Mr. WHITTEN. Gentlemen, we turn now to the Foreign Agricultural Service. JUSTIFICATION OF THE ESTIMATE At this point, we should like to have pages 107 through 112 and 117 through 138 of the justifications included in the record. (The information requested follows:) PURPOSE STATEMENT The Foreign Agricultural Service is the agency of the Department that promotes the export of U.S. farm products and represents the Department and U.S. agriculture aboard. It conducts foreign market development programs and disseminates to U.S. agriculture the basic information essential to aggressive foreign marketing of U.S. agricultural products and to making necessary adjustments to meet changing situations aboard. The Service works in the following fields: 1. Agricultural trade policy and analysis The Service directs and coordinates the continuous economic analysis and interpretation of world conditions and developments that significantly affect the retention and expansion of foreign markets for U.S. products. It analyzes and interprets world trends in foreign agricultural products, trade, price, finance, consumption, and economic policies of foreign governments as such trends affect U.S. foreign agriculture and trade. It analyzes the effect of restrictive trade policies on the demand for U.S. farm products and develops and coordinates the basic policies and programs for the removal or easing of restrictions and for the encouragement of world trade in U.S. agricultural products. The Service administers a program of import controls in accordance with section 22 of the Agricultural Adjustment Act of 1935, as amended. 2. Agricultural attachés The Service directs and coordinates a worldwide agricultural attaché service with particular emphasis on the development of markets for U.S. products, and on trade reporting from foreign areas designed to aid U.S. farmers and exporters. The Service participates in international agricultural organizations and trade conferences. 3. Market development and programs The Service conducts a broad program designed to develop foreign outlets for U.S. agricultural products and analyzes competition and demand factors relating to foreign marketing. It administers export programs, including those under the Agricultural Trade Development and Assistant Act of 1954, as amended, and related authorizations. The Service represents the Department at international commodity conferences and on foreign commodity matters at national conferences. In addition to regular dollar funds, the market development program is financed with foreign currencies accruing from Public Law 480 sales, purchased from U.S. Treasury holdings with dollars especially appropriated for this purpose. 4. Agricultural and horticultural exhibitions Through fiscal year 1961, the Service participated in foreign agricultural and horticultural exhibitions pursuant to section 104 (m) (b) of Public Law 480. Responsibility for this participation, for foreign policy reasons, has been transferred by Executive Order 10,900, of January 5, 1961, to the U.S. Information Agency. 5. Assistance to International Cooperation Administration The Service also participates in the administration of the agricultural portion of the foreign assistance program with funds allocated from the International Cooperation Administration. This work includes coordination of the Department's participation in the program and direction of the training program for foreign agricultural leaders, and the providing of technical information and advice in connection with the operation of the agricultural technical assistance program in foreign countries. 69248-61-pt. 2- 2 As of November 30, 1960, there were 813 employees in the Foreign Agricultural Service. Of the total number of employees, 572 were located in Washington, D.C., 3 in the United States outside the Washington metropolitan area, and 238 were stationed in foreign countries. 1 Represents appropriation for 1961. An additional $3,457,769 was available from unobligated balances brought forward from 1960 under the appropriation "Salaries and expenses (special foreign currency program)." Appropriation Act, 1961- (a) Salaries and expenses Second Supplemental Appropriation Act, 1961--- $4,487, 000 137, 500 232, 000 11, 155, 800 Transfer in 1962 estimate from "Salaries and expenses (special foreign currency program)" to provide dollars to finance market development projects overseas__. Total direct appropriation, 1961_-. Transfer from "Removal of surplus agricultural commodities" (including 1961 supplemental of $100,000 and proposed supplemental of $178,000 for pay act costs) Transfer in 1962 estimate from "Salaries and expenses (special foreign currency program)" to provide for dollar expenses of trade fairs under the market development program.... Base for 1962. $2,817, 000 300,000 3, 117, 000 19, 129, 300 BASIS OF 1962 ESTIMATES FOR FOREIGN AGRICULTURAL SERVICE The 1962 estimates for the Foreign Agricultural Service involve a number of changes in basis which are explained below. Financing of market development activities under section 104(a) of Public Law 480 In the fiscal year 1961 the direct dollar expenditures for these activities are being paid from the regular "Salaries and expenses" appropriation; the foreign currencies, on the other hand, are being provided under the "special foreign currency" appropriation which is available only for the purchase of foreign currencies derived from sales of surplus commodities under Public Law 480. The 1962 budget estimates proposed a different basis for financing this work, as follows: (a) The "special foreign currency" appropriation would be restricted to the purchase of (1) excess currencies (those currencies which are determined by the Treasury Department to be available in amounts in excess of the normal requirements of the United States-for 1962 it is estimated that there will be only seven such countries; namely, Burma, India, Israel, Pakistan, Poland, Egypt, and Yugoslavia), and (2) restricted currencies (those earmarked in sales agreements for use only for the purposes of sec. 104(a)-such currencies available in 1962 would be those of Colombia, Turkey, United Arab Republic (Syria), and Argentina). (b) The regular "Salaries and expenses" appropriation would finance all other expenses of market development work, including any necessary purchases of foreign currencies in the "nonexcess" countries. The effect of this proposed change is to shift a portion of the amounts heretofore appropriated under the "Special foreign currency" appropriation to the regular "Salaries and expenses" appropriation. This change in the basis of appropriation does not affect the nature and scope of the program for 1962. In the justifications for the two items which follow, the amounts for 1960 and 1961 under the respective appropriations have been adjusted for comparability with the 1962 estimate. Financing of international trade fairs under section 104(a) of Public Law 480 Through the fiscal year 1961 the trade fairs in which both the Department of Commerce and Department of Agriculture have an interest are being financed under an agreement whereby U.S. dollar needs are financed by the Department of Commerce and foreign currency needs in an equivalent amount are financed by the Department of Agriculture. Costs of these trade fairs which are payable in foreign currencies are paid from the "Special foreign currency" appropriation. The 1962 budget proposes that each department finance all of its own expenses directly. The dollar expenses of the Department of Agriculture for this purpose are approximately $300,000. The 1962 estimates propose, therefore, to transfer this amount from the "Special foreign currency" appropriation to the section 32 transfer under the regular "Salaries and expenses" appropriation. This change does not affect the total funds available or the program level for these fairs in 1962. In the justifications which follow, adjustments have been made in the amounts shown for 1960 and 1961 for comparability with the 1962 estimate. Financing of agricultural and horticultural exhibitions under section 104(m) (B) of Public Law 480 Executive Order 10900 of January 5, 1961, transferred this activity to the U.S. Information Agency, and 1962 requirements are included in the budget for that Agency. The amounts available to the Department of Agriculture in 1960 and 1961 for this purpose are reflected in the justifications as comparative transfers for comparability with the 1962 estimate. Revision of activity titles and structure in the 1962 budget estimates The 1962 budget estimates propose a revision of the activities under the item "Salaries and expenses, Foreign Agricultural Service," as follows: Activities in the 1961 budget 1. Analysis of foreign agriculture and trade 2. Agricultural attachés 3. Foreign market promotion 4. Import control Activities in the 1962 estimates 1. Agricultural trade policy and analysis 2. Agricultural attachés 3. Market development and programs The proposed change in activity structure is for the purpose of alining the activities with the organizational structure of the Foreign Agricultural Service and eliminating the crossing of organizational lines by activties, as explained below. The new activities titles correspond to the three program areas of FAS, each of which is headed by an Assistant Administrator. Each of the new activities will include all the programs under the direction of the Assitant Administrator of that area, with executive direction and management costs being distributed among the activities. This revision would have no effect on the scope and nature of the programs conducted but is proposed to facilitate the accounting for and administrative management of the budget activities. Although the 1962 budget was prepared on the basis of the four activities used in previous years, the Bureau of the Budget subsequently reviewed the above proposal and indicated its approval of the revised activity structure. The following table shows the distribution of 1961 obligations in terms of both the old and new activity structure: Redistribution of estimated obligations, 1961, on basis of revised activity structure NOTE.-The following justifications incorporate the changes in the basis for the 1962 estimates as described above, and are presented on an available funds basis. The budget estimate for 1962 reflects a decrease of $2,326,300 below the appropriation for 1961; the decrease on an available funds basis is $4,742,470. Summary of increases and decreases, 1962 (on basis of available funds) To intensify analyses of foreign agricultural developments, includ- Total decrease, salaries and expenses_ +$33, 500 +189,000 +496,000 +148, 000 -5, 608, 970 -4.742, 470 1 Applied costs comparable to total obligations are $8,698,916 in 1960, $13,829,734 in 1961, and $17,677,845 in 1962. The differences are due primarily to an excess of market development contracts entered into over work completed. Current activities STATUS OF PROGRAM Current information of foreign agricultural production, markets, policies, and competition are gathered, analyzed, interpreted, and disseminated to U.S. farmers, business, and Government. This information is made available, in person and through publications, wherever decisions are made on important foreign economic and other problems so that the interests and problems of the U.S. farmers may be taken into account in making those decisions. The expansion and stabilization of world trade, particularly in agricultural products, is actively encouraged through the removal of barriers to trade, the solution of monetary problems, the study of foreign competition with American products, the analysis of market situations affecting the sale of agricultural commodities through the world, and making the information obtained available to the U.S. farmers, processors, exporters, and other interested groups. U.S. agricultural interests are represented and their position presented in the development of international agreements. Agricultural attachés are stationed in 52 countries throughout the world to represent U.S. agriculture at those posts. The attachés' work includes a comprehensive system of reporting to meet the needs of U.S. agriculture, to act as the voice of American agriculture at the posts, and to take necessary action in the development of foreign markets for U.S. agricultural products. A broad program is carried out for the development of markets abroad for U.S. agricultural products in surplus or potential surplus supply. Export programs, including those under the Agricultural Trade Development and Assistance Act, Public Law 480, and related authorizations, as well as import programs and controls, are administered by the Service. The State Department is reimbursed by the Foreign Agricultural Service for administrative and other support costs furnished overseas at the attaché posts. It is estimated that such costs will amount to $920,000 in 1962 for which reimbursement will be made in 1962. |