820.00 TA/11–3054
Memorandum by the Acting Deputy Assistant Secretary of State for Inter-American Affairs (Sparks) to the Deputy Under Secretary of State for Political Affairs (Murphy)
Subject:
- Technical Cooperation and Development Assistance Programs in Latin America.
We have just been told informally that, after considering your letter to him of November 24 stating that the Department of State believes the Technical Cooperation Program Plan for Latin America should be implemented at an early date except for those activities to which the Department has objected,1 Mr. Stassen has reiterated his instructions to his staff that the Program shall continue to be held up until after Mr. Stassen [Page 261] meets with Secretary Dulles, which he hopes to do on December 1. In your conversation with Mr. Stassen, it is recommended that you discuss with him both the Technical Cooperation and the Development Assistance Programs in Latin America along the following lines:
- 1.
- It is our understanding that except for funds required to maintain the FOA personnel who are already in Latin America and who are continuing to work on activities for which financing is still available from funds contributed in previous years, the $26 million appropriated and allocated for the Technical Cooperation Program for FY 1955 has not been released for obligation even though almost five months of the fiscal year have passed. Although the activities in operation at the end of FY 1954 (which constitute the major portion of the FY 1955 Program) are still in operation, most of these are operating at reduced levels and many are actually running out of funds. In addition, activities authorized for the first time in FY 1955 Program are not being initiated. For example: (a) the expanded program for Guatemala (including technical cooperation and development assistance), which was developed because of urgent political considerations, is not going forward. The Director of the USOM to Guatemala and Guatemalan officials are in Washington to press for action on this program, in particular the highway program; (b) hundreds of trainees scheduled to be brought to the United States under the FY 1955 Program are not being processed. (c) The proposed contract with the Inter-American Institute of Agricultural Sciences of the OAS (Turrialba) under which the Institute would furnish assistance in cacao and coffee production, has not been signed. (d) Proposed contracts with various United States educational institutions for carrying out segments of the Technical Cooperation Program are not being executed.
- 2.
- With regard to Development Assistance: (a) it is our understanding that FOA is withholding action to make available to Bolivia promptly the $16 million in grant aid as requested in your letter of November 23 to Mr. Stassen; and (b) the $3.7 million for Guatemala is being held up as mentioned above.
- 3.
- Failure to implement the basic Technical Cooperation Program and the Development Assistance grants in Guatemala and Bolivia would give grounds to the Latin American countries to consider the United States in default of commitments made to them. This would cause serious damage to the position of the United States in Latin America.
After you make the foregoing statements, Mr. Stassen may counter that the Department of State has caused the delay in implementing the programs and that he still wishes to resolve with Secretary Dulles the points at issue between FOA and the Department. If so, I recommend that you make the following points: [Page 262]
- 1.
- The activities to which the Department has objected represent a relatively small portion of the total FY 1955 Plan. (These fall principally in the Industry, Investment and Labor fields, where the views of ARA continue to be those set forth in Mr. Holland’s memorandum of November 13 to the Secretary (Tab A).2)
- 2.
- The Department continues to be prepared to give consideration to the possible implementation of certain of the activities in question. For instance, our objection in some instances would be removed if the other Government makes a request for the technical assistance which would be rendered. In this connection it is important that you read the memorandum to the Secretary of November 13, 1954 (Tab A).