v°|- '1 N°- 24 February i7, 1959

Circuiufed privately to leading Canadians 0 Copyright ‘I959 by Nash Associaies

Dear Sir: "Food for peace."

You're going to be hearing a lot about this phrase in the coming months. Agriculture Minister Douglas Harkness may be coming to Washington to talk about it this summer and Canada could wind up exporting a lot of subsidized wheat under its banner in a year or two. A

Basically, President Eisenhower wants farm surplus—producing nations like Canada, Australia, United States to operate a kind of international Public Law 480; that is to have an overall coordination of bilateral give-away pro- grams. He figures this would reduce foreign criticism of the U. S. surplus disposal programs; help in the Cold War; meet a humanitarian need; and mend a few political fences at home. '

The idea really belongs to a Mr. Don Paarlberg, who is one of Mr. Eisenhower's economic advisors. He'd like to see these give-aways build up national reserves in the so-called hungry countries. Storage facilities probably would be paid for by Uncle Sam. A meeting of the surplus-producing nations likely will be held in Washington this summer to work out details. One thing for sure: there would be no international control over the sur- pluses; no multilateralism; only, at best, a coordinated bilateralism.

* * This whole thing is vitally important to Canada. If we go along with the scheme, it means we will have found that we can't "lick 'em" so we must "join 'em". It would put us permanently into the business of surplus disposals similar to those of the United States which we have been criticizing so heartily over the past years. It seems certain Washington's cut-rate deals on surplus disposals are here to stay. Talk about the program being "temporary" or "only for a couple more years", you can mark down as daydreaming. The cut-rate deal has become a fact of life and it looks like we may have to join in or else see many of our wheat markets nibbled away.

This, of course, means subsidized exports. How much we can afford will be a real headache for Finance Minister Fleming.

* * Incidentally, we've come in for some strong criticism on Capitol Hill for our own complaining about U.S. surplus disposals. Harold Cooley, the North Carolinian Democrat who is Chairman of the House Agriculture Committee says Canada is to blame for what he calls a slowness in pushing American farm sur- pluses into the world markets. And he says he's so mad about our complaining he may send a Subcommittee to Ottawa to investigate the whole thing. Within