EXCESSIVE COST AT MINNEAPOLIS Mr. ROONEY. How can you save any money by going to Minneapolis? Mr. WHEELER. The cost at Minneapolis will exceed the minimum cost we figured in the United States. Mr. ROONEY. Is New York out? Mr. WHEELER. Yes. Mr. ROONEY. How much is there in this budget for entertainment? Mr. WHEELER. There is no entertainment in this budget. Mr. ROONEY. Why is that? Mr. WHEELER. That is at the expense of the United States delegation. Mr. ROONEY. Where will the money for it come from? Mr. WHEELER. The international contingency appropriation. Mr. WILCOX. May I add that, of course, each delegation will do its own entertaining, and, obviously, that will be paid for by the country involved. Mr. ROONEY. I understood you set this up as a request for $400,000 to have it in New York. Now you want $460,000. Is that correct? Mr. WHEELER. No, sir; we still want $375,000. Mr. ROONEY. You want $460,000, less $85,000. In other words, your cost instead of being $400,000 is now $460,000, is that right. Mr. WHEELER. That is correct, to hold it in Minneapolis. Mr. ROONEY. As to this set of justifications we just came across. I had been wondering about $4,000 worth of "hire of cars with chauffeurs" for this 3-week gathering. Now we find that it is $4,850; is that correct? Mr. WHEELER. Yes, sir; that is correct. Mr. ROONEY. And instead of the contribution to the World Health Organization for excess costs which we talked about at the outset, to wit, $326,000, we now find the amount for this is $338,500; is that correct? Mr. WHEELER. That is correct. But if I may point out again, sir, the difference in cost between holding it in New York or east of the Mississippi in comparable facilities and the cost in Minneapolis is made up by a contribution promised by the people of Minneapolis and the Governor of the State. Mr. ROONEY. We spent some time at the outset of this hearing discussing the fact that the duty travel estimated cost at Geneva was $9,060 and we spoke of that figure in relation to your estimated excess costs awhile ago, to wit, $151,067. Now we find the figure is $153,947. You do not have any more figures with you here today; do you? Mr. WHEELER. If I may point out, those figures were presented to the committee at least 10 days ago. The ones you had in front of you were based on the figures available to us at that time. Mr. ROONEY, Why did you not 1 hour ago, when you came into this hearing room, give us the set of justifications your request is based on? We have sat here 1 hour reading and discussing a budget which is now entirely different. Instead of being a $400,000 budget, it is now $460,000. Mr. WILCOX. I should apologize. I thought the committee did have before it this new set of figures. Mr. ROONEY. You should have known we did not because we were discussing the figure $151,067 as compared with $9,060 and not $153,947 as compared with $9,060. This contains an increase in connection with travel and per diem of this temporary staff, too; does it not? Mr. WHEELER. Yes, sir. Mr. ROONEY. That is all. Thank you, gentlemen. EDUCATIONAL, SCIENTIFIC AND CULTURAL ACTIVITIES IN ISRAEL, STATE, 1958 WITNESSES J. BURKE WILKINSON, DEPUTY ASSISTANT SECRETARY, PUBLIC AFFAIRS BERNARD KATZEN, SPECIAL ASSISTANT TO THE ASSISTANT SECRE- O. A. SIMMES, ACTING DIRECTOR, EXECUTIVE STAFF Mr. ROONEY. The next supplemental appropriation request to which we shall direct our attention is for the Department of State in the amount of $3,525,000 and is entitled "Educational, Scientific, and Cultural Activities in Israel, State, 1958." This request is also contained in the House Document No. 198 to which reference was made a while ago and appears at page 7 thereof. Without objection, at this point we shall insert in the record pages 1 through 7a of the justifications. (H. Doc. 198) Educational, scientific, and cultural activities in Israel, State, 1958 Request $3, 525, 000 0 PURPOSE AND NEED FOR FUNDS These funds will be used to purchase Israeli pounds generated by the informational media guaranty program which are owned by the United States Treasury and will be used for educational, scientific, and cultural purposes. "EDUCATIONAL, SCIENTIFIC, AND CULTURAL ACTIVITIES "For expenses to carry out the provisions of section 1011 (d) of the United States Information and Educational Exchange Act of 1948, as amended (22 U. S. C. 1442 (d)), $3,525,000: Provided, That this amount shall be used for purchase of foreign currencies from the special account for the informational media guaranty program, at rates of exchange determined by the Treasury Department, and the amounts of any such purchases shall be covered into miscellaneous receipts of the Treasury." EXPLANATION OF LANGUAGE This proposed appropriation language is to permit use of Israeli pounds ac crued to the Treasury through operation of the informational media guaranty program. Legislation authorizing the availability of such foreign currencies for educational, scientific, and cultural purposes is contained in section 1011 (d) of the United States Information and Educational Exchange Act of 1948, as amended. The language provides that the Treasury Department shall deter. mine the rates of exchange, and that the amounts of such purchases shall be covered into miscellaneous receipts of the Treasury. General statement It is requested that $3,525,000 be appropriated for the purchase of Israeli pounds (I£) which accrued to the account of the Treasury of the United States through the operation of the informational media guaranty program. This request is made pursuant to the statutory authority provided in subsection (d) of section 1011 of the United States Information and Exchange Act of 1948, as amended. It is proposed to expend the Israeli pounds purchased with these appropriated funds for educational, scientific, and cultural purposes, in accordance with the program described below. This program will be of great benefit to the United States in its relations with Israel. THE IMG FUND IN ISRAEL The informational media guaranty (IMG) program makes it possible for foreign countries having a shortage of foreign exchange to import books, periodi cals, and other informational media from the United States through regular commerical channels. Under this program, foreign importers make payment to the American exporter in local currency, and the exporter exchanges the local currency upon application to the United States Information Agency, in accordance with the terms of his IMG contract. Originally authorized under section 111 (b) (3) of the Economic Cooperation Act of 1948, the legal authority for the IMG program is now contained in section 1011 of the United States Information and Educational Exchange Act. Administrative responsibility for the IMG program is vested in the United States Information Agency. An appropriation for the purchase of the IMG funds in Israel is necessitated in that country first because of two factors: (1) The IMG program in Israel is the largest in the world, resulting in a particularly high rate of accrual of local currency funds, and (2) the agreement between the United States and Israel was the first which limited the expenditure of local currency proceeds to scientific, educational, and cultural purposes, and such other purposes as might be agreed upon between the two governments. A summary of the accumulations of Israeli pounds, by fiscal years, since the first year of the operation of the program in Israel is as follows: Of the above total, IL6,345,000 ($3,525,000 at the current rate of IL1.80 equals $1) is recommended for expenditure. The remaining funds have been left for purchase with funds appropriated for the Fulbright program, plus appropriations for local administrative expenses of the USIA operation in Israel. IMG operations in each country are based upon bilateral executive agreements between the United States and the foreign government. The agreement on the disposition of IMG funds in Israel was contained in an exchange of notes dated June 9, 1952, between the Prime Minister of Israel and our Ambassador to Israel. Under this agreement, the funds are "freely expendable by the United States Government for scientific, educational, and cultural activities and for such other purposes as may hereafter be agreed upon by the United States Government and the Government of Israel." This provision of the agreement was introduced at the insistence of the Israel Government to avoid the loss of dollar exchange, and it now appears in several other agreements. Such a provision has been accepted by the United States Government in countries where, for reasons of policy, it has been especially desirable to introduce informational materials from the United States. While the funds accrued under agreements of this type cannot be utilized for general United States expenses, they provide the means through which friendly relations can be cemented by using them for cultural, scientific, and educational activities of mutual interest. SCOPE AND EMPHASIS OF THE PROGRAM In February and March of 1956, Mr. Bernard Katzen visited Israel as a special consultant to the Secretary of State. He was entrusted with the preparation of recommendations for the use of the Israeli pounds accrued under the IMG program for purposes that would further the common interests of the United States and Israel. The recommendations serve as the basis for this program. The fol lowing principles were followed in preparing the program: 1. Each project is calculated to create closer ties between the United States and Israel. 2. Each project is planned to permit it to be financed entirely in local currency. 3. Each project provides some specific new service or facility, not merely budgetary support. This was believed necessary both to maximize the impact of the proposed expenditures and to avoid future claims for assistance to maintain operations. 4. The program as a whole is designed to reduce administrative problems and expenses to the absolute minimum. Through use of United States grants, the total administrative cost has been kept well below 1 percent. 5. The program as a whole is designed to appeal to all major social groupings within Israel. 6. The geographic distribution of the projects was taken into consideration to reach as many people as possible. The program proposals listed below represent agreement between the Governments of the United States and Israel as the best use of the funds for educational, scientific, and cultural activities in Israel, in accordance with the provisions of the IMG agreement. Bar-Ilan University (construction of American science wing). 27, 778 69, 444 Beth Emmanuel Museum, Ramat Gen--- Beth Esther (purchase of orphanage). 41, 667 Beth Ha'am, Jerusalem (cultural center). Beth Hanoar Haivri (YMHA: YWHA), Jerusalem (English-lan- B'nai B'rith (Yehouda Halevy Lodge), Tel Aviv (scholarship fund)- 3, 333 27,778 5, 556 27,778 Chinuch Atzmai (elementary-school system). 27,778 216, 667 Council of the Shepardi Community, Jerusalem (study of American jurisprudence). 138, 889 13, 889 Summary of projects through grants-Continued HIAS, United Service, Beersheba (assistance to immigrants) – Hebrew University (construction of teachers' training school). Israel-American Archeological Foundation___ Israel-American Museum Foundation (construction of a museum). $25,000 105, 556 138,889 8, 333 111, 111 27,778 333,333 833.333 27,778 5,556 16, 667 Israel Conservatoire and Academy of Music, Tel Aviv_ Jerusalem School of Archeology (archeological studies). Israel Institute of Technology (Haifa Technion) (construction of vocational training building) – 7,778 166, 667 27,778 47, 222 P'eylim (camp for underprivileged children) ....... Torah Shelemah Institute (construction of library). Pardess Katz Maabarah (construction of children's nursery). Science laboratory, Herzlia High School, Tel Aviv.. Tel Aviv Cultural Center___ World history of the Jewish People.---. Young Men's Christian Association, Nazareth_. Zebulon Israel Seafaring Society Zionist Organization of America, Tel Aviv_ Total projects on grant basis---. 27,778 30,556 22, 222 27,778 166, 667 11, 111 111, 111 41, 667 27,778 5,556 41, 662 3,516, 667 Mr. ROONEY. Who will make the opening statement with regard to Mr. WILKINSON. I might also express Mr. Berding's regret that he is out of town today. He would like to have done this. I am the other deputy and I was asked to do it. Mr. Chairman and members of the committee, in this item the Department is requesting an appropriation of $3.525.000 for fiscal year 1958 for educational, scientific, and cultural activities in Israel. These funds will be used to purchase Israeli pounds generated by the informational media guaranty program which are owned by the United States Treasury and will be used for the purposes outlined in these estimates. As many of you know, the informational media guaranty program, originally authorized by the Economic Cooperation Act of 1948, makes it possible for foreign countries having a shortage of foreign exchange to import books and magazines from the United States through commercial channels. The foreign importer pays the American exporter in local currency and the exporter exchanges the local currency upon application to the United States Information Agency. The IMG program can only operate in countries that are willing to make formal agreements with the United States for its implementation. Such an agreement was signed with the Government of Israel in 1952. The agreement stipulates that the local currencies accruing to the United States Government under this arrangement shall be used |