Foreign Relations of the United States, 1958–1960, Foreign Economic Policy, Volume IV

243. Notes of the Legislative Leadership Meeting⁰

June 16, 1959, 8:30–10:35 a.m.¹

[Here follow a list of participants, a summary, and discussion of unrelated topics.]

Mutual Security—Acting Secretary Dillon described at length the changes made by the House Committee and others by the Senate Committee on the mutual security authorization. While a number of them could be lived with, he considered very serious the following: (1) the House 10% reduction in military assistance in face of the Draper Report requesting additional funds; (2) the directive to terminate aid to any country expropriating American owned property without immediate compensation; and (3) the Fulbright proposal for borrowing funds for the Development Loan Fund from the Treasury.² He cautioned also against the Rep. Hardy amendment to be offered on the Floor prohibiting all public information activities by ICA even on request. He mentioned several other items where the Department’s objections were not so serious, but it would be desirable to avoid them.

The President read from a memorandum he had received the previous day from Sec. McElroy³ stating further the JCS feeling of urgency about maintaining the military assistance program at the $1.6 billion level. To cut 10% would inevitably require an increase in DoD funds in FY 61 of perhaps $2.5 billion.

Sen. Bridges expressed some favor for the amendment concerning expropriation. Mr. Dillon saw some merit in the principle but felt that it should not be a mandatory requirement, and Sen. Bridges suggested State make that position clear.

The President then requested comments from others present. Sen. Wiley stressed the desirability of a strong position on mutual security by the President and perhaps some sort of reassurance to domestic manufacturers hurt by imports, as for instance the shoe industry. Sen. Hickenlooper recounted some of the Committee in-fighting and expected that the bill as reported by the Committee could be upheld on the Senate Floor. Mr. Chiperfield noted that the item concerning a 30% transfer from one activity to another was permissive and would help overcome the military assistance reduction. He felt that the Democratic Majority would support the Committee bill without further reduction. Mrs. Bolton noted the unsuccessful effort made to eliminate the mandatory provision regarding expropriation.

The President stressed the large portion of the military assistance program required immediately for Korea, Taiwan and Viet Nam, leaving not a great deal for other necessary activities.

Rep. Halleck raised the question as to whether Republicans on the Floor should endeavor to restore the items cut or merely work to prevent further cuts. Mr. Dillon and the President both felt that was up to the Leaders to determine, though the President wondered if there would be more of a chance for restoring strictly the military assistance item. Rep. Halleck thought it necessary to inquire further as to the risks involved in opening up the Committee bill.

[Here follows discussion of unrelated topics.]

LAM

0. Source: Eisenhower Library, Whitman File, Legislative Meetings. Confidential. Drafted by Minnich.
1. The meeting was held at the White House.
2. The House Foreign Affairs Committee reported H.R. 7500 on June 5; for text, see U.S. House of Representatives, Committee on Foreign Affairs, Selected Executive Session Hearings of the Committee, 1957–60, vol. XX, Mutual Security Program, Part 7 (Washington, 1983), pp. 637–657.
3. Not printed. (Eisenhower Library, Whitman File, Administration Series, McElroy, Neil H., 1959 (2))