Evening star. [volume] (Washington, D.C.) 1854-1972, 1956-04-08
Can We Spend More?

Underdeveloped countries have
rather close limits, of course, on
what they can absorb. They are
short of technicians and managerial
skills. This is such an "iffy" area,
however, that there are many ver-
sions among economists themselves
on how much help these countries
could profitably accept.
The International Cooperation
Administration estimates the Far
EastNear East absorptive ceiling to
be about $500 million year above
what it proposes that the United
States supply. ICA does not think
it has chance to get the extra
$500 million from Congress.
Other judgments of underdevel-
oped countries capacities range
higher. The Committee for Eco
nomic Development. composed
mainly of American businessmen,
believes the figure is between $500
million and SIS billion more per
year. Others claim 1t should be
50 billion.
Every billion dollars added to the
foreign aid bill would mean another
S24 year per American family. It
is possible that Americans could
afford another billion or So
their median income is around
SO 400 a year-if the incentive were
right But what would their sacri-
fees accomplish?
The So billion estimate assumes
a resultant improvement in living
standards Of / per cent per year
in the underdeyeloped countries.
That sounds hardly noticeable. It
is an average, however. and Asian
countries, being at different stages
of development, would likely de-
velop in quite noticeable spurts.
The aim would also be to put
enough of the new expenditures
into noticeable Improvements like
dams, ports or steel mills, so the
peoples of the underdeveloped ma
tons could see the advancement.
There are other limitations than
the actual availability of the money
on the amount we can spend for
foreign aid. One is the number
of American technicians and man.
ayers who are available to go
abroad to supervise the spending
of these vast sums. We now have
some 1000 technicians in the I'M
derdeveloped areas. At even the
present rate of spending, ICA
officials believe we could get more
for our money if We had 5000 or
5000 men in the field.
But as the pool of skilled man
power in this country is spread
thinner each year. the pressures
for keeping technicians home will
probably increase.
Initiation Is Danger
Another limiting factor on for
eign aid spending is imitation.
Heavy investment in backward ma
tons causes initiation unless at the
same time additional consumer
goods are made available to alb
Sorb the new money put into the
hands of the workers who build
the capital-investment works.
United States economists wisely in
sist on balance between invest
ment funds and consumer-goods
imports-principally food and tex
tiles-to keep initiation in check.
Recently there has been some
attention to using American farm
surpluses-mainly wheat and cot
tonic help combat this infla-
tionary threat 1t has been used
to some extent already But food
surplus nations like Burma COM
plain of American dumping.
Some economists think the way
out is to buy up Asias food sur
pluses and use it with our own in
a considerably expanded foreign
aid program. This would mean a
much bigger foreign-aid budget
than the administration has pro-
posed, however, and 1t stands little
chance Of getting hearing this
election year.
Important as the money side OF
foreign aid is, most experts in the
still-new field believe that de-
veloping the proper spirit OF digni-
fled partnership with the recipients
is more important. Some fear that
the Soviet Union may now be more
successful in this partnership build
ing than we have been, while
spending much less money. Con-
gress is looking at our foreign-aid
budget this spring with this in
mind.