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If you are talking about strict lines of organization, I guess that in theory the attaché reports to him directly rather than through the USOM.

Mr. FASCELL. The agricultural attaché is in the line of command under the Ambassador?

Mr. HINMAN. Correct. He sits up here on the sixth floor and I am on the fourth floor and we spend an awful lot of time together,

Mr. FASCELL. He does not do anything independently as far as the
Department of Agriculture is concerned
Mr. Hinman. It is a highly cooperative arrangement.
Mr. FASCELL. Any other questions on this phase of the discussion ?

Mr. MONTGOMERY. I might ask this one question: What is the ratio of the Spanish military budget to the gross national product?

Mr. HINMAN. As I recall, it is something under 4 percent, defense expenditures,

Mr. MICHEL. Would you have the gross national product figure handy?

Mr. HINMAN. That is around $7.5 billion, or equivalent, somewhere around there. It is about $255 per capita, and the population is around 30 million.

Mr. MICHEL. Their budget for the last year ran what in dollars, roughly?

Colonel MELENDEZ. About eight-hundred-some-odd million dollars.
Mr. HINMAN. That would be 10 percent.

Mr. MICHEL. The total budget for the year was, roughly, $800 million?

Colonel MELENDEZ. I have the exact figure, but not here.
Mr. MICHEL. The percentage figure that you gave there was of

gross national product; is that right?

Mr. HINMAN. I am afraid some of those are classified figures. The
Spanish keep their defense figures closely held. Am I correct on that?
Colonel MELENDEZ. Yes.
Mr. HINMAN. We have had trouble in getting hold of some.
Mr. FASCELL. Generally, it is in that magnitude?

Mr. HINMAN. I do not think the ratio is as high as 10 percent. It may be a little under that. Actually, according to our projection, the ratio will probably go down next year. The national product is growing a little faster in proportion than the Spanish defense outlays, although they are both growing: We do give considerable thought in the economic section to the question of economic impact and the burden of the Spanish military effort.

Colonel Chiles. I can show you a confidential document on this, if you wish.

Mr. Fascell. I think we have gotten generally basically what we need here in order to make a slight comparison. The Spanish Federal budget is a Federal budget as such? I mean the Federal level.

Mr. HINMAN. It is more so than ours. The Provinces have fewer

functions.

Mr. FascELL. Cities are independent ?

Mr. HINMAN. Cities are not nearly as independent as in the United States. They do have some local revenues.

Mr. Fascell. They are technically Federal functions that go into that?

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Mr. HINMAN. For the past several years, in Spain, the primary 1 you focus of the defense support program has been on immediate, shortrun stability.

Mr. FASCELL. There was no expenditure of Public Law 480 toward F any defense support as such, even under the old definition!

Mr. HINMAN. Public Law 480 funds are only available for the agreed-on uses between the two countries, of which military use is one possibility.

Mr. FASCELL. Which could include a number of things, for example! I know that in some cases it includes construction of barracks and supplies.

Mr. Hinman. There is another point there. We have another special feature in the program here in Spain. In 1953, there was a section of the defense support program called the McCarran amenl. CH ment, section 109, which added $55 million to the Spanish program making a total of $85 million. That $55 million had to consist of agricultural surplus commodities sold in Spain for pesetas and the proceeds had to be loaned 80 percent to Spain for economic develop ment. That year we had specific injunction that that much of the

E. proceeds had to be used for development purposes. The other 20 percent was used for United States use.

Mr. FASCELL. That was a one-shot thing?
Mr. HINMAN. Yes; the use of that 20 percent could include military

Mr. FASCELL. How about the problem that you continue the sales under Public Law 480? You obviously could not build up local currencies available. That would make more credit available in a country which would have a definite impact on your economy,

Mr. IIInman. The impact would be desirable or undesirable, depending on general circumstances in the country.

Mr. Fascell. To what extent does the Department of Agriculture participate?

Mr. Hinman. They have the primary responsibility. Their field man is the agricultural attaché who is a member of the embassy staff de facto and works cheek by jowl with the rest of us.

1 Mr. FASCELL. Do ICA and the agricultural man reach a joint agreement then on the amount of sales that the Agriculture Department is going to make in Spain?

Mr. HINMAN. We try to work it out as closely as possible for several reasons. One is that it has a big impact on the total economy which is our concern. Second, in the ICÀ program or the defense support program we usually have to have a component of agricultural surplus commodities. Certainly, we want to make sure that surplus commodities under 480, surplus under ICA, are dovetailed as well as possible. They are 2 halves of a total import program, or ? parts, I should say. We do work strictly close with the agricultural attaché.

Mr. FASCELL. Since your mission is integrated with the economic section of the Embassy, it would appear to me that you should have direct control over the question of whether or not sales are to be made in Spain.

Mr. HUNN. The Ambassador is the No. 1 man out here. He has, if not direct control, an awfully strong voice. I would say that for all practical purposes his voice is controlling in these decisions.

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If you are talking about strict lines of organization, I guess that in theory the attaché reports to him directly rather than through the USOM.

Mr. FASCELL. The agricultural attaché is in the line of command under the Ambassador?

Mr. HINMAN. Correct. He sits up here on the sixth floor and I am on the fourth floor and we spend an awful lot of time together.

Mr. FASCELL. He does not do anything independently as far as the lige fraDepartment of Agriculture is concerned?

Mr. HINMAN. It is a highly cooperative arrangement.

Mr. FASCELL. Any other questions on this phase of the discussion? le hares

Mr. MONTGOMERY. I might ask this one question: What is the ratio of the Spanish military budget to the gross national product?

Mr. HINMAN. As I recall, it is something under 4 percent, defense expenditures.

Mr. MICHEL. Would you have the gross national product figure handy?

Mr. HINMAN. That is around $7.5 billion, or equivalent, somewhere around there. It is about $255 per capita, and the population is around 30 million.

Mr. MICHEL. Their budget for the last year ran what in dollars, roughly!

Colonel MELENDEZ. About eight-hundred-some-odd million dollars.
Mr. HINMAN. That would be 10 percent.

Mr. MICHEL. The total budget for the year was, roughly, $800 million?

Colonel MELENDEZ. I have the exact figure, but not here.

Mr. MICHEL. The percentage figure that you gave there was of gross national product; is that right?

Mr. HINMAN. I am afraid some of those are classified figures. The
Spanish keep their defense figures closely held. Am I correct on that?
Colonel MELENDEZ. Yes.
Mr. HINMAN. We have had trouble in getting hold of some.
Mr. FASCELL. Generally, it is in that magnitude?

Mr. HINMAN. I do not think the ratio is as high as 10 percent. It may be a little under that. Actually, according to our projection, the ratio will probably go down next year. The national product is growing a little faster in proportion than the Spanish defense outlays, although they are both growing. We do give considerable thought in the economic section to the question of economic impact and the burden of the Spanish military effort.

Colonel Cuines. I can show you a confidential document on this, if you wish.

Mr. FASCELL. I think we have gotten generally basically what we need here in order to make a slight comparison. The Spanish Federal budget is a Federal budget as such! I mean the Federal level.

Mr. HINMAN. It is more so than ours. The Provinces have fewer functions.

Mr. FASCELL. Cities are independent?

Mr. HINMAN. Cities are not nearly as independent as in the United States. They do have some local revenues.

Mr. Fascell. They are technically Federal functions that go into

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Mr. HINMAN. For the past several years, in Spain, the pri 2 'res of orga focus of the defense support program has been on immediate, & run stability.

Mr. FASCELL. There was no expenditure of Public Law 480 ton attaché is i any defense support as such, even under the old definition?

Mr. HINMAN. Public Law 480 funds are only available for es up here ot agreed-on uses between the two countries, of which military unfullon one possibility.

rathi Mr. FASCELL. Which could include a number of things, for exam memed I know that in some cases it includes construction of barracks i

operative supplies.

tions on Mr. Hinman. There is another point there. We have anot

as this ot special feature in the program here in Spain. In 1955, there wa

te to the section of the defense support program called the McCarran amer

is gone ment, section 109, which added $55 million to the Spanish progn making a total of $85 million. That $55 million had to consist agricultural surplus commodities sold in Spain for pesetas and &

y have the proceeds had to be loaned 80 percent to Spain for economic develop ment. That year we had specific injunction that that much of tủ trond 37.5 proceeds had to be used for development purposes. The other 20 pel cent was used for United States use, Mr. FASCELL. That was a one-shot thing?

a badget for Mr. Hinman. Yes; the use of that 20 percent could include military Mr. Fascel. How about the problem that you continue the sales would be 1 under Public Law 480? You obviously could not build up local currencies available. That would make more credit available in a country which would have a definite impact on your economy;

Mr. Ilinman. The impact would be desirable or undesirable, de Tercentas pending on general circumstances in the country.

Mr. FASCELL. To what extent does the Department of Agriculture
participate?

Mr. TIINMAN. They have the primary responsibility. Their field
man is the agricultural attaché who is a member of the embassy staff
de facto and works cheek by jowl with the rest of us.

Mr. FASCELL. Do ICA and the agricultural man reach a joint agree-
ment then on the amount of sales that the Agriculture Department is
going to make in Spain?

Mr. HINMAN. We try to work it out as closely as possible for several reasons. One is that it has a big impact on the total economy which is our concern. Second, in the ICÀ program or the defense support program we usually have to have a component of agricultural surplus commodities. Certainly, we want to make sure that surplus commodities under 480, surplus under ICA, are dovetailed as well as possible. They are 2 halves of a total import program, or ? parts, I should say. We do work strictly close with the agricultural attaché.

Mr. FASCELL. Since your mission is integrated with the economic section of the Embassy, it would appear to me that you should have direct control over the question of whether or not sales are to be made in Spain.

Mr. HUNMAN, The Ambassador is the No. 1 man out here. He has, if not direct control, an awfully strong voice. I would say that for all practical purposes his voice is controlling in these decisions.

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GENERAL ACCOUNTING OFFICE IN EUROPE

If you are talking about strict lines of organization, I guess that sn theory the attaché reports to him directly rather than through the TOM.

Mr. FASCELL. The agricultural attaché is in the line of command
harder the Ambassador
Mr. Hirman. Correct. He sits up here on the sixth floor and I am
on the fourth floor and we spend an awful lot of time together.

Mr. FASCELL. He does not do anything independently as far as the
Department of Agriculture is concerned?
Mr. Hinman. It is a highly cooperative arrangement.

r. FASCELL. Any other questions on this phase of the discussion?
of the Spanish military budget to the gross national product?
Mr. HONTGOMERY. I might ask this one question: What is the ratio
Mr. Hisyan. As I recall, it is something under 4 percent, defense

Ir. Michel. Would you have the gross national product figure around there. It is about $255 per capita, and the population is Mr. Hiswan. That is around $7.5 billion, or equivalent, somewhere Mr. MICHEL. Their budget for the last year ran what in dollars, Mr. Hinman. That would be 10 percent. Colonel MELENDEZ. About eight-hundred-some-odd million dollars. Mr. MICHEL. The total budget for the year was, roughly, $800 milMr. MICHEL. The percentage figure that you gave there was of gross Colonel MELENDEZ. I have the exact figure, but not here. Lational product; is that right?

Mr. HINMAN. I am afraid some of those are classified figures. The Spanish keep their defense figures closely held. Am I correct on that? Mr. HINMAN. We have had trouble in getting hold of some. Mr. FASCELL. Generally, it is in that magnitude? may be a little under that. Actually, according to our projection, the

Mr. Hixmax. I do not think the ratio is as high as 10 percent. It ing a little faster in proportion than the Spanish defense outlays, ratio will probably go down next year. The national product is growthe economic section to the question of economic impact and the burden although they are both growing. We do give considerable thought in of the Spanish military effort.

Colonel CHILES. I can show you a confidential document on this, if need here in order to make a slight comparison. The Spanish Federal

Mr. FASCELL. I think we have gotten generally basically what we budget is a Federal budget as such? I mean the Federal level.

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Colonel MELENDEZ. Yes.

The Provinces have fewer

you wish.

functions.

Mr. FASCELL. Cities are independent ? States. They do have some local revenues. Mr. HINMAN. Cities are not nearly as independent as in the United Mr. FASCELL. They are technically Federal functions that go into

that?

98996-58

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