752.5 MSP/11–1253
No. 909
Memorandum of Conversation, by Robert W. Barnett of the
Office of Western European Affairs
- Subject: Aid to Spain
Participants:
- Mr. Nolting—S/MSA
- Mr. Moreland—S/MSA
- Mr. Moore—RA
- Mr. Jones—WE
- Mr. Barnett—WE
A meeting took place this afternoon in Mr. Nolting’s office (S/MSA) to establish, subject to Mr. Merchant’s (EUR) concurrence, [Page 1963] the Department’s position on Embassy Madrid’s recommendation1 regarding programming of U.S. aid to Spain. Discussion proceeded from the fact that the United States had declared to the Government of Spain its intent “to provide a total program in the amount of $465 million over a period of four years, subject to Congressional appropriation.”2 There was a consensus that this commitment should be fulfilled and that $465 million should continue to be, for the four years, the ceiling of aid to which this government is committed. There was also a consensus that the new obligational authority necessary to supply this aid could be requested from the Congress in two stages, i.e. in FY ’55 and FY ’56, rather than in the three stages previously contemplated, provided that the Government of Spain would be advised appropriately, that appropriation by the Congress of the United States of funds in FY ’55 which might be considered disproportionately high for a four year program should not be considered by Spain as indication that the United States Government contemplated requests for successive appropriations in later years which would exceed, in total, the $465 million total for the four year period.
This consensus was reached on the basis of Embassy Madrid’s view that our commitment to Spain would be met by providing an additional $239 million whether it be over the next two or the next three years, that the Spanish armed forces could absorb equipment at the accelerated rate proposed, that the greatest need for economic aid to counter the inflationary impact of the base program would be in the latter part of FY ’54 and all of FY ’55, and that the Spanish expectations for economic aid should be met soon in order to maintain friendly cooperation in the construction and operation of joint military facilities. Account was also taken of the fact that Defense and FOA are understood to have accepted Embassy Madrid’s recommendation.
In view of the desirability of eliminating, if possible, appropriation requests in FY ’55 for any economic assistance for the Title I area, it was considered important that to the extent possible FY ’55 aid for Spain should cover imports which could be justified, within the framework of a Defense foreign aid Title, as covering items directly related to military need. This might be possible if such imports were common use items, transportation equipment, industrial items for the munitions industry, other items related to the needs of the Spanish defense establishment, or McClellan Amendment [Page 1964] types of agricultural commodities.3 It was the opinion of WE that Spanish imports under the comtemplated $30 million economic aid for FY ’55 could all qualify under this definition, even though items are being procured under the $85 million program for FY ’54 which do not.
It was, accordingly, agreed that Embassy Madrid’s recommendation should be accepted by the Department, subject to Mr. Merchant’s approval, and that Embassy Madrid should, with Defense–FOA concurrence, be informed, and instructed to advise the Government of Spain.4
- The recommendation under reference was contained in telegram 331 from Madrid, Oct. 22, supra.↩
- The declaration cited here was contained in Document 904.↩
- The McClellan Amendment was Section 550 of the Mutual Security Act of 1953, P. L. 83–118 (67 Stat. 152), July 16, 1953. It authorized the use of between $100 million and $250 million of military aid funds for financing the purchase by foreign countries of surplus agricultural commodities.↩
- The Embassy in Spain was informed of the decision in telegram 411 to Madrid, Nov. 20. (752.5 MSP/10–2253)↩