No. 295
Editorial Note
On June 23, 1954, President Eisenhower transmitted to Congress recommendations for a new Mutual Security Program that included a requested authorization of $3,500 million which the President noted “amounts to approximately a 40% reduction in 2 years” in Mutual Security requests.
The President’s request and subsequent Congressional debate took place during the climax of the Indochina crisis of 1954 and the convening of the Geneva Conference on Korea and Indochina, April 26–July 21; for documentation on the conference, see volume XVI. In his message, the President emphasized that 79 percent of the new appropriation request “is for programs essentially of a military nature” and that “dividing the $3.5 billion into areas, approximately $900 million is for Europe, $570 million for the Near East, Africa, and South Asia, $1,770 million for the Far East and the Pacific, and $47 million for Latin America.” The President further specifically emphasized that “recent events in Southeast Asia have [Page 619] created grave uncertainty. The security of that region and the interests of the United States and its allies there are clearly endangered.” The President also took note of the recommendations of the Randall Commission (see Document 293) by first reminding Congress that he had, three months before, advised that economic assistance on a grant basis be terminated “as swiftly as our national interests would allow”, and that this “concept underlies the new” Mutual Security Programs. Nonetheless “more durable undertakings in the field of mutually profitable private investment and trade” took time and effort and some grant aid was still necessary. Finally, the President noted that in the administration of the Mutual Security Program “agricultural surpluses will be used to strengthen the economies of friendly countries and to contribute in other ways to the accomplishment of our foreign policy objectives.” (Public Papers of the Presidents of the United States: Dwight D. Eisenhower, 1954, pages 590–594)
Full House debate on the Mutual Security Act of 1954 began on June 28. Unlike previous years, the Congressional committees did not print the basic data supplied by the Executive Branch, nor apparently, did Secretary Dulles testify on behalf of the legislative program. Stassen testified before the House Foreign Affairs Committee on April 6, “presenting to the Committee the salient facts of President Eisenhower’s proposed program of foreign operations for Fiscal Year 1955”, but his opening remarks were quite brief and general and no record of his subsequent specific exchanges with committee members regarding the President’s proposed program has been found in either Department of State or Foreign Operations Administration files. Secretary Dulles did inform Alexander Wiley, Chairman of the Senate Foreign Relations Committee, on July 22 that the signing of the Geneva Accords on Indochina in no way diminished the need for requested Mutual Security funds for the area. Dulles’ letter is printed in Department of State Bulletin, August 9, 1954, page 221.
The House passed H.R. 9678 authorizing appropriations of $3,368 million on June 30, 1954. The Senate began debate on Mutual Security appropriations on July 28 and passed a $2,700 million version of H.R. 9678 on August 3. A conference report authorizing $2,800 million was agreed to by the House on August 9 and by the Senate on August 12. (Congress and the Nation, 1945–1964, page 173)
In addition to its funding provisions, the Mutual Security Act of 1954 contained several other important provisions. Unlike the Mutual Security Act of 1951 which contained a three-year termination clause, the 1954 Act made no general provision for ending foreign aid; but Congress did stipulate that outright economic aid would end in 1955. Moreover, H.R. 9678 provided for the termination [Page 620] of the Foreign Operations Administration no later than June 30, 1955 and granted the President power to abolish all or a portion of the agency and/or its functions at any time prior to that date. The Mutual Security Act of 1954 was signed by the President on August 26, 1954, as Public Law 665. (68 Stat. 832)