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89Th Cong., 2Nd Sess., Congressional Record

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89Th Cong., 2Nd Sess., Congressional Record ~ ... ,,, "",.~ "'.~ -~. UNITED STATES OF AMERICA (tongrEssional REcord th PROCEEDINGS AND DEBATES OF THE 89 CONGRESS SECOND SESSION VOLUME 112-PART 8 MAY 3, 1966, TO MAY 18, 1966 (P}l<7ES 9511 TO 10980) UNITED STATES <70VERNMENT PRINTIN<7 OFFICE, WASHIN<7TON, 1966 9566 CONGRESSIONAL RECORD - SENATE MayO, 1966 In this way the disruptions in the business The legislation we have asked for to loan program, which have sometimes oc­ Because I deem these articles of con­ achieve this has passed the Senate. It is siderable value to the current congres­ curred when disasters have struck various under active consideration in the House. It communities, can be avoided. is as necessary for small business as It is sional diScussion of the proper degree of The b1ll also Increases by $125 milllon the sound for the Government. congressional review of CIA activities, I amount of loans SBA may have on Its books SBA Is not the only Federal agency in ask unanimous consent that they be at anyone time. And we expect SBA to use need of more effective financing authority. printed. this authority to serve more firms than ever If selling certificates of participation makes There being no objection, the articles before. sense for SBA, it makes sense as well in our were ordered to be printed in the RECORD, These are necessary changes, If the Agency other programs. That Is why I have rec­ as follows: is to carry out the small business program ommended that the Congress authorize the I have proposed for the coming fiscal year. same sound fiscal procedures for agencies [From the New York Times, Our budget for fiscal year 1967 proposes throughout the Government. Apr. 25, 1966] that SBA make avallable about $725 mill10n This policy Is not original With this ad­ CIA: MAKER OF POLICY, OR TOOL?-8URVEY in loans, guarantees, and other commitments ministration. In 1954, In 1955, in 1956, and FINDS WIDELY FEARED AGENCY Is TIGHTLY to small business. That Is the largest again In 1958, President Eisenhower affirmed CONTROLLED amount of financing SBA has undertaken in his bellef that private capital should be (NOTE.-The Central Intelligence Agency, its entire history. It Is more than four times gradually SUbstituted for the Government's which does not often appear in the news, what the Agency accompllshed in 1960. investment in housing mortgages. This is an impressive program-as it must made headlines on two counts in recent 1954, be, if it is to keep pace with the growth of In for example, President Els'enhower days. The Agency was found to have inter­ small business during the past 4 years. said: "The polley of this administration is to ceded in the slander trial of one of its agents There are about 300,000 more small busi­ sell the mortgages now held (by the Federal in an effort to obtain his exoneration with­ ,ness firms operating in America today than National Mortgage Association) as rapidly as out explanation except that he had done its the mortgage market penuits." there were 4 years ago. bidding in the interest of national security. There were 20 percent fewer fallures among In 1955, again President Eisenhower made And it was reported to have planted at least all businesses last year, than there were in clear his position: "Private capital w1ll be five agents among Michigan State University 1961. You know only too well that the great gradually SUbstituted for the Government scholars engaged in a foreign aid project part of those fallures were among small investment until the Government funds are some years ago in Vietnam. Although the businesses. fUlly repaid and the private owners take specific work of these agents and the cir­ Profits after taxes In small manufacturing over responsib1l1ty for the program." cumstances of their employment are in dis­ corporations were nearly three times greater President Eisenhower appointed a Com­ pute, reports of their activities have raised in 1965 than they were in 1961. mission on Money and Credit, and in 1961 many questions about the purposes and Small business has taken a much greater the Commission's report called once again methods of the CIA, and about Its relation­ share of mllitary prime contract awards. In for the maXimum SUbstitution of private for ship to other parts of the Government and 1961 small firms obtained $3.6 bill10n of Federal credit. nongovernmental institutions. Even larger those awards. In 1965 the figure was $4.9 In 1962 President Kennedy's Committee on questions about control of the CIA Within bllllon-an increase of 36 percent in 4 years. Federal Credit Programs reported that "un­ the framework of a free government and So we are planning and working for a less the urgency of other goals makes pri­ about its role in foreign affairs are period­ growth industry-for almost 5 million busi­ vate participation infeasible, the methods ically brought up in Congress and among nesses, from the corner store to the small used shOUld facilltate private financing, and other governments. To provide background manufacturer-for those millions of men thus encourage longrun achievement of for these questions, and to determine what and women who by their initiative and deter­ program objectives with a minimum of Gov­ issues of publlc policy are posed by the mination and hope keep the wheels moving ernment aid." Agency's work, the New York Times has in our economy. And as recently as 1963 the Republlcan spent several months looking into Its af­ This blll is essential for their growth and members of the House Ways and Means Com­ fairs. This series Is the result. development. But it is only half the answer mittee, led by Congressmen BYRNES, CURTIS, (Following Is the first of five articles on to small business needs. UTI', BETI'S, SCHNEEBELI, and COLLIER, argued the Central Intelligence Agency. The arti­ It gives SBA the authority to carry out that "the administration also can reduce its cles are by a team of New York Times cor­ our program for the coming year. But it borrowing requirements by additional sales respondents consisting of Tom Wicker, John does not give it any money. of marketable Government assets." W. Finney, Max Frankel, E. W. Kenworthy, We proposed to the Congress last year a That Is what we are trying to do through and other Times staff members.) new way of providing the funds necessary the general legislation we have offered to WASHINGToN.-0ne day in 1960 an agent for our small business programs. Congress. We are trying to further the SUb­ of the Central Intelligence Agency caught a Today SBA has only a limited amount of stitution of private for publlc credit-wher­ plane in Tokyo, fiew to Singapore and money for its lending operations. That does ever and Whenever we can in our free enter­ checked into a hotel room in time to receive not mean the Agency is Without assets. Far prise system. We want to extend the prin­ a visitor. The agent plugged a lie detector from it. It has in its revolving fund-in its ciple of private participation to SBA, and to into an overloaded electrical circuit and loan portfollo---loan paper worth almost $1V:z its sister agencies throughout the Govern­ blew out the lights in the bUilding. b11lion. ment. In the investigation that followed, the These tremendous assests, owed to the Now it is my great pleasure to sign my agent and a CIA colleague were arrested and SBA by those who have borrowed from it in name to the Small Business Act Amendments jailed as American spies. past years, represent the taxpayer's money. of 1966. The result was an international Incident Their representatives In Congress have ap­ that Infuriated London, not once but tWice. propriated it to the SBA over the years, to be It embarrassed an American Ambassador. invested In small business concerns. NEW YORK TIMES RESPONSmLY It led an American Secretary of. State to But there is no reason for SBA to hold so REPORTS ON THE CIA write a rare letter of apology to a foreign large an inventory. It can and should be chief of state. able to sell its loans to private Investors. In Mr. TYDINGS. Mr. President, last Five years later that foreign leader was that way, It should be able to generate new week the New York Times published a handed an opportunity to denounce the funds for It expanded lending programs. series of five very illuminating articles perfidy of all Americans· and of the .CIA SBA has long had the authority to sell Its concerning the Central Intelligence in particular, thus increasing the apprehen­ seasoned loans, as well as to make them. It Agency. sion of his oriental neighbors about the has used that authority over the years-to Agency and enhancing his own political provide new capital for assisting more small The Times attached such significance position. businesses. to this series that it assigned several of Ultimately, the incident led the U.S. Gov­ What we are asking for Is a more efficient its top writers, including Tom Wicker, ernment to tell a lie in pUblic and then to and practical way of achieving that goal. Max Frankel, Bud Kenworthy, and John admit the lle even more pUblicly. We want to authorize the SBA to sell par­ ticipations In its loan portfollo---to sell Finney to ''lork as a team to research and PERSISTENT QUESTIONS shares In this great $1.5 bl1llon pool of out­ write them. The lle was no sooner disclosed than a standing loans. Those shares would be guar­ As one would expect from this team, world predisposed to suspicion of the CIA anteed by the SBA, and sold to private in­ the Times series on the CIA was top­ and unaware of what really had happened vestors large and small.
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