Foreign Relations of the United States, 1952–1954, The American Republics, Volume IV

832.00 TA/4–2753:Telegram

The Ambassador in Brazil (Johnson) to the Department of State

confidential

Rio de Janeiro, April 27, 1953—8 p.m.

1501. Embassy telegram 1451, April 15.¹ I met with Foreign Minister this afternoon by arrangement to discuss question JBUSEDC termination. He told me that he has been in active consultation with President and his government colleagues on this matter for past two weeks, that he now has a draft note, which is projected as reply our note which he has in draft form (Department’s instruction 77, April 2).² Minister said he would prefer not give me his draft this afternoon as he has one or two points yet to clear up through conversation with Ambassador Salles at Washington. He will ask me to see him later this week and will give drafted text.

Minister then began his discussion of proposed Brazilian reply by saying that he agreed with principles of our proposed note and with our reasons for proposing termination Joint Commission on June 30. He said, however, that for “purely internal political reasons” Vargas administration earnestly hopes we will accede to Brazilian request which is contained in his draft note for termination Commission December 30 instead June 30 this year, even if it is continued with greatly reduced personnel after June 30. He hopes we would agree to withhold our projected note until arrival Dr. Milton Eisenhower in Rio end of June. I replied to Minister that I will be glad transmit his draft note when I receive it, together with his views, but that I had certain personal views about matter which I would state to him quite frankly. First, in my personal opinion, it would be unfortunate delay decision on this matter until end June and that I personally did not think question of life of Commission was matter which should be brought up for discussion with Dr. Eisenhower.³ I further pointed out to him that if life of Commission is extended on skeleton basis after June 30 until December 30, it would be bound to arouse hopes and expectations on part of public which might well be impracticable of realization; that resulting disillusionment would tend to wipe out good effects of Commission’s previous achievements and might, through its effect on a disappointed public opinion, have undesirable results on our relations, which would not be to benefit of either Brazil or United States. I further pointed out that by June 30, project reports included in Commission’s program will have been completed, that there is no practical possibility of any enlarged program resulting from continuation Commission for further six months, particularly as projects already completed by June 30 will be in hands of lending institutions for consideration and final determination as to financing. The Minister took my statements in good part and said he fully understands cogency of argument.

There is little doubt in my mind that Vargas administration hopes for further extensive financing from US and is therefore reluctant see technical termination Joint Commission, which provides convenient machinery for these expanded hopes. In spite of government’s desperate economic situation, however, and the intense desire and need for all dollar currency they can obtain, I believe responsible members of government, including Lafer and Fontoura, realize how thin a basis they have for additional loans from US until those already received and others possible under completed program of Joint Commission, have been organized and put in process of eventual liquidation. Political weakness of administration and its difficulty in getting support for legislative and administrative programs, is also factor which would give illusion that salvation might be found in further loans.

I am setting forth these preliminary views for Department’s consideration, I have discussed matter briefly with Ambassador Bohan, who agrees with foregoing. I would prefer reserve further comment until I have had opportunity consult with Lafer as well as Neves da Fontoura again, and to have actual text Brazilian draft note.

Johnson

1. In the referenced telegram, Ambassador Johnson reported that he had discussed termination of the Joint Brazil–United States Economic Development Commission with the Brazilian Foreign Minister, and that the Foreign Minister had asked him to refrain from delivering a note on the subject until he had an opportunity to review the matter with President Vargas (832.00 TA/4–1553).
2. Not printed (832.00 TA/4–253).
3. Reference is to Dr. Eisenhower’s factfinding mission to the countries of South America, undertaken as the Personal Representative of President Eisenhower between June 23 and July 29, 1953; see the editorial note, p. 196.