14. Memorandum of Discussion at the 443d Meeting of the National Security Council, High Point Relocation Site, May 5, 19601
[Here follow a paragraph listing the participants at the meeting, an explanation of why the meeting was convened at the High Point Relocation Site, and agenda item 1, “History of U.S. and USSR Long-Range Missile Development.”]
2. U.S. Policy Toward Latin America (NSC 5902/1; OCB Report on NSC 5902/1, dated April 6, 1960)
[Page 141]Mr. Harr, summarizing the reference OCB report on the subject, said that on the basis of operations in Latin America during the past year, the Operations Coordinating Board recommended a review of U.S. policy toward Latin America for the following reasons: (1) the growing instability in Latin America; (2) increased Soviet influence in the area; (3) the desirability of re-assessing certain phases of our economic assistance; (4) the question whether regional guidance for Latin America continued to be adequate; and (5) the desirability of re-appraising policy in the light of the President’s recent trip to Latin America. Cuba and the Dominican Republic had of course been the most serious problems in the area during the past year. The Sino-Soviet Bloc had endeavored to extend its influence in Latin America, using native non-Communist groups as well as Communist subversive machinery. Sino-Soviet efforts were helped by latent anti-U.S. sentiment in Latin America, by economic yearnings, by nationalistic sentiments, and the feeling prevalent in many Latin American countries that closer association with the USSR could not be harmful since the U.S. appeared to be engaging in more contacts with Moscow. The “new climate of détente” was of course being emphasized by Moscow. Mr. Harr felt that we had made progress in Latin America in information and cultural activities, although the scope of these activities was still modest. We had, however, suffered a set-back with respect to labor unions, which are one of the primary targets of Communism, particularly in Chile, Venezuela, and Cuba. Economic conditions in the area have become more stable as price declines had ceased. Our trade with Latin America was at about the 1958 level. However, private investment in Latin America had declined because of restrictions and unsettled conditions; public investment had declined because the past year was largely one of preparation as far as public investment organs were concerned. Turning to the military situation, Mr. Harr said debate had centered on the validity of the hemisphere defense concept and on means of preventing unnecessary diversion of Latin American economic resources to military purposes.
Mr. Gray said the Planning Board was reviewing U.S. policy toward Latin America in accordance with the OCB recommendation. The Department of State had already begun the preparation of a revised draft statement of policy.
Mr. Dillon said the decline in public investments in Latin America was due not to lack of lending resources but to lack of planning and coordination. A difficult relationship had developed between the Export-Import Bank and the Development Loan Fund. The Export-Import Bank was vigorously resisting any activity in Latin America on the part of the DLF but had at the same time slowed down its own activities. It was even possible that the investment situation would show a net drain on Latin America this year; that is, Latin America [Page 142] would be repaying more loans than it received. This problem was receiving the attention of the Departments of State and Treasury. An effort would be made to work out an arrangement whereby the Export-Import Bank would either do more lending itself or would cease to object to activities by the Development Loan Fund.
Mr. Gray asked when funds from the new Inter-American Bank would be available to Latin American borrowers. Mr. Dillon thought funds would become available about next September and that possibly the first loan would be made by January 1. Mr. Harr asked whether the increased resources of the International Monetary Fund would not be helpful to Latin America. Mr. Dillon said the IMF might be of some help but he believed that all the assistance of this type needed by Latin America was already available.
Mr. Allen said he and Dr. Kistiakowsky had recently attended a meeting at which sharp criticisms were made of our policy of trying to persuade Latin America not to carry on cultural exchanges with the Sino-Soviet Bloc. He had also received a great many letters from Latin Americans who asserted they had been warned by our embassies not to go to Moscow. He wondered whether Latin Americans were not becoming irritated at this policy. Mr. Harr said that we usually did not offer the “don’t go to Moscow” advice unless our opinion was asked by Latin American countries.
The National Security Council: 2
- a.
- Noted and discussed the reference Report on the subject by the Operations Coordinating Board.
- b.
- Noted that the NSC Planning Board would review U.S. Policy toward Latin America (NSC 5902/1) as recommended by the Operations Coordinating Board.
[Here follows discussion of items 3–6: “Significant World Developments Affecting U.S. Security,” “U.S. Policy Toward Cuba,” “U.S. Policy Toward the Dominican Republic,” and “A Research Clearing House Within the NSC Staff.”]