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

319. Letter From the Assistant Secretary of State for Inter-American Affairs (Rubottom) to Senator Lyndon B. Johnson ¹

Washington , November 11, 1958 .

Dear Lyndon : I hope you have been able to relax at home since November 4. I was able to spend a few hours with my mother and sister during an overnight stop in Dallas one month ago, and the country looked in very good condition.

Both the Secretary himself and Bill Macomber transmitted your request for briefing material on U.S.-Mexican relations to help in preparation for your forthcoming meeting with President-elect Adolfo Lopez Mateos.² I think that the visit is a constructive move and am pleased to enclose briefing material³ which, in order to be useful, has been given, along with this letter, a rather high classification. You may wish to return all of the material by registered mail after you have read it or take whatever measures you deem necessary to safeguard it.

Lopez Mateos doubtless has mixed motives for wanting to talk to you, although I would guess that his principal objective is to make your acquaintance and let it be known, as he undoubtedly will, that he has done so. This should help him at home, particularly with the more sophisticated political and industrial groups with whom he will be dealing. He may also wish to discuss specific matters, such as Mexico’s interest in obtaining a substantial loan (probably $100 million) from the Eximbank.

In that regard, Mexico has an excellent credit rating with the Bank. The present Minister of Finance, Carrillo Flores, has ably managed Mexico’s fiscal affairs through good times and bad for the past six years and is very highly regarded in the financial community here. It is rumored that he does not as yet have any position in the new administration.

The head of the Bank of Mexico, Rodrigo Gomez, is now in Washington to be Mexico’s delegate on the Special Committee of the OAS Council to consider broad economic problems affecting the Americas, which convenes November 17.⁴ He will undoubtedly seize the opportunity while here to go further into the loan matter, which, I understand, he raised with Bob Anderson at the recent IMF–IBRD meeting in New Delhi. Mexico’s reserves have declined about $100 million (from $395 million to $307 million) during the past year but this is not considered unusual in view of the world economic situation. Her problem is not considered serious at this time, but, I am sure, the new President will want to demonstrate that his administration has the confidence and financial support of the U.S. Government. I do not foresee any difficulty if and when the negotiations reach a decisive stage.

We are concerned with Mexico’s seeming tolerance of excessive Communist activity. It is too early to assess what Lopez Mateos’ attitude will be toward the Communists, but we do attach significance to the fact that ex-President Lazaro Cardenas, generally regarded as the spiritual head of the extreme leftists within the Government party (PRI), has absented himself from Mexico at the time of the inauguration of the new administration. It could be that Lopez Mateos intends to take a firmer stand against the Communists, and we would like subtly to encourage him to do so.

There is no point in under-estimating the seriousness with which our military colleagues view Mexico’s lack of cooperation on mutual defense matters. That 2,000 mile gap along our southwestern frontier is one that they would like to have plugged, at least with an adequate warning system. This would obviously require Mexican military cooperation of the closest kind, something which we have never had, let’s face it, notwithstanding her token participation with an Air Force squadron in the last phase of World War II. With strong leadership from Lopez Mateos, Mexican public opinion might be guided to accept the kind of mutual defense collaboration which would be meaningful to both sides. It is probably over-optimistic to expect him to provide this kind of leadership.

There are other problems which could conceivably come up in your talks with him: (1) those relating to the Migrant Labor Agreements, especially with respect to non-occupational insurance (which would fly in the face of U.S. insurance companies in Texas and elsewhere); (2) river boundary problems such as Ojinaga,⁵ concerning which we have just taken an important initiative which may help us to find a solution, and possibly the Chamizal, which they have been reluctant to discuss for the past six years, but which, if not squarely faced soon, may become almost impossible of solution because of the business and residential development in the El Paso area with which you are well acquainted.

If I had to describe our number one problem with Mexico, I would be inclined to say that it is that of obtaining Mexico’s confidence in our good faith. Perhaps this is understandable in view of our long and complex history and Mexico’s injuries at the hands of the U.S., both real and fancied. Nevertheless, we should never relent in our effort to overcome this feeling and win her over completely to our side.

In the international field, Mexico has a number of influential diplomats who take a strongly neutralistic position. The present Foreign Minister, Padilla Nervo, seems to be among them. It is almost as though Mexico hopes to mediate some day between the free world and the Communist world. One of her officials, Jorge Castaneda, has just written a book entitled Mexico and the United Nations, in which he strongly advocates a Pan-Latin Americanism and is frankly critical of Pan-Americanism because of the influence which the U.S. allegedly wields in the latter. I should make clear that these problems with Mexico, both of substance and of attitude, are not new.

We have had indications that Mexico has questioned our sincerity in announcing support for the long-cherished Latin American aspiration to have an inter-American regional bank or development institution. If the President-elect questions you about this, you certainly can allay any doubts he may have on that score. We do, of course, want it to be a soundly managed financial institution, not just a political football, but we believe that most Latin Americans would hold to the same idea.

If Lopez Mateos should raise the subject of our general policy toward Latin America, you can make it clear that we desire to cooperate and help to the utmost of our ability. We took the initiative in calling the Foreign Ministers to meet here on September 23 and 24 and the resulting discussion centered on a cooperative hemispheric approach to economic problems, including the urge for more rapid development. The Special Committee of the Council of the OAS is to meet November 17 to begin substantive discussions on financial and economic problems affecting all of the Americas. Early in January (and it would have been a month earlier except for the Mexican request for its postponement due to the change in Government) a Special Committee of the Inter-American Economic and Social Council will begin to meet in continuous session to establish the new Inter-American Regional Development Institution.

We have expanded the resources of the Eximbank by $2 billion, as a result of Congressional action in the last session, and it is well known that in the past decade 40% of the Eximbank’s loans have gone to Latin America. We have recommended the expansion of the resources of the World Bank and the International Monetary Fund. We have helped with the creation of instruments, particularly in the new International Coffee Study group, to try to achieve greater stability in the coffee market, and we are presently trying again to work out a multilateral approach to the lead-zinc problem. Finally, I should mention that we have concluded several financial stabilization agreements, cooperating with the International Monetary Fund and in certain instances, the private banks, in Latin America during the past year.

Please excuse the length of this letter and the enclosure but we want to provide you with all of the ammunition you need.

With every good wish,

Sincerely yours,

R.R. Rubottom, Jr. ⁶

1. Source: Department of State, Rubottom Files: Lot 60 D 553, Mexico 1958. Confidential. Drafted by Rubottom.
2. In telegram 824 to Mexico City, November 3, Rubottom stated that the Department had learned of Johnson’s interest in meeting with López Mateos. The telegram stated in part, “Assume President elect would be prepared for publicity which Department believes inevitably will be generated by this meeting and for which parties concerned should be prepared in advance. Senator’s interest derives in part from inability accept Ambassador Tello’s invitation attend inauguration.” (Ibid., Central Files, 611.12/ 11–358)
3. Not printed.
4. Reference is to the initial meeting of the 21-nation “Special Committee to Study the Formulation of New Measures for Economic Cooperation,” commonly referred to as the Committee of 21, which met in Washington, November 17–December 12. See the microfiche supplement to this volume.
5. Ojinaga and Chamizal were the names of tracts of land along the U.S.-Mexican boundary, the ownership of which was in dispute as a result of the shifting course of the Rio Grande River.
6. Printed from a copy that bears this typed signature.