"Studies of Executive branch organization" was an agenda item discussed by the National Security Council at its meeting of February 1, 1961. Following this discussion President Kennedy approved, among other items, NSC Action No. 2399-c, which "Noted the President's view that the foreign assistance program must be reorganized before presentation to the Congress; and that the Director, Bureau of the Budget, was planning to submit such a reorganization along with the new foreign aid program." (National Archives and Records Administration, RG 59, S/S-NSC (Miscellaneous) Files: Lot 66 D 95, Records of Action by the National Security Council) This assignment was confirmed in National Security Action Memorandum (NSAM) No. 6, February 3, 1961, from Bundy to David E. Bell, Director of the Bureau of the Budget. (Ibid., S/S-NSC Files: Lot 72 D 316, NSAM No. 6)

On March 22, in a special message to Congress on foreign assistance, President Kennedy discussed, among other things, a proposed reorganization of foreign aid programs that would integrate into a single agency all the Washington and field operations of the International Cooperation Administration, Development Loan Fund, Food-for-Peace, Export-Import Bank, and the Peace Corps. Field work would be under the direction of a single mission chief in each country who would report to the Ambassador. "Similarly, central direction and final responsibility in Washington will be fixed in an Administrator of a single agency-reporting directly to the Secretary of State and the President." (Public Papers of the Presidents of the United States: John F. Kennedy, 1961, pages 203-212)

On May 26 President Kennedy sent identical letters to the President of the Senate and to the Speaker of the House of Representatives describing major features of a draft bill on foreign aid he was forwarding to Congress. The bill assigned overall responsibility and authority for the formulation and execution of foreign development aid programs to a single entity--the Agency for International Development (AID)--within the Department of State. It would replace the International Cooperation Administration and the Development Loan Fund, which were to be abolished. The new agency would be headed by an Administrator of Under Secretary rank who would report directly to the Secretary of State and the President. For text of President Kennedy's letter, see ibid., pages 407-411. The draft bill became S. 1983, which Senator J. William Fulbright introduced for the administration on May 31. For text of the bill, see International Development and Security: Hearings Before the Committee on Foreign Relations, United States Senate, Eighty-seventh Congress, First Session, Part 1, pages 1-25. Hearings on the bill in the Senate and House of Representatives were held from May 31 to July 6. For text of these hearings, see ibid., Parts l-2, and The International Development and Security Act: Hearings Before the Committee on Foreign Affairs, House of Representatives, Eighty-seventh Congress, First Session, Parts 1-3. Testimony in closed session of the Senate Foreign Relations Committee has been published in Executive Sessions of the Senate Foreign Relations Committee (Historical Series), Eighty-seventh Congress, First Session, 1961, volume XIII.

For additional documentation concerning reorganization of the foreign assistance program, see Foreign Relations, 1961-1963, volume IX, Documents 84-177.

On March 1, 1961, President Kennedy signed Executive Order 10924, which provided for the establishment of a Peace Corps on a temporary pilot basis. (26 Federal Register 1789) Under the authority of this Executive Order, the Peace Corps was initially established as an agency within the Department of State, with R. Sargent Shriver, Jr., as Director. (Department of State Delegation of Authority 85-11, March 3, 1961, in 26 Federal Register 2196) In September 1961 the Peace Corps began operating under the authority of the Peace Corps Act of September 22, 1961; see Document 73.

In a message to Congress, also on March 1, the President recommended "the establishment of a permanent Peace Corps--a pool of trained American men and women sent overseas by the U.S. Government or through private organizations and institutions to help foreign countries meet their urgent need for skilled manpower.

"The temporary Peace Corps will be a source of information and experience to aid us in formulating more effective plans for a permanent organization. In addition, by starting the Peace Corps now we will be able to begin training young men and women for overseas duty this summer with the objective of placing them in overseas positions by late fall. This temporary Peace Corps is being established under existing authority in the Mutual Security Act and will be located in the Department of State. Its initial expenses will be paid from appropriations currently available for our foreign aid program."

The President pointed out that the Peace Corps would "differ from existing assistance programs in that its members will supplement technical advisers by offering the specific skills needed by developing nations if they are to put technical advice to work. They will help provide the skilled manpower necessary to carry out the development projects planned by the host governments, acting at a working level and serving at great personal sacrifice. There is little doubt that the number of those who wish to serve will be far greater than our capacity to absorb them." (Public Papers of the Presidents of the United States: John F. Kennedy, 1961, pages 143-146)

On May 30, in identical letters to the President of the Senate, Lyndon B. Johnson, and the Speaker of the House of Representatives, Sam Rayburn, President Kennedy transmitted proposed legislation to authorize the establishment of a Peace Corps in fiscal year 1962, as he had recommended in his message of March 1. The President stated that "enactment of this legislation will provide authority for the recruitment, training, and service overseas of American men and women whose skills and knowledge can contribute in a most valuable and practical way to the achievement of social and economic development goals of developing countries."

The President noted that projects had already been announced for Tanganyika, Colombia, and the Philippines, and others would be announced soon. Over 8,500 Peace Corps Volunteer Questionnaires had been returned. The President asked Congress to authorize $40 million for the program for fiscal year 1962. This was intended to enable the Peace Corps to have between 500 and 1,000 volunteers abroad by the end of 1961, 2,700 abroad or in training by June 1962, and provide for summer 1962 training of volunteers expected to be enrolled in June 1962. The President noted that he had "requested the Secretary of State to establish arrangements to assure that Peace Corps activities are consistent and compatible with country development assistance plans. These arrangements will assure that the Peace Corps and the Agency for International Development programs are brought into close relationship, while at the same time preserving the separate identity and unique role of the Peace Corps." (Ibid., pages 418-419)

Washington, June 26, 1961.

Dear Mr. Secretary:

We shall certainly keep in mind your recommendations that we start from the talent available rather than from the requests sent to us from foreign countries in establishing what we will, or will not undertake as Peace Corps enterprises in the future. I want to reassure you, however, that we have not undertaken any final commitments to send people abroad unless we were morally certain that we had the people available to do the work.

I have just returned from visiting our first group of Peace Corps Volunteers who are assembled at Rutgers University for a 2-month training period. They are a most inspiring group of men. Everybody connected with CARE, which is cooperating with us in this particular enterprise, is enthusiastic about the selectees. I think you would be, too, if you had a chance to visit New Brunswick to see them. I feel confident that we can maintain the same high standards in the other programs.

You said you would be glad to talk to Senator Fulbright about the amount of money being asked for the Peace Corps and the numbers of persons we propose to involve in the Peace Corps program this year, if he asked you. May I respectfully suggest that it would be very helpful if you could find it possible in some appropriate way to take the initiative in this matter. I think it would be helpful if Senator Fulbright realized that our proposal had the support of the administration as a whole, especially the Secretary of State. Moreover, I think it would be a tragedy if, in response to the President's call for a Peace Corps, we on the executive side responded with a program any smaller than the one we have proposed.

Sincerely yours,

Sarge

On September 4, 1961, President Kennedy signed into law the Foreign Assistance Act of 1961 (P.L. 87-1985; 75 Stat. 424; see Document 69). On October 3 Fowler Hamilton was sworn in as Administrator of the new Agency for International Development (AID). The Foreign Assistance Act of 1961 had specified that a new agency was to replace the International Cooperation Administration and the Development Loan Fund within 60 days after the law was enacted. Executive Order 10973 specified the terms of establishment for the Agency for International Development. Department of State Delegation of Authority No. 104, November 3, 1961, conferred specific responsibilities on the new agency. (26 Federal Register 10608)

On September 22, 1961, President Kennedy signed the Peace Corps Act. (P.L. 87-293; 75 Stat. 612) For text of the President's remarks on this occasion, see Public Papers of the Presidents of the United States: John F. Kennedy, 1961, pages 614-615. The Act formalized the authority and purpose of the activities of the Peace Corps, which included the placement abroad of volunteer men and women of the United States in newly developing nations of the world to help fill needs for critical manpower. Peace Corps volunteers, carefully selected and trained, were to serve for periods of 2 years teaching, building, or working in the communities to which they were sent. They would serve local institutions and live with the people they were helping. Volunteers could also be used to support existing economic assistance programs of the United States, the United Nations, or other international organizations.

The Peace Corps would provide skilled manpower to newly developing nations through several different channels of operation, as follows: 1) arrangements with private voluntary agencies to carry out Peace Corps-type programs; 2) arrangements with colleges, universities, or other educational institutions; 3) programs of other U.S. Government agencies; 4) programs of the United Nations and other international agencies; 5) directly administered Peace Corps programs with host countries.

R. Sargent Shriver, Jr., as Director of the Peace Corps, was responsible to the Secretary of State for all activities of the agency. He was assisted by a Deputy Director and an Executive Secretariat. The operating components of the Peace Corps included an Office of Program Development and Operations; Office of Public Affairs; Office of Peace Corps Volunteers; Office of Management; Office of Planning and Evaluation; General Counsel; Division of Contracts and Logistics; Division of Public Information; Division of Private Organizations; Division of University Relations; and Division of Research.

Documentation on the establishment, organization, and operations of the Peace Corps is in the National Archives and Records Administration, RG 490, Records of the Peace Corps; and in the Peace Corps Historical Collection, maintained by the Peace Corps, Reference, Research, and Distribution Division, Washington, D.C.

On September 26, 1961, President Kennedy signed H.R. 9118, creating the U.S. Arms Control and Disarmament Agency (ACDA). As enacted, H.R. 9118 was Public Law 87-297. (85 Stat. 631) The new agency was to be responsible for the conduct, support, and coordination of research for arms control and disarmament policy formulation; the preparation and management of participation in international negotiations in the arms control and disarmament field; the dissemination and coordination of public information concerning arms control and disarmament; and the preparation for, operation of, or, as appropriate, direction of U.S. participation in such international control systems as might under treaty arrangements become part of U.S. arms control and disarmament activities.

The agency was to be headed by a Director, appointed by the President with the advice and consent of the Senate. The Director was also to function as the principal Adviser to the President and Secretary of State on arms control and disarmament matters and, under the direction of the Secretary, have primary responsibility within the government for such matters. The Agency's program responsibilities would be primarily discharged through four bureaus: International Relations Bureau, Weapons Evaluation and Control Bureau, Science and Technology Bureau, and Economics Bureau.

At the signing ceremony in New York City on September 26, the President emphasized the importance the United States placed on arms control and disarmament in its foreign policy. The ultimate goal was a "world free from war and free from the dangers and burdens of armaments in which the use of force is subordinated to the rule of law and in which international adjustments to a changing world are achieved peacefully. It is a complex and difficult task to reconcile through negotiation the many security interests of all nations to achieve disarmament, but the establishment of this agency will provide new and better tools for this effort." The President announced that William C. Foster, who had been a consultant to John J. McCloy, the President's Adviser on Disarmament, would be Director of the new agency. (Public Papers of the Presidents of the United States: John F. Kennedy, 1961, pages 626-627)

Transferred to the new agency was the former U.S. Disarmament Administration, which had been established within the Department of State on September 9, 1960. (Department of State Circular No. 370, October 12, 1960; copy in Eisenhower Library, President's Office Files, ACDA) During the course of 1961, there had been considerable discussion concerning the location and functions of a new disarmament agency. Presidential transition adviser Richard E. Neustadt in a memorandum to Rusk on January 2, 1961, indicated that President-elect Kennedy had a "'superficial preference' for locating the work of policy development and attendant research on 'disarmament' or 'arms control' in the Executive Office of the President, rather than in the Department of State." In a memorandum of January 4 to Kennedy, Neustadt stated his own view "that an Executive Office unit should be avoided if possible and that a try should be made with an autonomous unit under the Secretary of State but with access to you insofar as you want it. McCloy's presence makes this easier to work than might otherwise be the case." (Kennedy Library, National Security Files, Staff Memos, Richard E. Neustadt, 10/60-11/63)

In a letter of January 27 appointing McCloy as his Adviser on Disarmament, Kennedy asked McCloy to make recommendations concerning the organization of the U.S. Disarmament Administration and related activities. (Foreign Relations, 1961-1963, volume VII, Document 2) After studying the question, McCloy concluded that the agency should be established by statute "at an authoritative level in the Government with the exceptionally broad competence, functions and resources required to work on the problems of arms control and disarmament, including the conduct of the research so essential to progress in this field. I was also of the opinion that those conducting this research should be in the same organization as those charged with actually carrying out negotiations in the field and that the organization should be subject to the direction of the Secretary of State, although distinct from the Department of State. The Director of the new Agency would have to deal with and coordinate the activities of many other agencies of government which have direct access to the President. The Director, therefore, should serve as the principal adviser to the President in the disarmament field, with direct access to the President upon notification to the Secretary of State."

McCloy prepared a draft bill to establish the proposed new agency and transmitted it to the President under cover of a letter of May 9. After a government-wide clearance process, McCloy sent a slightly revised draft bill to the President on June 23. The President transmitted this draft bill to Congress by letter of June 29. In the Senate it was introduced by Senator Hubert H. Humphrey as S. 2180. About 70 other similar or identical bills were introduced in the House of Representatives, many of them calling for the proposed entity to be named the "Peace Agency." (Letter from McCloy to Kennedy, May 9 and June 23, 1961, and related documents; National Archives and Records Administration, RG 383, ACDA/DD Files: FRC 77 A 17, Chron File, April-June 1961; draft letter from McCloy to President, September 29, 1961, ibid., July-September 1961)

Washington, September 28, 1961.

SUBJECT
Washington News

[Here follow paragraph 1, dealing with the appointment of John McCone as Director of Central Intelligence, printed as Document 91; and paragraph 2, dealing with the military budget for Fiscal Year 1963.]

3. There is an important management decision brewing in the foreign aid field. Dave Bell has been working on the executive order to put the new legislation into effect, and he is coming up against the key question of assignment of responsibility, within the Department of State, for coordination of military and economic assistance. Formally, this must go down through the Secretary of State, but the operating question is which of his subordinates will do the job for him, since no Secretary can find the time for this type of judgment--and, in any event, this is not Dean Rusk's major interest. Bell and I and our respective experts are inclined to press hard for delegation of authority here to Fowler Hamilton. In this case he would act as the Secretary's agent and not simply as the Director of the AID agency, and he would have to show the kind of wider judgment that is implied in balancing political, military, and economic considerations. But of the available senior men in the Department, he seems the best qualified. And, in particular, this seems a better answer than the one the Secretary may prefer--which is to have the coordination managed directly from his office by a relatively junior special assistant acting in the name of the Secretary. An arrangement of this sort simply would not stick, and the result would be that issues would always be pressed beyond the Department to the White House. Big issues are bound to come to you, but day-to-day matters really should be settled by a man who has the seniority to make decisions stick. The Pentagon is happy to entrust this to Hamilton. Dave Bell is going to try to sell this solution to the Secretary of State, but if he fails, you are likely to find the issue on your desk next week.

[Here follow paragraph 4, concerning Chester Bowles, printed as Document 43; paragraph 5, dealing with Syria; and paragraph 6, dealing with Berlin.]

McG. B./2/

Washington, December 3, 1963.

Dear Mr. President:

I welcome and will give full personal support to your memorandum of November 30 about thrift and frugality in Government./2/ I should like to emphasize the importance of a single policy throughout the Executive Departments on matters of personnel. Unless such policies are pursued diligently and systematically across the board, those who achieve the desired result in prudence and economy would face morale problems arising from a sense of inequity or lack of confidence in their immediate leader's dedication to the interests of their own Departments.

It would be my suggestion that you make it clear to all of the Executive Departments that you expect them to hold the line on numbers of personnel except (a) where there is a clear and almost mathematical relationship between the numbers of persons required and the necessary services to be rendered, and (b) where new programs have been specifically approved by the Congress and require additional personnel.

As one who served in the Department of State in the 1940's and has now returned to it after a decade, I have been tremendously impressed by the way in which the Department has measured up to rapidly increasing responsibilities without a comparable increase in personnel. This means a gratifying increase in productivity in ways that are difficult to measure.

Respectfully yours,

Dean Rusk/3/

Secretary of State Rusk testified on December 11, 1963, before the Senate Subcommittee on National Security Staffing and Operations, chaired by Senator Henry M. Jackson. In a broad statement, Rusk discussed a variety of issues concerning the staffing and operations of national security policy. He discussed the scope of foreign affairs; the role of Congress and Executive-Legislative relations; the respective roles of Desk Officers, Assistant Secretaries, and Ambassadors; the role of intelligence; and problems of coordination and administration. For text of his testimony, see Administration of National Security: Hearing Before the Subcommittee on National Security Staffing and Operations of the Committee on Government Operations, United States Senate, Eighty-eighth Congress, First Session, December 11, 1963, Part 6.