Evening star. [volume] (Washington, D.C.) 1854-1972, 1949-07-25
ECA Intended To Serve Commodity Need,
And Not Global Dollar Requirements

ECA Intended To Serve Commodity Needs
And Not Global Dollar Requirements
To the Editor OF The Star:
Dorothy Thompsons column headed Ear
marking of Farm Surplus Food Within ECA
Likely to Wreck It's Policy" does not seem
justified. either by the proposed amendment
to the ECA Appropriations Bill or by the
circumstances that led to its recommended
ton.
If one who asks for money to buy groceries
receives a credit on a grocer instead, his
program" is wrecked only if his real inten-
ton was to use the money for some purpose
other than the purchase OF groceries.
Throughout all the testimony before the
Committee, both Mr. Hoffman and his staff
made it clear that his program was based
on commodity needs only, not global dollar
requirements. For instance, he states page
of the Appropriations hearings :: cat the
outset, I would like to call your attention to
one very important fact about our program.
1t is fundamentally a commodity program
rather than dollar program"
When Senator Wherry quoted from an
ECA publication, as follows: THE French
import program for 1949-50, as submitted to
the OECC and ECA, was based on the avail
able and foreseeable resources of foreign ex-
change including an amount of ERP aid
about 1919 smaller than 1948-49," Mr.. Hoff-
man emphatically assured him that this was
not the case and that the aggregate amount
had been ascertained by computing actual
commodity needs He went to great
lengths in giving examples as to how these
needs we're computed, commodity by COM
modify.
Reduction in Total Aid Not Diversions.
It was clearly indicated that reductions
in commodities would lead to reductions in
total aid, not in diversions to other use. For
instance, discussion about Europes need
for cotton ended in the following question
by Senator Ferguson: Let us say that as
you went along you found that you were
unable to sell the goods, therefore you would
not need to have the raw materials shipped
over. Would you then drop the program as
you went along?"
Mr.. Hoffman answered: I'VE would cut
right back" This was indicated more clearly
when Senator Robertson asked: so If.
however as the program advances the Ad-
illustrators find that they are not able to
sell (textiles), you will not keep pumping
cotton into them, but you would save our
dollars by curtailing the supply of their raw
Materials.
ECA's Mr. Bissell replied: THAT is cor
rect" This certainly left no doubt that a
commodity reduction would be dollar re-
duction, not substitution.
Wnen ETA was asked 10 SCaCe the eI1ecC
Of program reductions of 100000 and
81 900 900, respectively, they had no difficulty
in listing the commodities which would be
reduced in quantity and the precise amounts
of decrease in each. These reductions heavily
affected commodities which the United
States has in abundance and wishes to sell.
AS an example: In the proposed billion
dollar cut, ECA stated that $50 million would
be for tobacco This testimony followed:
go The reduction in tobacco in dollars
would be $50 million and in pounds it would
be 81 million pounds; we would have that
much backed up in unsaleable SURPRISES"
Observers at the hearings are convinced
that such testimony undoubtedly deferred
the Committee from making a very much
more drastic cut in the ECA program.
ECA testified that much Of Europe's in
dustria1 production Is above prewar and
that number Of points represent real COM
petitive danger to traditional United States
trade and even threaten our home markets
In some cases. In one case, France. the
planned Industrial production was 1881 Of