Statement by the President Making Public a Report "The Impact of the Foreign Aid Program Upon the Domestic Economy."

TWO WEEKS ago I made public the report on "National Resources and Foreign Aid," prepared under the direction of the Secretary of the Interior. At that time I noted that a second report in the series on foreign aid would soon be made by the Council of Economic Advisers. This report has now been completed and submitted to me under the title, "The Impact of the Foreign Aid Program upon the Domestic Economy."

Secretary Krug reported that on the whole our national resources, if intelligently utilized, are physically sufficient to support a considerable foreign aid program, while preserving the national security and the American standard of living. The report of the Council of Economic Advisers moves on from this point to present an economic analysis of the effect that a foreign aid program of substantial size would have on agricultural and industrial production in the United States, on domestic consumption and prices, and on Government finance and the tax structure.

The Council of Economic Advisers reaches the conclusion that the American economy can sustain the general impact of a new foreign aid program, and that there is no question of our general financial capacity to support such a program. At the same time, the Council stresses the fact that we must deal promptly and effectively with problems raised by key commodities--wheat, steel, certain items of industrial and agricultural machinery, coal, and fertilizer.

The materials contained in both Secretary Krug's report and the Council's report have been made available in advance to the committee of 19 private citizens working under the chairmanship of the Secretary of Commerce. That committee, after studying these analyses of domestic effects and the Paris Conference's presentation of European needs, will submit its conclusions and recommendations as to the limits within which we may wisely and safely extend assistance to foreign countries. Aided by these reports and other pertinent material, I shall make recommendations to the Congress concerning a program of foreign assistance.