800.05132/5–952:Telegram
The Ambassador in Brazil ( Johnson ) to the Department of State
priority
1391. For Assistant Secretary Miller. Bohan and I saw Pres Vargas this afternoon. Pres had been previously informed that we wished to discuss certain aspects of remittance decree and both Bohan and I felt that he gave us an exceedingly friendly and attentive reception. I told Pres that we hoped he might be interested to hear directly from Mr. Bohan, who had come recently from Wash, something of the effect produced by the decree in Amer circles that are friendly to Braz and keenly interested in its development.
When we had finished, Pres, who gave every indication of an understanding of position we outlined, began his own remarks with statement that he hoped we wld realize tremendous pressure now on him through growing force of nationalism, which he frankly said had been linked in many minds with Commie, but nevertheless, was a major factor in his own political calculations. He spoke of resentful feeling existing in Braz because of large sums of money allocated through Marshall Plan to Eur, and other areas of the world in comparison to what had been done for Braz. He also expressed his disappointment and dissatisfaction with slow progress made by Joint Comm, and said that speaking frankly, he wld also tell us that he had been informed that several members of the Amer sec of the Comm had close ties with Wall Street. Bohan and I defended the Amer sec of Comm vigorously. We told Pres he had been seriously misinformed regarding Wall Street connections of members of the Comm, which was contrary to fact. Pres seemed receptive to our explanations and statements and likewise to our expression hope that he wld be patient for we felt that the Comm was on eve of really constructive accomplishments.
Pres was very frank and moderate in all his statements. From things he said it was apparent, however, to Bohan and me that he has been subjected to considerable anti-Amer propaganda much of it vicious, and that it has been so persistent he is beginning to wonder if some of it is not true. In spite of Pres’s moderation of statement, I have concluded [Page 577] that opinions given me by FonMin Fontoura regarding certain influences on Pres have not been exaggerated, and that he and FinMin Lafer are objects of attack by these same groups. Pres gave us feeling of his sincere friendliness to US, but also feeling that he is genuinely disappointed at neglect with which he considers Braz has been treated by US. This feeling of disappointment has undoubtedly been fed by extremely nationalistic and anti-Amer propaganda to which he has been subjected and is consequently greatly exaggerated, but has become something of an obsession. I believe he is open-minded with a friendly disposition and not only ready but desirous to be convinced that our professions are sincerely meant. Most telling action that we can produce in clearing Pres Vargas’s mind of any remaining doubts will be prompt and effective action on loan projects recommended by Joint Comm.
Trend of Pres comments was consistent but in more moderate vein with account of his remarks to FinMin Lafer on May 7 reported in memo of conversation of May 81 between Lafer, Moreira Salles 2 and Bohan. Copies of this memo were forwarded by courier pouch today in an envelope addressed to Kidder and shld be in your hands on Mond.
Bohan is returning to Wash tonight by air will arrive some time May 11. He has an excellent and accurate understanding of situation here and will fill you in on details of talk with Pres today, as well as numerous conversations he has had with Min Lafer and latter’s advisers.