16. Memorandum for the Files, by the Assistant Secretary of State for Inter-American Affairs (Holland)1


  • Notes on Conference Regarding Guatemala


  • Mr. Holland
  • Mr. Sparks
  • Mr. Newbegin
  • Mr. Leddy
  • Mr. Fisher
  • Mr. Krieg

It was decided that our objectives in connection with aid to Guatemala are:

To increase employment in order to reduce political unrest, and
To help the Guatemalans produce and implement an intelligent, practical program for stabilizing their economy.

The quickest way to make progress toward objective No. 1 is to begin work on the Pacific slope highway for which FOA has made available $3 million. Work has been obstructed by the inability of the Guatemalans to overcome some procedural and governmental obstacles.

It was decided to recommend to the Embassy that it, in turn, recommend to the President that he order the workmen contemplated for the highway job be hired immediately and without waiting for solution of the problems which have been holding up the program. Thus, the objective of increasing employment can be achieved immediately and will not be further postponed pending the solution of the preliminary problems referred to.

As regards development of a practical economic program, it was decided that a contract between FOA and Klein and Saks2 is the first step. This has been held up because of haggling between FOA and Klein and Saks on relatively minor points. It was decided to ask the Secretary to telephone Mr. Stassen on January 24 and urge immediate execution of a contract with a minimum of delay. Likewise, a letter from the Secretary to Mr. Stassen making the same request was drafted.3

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Discussion was had of a long series of complaints against the Embassy relayed from the President through the Guatemalan Ambassador4 to Mr. Fisher of ARA. It was decided that Holland would talk to the Ambassador about these complaints and that their substance and the Department’s plans would be cabled to the Embassy. The cable was sent.5

  1. Source: Department of State, Central Files, 814.00–TA/1–2255. Confidential.
  2. A firm of economic consultants whose director, Julius Klein, served as Assistant Secretary of Commerce, 1929–1933.
  3. Document 19.
  4. José Luis Cruz Salazar.
  5. Infra.