825.512/6–1549: Telegram

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

confidential
Priority

322. President Chile called me again today to a meeting with him, the Foreign Minister and Finance Minister and asked that US urgently act on following four matters to avoid a situation in Chile which he said he himself had not even realized yesterday to be as grave as it is. (See my telegram 3121 and 315.)

1.
That proposed excise tax on copper not be reimposed by Congress, but that if it should be that President veto it.
2.
Chile begs that laws authorizing direct purchase and stockpiling of copper be made effective soonest.
3.
Chile needs aid of US in securing an extraordinary loan from proper organizations in amount 40 million dollars for low cost housing and public works to replace losses in revenues and foreign exchange.
4.
Chile asks that US not insist in its interpretation GATT, an interpretation which it believes due to lack of information.

These four points determined in prolonged meeting Cabinet with President. With spreading report pending bill increase import tax on Chilean copper indignation here is general and completely shared by every American businessman here. Such an accumulation within a few days of deadly blows to Chile economy will be interpreted as deliberately unfriendly acts. Drop in price is understood as something beyond our control but increasing of import tax on copper is open to such interpretation and will create worst possible reaction against US. Important Embassy be promptly informed of our attitude on above four points. Some reassurance as to increase import tax on copper would be most helpful.

Finance Minister Alessandri tells me that general alarm of public is such that he will be compelled issue a statement on proposed tax since extreme rightest element will now gay it would have been better for government to have gone along with Peron’s third front instead supporting economic policy of US.

Bowers
  1. Not printed.