The House Foreign Affairs Committee gave President Reagan a partial victory on foreign policy yesterday by approving a compromise of his plan for aiding Caribbean Basin nations but providing less money for El Salvador than he sought.
The committee also broke new ground by voting to waive a 20-year-old law and permit use of foreign aid money to compensate Salvadoran land-owners whose properties are redistributed to peasant families.
The committee's voice vote approving the Caribbean Basin Initiative was the first success of any kind for this proposal, which has been alternately ignored and rewritten since it hit Capitol Hill early this year.
But while the compromise had bipartisan support in committee, it faces an uncertain fate on the House floor, where foreign aid of all types is unpopular this election year.
The Foreign Affairs Committee was voting on the economic assistance part of the Caribbean Basin program. Other major sections, providing tax incentives for investing in the Caribbean area and trade preferences to nations there, have been substantially rewritten by a House Ways and Means subcommittee, and that full committee has refused even to consider it.
The administration in recent days has turned up the heat in behalf of both the Caribbean initiative and other aid to Latin countries, including especially El Salvador.
The $350 million approved yesterday is primarily designed to help Caribbean and Central American countries generate local currency to remain economically stable.
Reagan's original proposal had been strongly criticized by Democrats because it would have devoted $128 million to a single country, El Salvador. Yesterday the committee whittled that down with an amendment prohibiting more than $80 million from being given to a single country.
But it also separately authorized an additional $20 million to be used exclusively for land-reform compensation in El Salvador. Local currencies generated would be used to pay land owners in hopes of getting the controversial reform off the ground. A 1962 statute prevents use of American funds for compensation in any country where land expropriation has taken place.
Land reform has become a crucial issue between the United States and El Salvador. Current law requires the Salvadoran government to show progress in redistributing properties to poor peasants in order to continue receiving U.S. aid. It has been argued that land reform was slow because the government there lacked funds to compensate land holders.
Meanwhile, the administration presented new statistics which it claims show that Salvadoran land reform is progressing despite the partial suspension ordered by the conservative government that won control in the election last March.
Thomas O. Enders, assistant secretary of state for inter-American affairs, told a Senate Appropriations subcommittee considering military aid to El Salvador that the government has reversed its course and issued more than 4,000 land titles since the election.
Enders also said the country's armed forces have restored more than 1,700 evicted tenants and their families to their lands.
The House committee compromise was worked out between Rep. Michael D. Barnes (D-Md.) and the State Department. If it passes both houses, the assistance would be available in the current fiscal year. However, the Senate Foreign Relations Committee threw out the administration's version and transformed the whole program into a multilateral aid plan to be run by the World Bank. The administration hopes to reverse that on the Senate floor.