Foreign Relations of the United States, 1964–1968, Volume XXXI, South and Central America; Mexico

16. Telephone Conversation Between President Johnson and the Assistant Secretary of State for Inter-American Affairs (Mann)¹

Washington, June 11, 1964, 7:05 p.m.

Mann: I just got back from the Hill talking to Cooley about sugar with Charlie Murphy.²

President: What are our problems now? You got the Kubitschek problem in Brazil. What are the hot ones? You got an election in Chile.

Mann: We got an election in Chile in September.

President: All right.

Mann: We got this Foreign Ministers meeting which will probably take place in July on this Cuban, Venezuelan accusation against Cuba.

President: Are you, have you got that worked out where you’re going to get the kind of resolution that you want?

Mann: Well, we’re going to get, I think, a fairly good one. We’re having trouble with Mexico; Chile, because of its elections in September, probably going to vote against it; but we think that Brazil and Argentina will come along. We’ve been working on, haggling over words. Bunker’s working on it almost full time. I was talking, when you called, with the Mexican about it. Trying to get him to—

President: Who do you talk to? Who do you mean, the Mexican?

Mann: Sánchez Gavito.

President: Yeah.

Mann: He’s their OAS ambassador.

President: Is he pretty difficult?

Mann: No, he’s on our side, but he’s having trouble at home because of politics down there. Their basic problem is Lombardo Toledano and Cárdenas and trying to keep the party from splitting.³ It’s an internal problem with them. They’re fiddling with words that everybody can live with and—

President: When does that come up?

Mann: We think the first, within the first—it will be after the elections which in Mexico, which I believe are, it’s on a Sunday, I think the 6th of July, the 5th of July.

President: Any question about the Mexican election?

Mann: No, no, there’s no question at all there. They’ve had some disturbances—you know the Commies are growing up in Mexicali, that’s a serious problem for us, Mr. President—but I think we’re making progress.

President: How—Did you get Hayden⁴ to agree to what you want to do on that water?

Mann: We’re still waiting for word from him, but the Secretary is going to see him again tomorrow.

President: He told me, Hayden told me, yesterday that he had agreed to go along with the State Department.

Mann: Well, I think what he’s doing is waiting on some kind of a political commitment from your office about the central Arizona project.

President: That’s right, but he told me he’d agreed to go along with you all on the other one. I want to be sure it’s satisfactory before I agree with him.

Mann: Well, I think maybe that’s where we are, that’s the last word I had at noon today, that—I’ll talk to the Secretary about it in the morning if I may—

President: You be positive about that and tell him that he already told me he’d go with the Secretary. The Secretary ought to tell him that the President says that “you told him you’re going with us.”

Mann: I think he may infer back: “Yes, but this is a package deal, and whereas—”

President: He never has made it conditional that way, never has put it on that basis. He’s just said: “I’ve already helped you, now you help me.”

Mann: All right. Well let me—I’ll see the Secretary in the morning. I’ll tell him that it’s not conditional and—

President: No. No, that’s right. I’m trying to—

Mann: We have a lot of potential problems. For example, Uruguay has five presidents, as you know, and they’re just in a hell of a mess because they can’t manage their affairs very well; their growth rate is now down below their birth rate. The Kubitschek thing is bad. We’ll get some flak on that for two weeks, but the general trend, we think— after June 15 they can no longer do this, the law, their power to designate new people, expires then. We are urging them to set up an appeals procedure for Kubitschek and all of the others, so they’ll have a chance to be, for their day in court, to be heard. There’ll be charges against them and so forth—I don’t think it will get anywhere—but I would think the Brazilian thing would get better starting in about two weeks. I think it will look pretty good in thirty days.

President: You got any more hot spots?

Mann: We’ve got lots of headaches.

President: What’s happening in the Dominican Republic?

Mann: Well, they just reached an agreement with the Monetary Fund, and we’re now negotiating with them on trying to get them to take the self help measures that they have to take. They’ve got lots of problems. It takes them 7 cents—which is absurd—to produce sugar, and the world price is now around 5 and futures are about 4.5. So they have to fire a lot of people, and get more efficient, and increase agricultural production. And they’ve got to find a way to hold elections. And we’ve come to—some of them are really, Mr. President, are, you wonder sometimes whether they’re capable of governing themselves. But things are moving along pretty well. We’ve got problems nearly everywhere. Costa Rica’s in trouble. Their, they claim there’s a 35 percent loss of foreign exchange in their coffee exports and, I think it’s sugar, and we’re going to work on that because the President will be up here to see you and we’ll fill you in on that before he gets here. Panama is rocking along. They haven’t started talking yet but they will resume the next week. Illueca,⁵ I think, is coming in on Monday back from Panama.

President: What do we hear from our Ambassador down there?⁶ Is he doing all right?

Mann: think he’s done a fine job, and you made a good selection, I say that without qualification. He’s exercised good judgment, he’s been calm, and he’s been tough when he had to be tough. He’ll be up this week. By the way—early next week—we’ll have about seven ambassadors. You said you wanted to meet with them. Any time next week you’re ready, we’ll send about seven over there.

President: Yeah. All right. You just stay after Jack, make him give you a date, just hound him every day, ‘cause we just—The ones that raise the most hell get the most sugar.

Mann: All right. [laughter] I’ll stay on the phone—

President: You’re too good and too nice. So you just, you just give him hell. Just tell him every day, you got to call him the next day and get your date so you’ll know what you’re doing—

Mann: All right, will do.

President: And then you get me a briefing paper so I can tell me what I can say to them. And—what can I say that we’ve done in this Hemisphere now that’s improved the situation? What have we got that we can point to with pride besides pointing to with alarm?

Mann: Well, we’re going to send you over a memo with, it’s in preparation now, on the Alliance side.⁷ Where we’re weaker than any other place, Mr. President, is on trade. AID thing is going good, as you know, thanks to you. We’ll hear more complaints, I think, on trade, about sugar and coffee and things that they need to live, to sell in order to live. But I think on the whole that—

President: Can we say that these 6 months are better than the last 6 months before we came in?

Mann: I think we can. I believe—

President: Well, how or why are they better? How are they better now than they were—

Mann: Let me give you about twelve points on the AID side, and we’ll scratch around and find some other general points on—

President: From March though, if you’re just making a general statement, from March to November, the period in November to now, what’s the difference?

Mann: All right. Let us think about that.

President: I guess we’ll say Brazil, Brazil, say that’s the best thing, isn’t it?

Mann: No, I was thinking of things you could say.

President: No, no, I’m just talking about in my own mind.

Mann: Oh, well, the Panama thing went very well, Mr. President. The Guantanamo thing has gone well. The whole Cuban thing, in my opinion, has gone well.

President: The Brazil thing went all right.

Mann: Brazil is the most important thing outside of Cuba that’s happened in the last 20 years in Latin America—in spite of the difficulties, in spite of the excesses, and there have been excesses, stupidities, the pendulum swung too far back and now we’ve got to push it back toward the center. We’re going to win this election in Chile, things look good, we’ve done a hell of a lot of work on that. And—

President: Now, what have you got? A Communist running?

Mann: Well, we have a socialist running with Communist support, but the Communists are stronger than the socialists, and if he wins we think the Commies, he’ll be a prisoner of the Commies, cause they’re much, much better organized and much more disciplined.

President: What about our candidate? He’s not the incumbent is he?

Mann: No, our can—the candidate we hope will win is a Christian Democrat, and he’s being supported by the conservatives, the liberals, and, of course, the Christian Democrats, which is a new party. We’re not telling anybody this, but we’ve been taking polls, and even allowing for inaccuracies, the margin of inaccuracies, it looks pretty good. Frei, the Christian Democrat, comes up with 52 percent; Allende, the Communist-socialist candidate, with 36; and a third candidate, who represents the Radical Party—which is not radical at all, but it’s more anti-clerical, which we’re keeping in the race so, because we think all of his votes would go to Allende—he’s running about 7 percent; and the other 5, I think it’s 5 remaining, 5 or 6 percent undecided. So we’re not doing bad, we’ve picked up a lot of steam in the last, a lot of support for Frei in the last 6 weeks.

President: What are our danger spots?

Mann: Well, that’s the—

President: Chile election?

Mann: That’s the biggest one, I would say, with the fact of the Communist element in it.

President: And the Dominican—

Mann: The overflights over Cuba.

President: What in the world can we do to minimize that? We can’t go around them. We can’t circle the island. We got to go over it. And—

Mann: I think we’ll get, I’m hoping we’ll get some good resolutions, which would be very helpful on the domestic front, and also of real value to us.

President: Is trade going up much between the British and the Cubans?

Mann: Well, it has in terms of British exports to Cuba, and French exports.

President: They told me when they were here that they’d been 55 million, they’d cut them to five, but they’d be up on account of the buses. Now what, how much are they up to?

Mann: Well, what really happened, I don’t have the figures in my head, but I know it’s up quite a bit, Mr. President, because they’ve been buying all this sugar, and they’ve got these, Cuba’s got the convertible currencies to buy anything they want. I think it’s about two hundred million dollars a year that Castro made last year, and we expect him to make about the same this year as a result of the increased price of sugar. Now sugar prices are dropping, this is a very temporary phenomenon, sugar prices are dropping and he’s just, he’s not going to have the money to buy this kind of stuff much longer. So I don’t think that the prognosis, the medium and long term prognosis, is bad. It’s good.

President: You getting any reports of the things inside Cuba? What’s happening?

Mann: Well, not really anything new that—

President: Is there any dissatisfaction?

Mann: Yes, we figure about 25 percent of the people—the job holders, the office holders, especially the young people in the country who are better off than they ever were before—are totally in favor of Castro. We think he can count on about 25 to 30 percent of the people. We think there are about 25 to 30 percent of the people who are opposed to him, and the middle ground there, the 40 to 50 percent, are just sort of apathetic. And that’s the way it’s been for the last year or so, and there isn’t much change in that, because his hard core of support is built around the people who hold jobs.

President: Would you say that our economic isolation policy has been a complete failure?

Mann: No, sir. I think it’s been largely successful. I—

President: How? When the French and British are all trading with him?

Mann: Well, he’s had these dollars and they’ve sold him some things, and that’s hurt us. But on the, if—the alternative would be to let the bars down and let them extend credits and that sort of thing. And we’ve been very successful in keeping this limited to a number of isolated transactions. And this is a hell of a lot better than taking him into our bosom.

President: How are we going to get rid of him?

Mann: It’s going to take some time.

President: Well—

Mann: I think it’s going to have to come from—I really don’t think that, unless somebody kills Castro, or he dies, or the army is split in the very top command where they turn on him, the army especially, that the people themselves can get rid of him. As long as that army is loyal to him, he’s going to be there until he dies. And when he dies, nobody knows what’s going to happen, because he’s got the same power to mesmerize people that Hitler had, and we doubt that anybody else has got, can project this same kind of image. The only other way to knock him off would be to go in there with force from the outside, and this could happen, either as a result of our reactions to his shooting at our planes that are doing this photographic stuff, or as a result of collective action which we’re working on in this Venezuelan thing, whereby he tries again what he did in Venezuela, and if at that time you decide you want authority, the legal basis to go in, and you want to go in, I think we could get it. The main objective we hope to get out of this meeting is to say that subversion, communist subversion, is an aggression which is not an armed attack within the meaning of article six of the Rio Treaty, get them to accept that, so that if we have another act of subversion, we’ll have a good legal basis of going to the OAS and saying now you agreed that this was the law, and here are the facts, and this is what we ought to do. Because the biggest problem, as you know, that we had in the Bay of Pigs, was this doubt on the part of the lawyers and others that we had any right in international law to do anything, and we hope to clear that up considerably.

President: So that for the subversion by importing arms to other countries to be considered aggression, that would justify our moving.

Mann: That’s what we—if he does it again. But we would have to go to the OAS and prove the facts. They didn’t want to give us a blank check.

President: Well, you’ve got a statement there, say I ought to say at a press conference that I don’t intend to invade Cuba, just as Kennedy didn’t.

Mann: Well, sir, if I were you, I wouldn’t make a statement like that, because who can tell what’s going to happen tomorrow? Suppose he shoots tomorrow and—

President: Well they say Khrushchev is saying that he hadn’t seen us repeat Kennedy’s pledge and we ought to do it.

Mann: Well, I would send, I wouldn’t make a public statement, I’d have the Secretary of State say that if he behaves himself, doesn’t commit any aggressive acts against other Republics, and doesn’t shoot at any of our planes, or doesn’t give us cause to do anything, that everything’s going to be all right in terms of war and peace.

President: You tell, in the morning you call Mac Bundy, he’s not here, but you call him, and tell him I was talking to you last night, and you’d like to know what he’d propose to say in that statement and then you tell him why you don’t think it ought to be done.

Mann: All right.

President: Now, what’s the problem in Uruguay?

Mann: Well, Uruguay. They have this silly political system, Mr. President, where they’ve got five presidents of the country and, I think, it’s seven mayors of Montevideo, the capital city, and it’s a little tiny place, and graft and corruption is growing. They have an executive that’s almost paralyzed because there isn’t any one president. The people are beginning to talk about the need for strong leadership, but nobody’s done anything about it yet. And in the meantime their expenses are too high, they’re paying too much, they’re spending more than they’re earning on social security and a number of other things, and just having a hell of time making ends meet. And the result of this is a deterioration in confidence, the private sector is not investing in job-producing industries, and production is not going up. They actually had a slight decrease in their national GNP rate last year as compared with a fairly high birth rate, I think about two and a half per cent. And we are going to—[1 second sanitized by the Johnson Library under the donor’s deed of gift]—a skull session to see what it is we can do—because I see this one coming in some months ahead—and what it is we can do to get that economy rolling again. But when you have to work with five heads, a five-headed animal, a government, it isn’t always very easy to do, because they don’t, they fight like cats and dogs between themselves, they can’t agree on anything. That’s a major problem. We’ve got these, the possibilities of oil expropriations in Argentina and in Peru, but we think we’ve got those dampened down in Peru. We may have trouble in Argentina though, and it may come this month.

President: What are they going to do? Expropriate some of our oil companies?

Mann: It won’t be an expropriation. It will be a compensation for the amount of money they put in, which will satisfy some of the companies. Those that invested a lot of money and didn’t find oil, near as I can find out, they would be happy to get their money back. Then you have other companies like Standard of Indiana and Tennessee Gas and, I think, Cities Service, those three, made an investment and hit it pretty big, and they’re not about to think about, they’re not about to be satisfied with just getting their money back. So I told the Minister of Defense of Argentina the other day that we would not buy that, we thought the Hickenlooper Amendment would apply, and his reply was that they could not renegotiate those contracts. I suggested they might sit down and do whatever’s fair and reasonable. He said they couldn’t do that, it was too hot a political issue, but they could go through a procedure of opening this to bids, putting the concessions, the oil fields, up for bids, and then making the terms and conditions so that the same companies that own them now would end up owning them. Now this looks like to me it’s gonna be hard to do, and we decided this morning that I would call in these three companies and talk to them directly, and get their ideas, the ones who would be hurt the worst. I think Standard of Jersey and that crowd are going to be happy about it, but the others are not, and I think you can’t, can’t, without those guys.

President: Who’s that? Standard and Tennessee Gas?

Mann: I think Tennessee Gas, Cities Service and Standard Oil of Indiana are the ones who would be hurt the worst if they didn’t get—if they tried just to return their investments with interest. And I don’t think we can buy that, because if you apply that formula to Venezuela, where we have four billion dollars in assets, they’ll try to go back and say: “Well, you’ve already recovered your initial investment, so you ought to get out.” We have to be very careful about the precedent.

President: These damn coal men are really murdering me, because we don’t give them some of this substantial increase. They think that we ought to quit adding, importing that Venezuela oil all the time. Can we do anything like that?

Mann: Mr. President, I think there’s too much oil coming in from Canada. Their production—I worked out this exemption, overland exemption thing, about 4 years ago.⁸ We had a deal with them at that time that they would ship us in about 50,000 barrels a day mostly in the Pugent Sound area, and they’re now up to over 300,000 barrels a day or around there, especially in Humphrey’s state. I have to talk to Marlin⁹ about this. The Venezuelans are getting awfully nervous about this. The Ambassador was in to see me yesterday protesting.

President: What am I going to do about coal though if you and Marlin take all the God-damned oil that Canada and Venezuela produce? I’ve got all my people here that’s starving in these coal areas?

Mann: Well, we’ll have a look at the coal industry. I think they’re doing pretty good. I’d like to look at the figures, I—

President: No, they’re not. They’re in here this week, all of them, and just saying “you cost us 4,000 jobs by raising the oil quota on residuals.”¹⁰ And I’m going to appoint a committee, put you on it with McNamara, and make them redo it and do something for coal. We ought to help some of the people of West Virginia and Pennsylvania and Illinois, as well as help the people of Venezuela and Canada. I don’t mean just help them to the exclusion but give them some help.

Mann: Well, I’d rather give them help any place except at Venezuela’s cost. Maybe we can do, maybe we can find something in the Near East or something. Let us look at it, and see what we can do.

President: OK. All right. Bye.

Mann: Thank you.

1. Source: Johnson Library, Recordings and Transcripts, Recording of telephone conversation between President Johnson and Thomas Mann, Tape F64.31, Side B, PNO 5 and Tape F64.32, Side A, PNO 1 & 2. No classification marking. This transcript was prepared in the Office of the Historian specifically for this volume. Although the President’s Daily Diary indicates that Johnson placed the call, the tape does not include a salutation. (Johnson Library) The recording otherwise appears to document the entire conversation. An informal memorandum of the conversation, prepared in ARA, and incorrectly dated June 12, is ibid., Papers of Thomas C. Mann, Telephone Conversations with LBJ, January 4, 1964–April 30, 1965.
2. Representative Harold D. Cooley (D–North Carolina) and Charles S. Murphy, Under Secretary of Agriculture.
3. Vicente Lombardo Toledano, founder and leader of the Partido Popular Socialista (PPS), and Lázaro Cárdenas, former President of Mexico (1934–1940), who remained active on the left wing of the Partido Revolucionario Institucional (PRI).
4. Senator Carl T. Hayden (D–Arizona).
5. Jorge Illueca, principal Panamanian representative in the negotiations to revise the Panama Canal Treaty.
6. Jack Hood Vaughn.
7. See footnote 3, Document 15.
8. Mann was Assistant Secretary of State for Economic Affairs in April 1959 when the United States agreed to give Canada and Mexico an “overland exemption” to the oil import program. For documentation on that program, Foreign Relations, 1952–1954, volume IV, pp. 579–594, 608–609.
9. Marlin E. Sandlin, chairman of the Pan American Sulphur Company, Houston, Texas.
10. The Johnson administration amended the oil import regulation on March 6, raising the maximum level for residual fuel oil to the eastern United States (District I). (29 F.R. 3200, 3207) The President attended a National Coal Policy meeting on June 5 to discuss the concerns of the coal industry, including representatives from management, labor, and transportation. (President’s Daily Diary; Johnson Library)