. and Point IV programs comes up in the near future. A special message from the President, outlining his views on control of the funds and detailing his budget requests for the fiscal 1952 foreign-aid appropriations, is now awaited on Capitol Hill.

Under existing legislation, Congress appropriates funds for the several foreign-aid programs, not to the agencies administering the programs, but to the President “for expenses necessary to enable” him “to carry out the provisions” of the Economic Cooperation Act, the Act for International Development (Point IV), or the Mutual Defense Assistance Act as the case may be. Specific sums are appropriated for each of the programs, but no provision is made for general transfers from one program to another. There have been suggestions that the President will now ask Congress to appropriate a lump sum for foreign aid, to be divided under the direction of the Secretary of State among the various assistance programs. It is more likely, however, that separate appropriations for the separate programs will be requested as heretofore, but with blanket authority to transfer funds from one program to another.

In his letter to Foster, explaining the proposed new procedure, President Truman said that “The Secretary of State, after recommendation from the International Security Affairs Committee where appropriate, should mate the broad decisions concerning the use of the funds as between (a) military end-item assistance [finished military equipment] and economic support and (b) major political areas.” The allocations would be made, the President said, “in a manner which will give the operating agencies maximum flexibility in carrying out their responsibilities.” The bulk of available funds would be allocated early in the fiscal year, with a “moderate balance being reserved for adjustments later in the year to preserve flexibility.”