Foreign Relations of the United States, 1946, The American Republics, Volume XI

825.5045/11–946: Telegram

The Acting Secretary of State to the Ambassador in Chile ( Bowers )

secret
us urgent
niact

Washington , November 9, 1946—5 p.m.

544. For your information and re your telephone conversation with Assistant Secretary Braden last evening, Dept. has already informally pointed out to Chilean Chargé the embarrassing even untenable position in which this Govt, would be placed in considering Chile’s request for further Eximbank loans and credits on Naval vessels at very time when proposed arbitrary settlement strike (described by FonMin himself as Communist plot, which would have grave consequences Chilean economy unless challenged) was jeopardizing highly important US investment copper industry. It was made clear to Chargé Rodríguez that with all good will in world for Chile this Govt. might be bitterely criticized by press and Congress if it were alleged that at time when interests of thousands of Kennecott⁹ stock holders were endangered American Govt. had made additional loans to Chile.

In your discussion with Chilean authorities it should be reiterated that the Dept. (Deptel 524, Oct. 26¹⁰) is not passing judgment on accuracy Company’s estimate of effects acceptance labor demands but is seeking mutually satisfactory solution taking full cognizance legitimate rights this US enterprise.

Since drafting foregoing Stannard¹¹ has telephoned to report conversation this morning with Turton¹² who was instructed by Stannard to state that Company could not accept arbitration on all points but is prepared to arbitrate on single point of wage differential between raise accepted by three other unions and amount demanded by the fourth (Communist dominated) union. We trust this will lead to acceptance by Chilean Govt. as the “further concession” recently suggested by that Govt. (Deptel 524¹³). Should it not be so accepted we are confident you will be able to impress Chilean Govt. seriousness situation and importance taking no precipitate action, pending arrival Stannard and opportunity full discussion with him.

Stannard plans leave by air next Saturday, Nov. 16. He explains that because of highly important directors meetings including discussion critical Chilean situation scheduled take place 14th and 15th impossible for him depart for Chile sooner. He is coming to Dept. for discussion on Nov. 12.

Please report present status operation at mines. Have strikers returned? If so, at what wage level?

Acheson

9. Kennecott Copper Corporation.
10. Not printed.
11. E. T. Stannard, president of the Kennecott Copper Corporation.
12. Franklin E. Turton, Santiago manager of the Kennecott Copper Corporation.
13. October 26, 1946, not printed.