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and done their best to support our policies and programs in the free world defense against communism?

PRUDENCE RECOMMENDED

Mr. KENNAN. Senator Symington, I cannot speak to this particular case. It has never come under my ken. Nobody has ever asked me about it, and I am not familiar with the circumstances of it.

I would say that when it is a question of selling obsolescent equipment on proper terms-terms that we would sell it to anybody else in the world and against good dollar repayment-I think we might as well do it, because if we refrain from doing it, I suspect the Yugoslavs will get it from some source anyway. I think in certain instances it is better that they get it from us than that they get if from other people.

However, if it involves training Yugoslav pilots or anything in this country, I would want to look at this very carefully and be sure that we do not do anything that bewilders or confuses our own public. I think we ought to be very careful and prudent in what we do along these lines.

The CHAIRMAN. Do I understand as Ambassador you were never consulted and know nothing about this kind of a deal?

Mr. KENNAN. No. It is my impression that this was all arranged during the previous administration. At any rate, I can assure you we were never consulted in any way about its continuation out there.

JUSTIFICATION FOR SUCH ASSISTANCE

Senator SYMINGTON. Let me rephrase my question again because of my great respect for your knowledge. I want to show you what a problem there is in foreign aid. For the first time in my State, last year the majority of the Congressmen voted against foreign aid per

se.

Suppose you take India: Nehru 2 boasts about the fact that he is a peace-loving man, and that he is not interested in any military aspects.

He has one of the world's largest armies, and, by far, the largest air force in the Middle East. He has over one-half million men in uniform, and he is the only person out there who has anything like the 1,000 airplanes that he has in his air force.

Now, these people at the Belgrade Conference, as I remember it, sided with Mr. Khrushchev 3 on this testing business, against Mr. Kennedy.

If you are going to try to move along in the picture of foreign aid, and you come out to my State, how do you, in the discussion with people who are getting really fundamental-there is only one paper in my State that is really for this program-how do you develop the nuances of justifying heavy aid to Yugoslavia?

It is hard for me to do so on India, but I would think the harder it was for India, it would be even more hard to do it for Yugoslavia.

2 Jawaharlal Nehru, Prime Minister of India.

3 Nikita S. Khrushchev, Soviet Premier.

GRANT AID SHOULD CEASE

Mr. KENNAN. Senator, I certainly agree that is a legitimate question, and not an easy one to answer. I think I would only be able to deal with it in specific terms.

I am no great friend of aid to Yugoslavia, if by aid what you mean is any sort of one-sided grant aid or concealed grant aid, for which they do not pay us, and the sooner that ends out there the better I think it will be.

This view, incidentally, is shared by the Yugoslav leaders themselves. They are a very proud people. They do not really like to take this, and it is my hope that before very long we will not have any more of this.

FOOD ASSISTANCE

At present I think about the only thing that we are still committed to giving them is the surplus food for this year. This corresponded with my own recommendations. They asked for 1 million tons, and I felt we ought to give them about half of that, and that is what we are giving them now.

The reason I felt this was that they had a harrowing drought, the worst I have ever seen anywhere in my life, from June to October this year, and they were obviously going to be badly short of food. I thought that to cut out the surplus food shipments we had been giving for years, just at this moment when the people had had it, was going to create a misimpression there that I did not want to see created. Besides that, we have a problem of disposing of this stuff.

But it is my hope that within about 3 years, not next year because the drought is going to affect next year's crop, too, but within about 3 years they ought to be able to provide for their own needs in food, and that will be done with.

LOANS TO AID INDUSTRIALIZATION

As for other forms of aid, I do not think we cught to give the Yugoslavs anything really that they do not pay for. I am inclined to think that we ought to continue to make dollar loans to them, for dollar repayment, on a reasonably liberal credit basis for their industrialization. If you are interested, I will tell you why I feel

that.

Senator SYMINGTON. Sure.

Mr. KENNAN. This would not be great. This would be a matter of a few million dollars per year, and they would have to pay it back. The reason is that they, having broken with the Kremlin, have in recent years had a rate of growth greater than that of their satellite neighbors to the east; that is, they are industrializing faster on a basis of a set of economic relationships, which is primarily with the West, than their neighbors to the east are industrializing by relying on the Soviet Union.

I want to see that continue. I do not want to see them fall behind the Rumanians in the rate of growth. For this reason I would like to see us be reasonably represented in there, perhaps only to the

tune of about 20 percent, in the financing of this type of industrialization. I do not want to see us entirely absent.

I want, in other words, to demonstrate that the door is open for these people for a profitable relationship with the West, which will permit them to move their economy along and develop their country just as well as they could do through relationships with the East.

REPAYMENT OF LOANS

I am not talking about grant aid. I am talking about loans which they would be expected to repay, and to repay in dollars.

Senator SYMINGTON. If you say liberal terms, though, then the first question is, how are you going to make them pay back?

Mr. KENNAN. You have this problem with any foreign country to whom you make loans. But I think they will pay back if they possibly can. I do not see any disposition on their part to duck out of this sort of thing.

WHY HELP A COMMUNIST COUNTRY SUCCEED?

Senator CAPEHART. First, I want to say this: I think your answers have been very refreshing in that you have been very frank, and I like that. I am kind of direct myself.

But let me ask you this question for my own information and maybe for the committee's. Why do you want to help a Communist country to succeed? By giving them these loans you are talking about, and building up their economy, is that the way to kill communism in the world? Is that the way to meet it?

I am not asking this as a facetious question; it has always bothered me.

Mr. KENNAN. It is a good question.

Senator CAPEHART. Why do we want to do anything that will help them succeed and make their system work if they are out to destroy us and, therefore, the stronger they become, industrially and otherwise, the quicker they will be able to do it? Is that a fair question?

Mr. KENNAN. It is a perfectly fair question, sir.

Senator CAPEHART. It bothers me and worries me.

Mr. KENNAN. My answer to it would be this: They are an evolving country. The direction of the evolution is away from the Stalinist typical Communist-type of controls, to something different.

Second, I have not found any evidences in Yugoslavia, I am happy to say, that they are out to destroy us. I do not think they are conducting any subversive activities in this country. I think they are willing to let well enough alone in that respect.

Now, their system is not our system. But I would violently resent anybody coming in here from their side and trying to tell us what sort of an internal system we ought to have in this country.

SIGNIFICANT DIFFERENCES WITH RUSSIANS

Senator CAPEHART. You are going on the premise that they are not Communists like Moscow, and that someday might get com

pletely away from this system they have and have a private enterprise system?

Mr. KENNAN. I do not think they will have a system resembling ours, but I think they already have a system which is very significantly different from that of Russia and the other countries to the east, so different that the Russians refused to approve it. One of the great bases of differences between the Yugoslavs and the Russians today is that the Russians refuse to say it is socialism.

The CHAIRMAN. It is revisionism.

Mr. KENNAN. It is revisionism. And so long as they are that way, behave themselves properly in their relations with us and do not interfere in our own internal affairs, I am prepared to let them have any system that they find suitable there.

Senator CAPEHART. I do not quarrel with that, providing they are not getting ready and preparing to destroy us. That is the big question mark in my mind, and always has been.

I think Russia has said she will destroy us, and that is her intention. Now you distinguish between Yugoslavian communism and Russian communism.

Mr. KENNAN. This is correct. I do not want to be misunderstood in this.

YUGOSLAVS MAKE OWN DECISIONS

Senator CAPEHART. You have the same feeling toward Poland and Czechoslovakia?

Mr. KENNAN. No. Poland and Czechoslovakia are still-well, Czechoslovakia entirely, and Poland extensively-under Soviet control. They are not free to run their own affairs.

Now, this is one thing I can say about the Yugoslavs with the greatest of definiteness. They do not take orders from Moscow. They make their own decisions.

I do not agree with all those decisions. I do not agree with all their positions. I have had more bitter political arguments in the months I have been in Yugoslavia than I ever had in any other country, partly because of the disagreements, partly because these are people with whom you can argue.

I like this about them. You can take them on; you can say what you don't like, and they will reply.

I also do not want to gild the lily, and I do not want to persuade you that this is a bunch of nice people in our view. The Yugoslavs are pretty tough. They are a tough political regime, and their views, especially at the top, differ from ours very extensively.

That is why I say I do not want to see us giving them any form of unequal aid any longer than we have to. I hope that within 3 or 4 years there won't be anything like this.

PROVISION OF PLANES AND TRAINING

The CHAIRMAN. I would like to clear up one matter that surprised me, and that is, if I understand it, this program which has caused a great deal of talk domestically, and especially down in Texas, with large indignation meetings over jet planes and the training of pilots. You say that you had nothing whatever to do with advice on this; that this was set up and started before your

regime, and you have not been consulted as to whether it is wise to continue it or not; is this true?

Mr. KENNAN. This is correct. We have not even been kept informed.

The CHAIRMAN. You have not even been kept informed. Is this strictly under the direction of the Defense Department?

Mr. KENNAN. It is my understanding it is, sir.

The CHAIRMAN. And it is done without our Ambassador's approval?

Mr. KENNAN. I think that today I would be consulted if a new arrangement of this sort originated at this time. But this came into existence before I became Ambassador.

WITNESS WOULD APPROVE OF PROGRAM

The CHAIRMAN. Is it a fair question to ask you-I do not know whether it is fair to push you and I do not know what the administration's views are-if they asked your opinion today whether this should be continued or not, would you approve it?

Maybe you ought not to answer if you do not want to be pushed into this thing.

Mr. KENNAN. My answer would be if the equipment is obsolescent equipment, if there is no question of national security or classification involved, if it does not involve any secret information or anything that we would not want to have given to another government, and if they paid dollars on the barrelhead for it, I would say sell it to them. If you don't sell it to them, they are going to get it anyway somewhere if they are willing to pay that much money; there is usually someone else.

WAS PREDECESSOR CONSULTED?

Senator CAPEHART. Who was the predecessor Ambassador?
Mr. KENNAN. Carl Rankin was my predecessor.

Senator CAPEHART. Do you think he was consulted when this idea was originated?

Mr. KENNAN. I do not know. I rather doubt it because I think this was handled as a matter of sales of military equipment, over here, under the rules laid down at that time.

Mr. SPARKMAN. That was handled in 1956 and 1957, too. Rankin was not there.

The CHAIRMAN. Riddleberger.

Mr. KENNAN. No, up to 1956 and 1957 we used to give these people military equipment. In 1957 Tito came along and said he did not want it any more as a gift. If he took any more he wanted to pay for it.

A LOT OF NONSENSE

Mr. SYMINGTON. May I make a comment on that?

That is just a lot of nonsense, because what happens is-I do not mean, of course, what he said. What happens is that the military gets over $2 billion, and then they get what they say is the price for it, depreciated, you see, and they make whatever the foreign re

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