gency funds as of April 30, 1961. It appears that contingency situations developed in practically every country.

It has always been my understanding that the theory of the contingency fund is that it is to be used only in extraordinary, emergency situations for real contingencies. The question being raised within the committee, may I say, is as to whether or not the contingency fund is not pretty much a blanket fund. It authorizes the executive branch of government to spend money for specific purposes for which it might not be able to obtain the approval of Congress if it made a specific request at the time the mutual aid bill was before us. I think we ought to have a comment at a later date on that.

I would have you take a look at page 61 of the red book, where you have a table entitled "Allocation of Contingency Fund for Fiscal Year 1961, as of April 1961, Nonregional, Aid to American Schools Abroad." I think I should notify you that the question has been raised within the committee as to whether or not this even meets the definition of a contingency-whether this is a real contingency at all. The question is whether or not this should not be requested by way of a specific appropriation than under the label "Contingency.

Secondly, $5 million is requested for the Peace Corps. Various questions have arisen as to whether or not that is a contingency, or if it should not be considered as a separate request for an appropriation for a program. It has nothing to do with contingencies.

Then, your last item is "Other programs-$25 million." This is the largest category of all. What are they? It shows no breakdown at all. You cannot take time to answer that tonight. I just put it in the record tonight for you to prepare a memorandum to deal with these questions the next time we have the pleasure of meeting together. (The information referred to is as follows:)

ADDITIONAL STATEMENT ON CONTINGENCY FUND AND RESPONSES TO QUESTIONS OF SENATOR MORSE

As recently stated by the Secretary of State, the contingency fund "is of recent extraordinary importance. We have seen in these first 3 or 4 months of the administration, and looking back over recent history, that crises do occur and it is difficult to move promptly to meet some of these situations. Time and effort is spent weeks on end trying to piece something together from the crazy quilt pattern of availabilities from different sources all over the world. Valuable time is lost and frequently the resources are not available." These funds not only meet emergency requirements but also have been utilized to meet requirements which are either entirely unforeseen at the time the program is authorized or which, though anticipated in general terms, are not sufficiently clear to justify specific programing. In fiscal year 1961, all these conditions prevailed, particularly in the Latin American and African areas where the needs of the newly emerging countries and trouble spots in the Latin American area were largely unforeseen and difficult to program.

1. No-year availability

The contingency is not requested on a no-year availability basis. If the funds are not utilized during the fiscal year the unobligated balances would lapse to the Treasury unless the Congress reappropriated those balances.

2. Use of contingency funds for aid to American schools abroad

The executive branch request for authorization and appropriation for $268 million for special assistance for fiscal year 1961 included $2.5 million for capital improvements for American-sponsored institutions of higher learning in the Near East. As a substantially lesser amount was actually appropriated for special assistance, the American schools program was reduced to $2 million in the initial programing of fiscal year 1961 funds.

During the course of the hearings of the Senate Appropriations Committee on the mutual security appropriations for fiscal year 1961, one of the members referred to the plans of the American University of Beirut (AUB) for construction of a hospital and medical-training facilities. The Under Secretary of State indicated that while assistance to AUB for other capital development projects was included in the executive branch program, the medical project had been developed after preparation of the fiscal year 1961 presentation and that if assistance were made available for this purpose in fiscal year 1961 the funds would have to come out of the contingency account.

The report of the Senate Appropriations Committee on the mutual security appropriation bill, 1961, included the following paragraph:

"The committee desires to record its endorsement of the work being performed by the American University at Bierut. The committee recommends to

the Department of State that the sum of $2.5 million be allocated to this university from the funds contained in this act, for the construction of a clinical teaching and research building. With $2.5 million from the U.S. Government, the school will be in a position to receive substantial operating assistance from private sources."

Subsequently, several Members of Congress indicated their interest in support of the AUB medical project. Since funds allocated for the American Schools program had already been committed for other assistance to AUB, to its affiliated preparatory school, International College, and to other Americansponsored institutions in the Near East, $2.5 million from the contingency fund was made available for the AUB medical project.

3. Use of the contingency funds for the Peace Corps

On March 1, 1961, the President transmitted to the Congress a special message recommending the establishment of a Peace Corps, and on the same day signed an Executive order establishing a Peace Corps on a temporary pilot basis under existing authority in the Mutual Security Act. The President directed that the costs of the Peace Corps be met from funds currently available for foreign aid. In order to initiate the program during the test period this unforeseen need was financed from the contingency fund. To enable the Peace Corps to assemble a headquarters staff, to explore in the field possible programs, to begin recruitment of dedicated and skilled Americans to participate in the program and to finance pilot projects in Colombia, Tanganyika, Chile, and possibly other countries, thus far $700,000 has been made available from the contingency fund for administrative costs and about $1.4 million for initial program costs during fiscal year 1961. A total of $5 million has been programed this year for the Peace Corps.

As the President stated: "The temporary Peace Corps will be a source of information and experience to aid us in formulating more effective plans for a permanent organization. In addition, by starting the Peace Corps now, we will be able to begin training young men and women for oversea duty this summer with the objective of placing them in oversea positions by late fall."

4. Allocation of $25 million for "other programs"

The presentation volume entitled "The Act for International Development: A Program for the Decade of Development" includes on pages 60-61 a table indicating the allocation of the fiscal year 1961 contingency fund. The table indicates under nonregional programs that $25 million was allocated for "Other programs."

To the extent feasible, the table presented on an unclassified basis the allocations of the contingency fund as of April 30, 1961. The entry, "Other programs," represents two country programs which were in process of negotiation. Revelation of the amounts by country before agreement is reached would not be appropriate and would put U.S. negotiators at a disadvantage. It has subsequently been decided not to proceed with one of the proposed programs while negotiations are still underway with respect to the second.

Mr. Gardner, who is our next witness, will proceed tomorrow afternoon at 2:30.

We stand in recess until that time.

(Whereupon, at 5:15 p.m., the committee stood in recess until 2:30 p.m., Thursday, June 8, 1961.)

INTERNATIONAL DEVELOPMENT AND SECURITY

THURSDAY, JUNE 8, 1961

UNITED STATES SENATE, COMMITTEE ON FOREIGN RELATIONS, Washington, D.C.

The committee met, pursuant to notice, at 2:30 p.m., in room F-53, U.S. Capitol Building, Senator J. W. Fulbright (chairman) presiding. Present: Senators Fulbright, Lausche, Church, Symington, Hickenlooper, and Carlson.

The CHAIRMAN. The committee will come to order.

I am still very hopeful that we will be able to complete the economic portion of these hearings this week, which will enable us to proceed to the military portion next week, and we would hope to be able to get better attendance after action on the housing bill is completed.

We have made arrangements for Secretary Rusk to appear in executive session next Friday at 2:30 p.m., at which time he will discuss the Vienna conversations, and answer questions of a classified nature on the aid program.

Mr. Gardner, you have a statement to make, I believe?

STATEMENT OF HON. RICHARD N. GARDNER, DEPUTY ASSISTANT SECRETARY OF STATE FOR INTERNATIONAL ORGANIZATION AFFAIRS; ACCOMPANIED BY HERMAN EILTS, BUREAU OF NEAR EASTERN AFFAIRS, DEPARTMENT OF STATE

Mr. GARDNER. Yes.

Mr. Chairman and members of the committee, in the absence of Assistant Secretary Cleveland who is in Europe, I am appearing before you to justify the request of $158 million for U.S. voluntary contributions to a number of multilateral organizations. The specific amounts included in this request are shown on page 79 of the volume entitled "The Act for International Development" and more detailed justification of the specific amounts are found under the tab marked "International Organizations." All in all, they amount to about 5 percent of the total appropriation requested for the act for International Development.

This presentation brings together in one place our requests for a number of voluntary U.S. contributions to multilateral organizations. As you can see from page 79, contributions are listed for 13 different programs. Most of the programs involved are carried out within the framework of the United Nations; two are for regional organizations; and one is for an ad hoc international consortium.

MULTILATERAL PROGRAMS IN THE NATIONAL INTEREST

The executing agencies are identified by a range of initials which might bewilder even as well-informed a group as this committee. Their programs cover a wide range of activities from medical research to security forces-from surveys of natural resources to the care of refugees. At first glance, one might get the impression that this is a miscellaneous hodgepodge of unrelated programs with no clear relation to the national interest.

I should like to begin by assuring the committee that this is not the case. Each of these appropriation requests is in direct support of one or both of two basic aims of U.S. foreign policy: First, the promotion of peace and security; and second, the promotion of economic and social growth.

Each program listed has, in our view, a high priority in support of our national foreign policy objectives. Each has been pioneered or cosponsored by the United States, and stands as a symbol of U.S. leadership in both the security and development fields.

RELATIONSHIP BETWEEN BILATERAL AND MULTILATERAL ASSISTANCE

Many of these activities are analogous in character to programs carried out directly by the United States under bilateral programs of cooperation and assistance. I therefore should explain briefly why the programs represented in this part of the presentation are carried out through multilateral agencies and how they complement the rest of the program before you.

But first I should like to say that we do not see any conflict between bilateral and multilateral assistance. Both types are needed-and probably will be needed for the indefinite future--for solid, practical

reasons.

The choice between national and international institutions for maintaining peace and security or for channeling economic and technical assistance is not a theoretical but a pragmatic choice. In any given case, one route may be more feasible or desirable than the other or both may prove necessary.

ADVANTAGES OF MULTILATERAL ASSISTANCE

Let me list quickly some inherent advantages of the multilateral approach when that is the practical thing to do.

First, the use of international agencies for the maintenance of peace and order can avoid competitive intervention by rival nations with all the explosive implications of such action. The United Nations can intervene without being accused of intervention because it is done in the name of the world community; because it is clearly in the interests of peace; and because its motivation is beyond suspicion of national ambition. This is the case of the United Nations Emergency Force in the Middle East and, more recently, the United Nations operation in the Congo.

Second, some of the newly emerging nations are understandably sensitive about accepting even technical conditions for assistance from one of the great powers. This is eliminated or greatly reduced when the aid is furnished through an international organization of which