Foreign Relations of the United States, 1958–1960, American Republics, Volume V

265. Telegram From the Embassy in Brazil to the Department of State¹

Washington, March 27, 1959—10 a.m.

1299. Following family dinner on eve wife’s departure of [for] US,² President Kubitschek spoke to me about government’s financial problems:

1. He is “disappointed” IMF technicians who although well-disposed and technically highly competent “fail to understand” facts of Brazilan political life.³ Here am I, said President, endeavoring develop this great country, and forces have got out of balance. Brazil is not Argentina; steps demanded of that country are not relevant to Brazil.

2. If IMF continues not to understand, President is sure US Government will (i.e., when promenade with Fund reaches dead end, it will be our turn—we have foreseen). In view fact that situation at this juncture is between Brazil and Fund, and our belief as set forth final paragraph Embtel 1265⁴ that it is up to IMF to carry ball I refrained from arguing on behalf IMF proposals. On other hand I naturally made no comment which President could interpret as encouraging his resistance thereto.

3. Over and above these considerations, said President, is Operation Pan-America and demand of underdeveloped people for better life. Our Communist enemies are eagerly waiting for moment to get into the act.

4. Ambassador Peixoto is returning to Washington this weekend.

Later I spoke separately to Peixoto who impressed me as somebody uneager have last days in Washington occupied by dialogue along foregoing lines, and to Finance Minister Lucas Lopes who appeared depressed. Lopes is of course thoroughly versed in IMF attitude without however having sold Fund medicine to President. When I left, President, Peixoto and Lucas were continuing discussion. Lucas also told me Poock and Ribeiro are returning Washington after holidays.⁵

Briggs

1. Source: Department of State, Central Files, 832.10/3–2759. Confidential.
2. Documentation on Sara Kubitschek de Oliveira’s trip to the United States with her two daughters is ibid., File 732.11.
3. A report on the IMF mission, headed by G.A. Costanzo, to Brazil, March 16–25, was transmitted in despatch 1113 from Rio de Janeiro, March 26. (ibid., 832.10/3–2659)
4. Not printed. (ibid., 832.10/3–2359)
5. Reference is to discussions with the IMF staff in Washington during May-June by Paulo Poock Correa, Director of the Foreign Exchange Department, Bank of Brazil, and Casimiro A. Ribeiro of the Brazilian Ministry of Finance. Documentation on these discussions is ibid., 832.10.