The Secretary of State to the Embassy in Honduras 1
522. Holland spoke with Montgomery 2 fifth (urtel 419, June 4)3 on basis Department’s interest in strike settlement as essential to Central American stability in face of Guatemalan Communist threat (and possible OAS consultation) and your estimate anti-Communist leaders would benefit from higher UFCO pay scale than Standard’s. Montgomery last night reported, after phoning Turnbull 4 La Lima, UFCO’s offer 19%, 10% and 5% increases (which he said with added fringe benefits are substantially better than Standard’s) likely be accepted and strike ended by ninth, but today UFCO not so optimistic due to another change in strike leadership midnight; that Bishop Capdevilla persevering in attempt get strikers accept above offer today, which offer UFCO would explain in flysheets, encouraging return to work which believed wanted by many employees. Holland gave Montgomery positive lines on back-to-work movement and impressed our serious concern strike continuance.
In continuing your close contact with officials UFCO and Govt, you should without intervening in specific issues discreetly exert influence on both toward prompt settlement on enduring basis, making clear to Galvez that we regard Honduran internal stability most desirable before OAS meeting. Your further recommendations for Dept’s action will receive immediate attention.