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LINES OF DIPLOMATIC EFFORT

While we are thus giving our attention to the immediate and longrange military and economic requirements, we are directly working toward the solution of related problems of a diplomatic and political nature.

In Japan, having discussed the matter with other interested nations, we are at this moment exploring with the Japanese the basis for a treaty of peace. It is obvious that the security of Japan is vital to the security of the Pacific and of the United States. We are convinced that the full release through peaceful channels of the productive and technical potentials of the Japanese people can contribute immensely to the strength of the free nations of Asia.

In eastern Europe the increasing deterioration of our relations with the Soviet Union and its satellites continues to produce problems and difficulties whose solution is not likely so long as those governments adhere to their present policies. Time and again we have sought reasonable adjustment, only to be met by evasion or direct refusal.

The intensified effort by Moscow and its subordinate regimes to destroy all contact and friendly relationship between the United States and the populations under Soviet control is a matter of significant concern for the present and for the future. Friendly local relations between our representatives and the eastern European people have been made more and more difficult, and, in some instances, have been virtually terminated by the Communist authorities. In the case of Bulgaria, the conduct of that Government was so extreme that we had no choice but to suspend all relations. On the part of the Bulgarian people, however, as with the populations of all eastern European countries dominated by the Communists, we have sought to maintain and strengthen a friendly and helpful attitude toward the United States by means of the Voice of America. The Kremlin's effort at complete thought control is an evil which we must combat to the full extent of our ability. Our establishments for the international information and educational exchange program in Rumania and Czechoslovakia have been closed by those Governments. Only in Poland and Hungary can we continue this work and there only on a modest basis.

Our relations with Yugoslavia are of a completely different and more hopeful nature from a long-term point of view. With respect to this nation, we have been faced with the immediate problem of sustaining its ability to resist threats and pressures from the Kremlini Our effort has been to bolster the Yugoslav food supply, hit by a disastrous drought, and to assist Yugoslav home industry through international credit arrangements.

The United States has not altered its attitude toward the stalemate in Austria. We will continue our efforts to secure an Austrian treaty which thus far soviet obstructionist tactics have prevented. As long as the Soviet Union continues to prevent conclusion of a treaty and maintains troops in Austria, the United States will continue to occupy its zone in accordance with the existing four-power agreement. The transfer to the Department of State by Executive order last October of responsibilities in connection with the government, occupation, and control of Austria which had been exercised by the Department of the Army did not signify any change in policy toward Austria.

This change was part of a three-power effort to regularize relations with Austria and to ease the occupation burden.

As for Germany, our consistent and basic purpose has been to assist that nation in emerging as a free member of Western Europe. Politically we have sought internal democracy and external orientation in the direction of western democratic policy. In this connection we have placed great stress on the integration of Germany into Western Europe, and on the defeat of Communist strength and propaganda on German soil. Economically we have sought a revived and stable German economy as a goal necessary both for Germany itself and for the Western European economy as a whole. In public affairs we have sought a reoriented and democratic Germany, including the Government, German groups and institutions, and the German public at large.

To attain these objectives, the Office of the United States High Commissioner for Germany, in concert with our British and French allies, has conducted vigorous programs during the last year in the political, economic, and public affairs fields. During the last half of 1950, the events in Korea and the increasing world-wide pressure by the Soviet Union have brought to the fore the urgent necessity for German participation in the defense of Western Europe. To achieve this important objective, a quickening of the pace of the transitional occupation is required.

In 1951, the essential tasks which face the United States and its allies in Germany are to obtain the effective participation of Germany in European defense and to grant maximum political and economic freedom to the Federal Republic of Germany. It is anticipated that this can be done on the basis of contractual agreements which would insure the effective performance of matters which we deem essential as a condition of that freedom. Finally, it is our intention to exert the maximum influence possible on German attitudes to counteract communism. In achieving the latter, we must redouble out efforts to strengthen democratic thinking and to counteract the effects of Communist

pressure. This may require us to modify our methods in the light of the changing status of occupied Germany.

Singleness of purpose motivates and binds together the measures this country has adopted, through the United Nations and regional groupings of nations, to strengthen the free world and to provide technical assistance to the peoples of underdeveloped areas. Through all these means we seek to preserve individual freedom and ever enlarge the ranks of those who share that freedom. It is imperative that everyday people the world over be made and kept aware of this truth.

Throughout the world we must continue our unrelenting fight to counteract the vicious lies about this Nation and its objectives as perpetrated by the Communists and to build a positive psychological force around which the free world and freedom-loving people everywhere can rally. Truth is on the side of free nations and the leaders of communism everywhere fear the truth. Knowledge of the truth, however, is dependent upon the free flow of information and an exchange of ideas. This is the role of the international information and educational exchange program.

Substantial progress is being made during the current fiscal year, with funds appropriated by the last Congress, to increase the effectiveness of this program. Moving on beyond the practice of previous years of depending upon influential groups in each country to relay our story, we have begun to reach directly large mass audiences, and each month new thousands of people are hearing what we have to say. A network of radio broadcasting facilities capable of beaming the spoken word into all corners of the world is under construction. Visual materials, including current news topics, illustrated pamphlets, documentary motion pictures, exhibits, and similar items are being issued in larger quantity and prepared to appeal directly to the interest of significant population groups.

Great importance is attached to the exchange of persons, especially leaders, as one of the most effective means of accomplishing our objectives. The United States information centers abroad are increasingly popular as sources of information about the United States and as channels through which people are reached and influenced.

Much effort this fiscal year must, of necessity, be devoted to the mechanics of putting this intensified program in motion. We are endeavoring to recruit the best people available for assignment to the oversea and domestic phases of the operation. Careful security clearance is of utmost importance. Space and other operating tools must be provided.

The estimate for 1952 will provide for a continuation of the activities inaugurated in the current fiscal year, for the operation of the radio facilities on which construction will be completed during the year, for intensification of our efforts in three countries recently added to the areas of critical concern, and for specific projects to meet urgent needs in several other countries.

In dealing with the problems I have been discussing and with the myriad of others which will arise, the Department will continue to report to the Congress and the American people the facts essential for informed judgment or criticism. We are constantly endeavoring to develop closer working relations with Congress, and to promote more extensive consultations with the committees.

Mr. Humelsine, who I am sure is known to all of you, has assumed responsibility for _administration and controls in the Department. He succeeds Mr. Peurifoy, who did such a fine job. I feel that I am particularly fortunate to obtain the services of so competent a successor. Mr. Humelsine will be available to you and render any assistance you may require in the field in which he has jurisdiction. I have left the discussion of our problems on administration and controls to him.

In this presentation, I have endeavored to indicate the careful study which has gone into the preparation of this budget request and the care which has been exercised to relate expenditures to need. I will now be glad to talk with you about any matters which you may wish to discuss.

In accordance with what I understand to be the committee's desire, I shall discuss informally and off the record with the committee the entire situation in the world which lies back of this request for funds. Does that meet the wishes of the committee?

Mr. ROONEY. That is exactly what we have in mind, Mr. Secretary. (Statement off the record.)

STATUS OF LOANS TO SPANISH GOVERNMENT

Mr. Rooney. What is the present status of the Spanish loans? Secretary Acheson. As I understand it, Mr. Chairman, the present status of the Spanish loans is that the Spanish Under Secretary of Industry and Commerce is here negotiating the terms and amounts of various loans. My understanding is that initial loans were approved on February 14 for four projects, which total $12,200,000. These discussions are still going forward.

(Discussion off the record.)

DUPLICATION OF GOVERNMENTAL AGENCIES

Mr. STEFAN. Mr. Secretary, the questions that I have in mind have been disturbing me over a period of years. They concern the entire world picture, which is a very serious one, due to the fact that we have to take leadership in it. There is the question, if we are going to continue to take leadership in the situation all over the world in connection with all of these problems, what the effect will be of a duplication of effort by various Government agencies and how effective will be our regular Foreign Service in the future. I should like to develop that in detail, and that is going to take some little time.

Secretary ACHESON. I should like very much to talk with you about it. This is a matter which has concerned me a great deal, too.

Mr. STEFAN. I have been working on it ever since we got into Greece and since we first developed our Marshall-plan program, as well as these other programs. I have been disappointed, in that I think the work we are doing now is going to be ineffective unless we have a concentration of authority by our chiefs of missions who are scattered all over the world at 300 different posts. The question is whether they are going to be set aside, whether they are going to become merely glorified clerks, and superseded by some other agencies who could duplicate and perhaps destroy the objectives that we have in mind. I think we are wasting money because of interference and duplication.

Secretary ACHESON. I should be glad, indeed, to come back and talk to you about that.

(Discussion off the record.)

Mr. Rooney. Thank you, Mr. Secretary, for a very interesting and informative statement.

Mr. Preston. It has been a very interesting statement, Mr. Secretary.

Secretary Acheson. Thank you, Mr. Chairman and gentlemen.

SALARIES AND EXPENSES

CARLISLE H. HUMELSINE, DEPUTY UNDER SECRETARY FOR AD-

MINISTRATION
EDWARD B. WILBER, BUDGET OFFICER

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