56. Memorandum of Discussion at the 366th Meeting of the National Security Council, Washington, May 22, 1958, 9:03 a.m.1

[Here follow a paragraph listing the participants at the meeting and agenda item 1, “Significant World Developments Affecting U.S. Security,” a report by Allen W. Dulles.]

2. Report by the Vice President on His Trip to South America

In his opening remarks, the Vice President pointed out that he had already made various reports on his trip to Latin America. He had reserved, however, a few items of information as of special interest to [Page 240] the National Security Council. Later on he said he would submit his ideas in writing.2 Meanwhile, what he was about to say was intended only for the ears of those in this room.

First of all, continued the Vice President, we should all get clearly in mind that the threat of Communism in Latin America was greater today than ever before in history. Why was this so? One ran into some very interesting speculations, particularly when one recalled all our fine words about the development of democracy and free enterprise in Latin America.

The southern continent was certainly evolving toward a democratic form of government. Normally we would hail such a development, but we should realize that such a development may not always be in each country the best of all possible courses, particularly in those Latin American countries which are completely lacking in political maturity. In country after country in Latin America we have seen the end of dictatorships. These dictatorial leaders are nearly everywhere being replaced by completely new political types, like Frondizi in Argentina. The Vice President said that he had talked at length and very frankly with all these new Latin American leaders. The significant thing about them as a group is, with the exception of Prado in Peru, that there is not one who represents the old upper-class, wealthy politician of the past. Instead, these new leaders are drawn from the middle class and from the evolving intelligentsia. While they are honest men, they are certainly oriented in the direction of Marxist thinking, even though they realize at the same time the necessity of getting along with the United States in order to secure its economic assistance. Being the kind of men they are, they are very naive about the nature and threat of Communism, so much so that their attitude is frightening. They regard the Communists as nothing more than a duly-constituted political party. This is understandable because in many instances the Communists have assisted these new leaders in overthrowing the old dictatorships. Moreover, the Communist leaders are playing a very clever game in Latin America, using, for instance, the familiar Popular Front line.

The Vice President then turned to make a rather different point. In talking to the heads of the governments in Latin America, he had noted that, with the exception of Stroessner in Paraguay, all of them would say, in effect, we would like to adopt policies which would invite into our country private capital from abroad and which would support the private enterprise system. Nevertheless, Frondizi and the others had added that they simply could not get the support of their public for such policies. Moreover, our own Ambassadors generally agreed with this point of view.

[Page 241]

As for the issue of Communism, Frondizi and the other new leaders had not only stated that the Communist problem was not serious, but went further and said that when it came to dealing harshly with the Communists they would again fail to secure public support. This stemmed from the fact that the people of most of these countries were so weary of dictatorships that they felt that the danger of the old-fashioned dictatorship was much more to be feared than any danger from Communism. The Vice President then explained that when these new leaders thus stated that they could not gain public support for policies they might actually think wise, they didn’t mean the support of the masses. By public support they mean, rather, the support of the growing middle class, the intelligentsia, and the growing labor union movement. They also mean in particular the support of the so-called opinion-makers—that is, the journalists and the radio and TV people. The Vice President pointed out that there were very, very few pro-American newspapers in Latin America, at least among the rank and file, even though the editors and owners of some of these papers were friendly to the United States. The same was true in the fields of television and radio.

The Vice President then turned to the situation in the universities of Latin America. These were of great importance, not only for the obvious reason that they were providing the future national leaders, but also because they were a strong and vocal political force.

To sum up what seemed to the Vice President the important point, he emphasized that while we are thus witnessing the development of democracy in Latin America, we are at the same time witnessing the development of a serious Communist threat. There could be no doubt that International Communism was making a major effort throughout Latin America. There were 250 Communist-controlled newspapers. There were some 50 Soviet friendship societies, and scores of Communist book-publishing houses. The Communist effort was being directed at those elements of the population who could be in a position to overthrow governments—namely, the labor unions and the universities. In illustration of his point, the Vice President singled out Uruguay as the country which was in greatest real danger of a Communist take-over. Yet Uruguay was the most democratic country in the Western Hemisphere after the United States and Canada. It was just impossible to convince the Uruguayans of the dangers of Communism while they were facing such severe economic problems as now confronted them.

As another illustration, the Vice President cited Venezuela as the country in Latin America which had made the greatest economic progress and where private enterprise was the strongest. But here again the Communist danger was almost as great as that which faced Uruguay. [Page 242] Accordingly, the Vice President deduced that neither the democratic system nor the system of private enterprise is necessarily a safeguard against Communism.

As to his conclusions, the Vice President pointed out initially that there existed a Latin American deficit of $1 billion annually in trade with the United States, a deficit which we in one way or another are obliged to make up. How were we to deal with this and with other problems facing us in Latin America? The Vice President said he felt that the answer was certainly not just better publicity for our policies and our actions in Latin America. He said that he had found the quality of the USIA personnel stationed in Latin America to be higher than the quality of such personnel that he had observed on any other of his trips abroad. Yet, even so, we somehow failed to reach the people with our message. In illustration of this point, the Vice President cited a lengthy conversation with a Colombian General who was a very intelligent man and strongly pro-American. He said that he and the other leaders of Colombia were perfectly well aware of all the assistance which the United States had provided and was providing to Colombia. On the other hand, the people of Colombia, the ordinary run of people, were not aware of such U.S. assistance. Accordingly, continued the Vice President, the problem was how to get our story across to the rank and file. [2 sentences (5½ lines of source text) not declassified] We will have to contemplate here a long-range campaign. [1½ lines of source text not declassified] we must contemplate an increase in the activity of the USIA and vastly increased exchange programs with the key population elements of the intelligentsia, the labor leaders, and the newspaper people.

Generally speaking, the Vice President insisted that U.S. policy and what the United States is doing today in Latin America is not subject to very much criticism. Our policies and actions were generally correct, but the problem was essentially more subtle and hence more difficult to solve. We must join the battle in Latin America on the field of propaganda. Otherwise the Communists would ultimately win out.

The Vice President closed his remarks by stating that if the rumors that Milton Eisenhower’s trip to Central America was going to be cancelled were true, the Vice President would regard the cancellation as a serious mistake.

When the Vice President had concluded his report, Mr. George Allen commented that as head of USIA he was naturally much interested in the Vice President’s remarks. He personally was very glad indeed that the Vice President had made this trip; but the results of the trip would only be useful, as he himself had said, if it caused us here in Washington to take a very hard look at the situation in Latin America. As for organizing pro-U.S. groups among students in the Latin American universities, the real problem was what we were going to give [Page 243] them as a message to rally round and about which they could become enthusiastic. Once we succeeded in setting up such groups, we will need a real program. [1 sentence (1 line of source text) not declassified]

As to the exploitation of petroleum and the use of private capital, Mr. Allen pointed out that the USIA has been sending about the world an exhibit called “People’s Capitalism”. While often successful in its impact, this exhibit sometimes arouses considerable grumbling and disapprobation because in Latin America, for example, there was no such thing as people’s capitalism and, accordingly, many Latin Americans could not distinguish between people’s capitalism in the American style and the old-fashioned capitalist imperialism.

Mr. Allen went on to say that according to every indication available to him, not a single politician could get elected to high office in any Latin American country unless he insisted that his program assured government exploitation of the petroleum resources of the country. This is an absolutely fixed idea in Brazil, in Argentina, and in Mexico. Accordingly, if these proposed student and other groups [less than 1 line of source text not declassified] in Latin America are to go out and fight for pro-American causes, we must avoid giving any overemphasis to our policy of trying to keep Latin America as a safe preserve for U.S. private enterprise and U.S. private investment. We must, rather, try to go along more with the sentiments of the people of Latin America. This may sound like promoting socialism, but nevertheless this was the fixed point of view of most Latin Americans.

The Vice President replied that he found himself more or less in agreement with Mr. Allen’s point. As to the question of providing a program for the pro-U.S. student groups, the Vice President believed that you could attack this problem both in a negative and in a positive way. Negatively, these groups could attack the Communists on the ground that they were advocates of dictatorship, rather than on the ground that they were socialists. On the positive side, the program would stress the fact that foreign investment in Latin America would be the means of raising living standards there and not, as often thought in the past, merely a means for foreign exploitation of the resources of these nations.

Secretary Dulles said that he was in general agreement with the Vice President’s views. He said that we must realize that in Latin America, as well as in the Middle East and other parts of the world, there was a definite swing away from the old-fashioned ruler or king, in favor of the kind of dictatorship of the proletariat which was represented by a Nasser or a Sukarno, with their mass appeal. [2 sentences (5½ lines of source text) not declassified] We must develop a greater potential.

[Page 244]

One of the weaknesses in our position, continued Secretary Dulles, was represented by our system of labor attachés. These labor attachés were almost universally bad. As the system worked, they were nominated for their posts by the Labor Department, which, in turn, got its candidates from the CIO and the AF of L. Unhappily, the CIO and the AFL usually presented as candidates labor leaders that they wanted to get rid of in the United States. There could be no change for the better in the quality of our labor attachés until this patronage system of the AFL and the CIO was itself changed. The Vice President strongly confirmed Secretary Dulles’ view, and stated that he had not met a single effective labor attaché in the course of his entire trip.

Secretary Dulles then went on to say that there was one more very important factor in the Latin American problem which the United States faced. This was the collapse of religion generally in Latin America. We all believe in this country that religion, with its emphasis on the rights and freedom of the individual under God, is the very core of our democratic system and that it is also the greatest bulwark against atheistic Communism. Unhappily, the monopoly of the Roman Catholic Church in Latin America has had very serious repercussions, to a point where organized religion had practically no influence on the mass of the people as opposed to the aristocracy. Admittedly, said Secretary Dulles, he did not know what we could do about correcting this very grave situation, but it was certainly at the heart of our problem in Latin America.

The Secretary of State added that he was in complete agreement on the need of our stepping up our exchange programs with the Latin American countries.

The President commented that he had two specific points that he thought we should keep thinking of. The use of the term “capitalism”, which means one thing to us, clearly meant to much of the rest of the world something synonymous with imperialism. We should try to coin a new phrase to represent our own modern brand of capitalism. On the negative side, continued the President, why don’t our people in Latin America talk more about Hungary as an example of the fine fruits of Communism? We should stress this example to show what happens to a country under Communist dictatorship.

The Vice President expressed his belief that we should frame our arguments in the following context: We should base our position on the understanding that dictatorship now constitutes the most emotional issue in Latin America. From this premise we should accordingly in Latin America attack Communism not as Marxist economic thought but as a dictatorship and, worse than that from the Latin American point of view, a foreign-controlled dictatorship. In so doing [Page 245] we could combine and exploit the two chief hatreds of Latin America—namely, dictatorship and foreign control. Hungary exemplified both.

Mr. Allen commented that the USIA had been doing its best to keep alive the lessons of Hungary. Recently in France they had undertaken a survey to find out how effective they had been in keeping the Hungarian story alive. The survey had shown a dismaying lack of interest among most Frenchmen. It had been next to impossible to keep the Hungarian story vivid in the minds of these Frenchmen. When our people had brought up Hungary, one Frenchman had replied, “Why not talk about the Punic wars?”

The Director of Central Intelligence said he felt obliged to point out [3 lines of source text not declassified]. The trouble was that even though we had the goods on the Communists, we simply could not get any support from the Latin American governments to do anything about the disclosures which we had made. After what had happened during the Vice President’s tour, we may at long last get the necessary support of these governments against the Communists. We are all ready to go if we can get such support.

Mr. Allen then said he had one more suggestion to make with respect to the problem of trade with Latin America. We have been for some time promoting the development of a Common Market in Europe. Why could we not make a similar effort on behalf of a Common Market for Latin America? Secretary Dulles commented that while the idea had much to recommend it, he was not sure that the Latin American states would want a Common Market with the United States a member of it. Secretary Anderson in turn pointed out that at the Buenos Aires meeting the Treasury people had strongly supported the idea of developing a Common Market in Latin America, although they had pointed out that the United States itself would not join such a Common Market. One of the great difficulties was that the countries of Latin America were in many cases geographically so far apart and with very poor transportation between them. This was quite unlike the compact area of Western Europe, where a Common Market would not meet such severe geographical obstacles.

Secretary Dulles indicated that there was yet another difficult aspect of the plan for a Common Market. If there were a Common Market in Latin America and the United States were to be a member of it, the effect would be to perpetuate the status of the Latin American states as producers of agricultural and raw materials and the United States as the manufacturer of the finished products. What the countries of Latin America really want and really need was, rather, a diversification of their economies.

[Page 246]

The National Security Council:3

Noted and discussed an oral report by the Vice President on his recent trip to South America.

[Here follow the remaining agenda items: United States policy toward the Soviet-dominated nations in Eastern Europe and a consideration of United States policy toward Italy.]

S. Everett Gleason
  1. Source: Eisenhower Library, Whitman File, NSC Records. Top Secret. Drafted by Gleason on May 23. The time of the meeting is from the President’s Daily Appointment Book. (ibid.)
  2. No such document has been found in Department of State files.
  3. The paragraph that follows constitutes NSC Action No. 1913, approved by the President on May 24. (Department of State, S/S–NSC (Miscellaneous) Files: Lot 66 D 95, NSC Records of Action)