224. Telegram From the Embassy in Argentina to the Department of State1
412. As result week-end rumors military unrest considerable speculation aroused by meeting army commanders scheduled here this morning. Reported grievances include invitation for bids from foreign firms for development petroleum area south Comodoro Rivadavia. Invitations postponed last week after criticism by army representative on YPF. Other grievances may be complaints against government’s alleged deals with Peronists, certain provincial governors of integrationist school, communist infiltration in universities and other quarters, and graft in oil contracts.
Information received last week from Embassy [less than 1 line of source text not declassified] sources re army concern over oil operation graft and communism. There have been signs of greater emphasis in army for rooting out latter evil at all cost, whereas administration apparently desirous avoid McCarthyism. This issue illustrated in recent conversation between Defense Minister Villar and General Picca at which I was present. Feeling probably extends to air force and navy although latter two less demonstrative.
[Page 647]Army Secretary Larcher has returned for meeting and YPF President Bruno expected today. All officials deny either knowledge army tension or cause for concern. Navy and air force commanders briefed on administration’s oil policy and reportedly not against it. Industry Secretary Juni said October 7 bids will be invited.
Embassy believes administration intends make thorough sounding military views on oil question and will retreat into further postponement bids if pressure too great but only after usual public spotlight on army attitude and responsibility for any change.
- Source: Department of State, Central Files, 735.00/10–1060. Confidential; Priority.↩