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responsive to the will of the people, an enlightened citizenry, that we can achieve the ideals of a democratic and free people.


Mr. HUMPHREY. Mr. President, I wish to comment with respect to the export program and the relationship of the Commodity Credit Corporation to it.

The Commodity Credit Corporation has a program under which sales of surplus commodities in its stocks are sold for export on credit guaranteed by private banks. I underscore "guaranteed by private banks," because the argument last night and the discussion today on the Mundt amendment related to credits that were guaranteed by the Government bank, the Export-Import Bank. It was made quite clear in the colloquy today with the Senator from South Dakota [Mr. MUNDT] that sales of Commodity Credit Corporation stocks guaranteed by private banks do not fall within the purview of his amendment and the resolution that was referred to the Committee on Banking and Currency. Nor do the sales guaranteed by private banks or financed by private banks fall within the purview of the discussion relating to Government assistance in the financing of sales of commodities to Communist countries. These are commercial loans for export to hard-currency countries, and not in any sense guaranteed by the Government.

The credit is extended to U.S. exporters. The exporter has to arrange for a U.S. bank to guarantee the payment, and in this instance the payment is to the Commodity Credit Corporation.

The period for which credit is extended ranges from 6 months to 36 months.

Since July 1, 1963, credit sales have been made under this program for more than $65 million. It has been planned to make sales under this program for export to Bulgaria, Czechoslovakia, Rumania, and Hungary. Again, these are sales, the credit for which is guaranteed by private banks, not by a Government instrumentality.

It is believed that it would be helpful to our foreign policy if these Eastern European satellites were less dependent upon the U.S.S.R. Sales to them would help to achieve this purpose. We have the surplus commodities in Government stocks, and the benefits we realize from their sale is almost entirely a net gain, both in terms of balance of payments and in Government receipts.

It would be foolish for us to shut the door on this commercial market when we are trying so hard to make the same kind of sales to other commercial markets. At present there is an active interest in exporting tobacco, corn, wheat, and vegetable oils to satellite countries. I am not speaking of the Soviet Union; I am speaking of satellite countries. Other countries in Western Europe are actively competing for this market. Undue delays in making credit available will reduce the possibility of the sale.

I ask unanimous consent to have printed in the RECORD a bulletin entitled

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U.S. exporters apply to the Office of the General Sales Manager, Foreign Agricultural Service, U.S. Department of Agriculture,

Washington, D.C., under credit announcement GSM-1, revised, giving: (a) dollar

CCC EXPORT CREDIT SALES PROGRAM-HOW Ir amount of commodities desired to be pur



Commodities eligible under the CCC export credit sales program are those in CCC inventory as listed in the CCC monthly sales list, and tobacco under loan to CCC. During 1962 the following commodities were in CCC inventory and thus eligible for financing: butter, nonfat dry milk, cheddar cheese, cotton (upland and extra long staple), peanuts, corn, wheat, oats, barley, rye, grain sorghums, rice (rough and milled), dry edible beans, cottonseed oil, refined, and gum turpentine. CCC has from time to time sold out of certain of these commodities.


U.S. Department of Commerce export conin the applicable CCC commodity export trol policies and regulations as referred to program announcements are applicable with respect to export of agricultural commodities to certain Communist or Communist-controlled countries and areas.


CCC will defer payment for periods up to 36 months, depending upon credit need, and country of export.


Interest will be charged at the rate specified in each credit approval and shall run for the length of the deferred payment period.


For all purchases made under this program, there will be required an assurance of payment from a bank in the United States. This may be in the form of an irrevocable

letter of credit; an endorsement on a note executed by any party to the transaction; a draft accepted by the bank; or some other form of bank assurance acceptable to CCC. A foreign agency bank licensed under New York law, will qualify as a bank in the United States.


The exporter is not obligated to buy commodities from CCC when granted a credit approval. If he is going to use the credit exmodities within the purchase period specitended, however, he must purchase the com

fied in the credit arrangement. Upon acceptance by CCC of the bank obligation, CCC will not hold the exporter responsible for the purchase price plus interest, but will look only to the U.S. bank for payment. To the extent that the bank obligation is issued on the basis of the importer's line of credit, the exporter's line of credit will not

be used.


Purchases of commodities on credit are made in accordance with applicable CCC export sales announcements to the extent that the commodities are available in CCC inventory at the time of purchase. In accordance with these announcements, the exporter will present to CCC proof of exportation of provided in the anouncement after the commodities have been exported. Purchases will be made during the period provided in the credit arrangement for such purchases.

the commodities or subsitute commodities as


Provisions of Public Law 664, 83d Congress (the Cargo Preference Act requiring shipment on U.S. flag commercial vessels) are not applicable to export sales under the CCC export credit sales program.

chased; (b) commodity or commodities desired; class, grade, quality, and quantity; port of export and country of destination; (c) period during which it is desired that purchases be made; (d) period of deferred payment desired; (e) the extent to which credit will be extended to the importer; (f) name of bank in United States which will assure payment.

(Exporters desiring to purchase tobacco on credit apply under GSM-2.)

Mr. HUMPHREY. Mr. President, I ask unanimous consent to have printed at this point in the RECORD an editorial entitled "Bonn's Opening to the East." The editorial was published on May 14, in the New York Times.

There being no objection, the editorial was ordered to be printed in the RECORD, as follows:

[From the New York Times, Nov. 14, 1963] BONN'S OPENING TO THE EAST

In a move that could ease European tensions, West Germany is seeking to improve relations with Communist-ruled countries in Eastern Europe. Following agreements with Poland and Rumania to expand mutual trade and establish West German trade missions in their capitals, Bonn has now reached a similar agreement with Hungary, and negotiations going on with Czechoslovakia and Bulgaria.


These agreements are in line with Chancellor Erhard's middle-of-the-road policies, more flexible than those of his predecessor. They still fall far short of diplomatic recognition, which West Germany refuses to any country recognizing the East German regime. But the trade agreements, supplemented by German promises to promote understanding for East European trade interests within the European Economic Community, are regarded in Bonn as the first steps toward a reconciliation which would help to meet Eastern Europe's urgent need for Western goods, make it less dependent on Soviet Russia and perhaps ultimately pave the way for a solution of the problems of German reunification and European security.

As a small advance in this direction, West Germany has won the approval of its new Eastern trade partners for inclusion of West Berlin in the "West German mark area." But Soviet resistance to any recognition of West German rights in Berlin continues to hamper trade relations with the U.S.S.R., whose hostile attitude makes it easier for Bonn to agree with the United States on a policy of barring long-term credits for the Soviet bloc. Trade is a potent political weapon, but without such credits its uses remain strictly limited.

Mr. HUMPHREY. Mr. President, I make this statement and submit these items for printing in the RECORD because last evening, when the Senate was engaged in debate on the Mundt amendment-which today was withdrawn, I commented on the recent trade agreements negotiated by the Federal Republic of Germany with certian of the satellite countries-in particular, with Poland and Rumania.

I do not want my remarks in regard to Germany to be interpreted as critical or in condemnation of that country. I fully

recognize the importance of German industry and the importance of having the Federal Republic of Germany have a strong economy. Chancellor Erhard's policies have produced rather amazing and miraculous results for the German economy.

I merely suggest that the Germans, who often are known as good professors, might well be listened to in this instance in connection with the consideration of trade policy. The Germans are as opposed to communism as anyone could be. The Federal Republic of Germany has a vigorous record of anticommunism and of prodemocracy, for which we are extremely grateful; and Chancellor Erhard is a wise and prudent man. He understands that it is better to trade than to give aid. He understands that trade breaks down barriers of misunderstanding. He understands that through trade it is possible not only to penetrate a market, but also to penetrate minds. And he understands that through trade, it is quite possible to relax tensions and to break away from the absolute control by the Soviet Union over the economies of the satellite countries.

I believe that this New York Times editorial, which refers to recent developments in the Federal Republic of Germany in terms of economic policy, is worth the attention of every Member of

the Senate.

THE SAO PAULO CONFERENCE AND THE ALLIANCE FOR PROGRESS Mr. HUMPHREY. Mr. President, I wish to comment on the developments at the São Paulo Conference, in Brazil, in connection with the Alliance for Progress. As I said earlier today, during the past week newspaper and radio commentators have been wringing their hands over the Alliance for Progress, and there has been a good deal of what one might call "doom and gloom." During the week we read newspaper headline articles about President Goulart, of Brazil, and the statements he made in his opening speech at the Conference. In that speech, he pointed out that trade and commodity prices represent the major problem confronting Latin America. Regrettably, he downgraded the Alliance for Progress.

Under Secretary Harriman, representing the United States, and Mr. Moscoso, in particular, representing the Alliance for Progress, were able to carry the day, in cooperation with our Latin American neighbors. The proposal which the United States had endorsed, and which was advanced by this country and other countries in this hemisphere-to "Latinize" the Alliance by establishing a coordinating committee for the Alliance, has been endorsed and is wholeheartedly supported by the Conference at São Paulo.

I consider this a highly important and singular diplomatic victory, not only for the United States, but also for the nations which have adopted the reforms agreed upon at Punta del Este and for the nations which have actively cooperated in making the Alliance for Progress what

it truly is—a hemispheric program in which all of us are partners.

This great victory represents the first major breakthrough in making the Alliance for Progress a real alliance of the countries of Latin America, which with our help can achieve the great goals of the Alliance. It represents a very important step toward greater involvement of the Latin American countries in implementing the goals of the Alliance.

This development should be very encouraging to all those who think that the Latin American countries are not really behind the Alliance for Progress. They have shown by this step that they are ready and willing to shoulder their responsibilities for implementing the Alliance and for managing the affairs of the Alliance with our help. As we know from our experience with the Marshall plan, this kind of self-help and internal management is essential if U.S. aid is going to be effective in helping these countries to help themselves.

Our goal is to make the Alliance more and more a true and working alliance, and less and less a U.S. aid program.

I am happy that the Senate concluded debate on the foreign aid bill at a time when there is in the air at São Paulo, Brazil, a victory note for the Alliance for Progress. The Alliance for Progress is weathering the storms of criticism and dissent. The Alliance for Progress is a peaceful revolution in this hemisphere of historic importance. The Alliance for Progress is our only hope for constructing in this hemisphere an orderly change for better living, for a more progressive economy, and for political freedom. The alternatives to the Alliance for Progress are violence, disorder, and chaos.

This is why I have tried on this floor, day after day, to direct attention to what I consider the fundamentals and the main body of the Alliance for Progress program.

I recognize that funds were taken out of the foreign aid authorization bill, when it was before the Senate, from what we call the social progress trust fund; but I predict that the full authorization for this fund will be restored in conference, because in dealing with that area the House of Representatives voted for the full amount of the authorization requested by the administration.

Mr. President, the Alliance for Progress is our best bet for freedom in this hemisphere. As the President of the United States properly said, what we are United States properly said, what we are doing at the present time is putting into the entire Western Hemisphere about the same amount of money that Russia is putting into Cuba; and I cannot believe that this Nation, the richest in the world, will do less for all of Latin America than Khrushchev is doing for the island of Cuba.

Therefore, I have vigorously tried to defend the program of the Alliance for Progress. I do not do so because I believe it is perfect-because we know better than that. I do not try to defend the Alliance for Progress because I believe it has produced phenomenally constructive

results, because I know better than that.

But I say it is making progress and it is vital to progress in this hemisphere; and I say that until someone can show us a better way, we had better stick with this way-the way of the Alliance for Progress.

With further reference to the speech by Mr. Goulart, whom I have been privileged to know, and he is the President of a great country and a great people-I make the following comment: Commodity export prices have long been a problem for all countries. In fact, coming from the Midwest, I think I know what it means when raw material prices are depressed. The wheat farmers, the dairy farmers, and all who produce food and fiber from the soil know what depressed prices mean. One of the regrettable developments in our time is that most of the thinking which today controls nations is the thinking of men and women who come from the finance community or the manufacturing community, rather than by those of the raw materials-producing community. Therefore, all too often we have inadequate appreciation of the importance of commodity prices.

World markets are fickle, and the prices of the goods which the primary producing countries have to import have been on the rise. But in the past year, the situation for most of the Latin American countries has been improving. In 1962, the value of the goods exported from the Latin American countries increased by 6 percent, and indications are that this trend is continuing.

I should add, Mr. President, that where there is a regional approach and where there is a common market, such as in Central America, the rise in exports has been tremendous-as much as 30 percent, and the improvement in the economic position has been considerable.

Unfortunately, not all countries have shared in this favorable trend. The reason is that internal policies-especially financial policy, lack of diversification and other elements in the domestic economic situation-have reduced the longrange benefits of a few countries from the improving trend.

Regrettably, Brazil qualifies as one of those countries in which there have been severe internal difficulties. Inflation in Brazil is like a prairie fire sweeping the country. I do not raise my voice in criticism because it is important to all the world that Brazil remain as a free country, that parliamentary institutions be preserved, and that her economy be strengthened. I wish to do all that I can as a responsible public official to cooperate in that endeavor.

Our Ambassador to Brazil, Mr. Gordon, has pointed out clearly and succinctly and on more than one occasion that his Brazilian friends peg all their calculations and complaints to the highest price level their commodities have reached.

The Ambassador has carefully and courteously pointed out that that is an unrealistic approach, that it is in the nature of commodity prices to vary, to be flexible, and to fluctuate, and that the world owes no country or producer the

difference between the highest price it is willing to pay at one time and any drop in price that the same world market develops at some other time.

What we have attempted to do is to stabilize commodity prices. We have been doing it through some commodity agreements, and some of those commodity agreements are being developed year after year.

For many years in past decades Brazil has experienced favorable trade balances, even when commodity prices were far below their highest levels. That shows that many factors other than the world market for commodity prices, as emphasized by President Goulart, or the imaginary evil machinations of a nonexistent capitalistic clique, cause a country to have good or bad earnings from its commodity exports.

Even recognizing this and many other problems, the inter-American community has made considerable headway in key areas since the Alliance for Progress was initiated.

I have mentioned before the building of 140,000 homes, 8,200 classrooms, hundreds of water systems, hospitals and health centers. Those instances and the distribution of 4 million textbooks and the feeding of 9 million children are just a few of the concrete indicators of progress that are too often ignored by the critics or derided by the cynics. Tax and land reforms have got underway in countries wherever the political leadership has shown the imagination and the boldness that it takes to get countries with deeply encrusted habits out of the rut and into a new direction to progress. For example, in Brazil we have given evidence of our interest in working with the people of that country. The United States has committed some $700 million to the development of that great South American nation. We have cooperated in the building of schools, roads, water systems, and aided in the resettlement of farm families and the rehousing of slumdwellers.

We are doing more all the time. Unfortunately, billions of cruzeiros-the local currency-in counterpart funds from Public Law 480 shipments have not as yet been put to use. The reason is that we have not been able to arrive at an agreement with the Brazilian Government as to the proper use of those currencies. We are eager to plow those resources into Brazil's development programs because they could be of great advantage to large numbers of people who deserve assistance and whom we want to help.

Reports on Mr. Goulart's speech indicated that he himself recognizes the lack of movement toward development goals within Latin America. He said:

Reality can no longer tolerate that Latin America remain an archipelago of nations, implacably separated by the sea of frustrations of our own difficulties.

That is why self-help and reform within each of the Latin American countries must be the basis of Alliance progress.

I repeat once again that the Alliance for Progress is a cooperative mutual assistance endeavor. It is a program for which most of the resources, financial as well as human, must come from the Latin American countries and peoples themselves. We are a big partner, but it is not a U.S. program. It is a hemispheric program. It is a program in which we play a part, but a program that is not strictly a U.S. endeavor.

In summary, internal effort by the Latin American countries must be the essence of this Alliance. Outside aid is vital, yes, and can often provide the margin of success. But it still is only a margin. This is not an aid program of the conventional type. This is an alliance-just what the word says. And whether, as the newspapers emphasize, it was mentioned once or twice or not at all by this or that speaker is immaterial. What is important is whether the policies to which all 20 member nations subscribed are followed. We of the United States are willing to go a long way in carrying out these policies endorsed at the Punta del Este Conference and outlined in the Alliance for Progress. But we can and shall only help our Latin American partners.

We cannot do it for them; nor should we.

It is they who must make the hard decisions and carry on the bold policies it takes to move toward genuine development. For they are the masters of their own destiny and, as President Goulart says, they themselves must find their way out of their own difficulties. In that sense President Goulart's speech was most constructive and most realistic.

However, I wish to make clear that the interpretation that has been placed upon some of the comments at São Paulo is not an interpretation which today can stand the test of careful scrutiny, because today the partners in the Alliance have taken their part. They are supporting the United States in this endeavor, and we are supporting them in their endeavor. We have joined in establishing now this committee of supervision, of monitoring, of planning and programing-a committee that includes representatives of the Latin American countries as well as the United States to better coordinate and integrate all the policies of the Alliance for all of the countries that participate in the Alliance for Progress.

I am encouraged. I am encouraged despite the many days of debate in the Senate over the foreign aid bill, a debate which has often been interpreted and I gather properly so-as being most critical of the foreign aid program. Some people have interpreted it as literally crippling the foreign aid program.

I wish to make quite clear that I do

To that statement I am sure all of us not believe we have crippled the foreign would express agreement.

That is why it is a policy to which all Alliance members subscribed in Punta del Este; namely, to promote the economic integration of Latin America.

aid program. I think we have placed some unwise restrictions upon those who are responsible for the administration of the program, but the program will still have plenty of momentum. It will still

have financing. It will still have dedicated people.

As I said earlier today-and I wish my record to be crystal clear-I appreciate the faithful service of Fowler Hamilton, who was the previous Administrator of the AID program, of Henry Labouisse, who is presently our Ambassador to Greece, who undertook in the early days of the Kennedy administration the development and the management of our foreign aid program. Those are great Americans. Those are faithful, loyal, and excellent servants of the public weal.

I appreciate the high quality of those who are the assistant administrators of the AID program, and the tremendous effort that a man like Mr. Teodoro Moscoso is making. I must say that I have never known anyone who was more dedicated to the policies and the programs of which he has been assigned supervision and management than Teodoro Moscoso, affectionately known as "Ted Moscoso." The coordinator of the Alliance for Progress programs is giving of his very life to make the program successful. He is doing well with it.

I know that David Bell made a great sacrifice in accepting responsibility for the direction of foreign aid. I wish to make it manifestly and unequivocally clear that he is a good administrator, that nothing revealed in the debate cast any reflection on his integrity, ability, or competence.

Most of what we talked about in the foreign aid debate were the mistakes of many years past, mistakes that were made in the process of developing foreign aid. Many of the criticisms were related, I might add, too, to military assistance. Most of the General Accounting Office reports related to misuse of military weapons.

The technical assistance program, the social progress program, and the economic development program in the main, have been well managed and have fulfilled their objectives.

So I want the men and women who are working for AID, and those in the State Department, to realize that they do have friends in Congress. I do not believe everyone deserves a pat on the back on every occasion, but I, for one, do not like to see the State Departmentthat great arm of government-which is the frontline of our defense in the cold war and which represents the application of reason, intelligence, and diplomacy to the problems of the day downgraded or demeaned in any way.

America is fortunate to have men like Dean Rusk, and Averell Harriman, and George Ball, and David Bell, just to mention a few. When someone attacks the State Department, he is attacking these men, because they run the State Department. When someone attacks the State Department and the Foreign Service, he attacks its individuals.

I said last week that the Foreign Service represents our peacetime soldiers on the diplomatic, political, and economic front. The Foreign Service is capable, able, disciplined, and trained. Our AID people are making sacrifices far beyond

those of many civilians. Our Foreign Service and AID personnel do not deserve to be whiplashed, to be criticized en bloc, to be demeaned by words that indicate they are unworthy of their trust. So I believe, as we pass the foreign aid program and give it a big vote of confidence, that a vote of confidence should also be extended to those who administer the program, to those who

work down the line and carry out the daily tasks of economic aid and technical assistance throughout the world.

Mr. President, I ask unanimous consent to have printed in the RECORD a table, "Summary of Selected Indicators of Physical Accomplishments."

There being no objection, the table was ordered to be printed in the RECORD, as follows:


from Monday next. It is expected that the committee report will be available to the Senate by November 25, and that we will debate whatever the action of the committee may be, on the 25th or the 26th, and hold a reasonably short, but we hope full, discussion upon the substance of the recommendations of the committee.

Mr. McGOVERN. Mr. President, will the Senator yield?

Mr. HUMPHREY. I yield.

Mr. McGOVERN. Does not the Sena

Summary of selected indicators of physical accomplishments (July 1, 1961-July 1, 1968), tor believe that if a move of this kind


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Mr. McGOVERN. Mr. President, will get "kicked around" at home, but also the Senator yield?

Mr. HUMPHREY. I am glad to yield. Mr. McGOVERN. I should like to associate myself with the remarks of the Senator from Minnesota relative to the personnel who are directing our AID program and those who have responsibility in the State Department.

I wonder if the Senator from Minnesota would turn his attention for a moment to another matter.

As the Senator knows, I was absent from the Senate late last night on official business, speaking to a national agricultural meeting in Fargo, N. Dak., which for a long period of time I had been slated to address. This afternoon I was also slated to speak to a convention of wheat growers in Nebraska. canceled that commitment in order to make a special flight back to Washington, because I had understood that the amendment of my senior colleague [Mr. MUNDT] Would be pending this after



Can the Senator from Minnesota advise me as to the disposition of that amendment?

Mr. HUMPHREY. I express my gratitude to the junior Senator from South Dakota [Mr. MCGOVERN] for returning to the Senate today. We knew he had a long-standing commitment and that it was an important commitment.

The Senator is a member of the Committee on Agriculture and Forestry, and if any one group in this country needs a little encouragement these days it is the farmers of America. They not only

they get "kicked around" in the Senatenot by the Senator from South Dakota or by myself, nor, I add, the Senator from Hawaii [Mr. INOUYE], whom I see in the Chamber, nor the Senator from New Jersey [Mr. CASE], nor the Senator from Indiana [Mr. BAYH].

The situation is as follows: Today the senior Senator from South Dakota [Mr. MUNDT] withdrew his amendment to the foreign aid bill, and introduced as a bill the substance of that amendment, as amended-to include not just grain, but also manufactured, processed, raw materials, and industrial products. The substance of the amendment, in the form of a bill, was referred to the Senate Committee on Banking and Currency.

The Senator may recall I said last night that what was being suggested by night that what was being suggested by the senior Senator from South Dakota [Mr. MUNDT] was a major policy decision, and that we should not vote on it quickly or immediately, that it should go to an appropriate committee. I mentioned that it should go to the Banking and Currency Committee.

I am happy to say, after hours of discussion, since early this morning-and some of us have been working on this since 8:30 this morning-we were able to work out an understanding whereby the senior Senator from South Dakota [Mr. MUNDT] withdrew his amendment from the foreign aid bill and presented it in the form of a new bill, which was read and referred to the Committee on Banking and Currency. That committee will report not later than a week

were made and approved by the Senate, it would have the effect of undercutting the entire negotiations now underway for the sale of wheat to Eastern Europe and to the Soviet Union?

Mr. HUMPHREY. I do. It is my view that this kind of precipitate action could jeopardize the entire wheat sales program, and might very well do so yet. Let me make it clear that I am not for the amendment in any way, shape, or form. I believe it is unwise and unnecessary.

Incidentally, the Export-Import Bank was established in 1934. It was established with the prime purpose in mind, at that time, to finance certain sales of goods to the Soviet Union.

The amendment which was offered last night by the senior Senator from South Dakota [Mr. MUNDT] was primarily directed toward the guarantee by the Export-Import Bank of certain credits made by private American banks to private American exporters who would be doing business with the Soviet Union.

I should like to make it clear once more that there is no business now. The Soviet Union has agreed to nothing. Frankly, I am doubtful there will be an agreement because we insist on making this business deal as difficult as possible. We are a nation of businessmen that does not want to do business.

I can imagine a car salesman in this situation. He would refuse to meet the customer. Then, when he did meet him,

he would insult him. Then he would tell him he could not have time payments on the purchase of a car. Then he would tell him that his credit is no good. Finally, he would tell him he wished he had not come into the salesroom in the first place. If the automobile industry had to depend upon that kind of salesmanship, we still would be riding around in oxcarts or on horseback.

Mr. McGOVERN. I cannot imagine any move we could make that would be more of a cruel blow to American agriculture than to take steps to close the possibility of making these sales. Every other exporting country in the world is taking advantage of the opportunity to broaden its exports. If we back out of the negotiations or impose conditions that are so unreasonable that the negotiations fall through, we are not hurting anyone but our own farmers and our own exporters.

Mr. HUMPHREY. The Senator is correct. To show the Senator how ridiculous the situation is, our friends in Canada-and they are our friends, and I do not want my remarks to be inter

preted as being critical at all; they are our friends and neighbors sold feed grains to Poland. They sold those feed grains by financing them through banks in New York, with American money. The reason they were able to finance them through banks in New York was that Canada has an export credit guarantee program. Any nation that does any business of any consequence has an export credit guarantee program. The British, for example, sell large amounts of machinery to the Soviet Union and satellite countries. They sell it under an export credit guarantee program. A good deal of the machinery is financed here in the United States, with money out of our financial institutions, but the machinery is manufactured in Great Britain, providing jobs for workers in that country and profits for its industry. Why do the banks finance it? Because the British have an export credit guarantee program.

The Export-Import Bank has an export credit guarantee program for American industry. We are in a situation now in which, if any country in the world wants to sell to the Soviet Union, it can do so. The financing can be obtained in other countries of the world. Much of it will come from the United States. All that is necessary for a country to make a sale is to have an export guarantee program that satisfies a bank in the United States. But when it comes to But when it comes to selling anything from our own factories, from our own farms, financing it out of our own banks with an export guarantee program, we say, "No," according to the proposal of last evening by the senior Senator from South Dakota [Mr. MUNDT).

That is why some of us felt the question should be referred to committee, that we ought to take a good look at it, that a basic policy decision is being made. The question before the world is whether cutting off sales to Russia and the satellite countries will break down the system in the Soviet Union. We have been trying to do that for 30 years, and it has not worked. Russia today is the second largest power in the world.

The other possibility is that through trade we may be able to ease some of the tensions in the world. This is what Chancellor Erhard said in Germany. I referred to his recent efforts. He is the Chancellor of the Federal Republic of Germany. He says that by trade we ease tensions; by trade we not only penetrate a market, we penetrate minds. By trade we may very well prevent a war and improve conditions of the free nations of the world.

The Germans have as big a stake in what the Russians are going to do as we have. The difference is that we have all the emotions, and they have all the business. We have the cost of defense, and they have the orders. And why? Because the Congress of the United States insists on acting this way. Whenever Whenever the President or the Commerce Department want to do something that approaches reasonable, normal business operations, somebody in Congress says we are soft on communism,

We have had many lectures from our friends in Europe about how we help the

Russians. They lecture us while they do business. Then we proceed to act politically, with the fear of certain political consequences because of a misunderstanding and misinformation about trade with the Soviet and satellite countries, and we literally cut off our nose to spite our face. That is what we are doing in this country. Many businesses have been moving out of the United States to Europe. American capital is leaving the United States and going to Europe. Europe. American companies are establishing subsidiaries there and doing business with countries behind the Iron Curtain. Every Senator knows I am speaking the Every Senator knows I am speaking the truth. What we are doing is acting hypocritically. We are pretending these things do not happen. There is not a single American business which has a subsidiary in Western Europe that cansubsidiary in Western Europe that cannot do business with Bulgaria or Poland or Czechoslovakia or Rumania or the Soviet Union. They do not give away their goods; they sell them and get money for them-good, hard cash. Of money for them-good, hard cash. Of course, credits are involved, but they are good commercial credits.

As the acting head of the Export-Import Bank told us this morning, as well port Bank told us this morning, as well as the representative of the Treasury Department, there has not been known to be one default by the Soviet Union on commercial credits and sales-not one. commercial credits and sales-not one.

Mr. McGOVERN. If the Senator will yield further, does not the Senator think yield further, does not the Senator think it is rather strange reasoning that leads it is rather strange reasoning that leads some people to believe that a Commusome people to believe that a Communist who is hungry is a more peaceful individual than one who has enough to individual than one who has enough to eat?

Mr. HUMPHREY. It is peculiar and twisted reasoning to me. It also is peculiar and twisted reasoning to think that if we sold soft, perishable goods for hard currency, we are really strengthenhard currency, we are really strengthening the Soviet Union. The Soviet Union requires money, just as any other country does. Whether a country is Comtry does. Whether a country is Communist, Socialist, or capitalist, it takes so much money. There is only so much money to use and spend, because money is the measure of production. If she is the measure of production. If she spent $1 billion for food which was to be consumed by her people, it would be $1 billion less she would have to spend on sputniks or missiles or bombs or atom bombs. I wish we could sell them $10 billion worth of food, because then I would know she would not be able to keep up her arms race. If the people are deup her arms race. If the people are denied food, it does not make them more peaceful; it makes them more angry, more warlike and aggressive, and they have more money left over to make weaphave more money left over to make weapons. They know how to make weapons. They do not know how to produce corn or wheat, but they know how to produce bombs. I wish we would engage in a race, not to see who can build the biggest bomb, but, rather, who can produce the bomb, but, rather, who can produce the most food. We compete with them in an area where they have a chance of winning. I think we ought to compete with them in areas where they have no chance of winning; namely, food for peace.


Mr. McGOVERN. I think the suggestion made about the free advice we are getting from some Western European countries not to trade with the Soviet Union is a good point. On two different Union is a good point. On two different

occasions I noticed that Chancellor Adenauer told the United States we should not sell one bushel of wheat to the Soviet Union until she tears down the wall. He laid down other suggestions over a period of months. When we sold wheat to Germany, they turned it into flour and sold it to Russia. They did not ask for our consideration—it was just a good, solid business deal.

Mr. HUMPHREY. And the wall is in Germany. It is not in Minnesota or South Dakota. One would think he was as interested in trying to tear down the wall when they sold the flour as when we are getting ready to sell Russia wheat.

Mr. McGOVERN. It seems to me that what our competitors are saying is that the American farmers must be kept out of their market and leave it as the monopoly of other countries. I would hope, instead of the Senate making it harder and tougher for the American exporter to compete, it would move in the other direction. I would like to see some serious consideration given to relaxing some of our credit restrictions. I talked with some businessmen, some from the State of the Senator from Minnesota, some from my own State, and some from other parts of the Midwest, the other day, who were anxious to get more lenient terms of credit furnished to them which would make it possible for them to open up a mill in Costa Rica. I think that kind of arrangement is in the national interest, so that at a time when we know American agriculture is in trouble, when we have serious balance-of-payments problems, when we know our exporters are faced with tough competition, far from moving in the direction suggested by the senior Senator from South Dakota, we should be moving in the opposite direction.

I certainly hope the Senate will treat the proposal accordingly.

Mr. HUMPHREY. Mr. President, I thank the Senator. I can think of nothing which would be more helpful than to have 10,000 businessmen behind the Iron Curtain, to do business. First of all, they will show an example of an American democracy. That is what they will bring with them. They also will bring with them a tough mind, which is unafraid of communism or the bureaucrats they will meet there.

Instead of that, we permit other countries to take on this entire opportunity and responsibility. It is incredible to me that we are so blind. I am not critical of the Europeans for doing what they are doing and for saying what they are saying, because they know if they will just throw out a little more emotion, we will not see anything but hatred of communism. While we are seeing that, they are out doing constructive things in the economic sector. Therefore, when the former Chancellor, Chancellor Adenauer, to whom we owe a great deal as Chancellor, made the comments he made recently, I am sure he knew that this would fan the flames of emotion in America, and in the meantime the new Chancellor could make all kinds of arrangements and business deals.

If we want to be that stupid, we should not complain about the Europeans who have a little more "savvy."

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