825.5045/11–1246
Memorandum of Conversation, by the Chief of the Division of North and West Coast Affairs (Wells)
| Participants: | Señor Mario Rodríguez, Chilean Chargé d’Affaires |
| Mr. Spruille Braden, Assistant Secretary of State | |
| Mr. Briggs, ARA | |
| Mr. Wells, NWC |
Summary
Mr. Braden reiterates this Government’s grave concern over Chilean strike situation.
[Page 609]Mr. Braden took advantage of the Chargé’s call on another matter to reiterate the Department’s very serious concern with the El Teniente (Braden Copper Company) strike situation. He went over carefully the basic issues involved. He stressed the point that the Department is not attempting to judge the Company’s evaluation of the effects of the proposed settlement, but does hope that the Chilean Government may find it possible to delay definitive action on all contested points until Mr. Stannard reaches Santiago and has had the opportunity of discussing the whole situation directly with the appropriate Chilean officials.
Mr. Braden impressed upon Señor Rodríguez the possible adverse effects on public opinion and Congress of precipitate action and subsequent settlement on terms that might prove tantamount to government intervention. In this connection, he mentioned that Kennecott’s 90,000 stockholders are not without influence. Should the situation develop to the point of irrevocably damaging this U.S. private investment in Chile, the Department, the Eximbank, and the Government as a whole would be in a most embarrassing position for having simultaneously extended large loans to Chile.
We had taken great pains to demonstrate good will toward President Gonzalez Videla, this in spite of a feeling of uneasiness in certain quarters at the inclusion of Communists in the Chilean Cabinet. Admittedly, the strike is Communist-directed, and is aimed at an American enterprise. Mr. Braden recalled (confidentially) that ex-Foreign Minister Fernández had told Ambassador Bowers that the strike was a “Communist plot which, if unchallenged, would have grave consequences on Chilean economy”; and that President González himself had expressed regret to the Company’s manager that the Company was the victim of a squeeze between the Communists and the Socialists.
Reviewing the chronology of the strike, Mr. Braden again emphasized that our immediate interest is limited to urging the Chilean Government not to take hasty, arbitrary action before the situation has been fully discussed wih Mr. Stannard, and that an earnest effort be made to reach a mutually satisfactory agreement.