Statement by the President on the House Appropriations Committee's Rejection of the Development Loan Fund.

I HAVE just learned of the action of the Appropriations Committee of the House of Representatives rejecting all funds for the continuation of the Development Loan Fund.

This irresponsible action, if not rectified, will do the gravest injury to the whole position of the United States in the world today. As I told the Congress when I requested these funds, the Development Loan Fund has committed virtually all of its appropriated funds and must have additional funds now. The only alternative is to turn a deaf ear to all loan requests from our friends until fiscal year 1960 funds become available through authorization and appropriation several months from now.

The commitment of virtually all of the capital of the Fund was made by formal letters of commitment and other pledges signed and delivered under my authority and publicly announced both here and abroad. It is now contended by those seeking to cut off this vital arm of our foreign policy that the Fund still really is well supplied with money because these actions did not constitute commitments.

These commitments are firm. They have been made at my direction under provisions of law and in accord with my Constitutional authority. They must be honored. They, therefore, leave us without funds for further commitments.

I recommended, and the Congress established, the Development Loan Fund as a major instrument of United States leadership in the world. The action today, if not reversed, will represent a long step backward toward isolating our country and weakening our national security.