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

218. Letter From President Frondizi to President Eisenhower¹

Buenos Aires, August 9, 1960.

Dear Mr. President And Friend: In moments of acute international tension, reflected in a particularly serious manner in our American sphere, I have decided to resume by means of this communication the frank discussion which I had the pleasure of holding with Your Excellency in the Andean setting of San Carlos de Bariloche.

After the visit to nine states of Europe which I have just made, I have reflected deeply on the way in which world events have developed within the past few months. Everywhere, in different political and economic circumstances and under varied guises, I have seen the multiple efforts which peoples are exerting in order to strengthen the bases of their national development.

I have thus had the satisfaction of ascertaining that this state of affairs brought about by the present world situation reflect a firm conviction on the part of the European statesmen with whom I had the honor to converse with the same frankness as that which prevailed between us.

From our Argentine viewpoint—an American and Western viewpoint—I emphasized in all the nations I visited the absolute necessity for the highly developed countries to step up decisively their collaboration in the development of the underdeveloped nations if all the peoples of the free world wish to preserve the way of life common to all of them.

I do not need to recall to Your Excellency the efforts put forth by my government to have the complex process of development unfolded within the framework of the strictest legality, maintaining the social order and adapting the economic structure and financial and commercial institutions to the needs of international economic cooperation.

The maintenance of the measures adopted constitutes a great effort for my government and imposes immense sacrifices on the people of the Nation. Your Excellency is well aware that we put those measures into practice with resolute decision, even knowing that we were endangering the political reserves with which we assumed the reins of government, and that if results commensurate with such sacrifices were not obtained, we would face ever-increasing unrest.

We believed, nevertheless, that such measures had to be taken: in the first place, to keep the Nation within the Christian and Western way of life that is a part of its traditions; in the second place, because we believed that by radically strengthening the foundations of our political, social, and economic structure, the human and natural resources that constitute our Nation would awaken in the more advanced countries the adequate response that is inherent in the enormous responsibility of leading the Western world and keeping it united.

We are, Mr. President, passing through a period of genuine world crisis. A feeling of nationalism through the development of countries that yesterday were in a semi-colonial status constitutes an indisputable fact. This critical time may hasten the process in one of two ways: either the countries develop and at the same time maintain an internal way of life and a form of international relations that are essentially those of the Western world, or they develop through social and political revolution, with various forms of dictatorship. And I do not believe it necessary to call attention in this connection to the terrible consequences of this second alternative.

At this point, and in respect to the participation they should have in guiding this process, the responsibility of national leaders is enormous, as is the responsibility of peoples.

For our part, the capacity and national feeling of the Argentine people have permitted us to make an immense effort which we believe has been understood by the people and government of the United States of America. I attribute this understanding to the great cordiality that has marked our relations since I took office on May 1, 1958. And, by virtue of such understanding, the multiple problems that stood in the way of closer ties between us have now been almost entirely eliminated.

As for the United States, on the other hand, it must be realistically admitted that the valued collaboration given toward giving an impetus to the national economy has not maintained a level nor a magnitude adequate to our tremendous effort.

I cannot but point out the bureaucratic barrier set up by the slow processes of the international credit agencies, to the detriment of the pressing needs which we must meet in order to ensure adequate integration of our economy, launched on a path of development that does not admit of delays. The financing of our iron and steel and hydroelectric program, together with that of our highway system and the resulting airports, hotels, and housing, must today take absolute priority in order to advance in a concrete and realistic manner cordial understanding between Argentina and the United States. It is enough to think that the means of stabilization—certainly impossible to postpone—that we have been applying for over a year are threatening to turn into a fruitless effort to maintain the level of the rate of exchange. If we do not create the necessary sources of work to absorb the idle manpower that is seriously burdening the fiscal budget, we shall have failed in our program of stabilization, despite the immense sacrifices laid upon the entire Nation, and the social and political results will be unpredictable.

I have expressed these thoughts because I have felt it right, natural, and above all indispensable to judge the Latin American problem by our more immediate experience, which is our national experience, based on the effort of all my compatriots.

Because of the similarity of views that has always prevailed in our conversations, I deem it appropriate to express my firm hope that the United States will not turn away from this genuine challenge of history.

I have wished to inform Your Excellency of my concern in the certainty that, if it should be shared, it might help Your Excellency and your Government adopt measures that will make the world regain the assurance that the Americas are the hemisphere of hope.²

With very friendly greetings to Your Excellency,

A. Frondizi³

Enclosure

MEMORANDUM

1. When the Government of the Argentine Republic decided to launch the country upon a great national effort as a result of its Economic Program, it had collaboration from abroad particularly in mind, especially that of the United States of America. To that end it effected a radical reform in its economic legislation, both in the monetary and financial field and in the business field, that would harmonize with the systems maintained by all the nations of the free world having the same type of political and economic organization. It was thereby hoped to attract the cooperation of foreign capital, recover the right to share in the coordination of the Western economies, and obtain the benefits of reciprocity in an economic system in which an inescapable interdependence is inherent.

2. It cannot be doubted that at this stage of the evolution of the Economic Program the maintenance of the measures of monetary stabilization and financial recovery adopted by the Government—with the valued aid of United States capital and the support of the United States in international credit agencies—is daily becoming more burdensome without accompanying benefits being derived therefrom. After a year and a half of application of such measures, Argentina is facing a marked decline in its gross national product, its imports have had to be reduced, its exports have not increased, domestic consumption has declined, and the purchasing power of the people has fallen. Except for the petroleum sector, in which the contribution of foreign capital, especially that of the United States, has caused this economic activity to flourish in an extraordinary manner, there has been a decline not only in industrial production but also in agricultural production in most of its ramifications.

3. Argentina now faces the following situation: if the shortage of credit continues, demand cannot grow and consequently production cannot rise; if domestic credit is relaxed in order to fill the needs caused by greatly shrunken imports and wages are raised to create greater consumer power, the national production can be revived, at least temporarily, but there is no doubt that this will mean a return to uncontrolled inflation and an increase in the deficit in our treasury accounts, which are precisely the things we wish to eliminate.

4. All of this threatens to cast doubts upon the efficacy and wisdom of the Argentine economic plan and therefore the readjustment of the structure inherent therein will not be temporary and will not offer prospects of susbstantial improvement. In spite of this, the Government of the Argentine Republic feels that it has adopted not only a good course but the only one compatible, on the one hand, with the economic and social situation which it inherited from the former administrations and, on the other hand, with the evolution of the political and economic institutions of the Western World. But it must state that the country has not obtained from the United States and from the other nations of the free world understanding and reciprocity in dealing with the needs of its development and collaboration in connection with the effort it has been putting forth since May 1, 1958.

5. In the case of the United States of America the circumstances in reference have special significance. The full re-establishment in the American community of Argentina, which has required the best efforts of its Government to strengthen relations between the two countries, and the reform undertaken with respect to the monetary and foreign trade system to form the bases and ensure the conditions for an increasing contribution of foreign capital and increasing the flow of reciprocal trade, has not evoked on the part of the United States the response needed by our national development, the inescapable objective of Argentine economic policy and of the system of inter-American relations.

6. Furthermore, in the field of trade Argentina is threatened by protectionist, highly restrictive, and even discriminatory policies with respect to the import systems of the advanced Western countries that may, within a short time, have significantly unfavorable effects on our traditional exports, whereby our foreign purchasing power will decline and consequently our agrarian recovery and industrial growth will be curtailed. In this connection, with one exception, mention must be made of an uncooperative attitude on the part of the Government of the United States of America with respect to Argentina’s right to participate in the international action being taken to reorganize the economic relations of the free world, whose inevitable interdependence cannot with justification admit of Argentina’s exclusion.

7. In addition, the Government of the Argentine Republic calls attention to unfavorable prospects in the intensification and diversification of Argentine exports to the United States market and, furthermore, the constant difficulty of selling in that market products constituting the traditional trade between the two countries is well known. Obstacles set up against the importation of mutton from Tierra del Fuego; liquidation of United States surpluses of quebracho extract; limitation of tung oil quotas; artificial sanitary barriers against the importation of cooked meats; maintenance of the agricultural surplus policy, etc., are all unfavorable factors not only for Argentine exports to the United States but also for the international marketing of her products.

8. In the bilateral financial field, one cannot but point out that the United States has not met the needs of Argentina relating to the acceleration of the iron and steel industry, the hydroelectric program, the highway plan and the resulting airports, hotels, and housing, and the national development complex based on the construction of El Chocón, the urgency of which is increasing in direct proportion to the need to maintain the present means of monetary stabilization and to the preservation of the absolutely unrestricted market created in the country in order that the foreign contribution, especially that of the United States, may be forthcoming in a rapid and flexible manner.

9. In view of the present world situation and particularly in view of the present inter-American situation, the Government of the Argentine Republic feels it to be its duty to point out the factors that can cause deterioration in the political and economic relations between two countries which, without any doubt, have never before attained the degree of friendship which they have at present. And, above all, it believes it appropriate to express the concern aroused by the factors of internal pressure which, in the light of the international situation, seek to deter the Government, either partially or totally, from the course it has undertaken in all aspects of the life of the nation and of its international relations and which it is determined to maintain by all possible means.

10. Therefore, taking all these circumstances together, it becomes imperative that the Government of the United States directly make available additional and adequate resources for the immediate initiation of a highway and airport program, without prejudice to the planning and financing handled by international credit agencies. This is absolutely necessary in order to make a resolute approach to the fiscal deficit that is endangering the effort toward monetary and financial stabilization with its social consequences and the effects of such action in the creation of new sources of employment, not to mention the hemisphere-wide strategic reasons therefor—all these things call for the execution of the said program.

1. Source: Eisenhower Library, Whitman File, International File. Secret. The source text is a translation of Frondizi’s origninal letter in Spanish. According to an August 25 memorandum from Lester Mallory to Acting Secretary Dillon, the Argentine Chargé delivered the letter and an accompanying memorandum, infra, on August 16. Mallory’s memorandum indicated that a translation of the documents was delivered to the White House on August 17. A copy of the memorandum is in Department of State, ARA/EST Files: Lot 62 D 420, Frondizi Letter Argentina 1960.

2. In telegram 222 to Buenos Aires, August 17, the Department instructed the Embassy to deliver the following message from Eisenhower to Frondizi:

   “I have read your letter and memorandum with interest and sympathy. I understand the seriousness with which you regard the economic situation in your country.

   “I will discuss your letter in detail with my advisers and communicate with you further.” (Presidential Handling Telegram; Department of State Telegram Reels)

3. Printed from a copy that bears this typed signature.