Evening star., 1948-06-30
u. 5. May Cut Off Aid
To Any Nation Selling
War Goods 10 Reds
Hoffman Gives Warning
After Query on British
Jet Deal With Soviet
BY the Associoted Press

Economic Cooperation Ad-
ministrator Paul G. Hoffman
said today American aid may be
shut off from any Marshall Plan
country which sends war-poten-
tial goods into Soviet bloc coun-
tries. He made that statement
at a news conference where the
question of British sale of jet
plane engines to Russia was
raised.
The ECA chief said that certainly
any sales of war-potential goods to
Soviet-bloc countries. will be con-
sidered cause for discussions looking
to a possible shutdown of American
aid.
Mr. Hoffman emphasized this
policy would apply not only to
American made recovery goods
financed with ECA dollars. but to
products produced by the Is Mar
shall Plan countries themselves.
This represented a broadening OF
United States policy on the issue
of "contraband' shipments into the
Russian sphere. Previously ECA has
stated it would shut off aid if Mar
shall Plan shipments we're diverted
to Russia.
Commerce List to Be Guide.
Answering questions at a news
conference, Mr.. Hoffman referred
specifically to jet plane engines.
Britain already has sold some to
Russia and has announced her in
tention of negotiating broad trade
agreement with Moscow. Empha-
sizing that even European-made
war materiel would come under
ECAs ban, Mr.. Hoffman said:
"A jet engine is still a jet engine,
whether it comes from this country
or a participating country"
He indicated that the Commerce
Departments list of goods which
may not be shipped from this coun-
try to areas behind the iron curtain
would serve as ECA's guide in de-
terminirg 'contraband.'
The meeting with reporters
marked the end of ECA's first quar-
ter of operations. Mr.. Hoffman de-
clared that the recovery program
now is, really under way with its
appropriation in hand and agree
ments being signed by the partlcl-
pating countries.
The agency closed its first quar-
ter with S731 100000 set aside for
recovery shipments. This
is about Sc per cent of the unofficial
goal originally set for ECA in its
first three months of operation.
81 Million Actually Spent.
Actual spending-as shown by
Treasury checks written to cover
the cost of ECA-approved foreign
purchases-totaled only S37,624, ,444
up to this morning.
The latter figure reflects in part
the necessary lag in handling inter-
payments. 1t will tilt up
steeply as month-end reports are
made. But it will not approach the
$500 900, 900 which President Truman
earmarked for European recovery in
his January budget estimate.
The difference will contribute to
the Nations expected record-break-
ing budget surplus for the 1948 fiscal
year which ends tonight.
To encourage private contribu-
tons to the recovery task, the Gov
ernment announced last night a
mail subsidy on relief packages to
Western Europe and China. Regu-
lations on the reduced rates will be
made available at every postoffice.
A cut of four cents a pound on
July 6 in parcel past rates to II
countries. made possible by the sub
sidy, will bring substantial in
crease in private shipments of food,
clothing and other items, the ECA
predicted.