The Chargé in Colombia (Lockett) to Mr. Bainbridge C. Davis of the Division of North and West Coast Affairs

Dear Mr. Davis: The reaction against us here in Colombia has been so terrific because we did not increase our ceiling price on coffee five cents instead of three cents, or because we did not eliminate the ceiling price altogether, that I want to write you a few lines about it.

With a very few exceptions, the tirade against us in the press and by individuals interested in coffee has included such terms as “unreasonable,” “unjust,” “dictatorial,” and many other such words, as well as the statement that the Office of Price Administration by its three-cent decision had retarded the Good Neighbor policy for twenty years. Not in one instance that I have seen did an editorial writer or a commentator take into consideration conditions prevailing in the United States or the determination of our people to hold prices within reason.

In my estimation the torrent of criticism against us has its origin in selfish interests and in propaganda in the press to see if sufficient pressure could be brought upon us to cause a reconsideration on the part of the Office of Price Administration. Of course, my feeling is that speculators in coffee, including producers, coffee associations, and some United States importers, made it impossible for our authorities to remove the control on coffee because they were hoarding it and withholding large supplies from the market in anticipation of making a killing when the controls might be removed. While I regret that we are being subjected to such unreasonable and unwarranted propaganda and criticism, I certainly can not take issue with the decision made by our control authorities under existing conditions. In spite of the existing deluge of bitter propaganda which is being directed against us, it is my belief that it will gradually decrease and that much coffee will be shipped in order to take advantage of the new price between now and March 31.

Amidst the storm which is blowing against us, one important and influential commentator, Calibán (Enrique Santos), has taken a very sane attitude toward the situation in his column in El Tiempo. While he does not hesitate to say that the increase of three cents is unjust, he warns his people that to attempt reprisals against us would be a very foolish procedure. Regarding the idea advanced by some coffee producers that new markets should be developed, leaving the United States market to take care of itself, Calibán cautioned that the present [Page 882] and future market for Colombian coffee is the United States and that Colombian producers might as well accept that fact realistically. He pointed out that should Central and South American producers withhold coffee from the United States, it would only mean that importations of African coffee would be greatly encouraged. It is a strange coincidence that a Russian ship arrived at a Colombian port to take some eighty thousand sacks of coffee right in the middle of the widespread propaganda against us. Concerning this particular point, Calibán comments that the hullabaloo and fanfare made over the sale of eighty thousand sacks to Russia is nothing other than propaganda and will have no future to it. I assume Calibán meant that the future market for coffee in Russia is not particularly promising, especially when compared with the tremendous consumption in the United States.

Some of the editorial writers and commentators have accused us of not following or violating certain economic principles enacted at the Chapultepec Conference.76 In this respect we are being condemned for supposedly not taking into consideration the cost of production in determining the ceiling price for coffee. Be that as it may, I have the feeling that it was necessary for us to establish temporarily a buffer ceiling price so that our own people would not be gouged by coffee speculators. The more uncertainty there exists as to what we intend to do when the present ceiling price terminates on March 31, the more difficult it will be for speculators to continue holding their golden coffee in anticipation of higher prices. In the general interest I would like to see coffee producers the world over receive a just and fair price, but, at the same time, I am glad to see that the interests of our own people are being given due consideration. During the period of the war we were so liberal in many respects with our neighbors that it is now very difficult for some of them to realize that we must now also take into consideration the welfare of our own people.

With kindest regards [etc.]

Thomas H. Lockett
  1. For documentation on this Conference, see pp. 1 ff.