Foreign Aid: The Stunning Setback

President Kennedy was furious. In a hastily called news conference he denounced the U.S. House of Representa tives for a "shortsighted, irresponsible and dangerously partisan" action. The House's Republican leaders, he snapped, were guilty of "a shocking and thoughtless" attack on a program vital to U.S. security.

That program was foreign aid — and the House that very afternoon had indeed given the President's foreign aid authorization bill an awful going-over. The Administration originally had requested $4.9 billion for foreign aid. Then, after the report of a presidential committee headed by retired General Lucius Clay had criticized the program, the Administration scaled down its demands to $4.5 billion. The House Foreign Affairs Committee cut the program even further, to $4.1 billion. And last week the House knocked out still another $585 million, slashing the total authorization to $3,502,075,000. It was the worst defeat ever suffered by the controversial foreign aid program.

The authorization had come to the House floor only after a highly skeptical report was made by the Foreign Affairs Committee. Why, asked the committee, should the U.S. taxpayer be required to help an anti-American, Communist-leaning country like Indonesia? The report questioned the wisdom of continuing open-handed aid to the politically unstable Near East—Israel and its Arab enemies. It recommended that Congress consider the "withholding of economic assistance from those countries which persist in policies of belligerence and in preparations for their execution." It suggested drastic reductions in aid to both India and Pakistan until they settle their longstanding disputes.

"Too Damned Big." With such ammunition, foreign aid critics could hardly wait to assault the bill on the House floor. Cried Iowa Republican H. R. Gross: "The day and the hour are at hand to begin ending this foolish notion that it is within the capability of the American people to solve all the problems of the world." Florida Democrat James Haley hoped that Congress would kill "this gigantic boondoggle."

Said Illinois Republican Edward Derwinski: "When I label this bill unsatisfactory, I am truly guilty of understatement, since this year, more than ever before, it represents by its size and scope and basic inconsistency an insult to the intelligence of the American public." G.O.P. Whip Les Arends, who had never before voted against a foreign aid program, warned that this time he would, unless there were substantial "retrenchment and revision." In private, Republican Leader Charles Halleck uttered his own blunt comment on the bill: "This amount is too damned big."

Last-Ditch Stand. In vote after vote, the bill's critics pushed through amendments. One would require that 50% of all Development Loan and Alliance for Progress funds be channeled through private enterprise. Another tightened aid restrictions on nations that trade with Cuba. Still another established a minimum interest rate of 2% on Development loans—as against the nominal ¾ of 1% "service charge" now required of some economically ailing nations.