(3) Training for students of European NAT countries has so far been given under both the fiscal year 1950 and consolidated 1951 programs, and is in progress under the fiscal year 1952 program. As of December 31, 1951, training spaces which have been filled totaled 16,296, divided by services as follows: Army, 3,809; Navy, 8,581; and the Air Force, 3,906. Training for 12,530 of these students has been in the United States, and for 3,766 of them in Europe. In addition, approximately 4,500 students have been trained within the countries, through the medium of United States training teams assigned on temporary duty.

d. My over-all evaluation of the training situation, in all NATO countries with the exception of the United Kingdom which has required little training assistance, is that there is still much to be accomplished. However, I believe that there has already been great improvement and that the outlook for the future is good. I should add that SHAPE and its subordinate commands are playing an increasingly important role in the training field—their emphasis being, however, placed on tactical training and training pertaining to the implementation of NATO plans, instead of on training devoted to the development of skills requisite to the receipt, maintenance, and operation of equipment being supplied under the program. 8. Indigenous military production and offshore procurement

a. Besides providing equipment and training assistance, the military-aid programs have also given some assistance in stimulating European production. Primary responsibility for this activity has not been placed upon the military, and so I shall not treat with it except to concede its tremendous importance in relation to ultimate United States objectives in Western Europe. I might add that the role of the MAAG's and JAMAG in this field has been confined principally to the provision of military guidance for United States country and regional-level consideration of projects for United States-supported indigenous military production.

b. (1) A related and comparatively recent activity in which JAMAG and the MAAG's are to a limited extent involved is that of offshore procurement-in other words, the utilization of European facilities in the production of military equipment, when procurement from those sources is found to be in the best interests of the United States. In accordance with the intent of Congress pertaining to the use of MSP funds, the United States military services have initiated an offshore procurement program under which it is hoped that contracts can be placed in Western Europe to the value of approximately $500 million during fiscal year 1952, and to the value of twice that amount during fiscal year 1953. Each of our services has designated an organization in Europe as its agency for the program.

(2) It is expected that offshore procurement will result in the following advantages for the United States:

(a) Provide sources of supply in Europe.

(b) Lay the groundwork for a greater European self-sufficiency in military production.

(c) Expedite deliveries of essential equipment.

(d) Relieve strains on United States industrial capacity and the drain on United States-provided raw materials.

(e) Provide savings due to cost differentials.

(f) Contribute to a limited degree to the economy of these European countries by providing them with additional sources of United States dollars.

(3) At the present time, although this program is still generally in a formative stage, it is progressing satisfactorily.

9. Progress made toward adequate defensive posture and role of military assistance therein

a. To turn now to the current situation in Western Europe, it is well known that it is as yet by no means secure. However, I feel that very substantial progress has been made toward the achievement of an adequate military defensive posture; and I am convinced that United States military aid has played the key role in this development.

b. (1) The increase in the effective strength of the armed forces in Europe during the past year has been substantial. At the time when United States military aid was first given to the NAT countries, virtually no combat-effective military units existed. By a year ago, a substantial base had been established upon which the countries could rebuild their forces, but none of the units could have been considered effective. Today there are available appreciably more units, and their standards of effectiveness have increased. Neither in quantity

nor in quality do they yet meet SHAPE's requirements, but progress has been encouraging.

(2) This increase in strength could not have been realized without the receipt by the countries of substantial United States equipment assistance with which to arm their new forces. Furthermore, it could not have been accomplished without the encouragement and assistance which was given the countries by the United States toward increasing their own output of military equipment for those forces.

(3) (a) The increase in quality could not have been achieved without the training provided by the United States and the constant efforts and influence of the MAAG's to cause the countries to improve their military command, training, logistical, and personnel structures and methods.

(b) In the training field, service schools are being expanded and training centers improved to provide more effective use of available facilities; and more modern methods of instruction and training are being employed. In general, the European NATO countries are making good progress in the development of trained manpower. While the total active strength (world wide) of the armed forces of those countries is at present approximately 40 percent less than that of United States forces, the European NATO countries could mobilize for combatin trained units and within 72 hours-about 5 percent more manpower than could the United States. Of course, the effectiveness of these units would be dependent upon the availability of equipment. However, if training gains continue as anticipated and if equipment becomes available, present indications are that the European nations will, by 1954, have increased their immediately available combat strength by approximately 40 percent.

(c) In other fields, military services are being reorganized to produce combat units which will fit more readily into an integrated Allied force, and terms of military service have generally been lengthened. Also, there has been some improvement in conditions of military service, although I might add that those conditions are still generally too low to attract to the services sufficient individuals of suitable character and ability to become members of regular forces. Further improvement in this regard can be expected; but I consider it pertinent, from the standpoint of United States policy, to note that--basically due to the difference in standards of living of Europeans and Americans-the cost of raising and maintaining European forces will probably always be substantially less than that of similarly providing United States forces.

(4) (a) Not all countries have done all of these things, for progress has of course been affected by local problems, customs, and background. For example, because of the lack of basic military traditions and of experience with modern military organizations, logistics and equipment there did exist on the part of some countries insufficient comprehension of the real scope and quality of military effort required to accomplish the NATO mission. Several countries in this category have now taken steps to modernize their military establishments, realizing with a growing sense of urgency that an ill-equipped and inadequately trained armed force cannot withstand the impact of modern warfare. Although their efforts in this direction were initially prone to be lethargic, within the last year these countries have steadily strengthened their military positions. Furthermore other NAT countries, in spite of numerous handicaps—including military responsibilities in other parts of the world-have made strong bids for leadership in Europe; and their progress toward meeting their force commitments to NATO on schedule is generally reassuring.

(b) Many factors have of course contributed to this improvement, and certainly the influence of SHAPE has been tremendous. However, I feel that it can truthfully be said that, to a degree impossible to measure accurately at this time, United States military assistance has acted as both the spur and the inducement in making these improvements materialize.

c. (1) The morale of the armed forces of the NAT countries, including their willingness to recognize the threat to their security and their will to resist it, is improving, although it naturally varies between countries and even between services within countries. Several factors have contributed to this improvement, besides the important one of the United States having clearly revealed-through its prompt action in Korea-its intention of resisting the forces of aggression. These factors are:

(a) The positive proofs which the United States has given that it is wholeheartedly behind the NATO defense effort—through supplying modern arms and training to enable the countries to deploy_effective combat forces, and through building up American military strength in Europe so as to be able to provide sup96968-52-19

port to the western European countries before an attack occurs and not after the countries themselves have been overrun.

(b) The development of an integrated effective western European defense force under a Supreme Allied Commander in Europe.

(2) Although there can be no mathematical assessment of the attitude of the Europeans, those attitudes improve as the factors which I have mentioned approach realization. In this connection, I believe strongly in the idea that strength begets strength. As NATO becomes stronger and our partners become more and more aware of that trend, I feel that there is a good chance that the western European effort will accelerate, with the result that military goals will be attained earlier than the present position would indicate. Certainly, the key to this development is the continuation of substantial United States military assist

ance.

10. Conclusion

One final point. It is imperative-from the standpoint of the security of the United States-that we hold our western European Allies, who provide the manpower and industrial capacity which enable us to maintain a favorable potential balance of strength. As I have indicated, those allies are incapable, in the time considered to be available, of raising and equipping, unaided, the forces needed for a successful defense of that key area. It is my considered opinion, therefore, that continued military assistance to our European Allies is our only acceptable course of action.

Senator SMITH of New Jersey. When I was in Europe all of our troops were in Germany. Are they still all in Germany?

General OLMSTED. The combat ground units are.

Senator GEORGE. In view of the bells, perhaps we will have to adjourn.

Senator WILEY. Take him on tomorrow. We will have to go up and see what is going on upstairs.

Senator GEORGE. Mr. Bruce, did you get your statement from your stenographers?

Mr. BRUCE. It has been distributed.

Senator GEORGE. It may be given out?

Mr. BRUCE. Yes, sir.

Senator GEORGE. And this may be given out?

General OLMSTED. And it may be released if you wish it.

Senator GEORGE. It may be released today?

General OLMSTED. Yes, sir.

Senator GEORGE. I am sorry that we will not have time to go through this morning with the statement. I will ask you to come back again tomorrow. Mr. Batt, of course, will be on tomorrow morning, but you can follow with these country programs, because we do want to get the program with respect to each of these countries, both from yourself and from Mr. Cleveland, I believe it is.

Thank you.

(Whereupon, at 12:40 p. m., the hearing was adjourned, to reconvene on the following day, Wednesday, March 26, 1952, at 10 a. m.).

MUTUAL SECURITY ACT OF 1952

WEDNESDAY, MARCH 26, 1952

UNITED STATES SENATE,

COMMITTEE ON FOREIGN RELATIONS,

EXECUTIVE SESSION

Washington, D. C.

The committee met, pursuant to adjournment, on Tuesday, March 25, in the committee hearing room, United States Capitol, at 10 a. m., Senator Walter F. George, acting chairman, presiding. Present: Senators George (acting chairman), Green, Gillette, Wiley, Smith of New Jersey, and Hickenlooper.

Present of committee staff: Dr. Wilcox, Mr. Marcy, Mr. Holt. Also present: Brig. Gen. Dan F. Callahan, USAF, alternate United States representative, North Atlantic Defense Production Board; Malcolm W. Hogg, program officer, Mutual Security Agency, Mission to the United Kingdom; Harlan Cleveland, Assistant Director for Europe, Mutual Security Agency; Walter Stettner, Deputy Director, European Program Division. Mutual Security Agency; Maj. Gen. George Olmsted, Director, Office of Military Assistance, Department of Defense; Samuel Efron, counsel, Office of Military Assistance, Department of Defense; C. Tyler Wood, Associate Deputy Director, Mutual Security Agency; Edwin M. Martin, Director, Office of European Regional Affairs, Department of State.

Senator GEORGE. Mr. Batt, we are very glad to have you this morning. We believe that you are going to tell us about how Great Britain, particularly, fits into this NATO program. You are a member of the Defense Production Board-is that what it is called?

STATEMENT OF WILLIAM S. BATT, MISSION CHIEF FOR GREAT BRITAIN MUTUAL SECURITY AGENCY

Mr. BATT. I am the Mission Chief for MSA for the United Kingdom.

Senator GREEN. Please do not deal in these alphabetical abbreviations.

Mr. BATT. I haven't yet.

Senator GREEN. I thought you said "MSA."

Mr. BATT. I am sorry. And I am the United States member of the Defense Production Board, which is one of the units for production in the North Atlantic Treaty Organization NATO.

I am here primarily to talk about the British situation, and I shall have a statement for you to release, if you wish, but I want to refer to these notes so that I may get the high spots of this problem before you, and then if you wish to, lay a basis for your questioning of me as much as you will.

Senator GEORGE. If you should wish anything kept off the record, you will indicate that to the reporter as you go through.

Mr. BATT. Yes, sir. I was here yesterday morning and listened to Ambassador Bruce talking about France, and I heard your instructions to him on that point and I will be guided accordingly.

There are some common elements between Great Britain and France in this problem of rearming Western Europe, and there are some very substantial differences. He told you about the size of the French program, and I want to emphasize that the British program is somewhat larger in volume than that of the French and is, except for the United States, the largest of these commitments to the rearmament of Western Europe.

BRITISH REARMAMENT PROGRAM

In terms of the percentage of national income devoted to rearmament, the figure is about the same for France and Great Britain. It runs somewhere in the neighborhood of 11 percent. In terms of actual amounts, you will find in some of this material submitted to you that the French proposal for 1953 runs a little under $4 billion, whereas the British proposal for the same period runs upward of 4.5 to 4.7 billion.

The reason why assistance to Great Britain is necessary_if_this program is to be kept up is in some degree similar to that in France, but in other respects is vitally different from France. I think it is important that I should point out that the British program is undoubtedly the firmest program in Western Europe, and of courseSenator GREEN. What do you mean by that?

Mr. BATT. It is a program of production and of building up of military strength which antedated Korea, growing out of their difficulties in Malaya and the Middle East. They have actually got today 11 Army divisions on active duty outside their own borders. Almost five of those are on the Continent, three in the Middle East, and three more in Malaya and with us in Korea. So we start out with 11 operating divisions outside their own borders.

Senator SMITH of New Jersey. And outside of the Atlantic group? Mr. BATT. No, part of that; that on the Continent is in the Atlantic Pact group.

Senator GREEN. May I ask another question just for my own enlightenment. What good does it do to know how many divisions they have scattered around the world if they are kept there? What we are interested in, isn't it, is whether they have divisions which will be available to resist an attack from the east.

Mr. BATT. Yes, Senator, but you will agree of course that the situation in Malaya, as you discussed it yesterday in Indochina, and I think one should also say in the Middle East and Egypt, is part of our whole problem with Russia.

Senator GREEN. Its connection with the whole world problem, not in connection with resistance to Soviet aggression in Europe.

Mr. BATT. Yes, sir. But again I would hesitate to limit the risks of the Soviet aggression to Europe, which I am sure you will recognize

too.

Another respect in which the British are strong is that they have a 2-year compulsory service set-up that is producing about 100,000