to build up his unions in Latin America? What is the justification for it? Is this the price that we pay them to support us in Vietnam? Secretary ROGERS. Senator, before I make any comment on it I would like to see the letter to which you refer, because I am not familiarThe CHAIRMAN. Do you have the letter? I do not mean to bore you with reading the whole letter. That is the significant part. It does not reach any conclusion, and that is that.

But what I am interested in is why do you wish to pursue this policy? I can understand why the previous administration pursued it because they had a stalwart supporter in Mr. Meany. But now this comes back to the same thing I have raised with you and with the President before.

Are we going to continue to follow the same policies we have been following in the last 4 years in the foreign policy field? This is one of the significant areas in it?

Secretary ROGERS. Senator, I have already answered the question. The answer to your question is, "No." On this particular one maybe Dr. Hannah can answer.

The CHAIRMAN. Dr. Hannah is a great friend of Mr. Meany's. I would like him to justify it.

Dr. HANNAH. I am not sure he considers me a great friend. I have not had a chance to evaluate these programs, Mr. Chairman.

I believe the Agency has made some valuations. They are a little indefinite. AID has supported these labor activities over a period of years, and these have been selected-as you know, we have contracted with the AFL-CIO to carry on operations in Latin American countries and elsewhere.

These are programs we expect to take a hard look at. We have inherited them, and I am not ready to appraise them.

REEVALUATION OF AIFLD PROGRAM URGED

The CHAIRMAN. Well, I know you inherited them, and that is why I mentioned it. You do not have to accept them just because they have been previous policy. I would urge you to evaluate them and not accept them just because it has been done before. Maybe you will come to the same conclusion, but I am telling you the GAO could not come to a conclusion saying this has been a very beneficial program "and we recommend its continuation, we find nothing wrong with it."

Secretary ROGERS. Senator, this letter that you refer to is dated May 1968, and it says, "We are not able to during our review reach any specific conclusion."

The CHAIRMAN. That is right.

Secretary ROGERS. Then it says, "In this respect the agency stated it hopes to complete an assessment of the relative success of the institute and in time incorporate necessary improvement in contracts anticipated in fiscal 1969."

So that this, to this extent, maybe it is not up to date.

The CHAIRMAN. Well, if there has been any change, we will be glad to hear from you.

Secretary ROGERS. I will get in touch with Mr. Staats and ask him.

The CHAIRMAN. This operation has been going on some 7 years, and in excess of $20 million has been spent. They are asking for more this year. What is it, about $6 million more?

It seems to me a very inclusive statement; it would certainly justify reevaluation.

NEWS ARTICLES ON AIFLD ACTIVITIES

I have some articles here that are not written by AID. One of them was from the Washington Post of April 21, 1969, by Mr. William Greider; another by Mr. Bernard Nossiter, who is a reputable reporter, and who also has done one of the best jobs I know of in revealing interesting activities in the Defense Department; and there is an article by Mr. Richard Dudman, who is the head of the Washington bureau of the St. Louis Post-Dispatch, which is one of the best newspapers, and he is one of the most reputable reporters in the business. I will put them all in the record.

All of them indicate that there is considerable doubt about the effectiveness of this program. These articles indicate that there is considerable evidence that the labor institutes have become embroiled in local politics in a number of countries and, in fact, in some instances a number of them have been closed down by the host country. This raises the same question I tried to suggest right at the beginning of this meeting. I do not believe that this country, as big and as important as it is, should just turn its back on the rest of the world. But what we are trying to get at is the way to do it, and there is considerable evidence that these direct interventions, through either this kind of an agency or bilateral aid, are causing as much harm as good, and there are better ways to do it than the way we are.

I am not advocating that we cut this program out just to save money, although that is not an inconsiderable item in view of our own difficulties, but nevertheless the real question, I think, at issue is how effectively are we spending the money. Are we doing it in the right way?

You mentioned and emphasized the multilateral way. I agree with that insofar as we can, because it disassociates us from the onus of intervention. If this is true and I have no reason to doubt it-about the labor institutes being closed because they were embroiled in local politics, that reflects upon our own Government. In view of the situation in so many Latin American countries, in view of the recent experience of Governor Rockefeller, that ought to be enough notice to us that we should reconsider our methods of doing business in this field.

I have put those articles in the record. I won't read them all. They are too long, but they make very interesting reading in case you have not seen them, and particularly for you, Dr. Hannah, if you have not seen them.

Dr. HANNAH. Thank you.

The CHAIRMAN. They could be very useful to you.

(The newspaper articles referred to follow :)

[From the Washington Post, Apr. 21, 1969]

UNIONS TURN TO AID AFTER CIA PULLOUT

By William Greider

Blessed with new subsidies from the Government's foreign-aid program, the AFL-CIO is putting extra muscle into its worldwide operations to create counterrevolutionary labor movements in underdeveloped countries.

The money-about $1,120,000 a year from the Agency for International Development-buys training seminars and field organizers, often hired locally, in Latin America, Africa and Asia. Their stated goal is "developing and strengthening free trade unions throughout the world."

In practice, this ranges from prosaic matters like pension-fund squabbles to ambitious schemes for overpowering the dominant leftist labor organizations in some countries.

This "union to union" diplomacy, "uninhibited by a formal Government relationship," as one AID official explained, is just the sort of thing which the Central Intelligence Agency used to pay for secretly-before the CIA's cover was blown two years ago and it had to abandon its network of dummy foundations.

Indeed, two of the U.S. Labor organizations which now share in the AID grants arranged last June were identified as beneficiaries of the CIA's covert funding. Though their leaders denied the connection, the Retail Clerks International was linked to the Granary Fund of Boston and the International Federation of Petroleum and Chemical Workers received funds from the Andrew Hamilton Fund, both of which were CIA conduits.

After the sensational disclosures of how the CIA had penetrated domestic institutions, the Government declared that the secret financing would be stopped and in a few cases replaced by public subsidy. One CIA orphan picked up by AID was the Asia Foundation.

CALLED SHEER NONSENSE

According to the AFL-CIO's Assistant Director of International Affairs, Ernest S. Lee, it is "just sheer nonsense" to put the overseas labor activities in the same category.

American unions, he pointed out, have been carrying out international programs for years, both with AID grants and with their own money. "We have to give any support we can to free trade unions," said Lee, "so that they will not be jeopardized from any position-government, the Communists, business."

However, AID Deputy Administrator Rutherford M. Poats was more equivocal on the question of CIA financing. "I know they were not CIA-financed at the time we picked them up," Poats said. "Whether they were at some time in the past I don't know."

Poats said he was told that the unions and their international affiliates had been paying for the network of organizers-with occasional support from foundations-but that they could no longer afford to maintain them. "I don't know," Poats said, "whether, among the foundations they turned to for help in the past, any of those were CIA conduits. I just don't know."

When AID agreed to pick up the costs formerly borne by the unions, the package was arranged by AFL-CIO's Lee, who is assistant to Jay Lovestone, the Federation's international director, and is son-in-law to George Meany, the president. The AID money goes to three regional labor institutes which the AFL-CIO operates in Africa, Latin America and Asia, then is passed on by subcontracts to seven labor organizations, which are either U.S. unions or their international trade affiliates.

The arrangement was approved by the Labor Advisory Committee on Foreign Assistance, a labor-government group whose regular meetings are spiced with the spirit of international combat. Presided over by Meany, the committee oversees the Federation's housing, training and institutional programs in foreign countries, which receive about $8 million a year from AID.

The main difference in the new AID spending, Lee said, is that Government financing now supports individual trade unions working with their counterparts within countries while the focus in the past has been on broader national labor confederations. The AID financing is no secret, but the new union activities do not require formal approval from the "host country" as most foreign-aid projects do.

Jay Lovestone, the elder eminence of American labor's cold-war operations, told the AID officials "that U.S. embassy sponsorship or close identification with these programs would be untendable and counter-productive.”

SUBSIDY IN NIGERIA

In Nigeria, the U.S. funds provide a modest direct subsidy to an infant union of oil workers whose dues will not support the union's activities "for quite some time to come."

In Colombia and Peru, the Retail Clerks International is concentrating on strengthening bank workers' unions. The budget proposal for Colombia listed the secretary general of the bank workers union as the locally-hired representative. In Japan, the long-range objective is welding together all of the diverse unions representing oil and chemical workers into one national union, to be affiliated with the Denver-based International Federation of Petroleum and Chemical Workers (IFPCW).

While most of the U.S. organizations submitted brief, bland descriptions last year of how they would spend the AID money, the IFPCW's budget proposal detailed its struggle with the other side in 19 countries-how it sometimes battles dominant unions or even the Government itself.

Its affiliate in Trinidad, the IFPCW noted, had "come under the influence of the Communist leadership, if not under the direction of Communist leaders." It proposed to correct this by supporting a challenge by oil workers dedicated to the free trade union movement.

In Colombia, the IFPCW intended to challenge "Fedepetrol," a rival federation. "Fedepetrol," it said, "is controlled by Communists and its leaders have recently increased their activities in attempting to organize chemical and pharmaceutical workers."

The AID-financed program would "assist the free, democratic trade union currently in Fedepetrol to recapture their organization from its present Communist leadership control. We must continue to work with key persons employed by Ecopetrol, Colpet and Intercol (the three oil companies where the rival union has its membership strength)."

At the same time, the U.S.-based labor group intended to beef up its own affiliate in Colombia "and assist it in developing a closer relationship with the government of Colombia. Eventually, merge Fedepetrol into our affiliate."

In Peru, the objective is signing up unorganized workers in chemical and pharmaceutical plants. However, the IFPCW said, "a rival union exists which is oriented toward the Communist Party. Our program envisions a vigorous attempt to win these employees to the democratic trade union forces."

In Pakistan, the oil federation complained, "politically, the government is leaning toward the Communist orbit and constantly puts pressure upon our affiliate and the Pakistan National Federation of Trade Unions to entertain visitors from China and the WFTU (the Communist-sponsored international organization of unions). These organizations have been able to maintain their independence in spite of government pressure."

The ICFTU and others have discovered that the helping hand of American labor is not universally welcomed.

In South Vietnam, where the AFL-CIO is pouring support into a tenant farmers' union, Lovestone complained to the State Department last year that the local labor leaders were continually harassed, even arrested, by South Vietnamese military leaders, whom the U.S. also supports. "This is a source of embarrassment to the AFL-CIO which is steadfastly supporting the U.S. war effort in Vietnam," Lovestone reminded the government.

When three AFL-CIO vice presidents landed in Nigeria on an inspection tour last spring, the airport officials at Lagos submitted them to a meticulous personal search, an embarrassment which the labor leaders blamed on Communist rivals.

In Brazil, a government decree ordered foreign labor organizers to apply for permission to operate in the country, but a year has passed and none of the applications have yet been approved.

It will be necessary that we work within the framework of the prsent Brazilian labor legislation," the IFPCW conceded, "but we must also work for new labor legislation and the elimination of the repressive type."

ACTIVITIES DEFENDED

AID officials defend these activities as a normal aspect of the foreign-aid program. The development of economic growth and stability requires free and strong labor unions just as it requires new industry and commerce, they contend.

"Our general view is that technical assistance to labor unions is and should be a continuing part of development," Poats said.

An AID labor adviser who covers Latin America explained: "Unions act as dividers of profits. The U.S. Government likes to see more purchasing power in the hands of these people rather than in Swiss banks."

Poats dismissed the domestic political overtones of the activities as an inevitable element. "The whole orientation is that they're out fighting the WFTU (the Communist federation) around the world," Poats said. "We are operating in host countries where the government favors a moderate, nationalist union as opposed to a Communist union."

Another AID executive put it this way: "Now, nothing is more political than labor union training. But we treat it as developmental."

The AFL-CIO's devotion to international operation stems primarily from Meany and Lovestone's commitment to help America fight the Cold War, an attitude which has drawn frequent atacks from Walter Reuther and the United Auto Workers, among others. The critics suggest that the labor federation's role in U.S. diplomacy inevitably affects its attitudes in U.S. politics such as the AFLCIO's hawkish defense of the American role in Vietnam.

In any case, there is an acknowledged self-interest for the U.S. labor organizations that work overseas. Though they do not expect to benefit directly and immediately, they are in the business of gathering new members and affiliates into the fold. One AID official described "organizing aims" and the Government aims as compatible. "If we get what we want as a byproduct of what the union wants, then it's worthwhile," he said.

And Lee offered this explanation of how the AFL-CIO views global unionism: "It's a selfish thing, too. After all, free trade unionism is our bread and butter. You get unions taken over by the Coms or even by the right-wing Fascists, what happens? It becomes stagnant, a cheap labor market. That becomes a threat to us and the United States. Industry is concerned about it, too."

[From the Washington Post, Apr. 28, 1969]

LABOR AND GOVERNMENT COOPERATE ON FOREIGN POLICY

By Bernard Nossiter

Organized labor and the Government's official foreign policy instruments cohabit in a murky, twilight world. It has now been illuminated in part by the minutes of private meetings, budget proposals and other documents that have recently become available.

They disclose:

• A relationship in which the Agency for International Development agrees to hide as much as possible its financial backing for AFL-CIO ventures abroad. A marked degree of logrolling with Federation and Government officials consulting on how best to lobby Congress for bigger AID funds.

AFL-CIO use of Government money to execute a cold-war policy that is sometimes more rigorous than that stated by the Government itself.

Since the end of World War II, the Federation and several American unions have openly advertised their support for what they routinely call the building of "free, democratic" trade unions abroad. They cultivate the impression that these activities are financed from their own resources and for some this is true. However, the Latin American arm of the AFL-CIO has been drawing AID money since 1962. With the disclosure two years ago that some union projects were financed by the Central Intelligence Agency, the bond with AID has been tightened.

The wish to conceal this link is understandable. Foreign unions might balk at taking money and advice from sources that are ultimately rooted in the State Department.

The policy of concealment is revealed in a paper dated Nov. 8, 1968, governing AID's relationship with the AFL-CIO's African arm. The six-page document is entitled "Policy and Procedure for AID-supported African-American Labor Center Programs and Projects."