Mr. VOORHEES. It is not so large, but it has been on hand apparently for about a year and a half. I did not want to determine that myself so I took the matter up with this committee. We do not want to make plans to spend any of our appropriation for these potatoes before I had had an opportunity to discuss the matter with the Appropriations Committee. I cannot dissipate any substantial amount of money in this program simply because somebody has an expensive business, or because somebody wants us to take a lot of their surplus commodities off their hands. We therefore presented the matter to the committee; we did that concerning sweetpotatoes, and now we expect to buy them with this appropriation if they are available at a price that is proper. POLICY OF GARIO WITH RESPECT TO ACQUISITION OF HIGH PRICED FOOD FOR RELIEF Mr. KEEFE. In connection with this specific item to which you have referred, namely, canned sweetpotatoes, then I understand the policy has been to only acquire the so-called high price food for relief feeding from the stocks of the Commodity Credit Corporation, which have been acquired in connection with the support price program and then only at a comparative price. Mr. VOORHEES. Yes. Mr. KEEFE. As indicated in the appropriation showing before this committee? Mr. VOORHEES. Yes. Mr. DRAPER. That is correct. Mr. KEEFE. Then with respect to the other special foods, such as canned peas, which are a high price product for relief feeding, and which, in the absence of the specific determination by the Department of Agriculture would not be given a support price, under the basic provisions of the Steagall amendment relating to basic commodities, you would not feel justified in using the money herein appropriated in this bill to purchase such high-priced foods merely because they were surplus in the hands of American producers. Mr. VOORHEES. Yes, because we have asked for money to feed people in Germany, not for the purpose of relieving the American producers. I do not feel that is our responsibility. Mr. KEEFE. If it should develop, however, that the Department of Agriculture, under the broad authority granted to it as included under this support program, should include a commodity, which is not basic, but which they have the discretion to bring in, and if they were to utilize their discretion and say that they wanted to support the price of peas, for example, and did so by going out and buying the surplus, which apparently is in the hands of the processors in their warehouses, and would acquire those peas at a support price which they determined, then and only then would you use the program and the funds provided to you for the purchase of these peas, to utilize them in connection with the feeding program, and then only if you could buy them within the limits of your requirements as set forth under the appropriation. Mr. VOORHEES. Yes. Mr. STEFAN. With another qualification that the Department of Agriculture would be willing to let you have them at the reduced price? Mr. VOORHEES. Yes. Mr. KEEFE. I intended to include that condition in my last statement; perhaps it was not stated in that specific language. Mr. VOORHEES. Then I wish to point out the great benefits that have been secured from this very farsighted amendment. It has made it possible for us to use surplus foods which, if we had had to go into the market and buy vast quantities of wheat and other foods necessary in order to keep the German population on a diet above the starvation level, would have resulted in a great increase in the cost of living to the American people. Mr. KEEFE. Of course, the thing that brings the cost of living down for the American people is a surplus of domestically owned produce, and every time there appears to be a break in the price of eggs or anything else, then the interested parties make an appeal to the Department of Agriculture to pay a support price. If the price starts to go down some place as, for instance, in my town where I can buy eggs for 35 or 32 cents dozen as against paying 79 cents dozen to my grocer here in Washington, when the price starts to decline a little bit. they come in with a price-support program to boost the market up, and then on the other side of our mouths we are complaining about the high cost of living and wanting to beat prices down, and the minute you beat prices down the Government has to step in and support the price. Mr. VOORHEES. That is beyond our competence, sir. Mr. KEEFE. It is beyond your jurisdiction, at least. Mr. VOORHEES. My purpose here is, first, to explain how our program fits in with the Economic Cooperation Administration program and, secondly, to justify our request for this appropriation. My part is limited to food and related items. Mr. WIGGLESWORTH. That covers projects 1 and 2, I take it. Mr. VOORHEES. Project 110, "Purchase of grain, feed and kindred products," project 120, "Purchase of agricultural supplies and fertilizer," project 130, "Purchase of petroleum and petroleum products," and project 150, "Medical supplies." Mr. WIGGLESWORTH. Do you cover all of those? Mr. VOORHEES. Yes, sir, and transportation-project 420-and I may possibly touch on project 160. OBJECTIVES OF GARIOA FOOD PROGRAM Gentlemen, in this, of course, we have two objectives, first a minimum objective of furnishing sufficient food so as to preserve order and to maintain our position in these areas. The second objective is to use our appropriation in a manner which fits in with the industrial recovery program in Germany and, if possible, to stimulate such a program in Japan as General Draper has discussed. These objectives fit together. What we have to do first, is supply the basic food necessary to enable us to preserve order. That is, of course, the foundation upon which economic recovery depends. As to Germany, there are not really two separate programs. These are parts of one program. From the GARIOA appropriation we are providing a very large part of the food imports necessary. Mr. CASE. Mr. Voorhees, on page 1171 of the justifications, under bizonal Germany food import program, fiscal year 1949, there appears a break-down both as to metric tons and the cost. The first column shows GARIOA, and the other column shows additional for ECA program. Mr. VOORHEES. Yes, sir. Mr. CASE. And you say that this budget should be considered as one? Mr. VOORHEES. As one program. Mr. CASE. So that we can understand the difference between the straight GARIOA appropriation and what would be called for under ECA the other column is given. I would like to ask General Draper if similar comparative columns have been prepared for the Japanese part of this program. Mr. DRAPER. In effect, yes. We can easily throw it together because there is nothing in the economic rehabilitation program for Japan that includes food. There is no need for the splitting of these items because there are no comparable items included in both. In Germany it was necessary under ECA to add a certain quantity in addition for economic recovery, but in the Japanese program we have limited the recovery part of it to raw materials. Mr. CASE. How much are you asking for in addition for Japan, Korea, and the Ryukyus because of the recovery program? Mr. DRAPER. $220,000,000. That is the total 12 months' program. For the 12 months' period it would be $144,000,000 for Japan; $60,000,000 for Korea and $16,000,000 for the Ryukyus. Mr. WIGGLESWORTH. Mr. Voorhees, you indicate on page 1173 that this project 110 goes to Germany to the extent of $479,953,000, and on page 1171 it would look as though that was the GARIOA program, and that there was an additional amount for the ECA program. Mr. VOORHEES. Yes, sir. Mr. WIGGLESWORTH. In the amount of $274,422,000? Mr. VOORHEES. Yes, sir. May I state that this justification is the justification of the GARIOA request and, therefore, in the summary which appears at page 1173, to which you refer, we have given the GARIOA program and have also included in that the prior contribution, which is the method which had previously been followed in prior requests, but in order to show the relationship of that to the European recovery program we put the table on page 1171 with the detailed statement of both in giving the food program, so that it is as indicated at the foot of page 1171, $479,000,000 is merely GARIOA, and the ECA program in addition to that, including certain items which are not strictly food, is $274,000,000. Mr. CASE. What do those respective columns represent, as far as calories per normal consumer per day are concerned? Mr. VOORHEES. That is given on page 1154. Mr. CASE. What is it? Mr. VOORHEES. GARIOA is about 1,050 calories, and the ECA is about 122 calories. Mr. CASE. Now, that does not give us the full story because that, apparently, is what is supplied by ECA, and it does not take care of the indigenous production. Mr. VOORHEES. That page gives it. The indigenous production is estimated also at 1,050 calories. If you will turn to that page, Mr. Case, I think it will be easily understood. BASIS OF ESTIMATE FOR GRAIN, FEED, AND KINDRED PRODUCTS Mr. WIGGLESWORTH. Can you not tell us, in a word, how you arrived at this figure of $479,953,000 of grain, feed, and kindred products as being essential for Germany? Mr. VOORHEES. Yes, sir, I can. If you would be kind enough to look at this statement which I will furnish you, and I do not have sufficient copies for each member of the committee, you will see that it is a comparison of the justification which was submitted up here last January with the present justification. The figure of $1,250,000 was set, as I stated, long before ECA came into being, and that figure could not be changed. Mr. WIGGLESWORTH. Why could it not be changed? Mr. VOORHEES. We cannot get permission from the Bureau of the Budget to increase that amount. What we have done was to let any increased feeding for Germany be absorbed into the ECA budget as part of their program. We merely took out of their program the things which we could pay for within our over-all ceiling of $1,250,000,000. Mr. WIGGLESWORTH. It looks to me as though your $1,250,000,000 is broken down into 10 different projects on pages 1161 and 1162. Mr. VOORHEES. Yes, sir. Mr. WIGGLESWORTH. The first of those projects, which is the big one is the purchase of grain, feed, and kindred products, calls for 738.7 million dollars. Mr. VOORHEES. Yes, sir. Mr. WIGGLESWORTH. Which is, in turn, divided into four items, first, Germany, 479.9 million dollars, second, for Japan 218.7 million dollars, third, the Ryukyus 12.4 million dollars, and fourth, Korea 27.5 million dollars. Mr. VOORHEES. Yes, sir. Mr. WIGGLESWORTH. What I would like to get into the record is some justification, indicating how you arrived at those figures. Mr. VOORHEES. Yes, sir, I will try to give it to you in generalities. Mr. WIGGLESWORTH. We would like to get it as specifically as we can. Mr. VOORHEES. I have people here who can give it to the full extent which you desire. Let me explain how that was arrived at. In the first place, the original computations were made last fall. These were the basis of the submission to the Bureau of the Budget and the basis on which the $1,250,000,000 was originally determined. Mr. WIGGLESWORTH. That includes all 10 projects, does it not? Mr. VOORHEES. Yes, sir, that includes all 10. Then, following the time that ECA became the foreign policy of the United States, it became necessary to fit this program into the ECA set-up. We thereupon obtained permission to rework the justification so that it does fit into the ECA over-all plan. The function of GARIOA now becomes a part of the over-all ECA program. In fitting the two programs together we made the changes which are indicated in the sheet which I have just furnished you. I do not know whether you wish to have it go into the record or not. Mr. WIGGLESWORTH. But that does not help me, or I think help the committee very much. In arriving at these specific figures you must have taken specific population figures and specific numbers of calories or some other specific figures. Let us have the mathematics of it. Mr. VOORHEES. I am trying to give it to you, sir. We took, then, that ceiling of $1,250,000,000. Mr. WIGGLESWORTH. How did you arrive at that? Mr. VOORHEES. I thought I had stated that, Mr. Chairman. Mr. WIGGLESWORTH. You said that you arrived at it sometime last autumn with the Bureau of the Budget. Mr. VOORHEES. Yes, sir. It was arrived at on the basis of what we then estimated to be necessary in order to feed 1,800 calories in Germany to the normal consumer, and 1,440 calories in Japan and the current amount in the Ryukyus. Mr. WIGGLESWORTH. What is that amount? Mr. VOORHEES. In the Ryukyus it is 1,800 calories. In Korea it is estimated to supply the food necessary to get through to their harvest in December. I should say that in Korea the present plans are that they would be sufficient as to food after their harvest comes in this year except as to sugar. Mr. WIGGLESWORTH. As far as dollars and cents is concerned I do not have the answer yet. That gives me a general guide as to your target. Mr. VOORHEES. Will you bear with me for just a minute, and I will try to explain it? Those were the targets and those were the amounts at the prices then in effect as the plan then looked. When conditions changed as to prices and as to ECA, we reworked the project estimates and we took amounts for food which would be sufficient to provide the necessary food at the lowered prices. We also made some changes in the characteristics of the foods so that we could supply the 1,800 calorie ration for Germany and the rations which I have stated for the other countries. We also squeezed everything we could out of other projects in order to increase certain items. As you will see we have increased by approximately $50,000,000 the amounts for fertilizer, seed and fishing fleet equipment which is mostly for Japan. This was done so that we would get to the maximum extent possible, the things which would enable these people to feed themselves. The respective amounts available for these projects were limited, of course, by the ceiling of $1,250,000,000. We have divided the funds within that ceiling in the way that we thought would be most useful to accomplishing our purposes. That is the reason therefore for the food estimate for Germany of $480,000,000 to which you refer. Mr. WIGGLESWORTH. But I still do not know how these figures were reached. I understand the general picture which you are painting. Mr. VOORHEES. I will try to tell you, sir. |