Jumping into a Pool

Disenchantment with ungrateful recipients and competing pressures on the federal treasury have steadily diminished American enthusiasm for helping less fortunate lands. Congress did not deign until the end of January, several months later than usual, to pass the aid appropriation for the present fiscal year. When it finally got around to what was obviously an unwelcome duty, it made the total only $1.8 billion--the smallest amount in the 22 years of foreign aid since the Marshall Plan was launched. Last week, to save foreign aid from withering away, a 16-man presidential task force headed by Rudolph Peterson, retired President of the Bank of America, came up with a series of drastic recommendations for overhauling all aid programs.

Peterson's force would abolish the U.S. Agency for International Development (AID), which now manages most of the assistance programs, and put U.S. aid funds into a pool managed jointly by the U.S. and other major international contributors, notably Western Europe and Japan. The underdeveloped countries getting aid would also have a bigger voice in deciding how the new multilateral pie would be divided. ''Only a genuinely cooperative program can gain the necessary long-term public support in the U.S.," the report contended.

Unrealistic Objectives. Such a switch might appease many congressional critics of the present program, including Senators William Fulbright and Edmund Muskie, as well as George Aiken, who recently damned the existing scheme as "a diplomatic pork barrel." It would also help to further lower the U.S. profile in international affairs, as Nixon wants to do. Military aid would be split off entirely from economic and technical assistance, thus ending a longstanding confusion. The U.S. would set up an international development bank, which would have $4 billion in capital and borrowing authority, and a technical-aid institute initially authorized at $1 billion. It would also double the current U.S. annual contribution of $500 million to the World Bank and other international aid institutions. The total outlay of federal funds for foreign economic aid would not necessarily increase at once, but the level of lending would be determined by the U.S. development bank rather than by Congress.

The Peterson report to Nixon came only a day after word leaked out about a strong critique of U.S. aid programs prepared for Secretary of State William Rogers by the American Ambassador to Chile, Edward Korry. U.S. effectiveness has been impaired, Korry asserted, "by the persistence of inaccurate or outdated assumptions and by the pursuit of unrealistic objectives." Korry argued: "By not differentiating our development objectives in accordance with realities, we appear to be engaged in developing virtually the entire less-developed world." Like Peterson, Korry found the answer in joint responsibility by donors and receivers for financing and carrying out aid programs. In substance, the Korry and Peterson reports are similar; in tone, however, Kerry's is much more harshly critical of inadequacies in the present aid structure.

The State Department played down the Korry report; one ranking official complained that Secretary Rogers found it "too revolutionary." By contrast, Nixon told reporters at Key Biscayne that he found the Peterson recommendations "fresh and exciting." He said that they will form the basis for a presidential report to Congress on foreign aid. He would, he said, "propose a new U.S. approach to foreign assistance for the 1970s."

Nixon hopes to make foreign aid more palatable to both Congress and the public, but the task will not be easy. The House, in particular, is jealous of its fiscal prerogatives and may well hesitate to turn control of the spending of U.S. aid funds over to an international agency. Foreign aid is deeply unpopular with Americans. In a Louis Harris poll taken for LIFE last year, 69% nominated foreign aid as the prime candidate for federal spending cuts. Still a condition that allows the gap between rich and poor nations to widen steadily is basically unhealthy--and dangerous to U.S. interests.

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