Cabot files, lot 56 D 13, “Uruguay”

The Ambassador in Uruguay (Roddan) to the Assistant Secretary of State for Inter-American Affairs (Cabot)



My Dear Mr. Cabot: This is a belated note of greeting and good wishes. Now that Tom Mann is leaving for the field, and in view of the approaching visit of Dr. Eisenhower,1 I believe this may be an opportune time to give you a brief résumé of the Uruguayan situation.

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The wool tops controversy is still smouldering although with diminishing heat. The Batlle-Berres faction is really bitter because it has long had political, and perhaps economic, ties to the tops industry. The Herreristas keep up the clamor for reasons of political expediency. Their interests are allied with the greasy wool producers and they never did like the tops industry. There is a measure of public resentment, without a real understanding of the issue, because many people believe the United States took an unfriendly action towards Uruguay. However, underneath there is a realization by moderates that the United States had justification for its action and hence the resentment will probably die away. Ambassador Mora now plans to leave for Washington this week-end and he should be able to give you a worthwhile view of the situation. He was very helpful here because of his restraining influence.

There is one adverse consequence of the wool tops ban which will linger on—that is, a worsening of the Uruguayan dollar position which is already bad. Exports to the United States constitute the principal source of dollars, amounting last year to $50,000,000 including $15,000,000 from tops, but this sum was more than offset by the dollar value of imports from there. In addition, Uruguay carries on trade in dollars with other countries at a net loss. Provisional estimates of trade with the United States for the first quarter of 1953 show an improvement of the Uruguayan position but at the expense of diminished imports from the United States. While the subject is too involved for treatment in a letter, it is certain that the loss of tops dollars will be fairly serious.

Overshadowing the economic factors, there is always the sensitive question of Uruguayan relations with Argentina. The Department was undoubtedly right in failing to mention Argentina in connection with tops in view of the explosive situation across the river, but this failure caused uneasiness here. The Peronista pressure against Uruguay continues, and it will probably continue even if the gentleman carries out his agreement to send an Ambassador here. Our Embassy is convinced that Perón did what he could to undermine this government during the general strike last September and the Uruguayan government is always apprehensive that he may try it again.

The Uruguayans, as we advised the Department, dislike the idea of Dr. Eisenhower coming here on a week-end and they will probably grumble again when they learn that he is visiting Argentina first. I think we can work out an acceptable schedule of dates without complicating the schedule too much and the business of visiting Argentina first should not be too important.

It is highly probable that on his visit here, the Uruguayans will seek some assurances from Dr. Eisenhower vis-à-vis Argentina and it may be well to begin thinking about it now. I appreciate that on a good will [Page 1564] visit to eleven Latin American countries, Dr. Eisenhower can hardly single out Uruguay for preferential treatment. Yet, Uruguay has been constant in its friendship to the United States and steadfast in its devotion to democratic principles and I think it deserves a degree of consideration a little above the ordinary. (Perhaps each Ambassador thinks the same about his post.) Quite frankly, just what we can do to reassure Uruguay or possibly to help overcome its economic difficulties, I haven’t been able to figure out.

The press has reported that you may come along with Dr. Eisenhower and if so we shall be happy to do what we can to make your visit pleasant and profitable.

With best wishes.

Sincerely yours,

Edward L. Roddan
  1. Reference is to the factfinding mission to the countries of South America undertaken by Dr. Milton Eisenhower between June 23 and July 29, 1953, at the request of President Eisenhower. Regarding Dr. Eisenhower’s trip, see the editorial note, p. 196.