Report on Aid

In 17 years, since the end of World War II, the U.S. has contributed close to $100 billion in economic and military aid to more than 100 foreign countries and foreign groups. There has, of course, been a lot of U.S. grumbling about the size and shape of the foreign aid program--to the point that President Kennedy last December asked retired General Lucius D. Clay to head up a ten-man committee to re-examine foreign aid policies. Last week the Clay group, both in a 22-page report to Kennedy and in a longer, more detailed series of recommendations to Foreign Aid Director David Bell, made known its findings. Clay's committee offered no bold new approaches to foreign aid--but it did take a hard look at the old avenues.

Clay recognized that foreign aid emphasis has shifted over the years. With U.S. help. Western Europe got back on its feet, to become a more formidable economic power than ever before. In the 17-year dollar-amount totals. France and Britain still lead the aid list (see box).

But last year France received only $51 million, and Britain just $25 million. At the same time, India, with $838 million last year, and Pakistan with $439 million, have come from far down.

The Clay committee argued that both India and Pakistan should continue to be heavy beneficiaries of U.S. aid, if only because of their precarious positions against the "Red Chinese colossus." But what is the sense of helping a mixed-up country like left-leaning Sukarno's Indonesia? Says the Clay report: "We do not see how external assistance can be granted to this nation by free world countries, unless it puts its internal house in order, provides fair treatment to foreign creditors and enterprises, and refrains from international adventures."

The committee could point to several nations--Greece, Israel, Nationalist China and the Philippines--which have, under U.S. aid, progressed to the point where they can soon stand on their own, needing little more than conventional loans from the Export-Import Bank.

But for every such praiseworthy example, there is another where U.S. money seems to be going down the drain. Wrote the Clay committee: "There has been a feeling that we are trying to do too much for too many too soon, that we are overextended in resources and undercompensated in results, and that no end of foreign aid is either in sight or in mind . . . While we are concerned with the total cost of aid, we are concerned even more with whether its volume is justified, and whether we and the countries receiving it are getting our money's worth. We cannot believe that our national interest is served by indefinitely continuing commitments at the present rate."

Yet even if the Clay committee's recommendations were followed, foreign aid would continue as a pretty expensive proposition for the U.S. It presently runs about $4 billion a year. And the Clay group suggested that only about $500 million could or should be shaved from that total under an improved program.

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