The Chargé in Brazil (Thurston) to the Acting Secretary of State
[Received July 18—11:45 a.m.]
66. A United Press despatch from Washington published in the Rio de Janeiro newspapers last night and this morning states that [Page 14] the “Cautious accepting in principle by Brazil” of the proposal to explore the possibilities of a reciprocal agreement with the United States made a deep impression upon diplomatic circles there. The despatch concludes with the statement that one motive which might justify Brazil’s attitude is the fact that the Brazilian economic delegation ascertain that the principal weapon of the United States was the possibility that Congress would impose a tax on coffee1 and that it is believed that such a possibility still constitutes an important factor in the forthcoming negotiations “although hope is entertained that an agreement may be reached on an amicable basis without the United States resorting to such a powerful recourse”.
During my interview with the Minister for Foreign Affairs reported in telegram 65, July 15, 10 a.m., I detected not the slightest sign of reluctance or “caution” with respect to this matter.