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a certain stability to agricultural prices which has encouraged the American farmer to invest in the inputs and make the effort to continually increase his productivity.

These developments in the United States did not come quickly or easily. They took place over a long period of years and involved hard work and determination, as well as good fortune. No circumstances or sets of conditions are ever reproduced exactly. Nevertheless, many of the problems faced by the developing nations are of the same nature as those which have challenged the United States. Thus, study of the successes and failures of the United States in its past agricultural development might help some of the developing nations plan programs which would hasten their own development.

Part III

FOOD FOR FREEDOM PROGRAM

The United States continued during 1964-66 to carry out an extensive
foreign food aid program under its Public Law 480 authorization (the Agri-
cultural Trade Development and Assistance Act of 1954).

Public Law 480 shipments comprise about one-fourth of total U.S. agri-
cultural exports. The Nation's total agricultural exports have risen to record
high levels currently, $7 billion or more a year. The big gain has been in
commercial export sales; aid shipments during the period of this report have
remained rather constant, ranging from $1.5 billion to $1.7 billion.
WORLD FOOD PROGRAM

As part of its overall food aid contribution, the United States has con-
tinued its vigorous support of the World Food Program which was estab-
lished in 1962 by the United Nations and the Food and Agriculture Organiza-
tion. This program is now in its second three-year phase.

During the initial 1963-65 period, the United States pledged $50 million
of the $93 million WFP budget. Sixty-nine countries contributed; 54 coun-
tries received assistance.

For the 1966-68 period, the United States has pledged to contribute up to
$130 million on a matching basis. To encourage participation by other
countries, the U.S. pledge specifies that its commodity contributions may be
as large as 50 percent of total commodity contributions.

122 YEARS OF FOOD AID

During the past 121⁄2 years, the United States has shipped $17.9 billion
worth of agricultural commodities to other countries under assistance_arrange-
ments. Of this amount, $15.7 billion has been under the Public Law 480
program, and $2.2 billion under the mutual security (Agency for International
Development) program.

About two-thirds of the Public Law 480 shipments have resulted from
sales in which the United States has accepted payment in local currencies.
One-sixth of the shipments have been grants and donations, and the remaining
one-sixth have been through barter and long-term credit sales.

The United States has shipped a variety of agricultural commodities under
its aid programs. Approximately half the total value has been wheat and wheat
flour. Other commodities included coarse grains, rice, fats and oils, lilseeds
and meal, dairy products, meat and poultry, fruits and vegetables, tobacco,
and cotton.

India is the largest recipient of U.S. aid shipments. During 1966, when
India was threatened by famine because of widespread crop failure, the
United States significantly increased its shipments-especially wheat-to that
country. In the largest food-aid operation of its kind in history, the U.S. sent
India more than 8 million metric tons of food grains during the 12 months

ending December 31, 1966. An estimated 60 million persons were fed through this assistance. (India currently is suffering a second year of bad crops and the United States, along with a number of other countries, again is helping to make up the deficit.)

Food aid shipments from the United States have been put to many constructive uses. In addition to helping prevent mass starvation in such countries as India, they have served to stimulate improved diets for millions of people throughout the world, including more than 40 million school children. They have brought additional supplies to retail food shops thereby helping to hold down inflationary food costs. They have benefitted approximately 12 million people on food-for-work projects, where U.S. food has been used as partial payment of wages in building schoolhouses and roads, clearing land, constructing dams, and irrigation and drainage facilities, and in carrying out soil, water, and reforestation projects.

FOREIGN CURRENCY USES

As indicated previously, two-thirds of Public Law 480 export shipments are paid for by recipient countries with their local currencies. These currencies are used in a number of mutually benefitting ways.

Since 1954, nearly $1.5 billion of such currencies have been disbursed to the countries of origin for economic development programs.

Another developmental use is loans to private business, both U.S. and foreign. Nearly 400 such loans have been made in 25 countries in the dollar equivalent of $341 million.

A specific provision of Public Law 480 sets forth that up to five percent of foreign currencies generated by such sales may be used to maintain or expand U.S. agricultural export markets or to develop new markets. Since 1954, somewhat more than $100 million has been used for this purpose. This program has four parts: (1) Jointly financed efforts by U.S. Government and private agricultural industry to develop foreign markets; (2) promotion of U.S. food and agricultural product sales in foreign trade fairs and trade centers; (3) research to improve export marketing; and (4) research to improve product utilization.

Such currencies also are put to a number of other uses, including educational and cultural exchanges, publication and exchange of scientific information, meeting U.S. Government costs overseas, financing common defense, meeting emergency relief needs, and financing maternal and child health and nutrition programs.

NEW DIRECTIONS

Upon recommendation of the President, and with the approval of the Congress, major changes were made in the U.S. food aid program, effective January 1, 1967. This revised food aid program will be in effect throughout calendar years 1967 and 1968.

The changes were motivated by growing realization throughout the United States that the Nation's food aid efforts-large and well motivated though they have been-were not in themselves bringing an end to world hunger. In country after country, despite food aid shipments received from the United States and other donor nations, food shortages continued to prevail. The only answer was to strike at the root causes of hunger.

On February 10, 1966, the President sent to the Congress a special Message on Food for Freedom. He proposed that the United States participate with other countries in a "war against hunger." He recommended new strategies in conducting this assault, including:

TABLE

VALUE of U. S. farm products shipped under Public Law 480 compared with total exports of U. S. farm products, July 1, 1954 through December 31, 1966 1/

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Previously reported at CCC cost.

2/ Title II shown at estimated export value for the first time. 3/ Sales for foreign currency, economic aid, and expenditures under development loans (1964 and 1965). Public Laws 87-195-665 and 165. 4/ Commercial sales for dollars include, in addition to unassisted commercial transactions, shipments of some commodities with governmental assistance in the form of short- and medium-term credit, export payments, and sales of Government-owned commodities at less than domestic market prices.

PB-0007498-SB 543-07

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