Action to Correct Payments Imbalance
American defense of the dollar will undergo its first test on the financial fields of Europe this year. The massive American business investment across the Atlantic is the central target of a new control program outlined by President Johnson on New Year's Day to bring this country's income from abroad into balance with its foreign spending—on trade, investments, tourism, military and foreign aid.
The United States balance of international payments, with an unbroken string of annual deficits since 1958, worsened under the impact of Britain's decision, Nov. 18, 1967, to devalue the pound sterling. The further imbalance threatened to undermine world confidence in the dollar, which has become the common currency for international transactions outside the Communist bloc.
Even before the British ...