Miller files, lot 53 D 26, “Uruguay”
The Assistant Secretary of State for Inter-American Affairs ( Miller ) to the Ambassador in Uruguay ( Roddan )
Dear Ed :
[Here follow personal comments.]
The new government has certainly done well so far in its principal tests. In addition to suppressing the Peace Congress and going along with the bilateral military conversations, its action in suppressing the public health strike seems adequately vigorous.
[Here follow additional personal remarks, references to Cuba, and to the book by Havelock Ellis entitled The Soul of Spain.]
I have been gravely concerned with your remarks about the wool situation.1. The gravity of my concern arises not simply from what you say but from the fact that on top of all this the Treasury Department is seriously considering the imposition of countervailing duties on wool tops from Argentina and Uruguay on the theory that the multiple [Page 1538] exchange rate system in operation in those countries amounts to a bounty or subsidy. This, of course, is a highly debatable point, but the Treasury is under strong pressure from Senator O’Mahoney 2 and the wool growers, and their eagerness to get the Customs Simplification Bill3 passed by Congress in this session makes them particularly vulnerable to this kind of pressure. We are trying desperately to hold the line but it is a difficult matter to fight on since Treasury claims that the law is mandatory. I can imagine nothing that would more seriously damage our relations with Uruguay than this or which would tend to throw them into the arms of the Argentines, much as they would hate so to be thrown. As for the Argentines, this, coming on top of our difficulties with Bolivia over tin and our current negotiations with Chile over the price of copper, would be just about the last weapon that they would need to have in their arsenal of anti-American propaganda.
I have just come from a long meeting in the Treasury Department to which I went with Willard Thorp but we encountered very stiff resistance. The matter is not yet finally settled but it is very hard to counter Treasury’s arguments that a bounty or subsidy is indirectly conferred upon producers of wool tops by virtue of their enjoyment of a more favorable exchange rate than that in effect for the bulk of Uruguay’s exports. We are playing for time and, at the very least, I hope that we will have a chance of discussing this in full with the Uruguayans before any final determination is made.
I hope your health will continue to be better, and again many thanks for your letter.
Please give my best to Ed Trueblood.4
Sincerely yours,
- In his letter to Assistant Secretary Miller, dated Mar. 17, 1952, Ambassador Roddan stated in part the following: “Uruguay is definitely feeling the pinch caused by failure to dispose of the wool crop and it may have serious consequences. The Foreign Minister mentioned the wool problem, without suggesting that we take up the situation with our government. There is no doubt that Uruguay is looking toward the United States in the hope that something may be done and I wish it were possible to find an answer. However, in the present state of affairs, I do not see how our government can guarantee a high price for the world wool crop or make an exception for Uruguay. Meanwhile, only about one-fifth of the wool crop has been sold and the new crop will be coming along in a few months. The government budget is sharply unbalanced, the lack of dollars is severely felt, and wage strikes may be numerous in the next few months.” (Miller files, lot 53 D 26, “Uruguay”)↩
- Joseph C. O’Mahoney (D.–Wyo.), Chairman, Interior and Insular Affairs Committee.↩
- For documentation concerning this bill, see volume i .↩
- Edward G. Trueblood, Counselor of Embassy, Montevideo.↩