Industrial and operating surveys.-If the major projects under the capital development program for South Korea are to be carried out, prior industrial and operating surveys are required. It is planned to employ the services of experienced American engineering, mining, and survey firms for this purpose. The cost will be approximately $2,215,000. The key surveys fall into three categories: coal, soil utilization and fertilizer production potential, and hydroelectric power potential. These surveys are necessary first steps in the rehabilitation and expansion of South Korean industry. The modest expansion anticipated will mean that many items essential for domestic use can be produced domestically. The consequent reduction in Korea's dependence on imports will be of decisive importance in reducing the country's foreign-trade deficit.

Survey of coal production.-The coal survey is part of the larger program for increased coal production. Four approaches to the problem are envisaged: core drilling to determine the extent of deposits wherever surface conditions are promising; a study of mining techniques in use; evaluation of these techniques; and a detailed study of mines now in operation and the best means for their immediate rehabilitation. These are indispensable steps for increasing substantially the availability of coal in South Korea. Dependent upon the availability of coal is the development of urgently needed power production. This, in turn, will largely determine the extent to which nitrogenous fertilizer plants can be developed so as to eliminate one of Korea's most expensive import requirements.

Survey of power production. Several small hydroelectric power plants now operate in Korea. An initial survey is already under way to determine the feasibility of rehabilitating and expanding these plants. The cost of hydroelectric power production is generally less than that of thermal electric power. The construction period is greater, however, and the cost of construction higher. Continuation of the analysis of the hydroelectric potential is essential if South Korea is to be independent of the North Korean plants in meeting its minimum hydroelectric power requirements.

Technical training and supplies.-Technical training during fiscal year 1950 will involve an estimated expenditure of $3,946,000. Most of the personnel of the Economic Cooperation Administration mission to Korea will be assigned to operational and technical functions, because Koreans with adequate managerial and technical knowledge and experience are not yet available for the specific functions involved. The mission, therefore, will have a much wider range of responsibility than a normal Economic Cooperation Administration mission to a participating country. It will participate directly in the conduct of operations. It will provide extensive on-the-job training in the conduct of highly technical activities among a newly independent people who were precluded by decades of Japanese occupation from developing their own technicians and managers. The operating personnel of the mission will furnish technical assistance of a most fundamental character.

Training in the United States. To the greatest extent possible the training of Koreans will be carried out in Korea. At a cost of $272,000, however, training in the United States in American industrial and agricultural techniques will be provided for a small group of Koreans. It is only through first-hand observation and study of American

plants, fisheries, farms, agricultural experiment stations, and the like that the knowledge essential to the successful implementation of the program in Korea can be obtained. The worth of such technical training has already been amply demonstrated by the benefits derived by European nations receiving assistance of this kind under the European recovery program.

Training in Korea. Of the funds allocated for technical training, $400,000 will be used to establish a special technical training institute to supplement the balance of the technical training program in Korea. This will be carried on through existing Korean industrial, technological, and agricultural institutions, under the general guidance of the Technological Training Division of the Economic Cooperation Administration mission to Korea. The institute will be staffed with American technicians. Its purpose will be to train Koreans. on a practical operating level. The fields to be covered in the institute will center around the areas of major expenditure of United States aid funds, such as mining, textiles, power, road construction, railroad construction, light manufacturing, and fisheries. The aim will be to develop essential skills among Korean workers in these particular economic areas. It can thus be seen that the training program envisaged is complementary to the capital improvement program planned for 1950 and to the general program for the improvement of Korean agriculture.

Training supplies and equipment.-Training supplies and equipment are scheduled at a total cost of $1,100,000. To implement the general technical training program it is essential that funds be provided for improvement of facilities and for equipment for demonstration and testing purposes in the fields of agriculture, mining, and industry. These funds will be used to purchase supplies and equipment which cannot be produced in Korea. Equipment provided by the Korean Government and private Korean institutions and paid for with local currency will be many times the value of the relatively small but crucial supplies to be provided by the United States.

Ocean freight costs.-Ocean transportation costs totaling $36,593,000 have been computed by items for each class of commodity in the fiscal year 1950 program. The estimates take into account antici pated sources of procurement and most probable ports of shipment. Use has been made of data furnished by the Department of the Army on estimated ocean shipping costs for items procured with fiscal year 1949 funds. Rate computations were based on both metric and measurement tons. It has been assumed that the methods of shipment used would be those most economical under reasonable, foreseeable circumstances.

Kimpo Airport. -This, the main airport in Korea, is located outside of Seoul. Its rehabilitation and maintenance are essential for its use. by all United States agencies in Korea. It will also be an asset to the Korean economy. As a matter of financial convenience, it was agreed by the interested agencies that the necessary dollar funds, estimated at $730,000, should be requested as part of the Economic Cooperation Administration's budget. It is anticipated that the airport will be operated by the Civil Aeronautics Administration.

Administrative costs.-$1,280,400 has been programed for administration. This includes all overhead expenses for the Division of Korea Program in Washington, for the administrative or overhead

part of the Economic Cooperation Administration mission to Korea, and for the Economic Cooperation Administration's contribution to the cost of the Joint Administrative Services operated in Korea by the Department of State for all agencies of the United States Government. The size of the Economic Cooperation Administration's contribution. to the Joint Administrative Services has not been finally determined and some increase in the total figure for administrative costs may be required if the Economic Cooperation Administration's share of the expenses is increased.

The headquarters staff.-The Washington staff as planned will consist of the minimum number of persons required to handle Economic Cooperation Administration headquarters responsibilities relating to the projected Korean aid program in fiscal year 1950. As a staff unit, the Division of Korea Program will coordinate the Korean program with the work of the Economic Cooperation Administration's functional divisions and staff offices. It will, in addition, initiate basic studies of the economy of Korea with the aim of insuring that approved programs reach maximum effectiveness as economically as possible. The Division will also assist in efforts to integrate the economy of Korea with that of the rest of the Far East in a manner consistent with United States policies and interests. Finally, in view of the fact that the Republic of Korea is a newly established government, the Korea Program Division will be called upon to perform functions ordinarily carried out by technical and purchasing missions of European recovery program countries.

The establishment in Korea. -The newly created Korean Government will require more help in all aspects of the Economic Cooperation Administration operation in Korea than would a longer established and more experienced government. There will be a need for more servicing, for more assistance in planning and in developing necessary records and the documentation required by the Economic. Cooperation Administration, more assistance in supervising the distribution of commodities financed under this program. The mission staff is the necessary instrumentality for assuring that the ultimate objectives of United States economic assistance to Korea are achieved at a minimum cost to this Government.

IV. THE TERMS OF THE BILL

A. THE BASIC POLICY (SEC. 2 OF THE BILL)

The language of the bill.-Section 2 of the bill presents language originating with the committee as an expression of the underlying considerations which impel the United States to underwrite the Republic of Korea with $150,000,000 at this time. It declares the American policy

* to continue, on terms consonant with the independence of the Republic of Korea and the security of the United States, to assist the people of Korea in their endeavors to establish a sound economy, to support the growth of individual liberty, free institutions, genuine independence, and representative government in Korea, to strengthen the ties of friendship between the American and Korean peoples, and to help to achieve the basic objectives of the Charter of the United Nations.

The section is a composite of the statement of policy in the Economic Cooperation Act of 1948, as amended, and of the preamble of the aid agreement of December 10, 1948, between the United States and the

Republic of Korea. The committee chose language from these two sources advisedly.

The link to European aid.-In selecting phrases from the Economic Cooperation Act, the committee indicates its view that the crisis of freedom in which the people of Korea find themselves is simply a facet of the same crisis which has confronted the peoples of Europe. It expresses the trust that with hard work, courage, and a measure of assistance from the United States, the people of Korea will continue to meet the challenge and will emerge from the crisis with the foundations of freedom strengthened. The United States has backed that hope for Europe with many billions of dollars worth of assistance. It is now called upon to show support of the same hope in a similar fashion in another portion of the world.

The link to the aid agreement.—The present bill represents the first full effort by the Congress to legislate a policy in relation to Korea. The earlier phases of American assistance to Korea have been in pursuance of appropriation acts and have been worked out in a field of responsibility that is primarily and almost exclusively the President's. Likewise, the policy of the United States in seeking to bring about the establishment of an independent Korea notwithstanding Soviet intransigence has been an executive policy. The aid agreement of December 10, 1948, was developed in the field of executive authority. This agreement speaks pointedly of the responsibilities of the United States arising from its special sponsorship of Korean independence in the United Nations Assembly. By adopting language from the aid agreement, section 2 of the bill emphasizes the continuity of United States policy from a stage when it was directed almost solely by the executive to a new phase in which the Congress undertakes a greater responsibility.

The principles of the Charter.-The statement of policy in this bill also reaffirms the principles of the Charter of the United Nations as part of United States foreign policy and relates them to the considerations underlying aid to the Republic of Korea. The Charter has been included by reference in the statements of policy in every enactment of the Congress authorizing foreign assistance since the Charter came into existence. This emphasizes the great weight which the Congress, the executive, and the American people continue to give the Charter as a keystone of United States policy. It emphasizes also that from the beginning of the Korean problem the United States has followed a course for which there was no alternative. Support for the Korean aspiration to regain nationhood in the full sense has been the only course compatible with the undertakings of the Charter.

The security question.-In its study of the Korean problem and in its consideration of the language of the policy statement, the committee gave earnest attention to the question of security. Is the security of the United States involved as directly and as obviously in Korea as it is in Europe? The United States is manifestly involved in the security considerations of the European Continent. That accounts for the presence of its troops there. So long as its troops are there, United States involvement in the security questions of Europe are beyond the realm of argument. Such troops as this Nation has in Korea, on the other hand, are now about to be withdrawn. Only an advisory mission will remain as a manifestation of this Government's