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

78. Memorandum From the Director of the Executive Secretariat (Calhoun) to the President’s Staff Secretary (Goodpaster)¹

Washington, April 28, 1960.

SUBJECT

• Follow-up Actions from the President’s Good Will Trip to South America

You approved on March 30 the list of follow-up actions arising from the President’s trip which I sent you with my memorandum of March 22.²

The enclosed report describes the status to date and future actions contemplated with respect to these follow-up items.³

John A. Calhoun⁴

[Enclosure]

STATUS REPORT ON FOLLOW-UP ACTIONS—THE PRESIDENT

A. Puerto Rico

1. Operation Big Slam⁵

State Department action completed, as reported in my memorandum of March 22, 1960.

2. Puerto Rican Taxes⁶

State Department action completed, as reported in my memorandum of March 22, 1960.

B. Brazil

1. Meeting of American Presidents

The Department sees no advantage to holding a meeting of Presidents prior to the Eleventh Inter-American Conference, now scheduled to be held at Quito, Ecuador, March 1, 1961. Furthermore, it is possible that a meeting of the Committee of 21 will be held in August, 1960, and many countries of the hemisphere believe that the Quito Conference is the appropriate body to give impetus to the results of that meeting. Ecuador in particular would very likely oppose an intervening meeting of Presidents as detracting from the importance of the Quito Conference.

In the copy sent to the White House, Goodpaster made the following handwritten notation in the margin next to this paragraph: “5 May 60. Told State this closes it out. G. Advised President. G.” (Eisenhower Library, Whitman File, Miscellaneous Material)

The Department does not believe that a commitment exists to reply to President Kubitschek on this point, and recommends that the matter be allowed to rest unless the Brazilians raise it again. No further report to you is contemplated.⁷

2. Meetings of Committees of Nine and Twenty-one (My memorandum to you of April 6, 1960)⁸

The Committee of 9 met in an organizing session on April 18, at the instance of the Brazilian representative and with US agreement, to prepare for further working meetings. Brazil proposed as an agenda for those meetings the five points of the Brazilian Aide-Mémoire II. It is expected that the Committee will meet again in early June to decide on an agenda and to begin working sessions. Eventually, possibly in August, it is thought that a meeting of the Committee of Twenty-one will be held to consider the results of these working sessions.

The train of events desired by President Kubitschek has thus been initiated. Action now lies within the normal procedural framework of the Organization of American States. Therefore, no further reports to you in the context of the President’s trip are contemplated. Significant developments will be brought to the President’s attention on an ad hoc basis.⁹

C. Argentina

1. New Steel Mill

Ambassador Donnelly has conveyed to the U.S. steel industry President Frondizi’s interest in increasing Argentina’s steel-making capacity. Ambassador Beaulac has informed President Frondizi of this, and of the fact that representatives of the U.S. steel industry will soon be visiting Argentina to study its potential for development in this field.

The Department believes that any commitment to President Frondizi has been fulfilled, and no further report to you on this subject is contemplated.⁹

2. Modernization of Armed Forces

Deputy Assistant Secretary for Inter-American Affairs Mallory has conveyed President Frondizi’s request to Assistant Secretary of Defense Irwin, stating that this was being done at your behest and offering State Department cooperation in dealing with the question.¹⁰ A copy of Mr. Mallory’s letter is attached for your information.¹¹

3. Civil Aviation Negotiations

The negotiation of a bilateral air agreement and the grant of a loan for airport construction have never been linked in reaching U.S. aviation objectives. However, since this possibility has been raised by the Argentines, the Department is giving some tentative thought to the feasibility and desirability of relating them. With respect specifically to an Argentine loan request, on the other hand, neither the Export Import Bank nor the Development Loan Fund had, as of April 22, been approached by Argentina with such a request, nor was the Department, including ICA, aware of any follow-up by Argentina on the matter. (This report was cleared at the staff level in the Export Import Bank and the DLF.)

Meanwhile, Ambassador Beaulac met with representatives of the Civil Aeronautics Board and the Department on April 14 to discuss resumption of civil air negotiations, and Embassy Buenos Aires has talked with Argentine officials on the question. Resumption of negotiations is tentatively set for April 28.

The Department does not at present plan to raise with the Argentines the matter of airport loans in the continued absence of an Argentine initiative. Negotiations will be limited to civil air relations. It is considered that the President’s commitment to look into the matter has been fulfilled, however, since all the agencies concerned have been brought into the preparation of this report. No further report to you within the context of the South America trip is contemplated.¹²

4. Ban on Cured Meats

The appropriate offices of the Department of State have been informed of the President’s assurances to President Frondizi, and Deputy Assistant Secretary Mallory informed Assistant Secretary of Agriculture Miller concerning them. A copy of Mr. Mallory’s letter is enclosed.¹¹ It is considered that the necessary steps have been taken to fulfill the President’s commitment and no further report to you is contemplated.¹²

5. Consultation with American Nations

Progress in this direction has been made during the past two years. The briefings of Latin American Ambassadors started by Secretary Dulles and continued by Secretary Herter have been helpful in showing the interest of the United States in keeping the other republics informed on important world events. In the United Nations a special effort has been made by Ambassador Lodge to keep in close touch with Latin American representatives in the development of United States positions on world issues before that body. The President’s briefing luncheon for Latin American Ambassadors on his return from South America helped convey the impression that his visit to four countries was evidence of his sincere interest in the problems of the entire hemisphere.

The problem of satisfying to an even greater extent the Latin American desire to cooperate more effectively with United States policy calls for country-by-country consideration. It is principally Brazil, Argentina and to a lesser degree Chile which have strong feelings in the matter. Mexico has expressed no concern partly because of its pride in the independence of its policy determinations, and also because its aspirations in this regard are satisfied through close association with the United States and active participation in the UN and other international organizations. The Central American and Caribbean countries, as well as most of the smaller South American states, while having a general interest in keeping abreast of United States policies, do not expect to participate significantly in their formulation. Special consideration would have to be given to frequent consultation with such countries as Venezuela, Colombia, Peru and Uruguay on issues of common interest.

A senior officer of the Department will be responsible for briefing Latin American Ambassadors on worldwide issues. This means of meeting Latin American desires to be consulted, or at least informed, about significant policy developments will be strengthened by a continuous effort by the Department to ascertain subjects of particular interest to the Latin Americans, as well as by supplementary background information transmitted to our Embassies in the field. Furthermore, our Embassies will be requested to recommend topics of general and special interest to the governments in the countries in which they are stationed. This will be a continuing program, and no further report to you concerning it is contemplated.¹³

6. Argentine Short-Term Debt

Since the discussion held between President Eisenhower and President Frondizi on February 28 on the Argentine short-term debt there has been no approach by the Argentine Government to the Export Import Bank nor as far as we know to private U.S. banks to obtain refinancing of these short-term obligations. It should be mentioned that Argentine external debt repayments for the next two years are heaviest with regard to European creditors. At present it appears that the Argentine Government is likely to concentrate initially on securing refinancing from its European creditors rather than its U.S. creditors. According to the Argentine Embassy, the data for a future approach to creditors is now being compiled in Buenos Aires. This report has been approved by the Export Import Bank and the Treasury Department. No further report to you is contemplated.¹⁴

D. Chile

1. Arms Limitation

In the April 6, 1960 session of the Council of the Organization of American States, Chile proposed the convocation of an OAS Conference on arms limitation as soon as possible. The U.S. supported this proposal. The project was referred to a five-nation working group (the U.S. was not a member but sent an observer). During consideration by the working group, the complexity of the problem became evident and there began to emerge among some of the major Latin American powers an attitude of reluctance, each tending to feel that it should not be included. The results of the working group’s study have now been referred to the governments of working group members and a delay of some weeks is anticipated before the group’s report will be ready for submission to the Council.

Significant developments will be brought to the President’s attention on an ad hoc basis, but no further report is contemplated within the context of the South America trip.¹⁴

2. U.S. Tax on Copper

The Departments of State, Interior and Commerce have considered the question of seeking suspension or removal of the copper excise tax and have concluded that this should not be done at this time.

Suspension or removal of the tax would require legislation. Prior suspensions were enacted at times of short copper supply, a situation which does not now prevail. In addition, the present session of Congress will probably be short, and its calendar is unusually crowded with items which would take precedence over copper legislation. Finally, there is some sentiment in Congress, reflecting that in certain segments of the domestic copper producing industry, in favor of raising the level of the present tax (1.7 cents a pound) or the price at which the tax increases to 2 cents (24 cents a pound). Raising the question of the tax in Congress might therefore bring about a situation less favorable from the Chilean point of view than the present one.

The Department recommends that these conclusions be conveyed to the Chilean Government by our Embassy at Santiago. If you approve, we shall send the Embassy instructions to this effect. Otherwise no further action or report is contemplated.¹⁵

With respect to liquidation of the U.S. copper stockpile, this country agreed in April 1959 to consult Chile prior to undertaking a program of disposal of Government-owned copper stocks in excess of the Government’s needs. The Department sees no need for further action on the matter at this time since, as the President told President Alessandri, it is not the intention of the U.S. to dispose of its stocks. No further report on this subject is contemplated.¹⁶

This report on both aspects of the copper question was approved by the Departments of Interior and Commerce.

E. Uruguay

1. Ambassador Woodward

This report is the subject of a separate communication.¹⁷

F. Miscellaneous

1. Cuban Note¹⁸

Action completed, as stated in my memorandum of March 22, 1960.

1. Source: Department of State, Central Files, 711.11–EI/4–2860. Secret. Drafted by Arthur R. Day of the Executive Secretariat’s Reports and Operations Staff on April 27.
2. Not printed. (ibid., 711.11–EI/3–2260)
3. According to a handwritten notation on the source text, Goodpaster on May 4 informed officials of the Department of State that he approved the contents of the enclosed report.
4. Printed from a copy that bears this stamped signature.
5. According to a March 22 memorandum from Calhoun to Goodpaster, Operation Big Slam was an airborne military exercise that occurred in Puerto Rico during the latter part of March 1960. (Department of State, Central Files, 711.11–EI/3–2260)
6. According to Calhoun’s March 22 memorandum, Under Secretary Dillon had discussed the question of Puerto Rican taxes with Governor Muñoz-Marin and had informed him that legislation had been introduced in the House of Representatives to correct the technical aspects of the Puerto Rican tax problem. (ibid.)
7. On the Eisenhower Library copy of this report, Goodpaster noted “OK” in the margin next to this paragraph. (Eisenhower Library, Whitman File, Miscellaneous Material)
8. Not printed. (Department of State, Central Files, 371.04/4–660)
9. On the Eisenhower Library copy of this report, Goodpaster noted “OK” in the margin next to this paragraph.
9. On the Eisenhower Library copy of this report, Goodpaster noted “OK” in the margin next to this paragraph.
10. On the Eisenhower Library copy of this report, Goodpaster noted “OK—complete” in the margin next to this paragraph.
11. Not printed.
12. On the Eisenhower Library copy of this report, Goodpaster noted “OK” in the margin next to this paragraph.
11. Not printed.
12. On the Eisenhower Library copy of this report, Goodpaster noted “OK” in the margin next to this paragraph.
13. On the Eisenhower Library copy of this report, Goodpaster noted “OK” in the margin next to this paragraph.
14. On the Eisenhower Library copy of this report, Goodpaster noted “OK” in the margin next to this paragraph.
14. On the Eisenhower Library copy of this report, Goodpaster noted “OK” in the margin next to this paragraph.
15. On the Eisenhower Library copy of this report, Goodpaster noted “OK” in the margin next to this paragraph. In a memorandum dated May 13, Calhoun informed Goodpaster that the Department of State had transmitted an instruction to this effect to the Embassy in Santiago. (Department of State, Conference Files: Lot 64 D 559, CF 1609)
16. On the Eisenhower Library copy of this report, Goodpaster noted “OK” in the margin next to this paragraph.
17. In an April 29 memorandum, Calhoun informed Goodpaster that President Nardone’s anxieties that the Department of State intended to transfer Ambassador Woodward were unfounded, and that the Department of State supported President Eisenhower’s statements to this effect to President Nardone. [1 sentence (31/2 lines of footnote) not declassified] (Department of State, Central Files, 711.11–EI/4–2960)
18. According to Calhoun’s March 22 memorandum to Goodpaster, the U.S. Chargé in Cuba on February 29 had informed Cuban authorities, in response to the Cuban Note of February 22, that the U.S. Congress had to implement new sugar legislation to replace that which was expiring, and that the President was unable to extend existing legislation by executive fiat. (ibid., 711.11–EI/3–2260)