30. Telegram 58 to Santiago, July 201
From Martin for Ambassador. Embtel 23 and 66.
I should like to repeat basic assumptions behind relatively hard line we take with respect to Chile’s economic problems and programs.
First, it is not just a stubborn insistence upon carrying out the letter of the Moscoso-Goodwin agreement, important as this is in our relations with other Latin American countries, with our Congress, and in the end, I believe, to our future relations with the Chileans themselves.
Nor are we, as it may sometimes seem, trying to convert Alessandri to anti-Americanism, even though, if he continues his do-nothing posture, this might help us with the Chilean people.
Nor are we, finally, insisting upon withholding aid until Alessandri’s Government takes certain measures, trying to employ our aid merely as a club to secure actions by the GOC that might please us in the abstract.
As I see it, the measures which we have discussed with the Chileans, and which in general have commended themselves to other outside observers of the Chilean scene, are measures which must be taken not only for the long-term benefit of the Chilean people but also, and most importantly, because of the contribution they will make to the success of the kind of center political forces that we (and we hope Alessandri) want to win the [Facsimile Page 2] 1964 election. Failure to take such measures may save some political difficulties this year but it would only be at the expense of creating much more serious difficulties in succeeding years because the fundamental problems will not have been tackled. This is the basic politico-economic calculation which we seem to have so much difficulty in getting across to Alessandri.
The withholding of aid (other than that pre-September tranche agreed upon in March) is not just to secure enactment of these various measures but reflects our belief that without them our money, whatever the amount, cannot create the kind of political and economic climate in Chile which is essential to the achievement of the goals for Chile of the Alliance for Progress and of the US and, we believe, the Alessandri Government. There are too many demands on our funds and they are secured with too much political blood, sweat, and tears here for us to [Typeset Page 71] be able to make them available where there is a substantial risk that they will not contribute proportionately to these shared objectives.
I want also to make clear that this is not just a Chilean policy but one which is being followed with considerable vigor everywhere.
I hope that you and your mission will continue to do everything possible to make this basic United States attitude toward our relations with Chile in connection with the Alliance for Progress widely understood within and outside the Government. Only if it is understood, could there be any possibility of a meeting of minds between the President and Alessandri, and thereby a fruitful visit.
On possibility Alessandri visit Washington we still considering various [Facsimile Page 3] aspects question, and need your reaction following considerations. There appears at present to be substantial danger Alessandri would see in invitation opportunity exert pressure directly on President Kennedy to relieve Alessandri from necessity taking various self-help and reform measures contemplated in Moscoso-Goodwin understandings. Invitation might accordingly encourage Alessandri resist recommendations made by his advisers as well as by foreign advisers for measures necessary in Chile’s own interest as well as for purpose reaching agreement with IMF.
If Alessandri were to come to Washington without prior performance in affecting minimum tax and fiscal reform and land reform measures and without having reached agreement with IMF, he would find no receptivity his efforts persuade Washington agencies waive conditions Moscoso-Goodwin understanding. On contrary we would expect Alessandri to receive a stiff lecture on necessity taking measures he so far has shunned. Any communiqué could only reflect this need. Accordingly visit might prove counterproductive for Alessandri’s political position at home, particularly assuming Chilean press build-up in expectation dramatic results his visit.
On other hand, we recognize that invitation to Washington might stimulate Alessandri to exert sufficient leadership to obtain IMF agreement and passage some reforms in order provide atmosphere for constructive conversations here. Likelihood this possibility presumably would be increased if Alessandri could be convinced our firmness in holding to conditions Moscoso-Goodwin understanding.
[Facsimile Page 4]On balance, we are reluctant encourage Alessandri visit in view our conclusion invitation would decrease rather than strengthen his determination take necessary internal measures. On other hand, we might be willing propose to President Kennedy that visit be scheduled only on understanding firm date will not be set until after those measures have been taken. However, will be extremely difficult to attempt arrange visit during remainder this year and particularly prior US election due heavy Presidential schedule. Therefore this message FYI [Typeset Page 72] only and not for discussion outside Embassy, in order avoid raising false hopes.
- Reiteration of U.S. hard line with respect to Chile’s economic problems and programs. Confidential. 4 pp. Kennedy Library, National Security Files, Countries Series, Chile, July–October, 1962.↩