Letter to Secretary Dulles Regarding Transfer of the Affairs of the Foreign Operations Administration to the Department of State.

[Released April 17, 1955. Dated April 15, 1955]

Dear Mr. Secretary:

The Mutual Security Act of 1954 provides for termination of the Foreign Operations Administration by June 30th of this year. Accordingly, I shall issue within a few days an Executive Order transferring the affairs of the Foreign Operations Administration, except for certain military functions which are charged to the Defense Department, to the Department of State as of June 30, 1955. Any subsequent transfers, modifications or elimination of functions, or other organizational changes, that should be determined advisable or necessary, prior to June 30, under the guide lines given here, will be covered in a supplementary Executive Order.

The Foreign Operations Administration established two years ago, was intended to centralize all governmental operations, as distinguished from policy formulation, that had as their purpose the cooperative development of economic and military strength among the nations of the free world. That function it has performed well, but the Foreign Operations Administration has been regarded by many as merely a temporary unit of government, established solely to meet certain short-term economic and military requirements. It has come to be widely recognized, however, that the functions and the need for cooperative development of economic and military strength among the free nations are continuing and integral parts of the fabric of our international relations. The new organization is intended to reflect this public recognition.

The placing of general responsibility for economic operations as well as for policy in this field within the Department of State offers assurance that, under a permanent government establishment, we are providing a long-range basis for this kind of international cooperation. It is emphatic recognition of the principle that the security and welfare of the United States are directly related to the economic and social advancement of all peoples who share our concern for the freedom, dignity, and well-being of the individual.

In the reorganization of Mutual Security activities two years ago, there was set forth a number of applicable basic considerations. In our discussions of recent weeks we have agreed that those considerations are still valid and should apply to the new organization and to the new administrative arrangements in the Department of State. This letter summarizes our discussions of these matters and of the arrangements which should govern the future operations of the Mutual Security program.

Two years ago I stated that the Secretary of State, under the President, must be the official responsible for the development and control of foreign policy and all relations with foreign governments, to include policies affecting mutual security. The policy authority then fixed in the Secretary of State is now extended to include supervising authority over operations. The Executive Order will provide for this.

It also was stated that related Mutual Security operations should be brought together in a single organization under a single management. Consistent with this approach we should avoid dispersal of operating responsibilities either within the Department or to agencies outside the Department.

A third objective stated in 1953 was the freeing of the Secretary of State from operating responsibilities so that he, assisted by his Under Secretary, could devote a preponderance of attention to foreign policy. These two important considerations are recognized in the Executive Order which will assign maximum responsibilities to a single key official within the Department of State.

In accordance with these organizational guide lines, the following administrative arrangements will obtain within the Department of State:

1. A new semi-autonomous organizational unit, to be known as the International Cooperation Administration, will be established in the Department of State, to carry out the transferred functions.

2. Provision will be made for a Director of the International Cooperation Administration who will be the key official within the State Department referred to above.

3. The Director of the International Cooperation Administration will report directly to the Secretary of State and will, on the Secretary's behalf, give supervision and direction to the Mutual Security operations performed within the State Department.

4. Except for those matters which, because of their nature, require final decision by the President, the Secretary of State will be responsible for coordinating all Mutual Security programs, which will of course include the establishment of arrangements with the Secretary of Defense for effectively coordinating Mutual Security programs involving the Department of Defense.

5. Since time is pressing, it is essential that the work of reorganization begin without delay. The key to success is the individual selected to head the new Bureau within your Department. He must be a man of such stature and standing and of such operational experience that you can trust him with full responsibility in the field of operations, so as to minimize the demands upon your own time.

If such a man is now known to you and available for the position, please recommend him to me promptly. If you need more time in the selection of a qualified person, then I request that you get in touch immediately with Mr. Joseph M. Dodge, who has been acting for me in working out the general principles of this reorganization, so that with him you may devise and set up temporary machinery fitted and empowered to begin at once the work of reorganization.

6. I am instructing the Director of the Bureau of the Budget and my Advisory Committee on Government Organization, in connection with their general responsibilities for advising me on Executive Branch organization, to give close attention to the new organizational arrangements and to recommend such organizational improvements as will be considered appropriate.

7. Any advisable or necessary changes in organization and personnel should be accomplished in a manner that will ensure equitable treatment to the Government personnel employed in the Administration of the transferred programs.

8. The appropriations for all the Mutual Security programs for the fiscal year 1956 should be made to the President, who will, as in the past, delegate the allocation of funds and other authorities to the appropriate agencies, at the same time setting certain limits on their exercise and reserving certain determinations to himself.

No major reorganization of this character can be accomplished quickly and to attempt to do so could jeopardize the implementation of existing programs which are so important to our relations with other nations. The Foreign Operations Administration has a large staff which operates in many countries and administers a number of different but related programs. It will take a minimum of six months to effectuate the desirable changes without unnecessarily disturbing projects and programs now under way.

It will, therefore, be necessary to obtain as part of the legislation to extend the Mutual Security programs beyond June 30, 1955, authority similar to Section 525 of the existing Act which would give flexibility, for a period of at least six months after the effective date of the transfer of the Foreign Operations Administration.

Sincerely,

DWIGHT D. EISENHOWER