145. Telegram From the Department of State to the Embassy in Argentina 1

184026. 1. Following is Memorandum of Conversation between Presidents Johnson and Onganía, at the San Rafael Hotel, Punta del Este, April 13, 1967 at 6:30 p.m. Present at the meeting were: President Johnson, Mr. Walt W. Rostow, and Assistant Secretary Solomon for the United States; and President Onganía, Foreign Minister Costa Mendez and two unidentified persons for Argentina.2

2. Argentina’s Political Situation

President Onganía apologized for monopolizing the conversation, but said that it was important for President Johnson to get a panoramic view of Argentina’s situation from the lips of the Argentine President.

3. President Onganía said that after the experience of two decades of difficulties, it had become necessary for his country to undertake what he called the “Argentine Revolution”. The Argentine Revolution called for the elimination of political parties, within the framework of a democratic system. As proof of the existence of a democratic system in Argentina, he could mention freedom of the press and freedom for the individual. For example, there was a better application of justice at the present time than before June 28, 1966. In addition, there was no state of siege, and there had been nothing but peace and tranquility in his country during the ten months of his government.

4. President Onganía went on to say that the main problem that Argentina faced was the existence of an archaic governmental structure which has the task of governing a modern country. This archaic governmental structure had proved to be unable to utilize the human resources of the country as they should be used. In his conception, the function of the government was to provide guidance and supervision to the individual and to private enterprise so that the latter could go about the process of developing the country. He added that he was convinced that Argentina’s main problem is political and not economic.

5. President Onganía went on to say that in the first stage of the Argentine revolution it would be necessary to systematize the government’s machinery. The second stage called for a reorganization of [Page 331]the entire community, including its material, spiritual, and intellectual values, so that Argentina could become what it should be.

6. Argentina’s Economic Situation

President Onganía said that his government had taken a series of important steps in the economic field, with a view to reducing inflation, which was growing at a 30% per year rate. These steps required the business and labor sectors to contain their aspirations, but were necessary to reduce the rate of inflation which was strangling the nation’s economy.

7. President Onganía said that his government, by making adjustments in the current budget, had reduced the projected deficit from $1 billion to $400 million. One of the items that had been taking up a large share of the budget was government-owned enterprises, especially railroads. His government planned to establish a higher degree of rationality in the management of these enterprises, and eventually to shift surplus personnel to more productive sectors. This same process would be applied to government personnel.

8. President Onganía said that there is one area in which the economy as a whole could be reactivated, and that is housing, as there was a deficit of 1,500,000 units in his country. In this endeavor, Argentina would need outside assistance.

9. President Onganía also said that Argentina wants to increase its exports, especially in non-traditional goods. He added that this does not mean neglect of beef exports, since his country had built up its reserves of beef cattle, and is now ready to go into the world market again. In that connection, Argentina is worried about the lack of progress on a world meat agreement in the Kennedy Round, although it had been assured of the support of the United States in this connection. President Johnson at this point observed that the Kennedy Round meat group discussions were not promising.

10. President Onganía said that his country is putting to good use the IDB loan for agriculture, and that he is convinced of the need of bringing the benefits of technology, specifically electricity, to the rural areas.

11. Of equal importance to the problem of housing is the need to begin the Chocon-Cerro Colorado project, which is a multi-faceted development effort.

12. President Johnson said that he and his government were impressed with the economic steps that had been taken in Argentina under President Onganía’s direction and that he was a great supporter of rural electrification.

13. Arms

President Johnson said that it is important that the Latin American countries not embark on an arms race, and that he hoped that [Page 332]President Onganía would provide leadership to the rest of Latin America in this matter.

14. President Onganía replied that his country does not aspire to have large weapons, rockets, or anything like that, but that at the present time the Argentine Armed Forces do not even have a minimum level of equipment. He said that it is important that the military vocation of the Latin American countries not be twisted, and that the Armed Forces of the Latin countries should not become mere national police forces.

15. Summit Conference

President Johnson said that he hoped that President Onganía would make a clear statement on the success of the Summit Conference, to counterbalance the effect that the statements of the Ecuadorean President might have on the American public and Congress.3

Rusk
  1. Source: National Archives and Records Administration, RG 59, Central Files 1967–69, POL 15–1 US/Johnson. Confidential; Priority. Drafted by Barnes and Dreyfuss on April 18, cleared by Solomon and Rostow, and approved by Sayre.
  2. According to the President’s Daily Diary the meeting lasted from 6 to 7 p.m.; one of the “unidentified” participants was the Minister of Trade and Industry, Angel A. Solá. (Johnson Library)
  3. See Document 51.