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

BL–25. Memorandum of Conversation, by the Officer in Charge of Bolivian Affairs (Pitts)¹

Washington, September 28, 1959

SUBJECT

• Recent Development in Bolivia, and U.S.-Bolivian Relations

PARTICIPANTS

• Victor Andrade, Foreign Minister of Bolivia
• ARA - Mr. Rubottom
• Mario Montenegro, Chargé d’Affaires of Bolivia
• WST - Mr. Silberatein
• WST - Mr. Pitts

COPIES TO:

• ARA - Mr. Rubottom (2)
• ICA
• E
• Amembassy La Paz
• L/E – Mr. Duvall
• IRC – 8 copies
• WST – Mr. Pitts 3 copies (2 cc’s)
• H

The Foreign Minister stated that the MNR Party Convention in December would probably nominate Victor Paz, Walter Guevara or himself as the party’s candidate for next year’s presidential election. At the moment it would appear Victor Paz was the front runner. Whoever was nominated by the MNR party would undoubtedly follow the same general policy of cooperation with the U.S. as the present Government, Andrade stated, and Mr. Rubottom replied that he was glad to hear Bolivia would continue this policy.

Concerning the present economic situation in Bolivia, the Foreign Minister reported that last week he had a long satisfactory talk in New York with the head of the Gulf Oil Company’s Latin American section, and that Gulf had confidence regarding its Bolivian operations. The Bolivian Oil Company, according to Andrade, is expected to become productive later this fall or winter in the Madrejones area, with a possible eventual production there of 10,000 barrels a day. In the Santa Cruz area, agricultural prospects were good, he said, with an improvement in sugar production and cattle raising. He thought that the entire economic picture was slowly improving. There had been impressive gains in manufacturing, end some plants (he specifically mentioned SAID and “a glass factory”) were even rehiring workers.

The past year had seen tough tough battles in the social sector, according to the Foreign Minister. The GOB, he said, had resisted the demands of the miners and teachers for higher wages. Andrade stated, however, that something would probably have to be done for white collar workers, such as government and clerical employees, who still earn very low salaries.

Mr. Rubottom mentioned the continuing harassment of our aid program in Bolivia, in which La Nación had participated. He said that we understood La Nación had been somewhat better in this respect recently. Andrade replied that he had a long talk with Ambassador Strom² concerning La Nación. He added that this newspaper must be permitted independence on “little” issues in order for it to support the government’s position on larger issues, else it would be discounted as purely a “government mouthpiece”.

Personalities were also involved in the minor irritations between citizens of our two countries, Andrade added. Some U.S. citizens just don’t understand how things work in Bolivia. There was no doubt, Andrade said, that there were different cultural roots and he said we must all have patience. He confirmed that we were agreed on the fundamentals. He referred to the fact that some Bolivian officials considered certain U.S. officials arrogant, and he then mentioned an incident when an American lady at La Paz who had been drinking told him at a party that she was fed up with Bolivia and wanted to go home. Some Bolivians present thought that Andrade should have made a scandal, but he simply passed over the insult. Andrade stressed the fact that we could not ignore the human element. Concerning U.S. officials in Bolivia, he said that they must be briefed before going there on the need for understanding the Bolivian people.

Mr. Rubottom commented that we were quite aware of the human factor, and that undoubtedly human failures creep in. He said that we tried to brief officials going to Bolivia, and that patience was certainly needed—on both sides.

Concerning the McClellan Committee hearings,³ Mr. Rubottom said that Under Secretary Dillon deserved considerable credit, as did Senator McClellan, for the quiet way the Committee meetings were conducted. There was a possibility the Committee would issue a report,⁴ and he hoped the Bolivian Government would be prepared to react in a “mature” manner to anything which might appear in the report. Andrade indicated that he intended to make a call on the Senator, and Mr. Rubottom advised him to “let sleeping dogs lie.”

The efforts of the municipality of La Paz to collect a tax from Grace & Co. on the disposal by Grace of commodities under the economic assistance program was mentioned by Mr. Rubottom. The Foreign Minister appeared to be quite familiar with this matter and confirmed that if the tax was paid the GOB would simply have to deposit that amount in the counterpart account. He concluded his remarks on this subject by stating that he would send a cable to La Paz concerning the matter. Mr. Silberstein mentioned that the Mutual Security legislation was involved and that continuation of the commodity program might be affected.

The refusal of Comibol to pay retentions to the Patiño Mines Enterprises on tin barter sales was then brought to the Foreign Minister’s attention by Mr. Rubottom. He said that we could see no difference between tin barter sales and ordinary sales, as far as retention payments were concerned. Andrade said this was a troublesome matter, there was some reason to believe the GOB may have already paid more than the value of the properties, and there was also the feeling in Bolivia that Bolivia had maintained the price of tin on the world market by its “sacrifices”. Mr. Silberstein pointed out the advantage to the GOB of a final settlement of this problem, and the Foreign Minister replied with a smile that this would have to wait for the next administration. Mr. Silberstein also remarked that as long as there was no settlement Comibol would undoubtedly find it difficult to get help from abroad. Andrade agreed that this was a serious problem.

1. Source: Department of State, Central Files, 724.00/9–2859. Confidential.
2. Carl. W. Strom was appointed Ambassador to Bolivia on April 8, 1959; he presented his credentials to the Bolivian Government on May 4, 1959.
3. Reference is to the Permanent Subcommittee on Investigations of the Senate Committee on Government Operation. Documentation relating to the subcommittee is in APA/WST Files, Lot 62 D 429, “McClellan Committee.”
4. The referenced report was issued on January 20, 1960, as U.S. Senate, Committee on Government Operations, “Administration of United States Foreign Aid Programs in Bolivia,” Senate Report No. 1030, 36th Cong., 2d Sess. (Washington, D.C.: Government Printing Office, 1969).