Latin America

on the World Today

ON December 16, the day of President Truman’s National Emergency proclamation, Edward G. Miller, Assistant Secretary of State in charge of Inter-American Affairs, announced that the United States government was requesting, through the auspices of the Council of the Organization of American States, a conference of the foreign ministers of the twenty-one American republics.

The following week the Council unanimously indorsed the request. And the conference is now scheduled to begin March 26 in Washington. Quite obviously, if international developments required, it could take place sooner — and elsewhere.

The call for the conference meant the traveling of an old road for the American republics but this time faster. At the beginning of World War II, their foreign ministers met once at Panama City in 1939, to devise what turned out to be futile measures of neutrality, and again in Havana, in July, 1940, after the fall of France and the Netherlands, to take measures for protecting the Hemisphere if the Axis powers should follow up their victories by attempting to take over European possessions in the Americas. Within a month of Pearl Harbor a third foreign ministers’ conference was summoned in Rio de Janeiro, in January, 1942, to coordinate plans for fighting the war.

The coming Washington conference will have to align the Latin American republics in a concerted program for supplying United States needs for strategic materials in the huge defense operation.

It will have to reach some reasonably concrete agreements on how the Latin American countries are to be supplied with essential import commodities, goods, and machinery in the face of allocations in the United States for the defense program. It will have to devise means for checking Communist infiltrations, espionage, sabotage, and propaganda activities within the Hemisphere similar to those which cut Nazi operations down to a minimum alter 1942. Some kind of political common stand will have to be reached in the conference against Sovietprompted aggressions and against Soviet and satellite behavior in the United Nations — but any joint declaration must not be weighted so literally in favor of democracy as to be unacceptable to certain totalitarian governments on the western side of the Atlantic.

Finally, although military problems are not proposed on the original agenda, there is no question that the conference will have plenty to do with them in all-but-official backroom sessions. For much would need to be decided about how Latin American armies, navies, and air forces could he trained, equipped, and strengthened in discipline and manpower to protect the ocean supply routes, the shores, and the cities below the Rio Grande against anything the enemy in World War III could throw against them.

Our help for raw materials

There are other questions not on ihe official agenda. Wages and working conditions for Latin American labor will be important in almost every region where the United States is seeking to intensify raw-material production for defense stockpiling. To procure the utmost output of essentials such as Bolivian tin, Chilean and Peruvian copper, Venezuelan oil and iron, steps will need to be taken toward satisfying long-standing demands of workers both organized and unorganized.

Commitments are likely to be proposed by various governments binding the United States to modify or abolish its tariff restrictions on imports of basic Latin American commodities — copper and petroleum, for example. The United States may be asked to sign agreements to carry out a kind of Marshall Plan program of aid to the rehabilitation and development of various national economies in the Hemisphere in the event of victory—instead of simply promising these benefits in general terms as was done during World War II.

And all these complex projects and problems will have to he dealt with, quite possibly, in an atmosphere murky with divergent speculations and with incomplete factual knowledge of the nature of the emergency. Unless World War III has broken out by the time the conference meets and the balance of strength between the combatants is clearly revealed in its opening events, the conferees cannot know whether their task is to plan for a prolonged period of armed truce; for a war in which Western Europe must be supplied as their fighting base and the strategic materials of the tropical Far East will be available to them; or for one in which the Western Hemisphere, under constant threat of air and sea attack and invasion, must fight on its own. They cannot, for that mailer, know in advance what the effects of atomic bombing would be on either American or Russian war industries.

In the over-all planning operation, then, the Washington conference must hedge against all contingencies. Clearly, it will be an important conference, whose results cannot conceivably satisfy all t he participants.

Latin America in working order

Fortunately, the Latin America which enters the ordeal of the 1950s is far stronger in materials and in morale than the Latin America of Pearl Harbor. The armies, navies, and air forces of the twenty republics are larger, better equipped, and better trained, though they are still inadequate to meet the demands which a global struggle might impose on a region containing 150 million people.

With negligible exceptions in a few specialized departments, all the training of Latin American armed forces during the past ten years has been received from United States military experts. And the overwhelming bulk of their weapons, armaments, and mechanized war gear since Pearl Harbor has been of United States make. While much of their equipment is obsolete by several years, habits of using North American types of armament gadgetry have been fairly well learned.

Brightest of all, in comparison with the situation ten years ago, is the Latin American economic picture. The major republics can no longer be described as primitive economies struggling out of the catastrophe of world-wide depression. Today they are partially but effectively industrialized nations whose policies during the past two years have gone a long way toward overcoming post-war economic and financial dislocations.

Brazil, for instance, is operating at Volta Redonda a steel plant comparable in size and output to all but the largest Tnited States mills. Last November Chile opened a new plant at Huachipato, near Concepcion, capable, at fully expanded capacity, of producing 350,000 tons of steel ingots a year — approximately sixteen times the Chilean peacetime requirement. Mexican steel production since 1939 has increased from 113,000 tons to well above 320,000 tons.

Again in Chile, the copper smelters at Chuqnicamata have been outfit toil with new machinery of the highest known efficiency, guaranteeing maximum output from both high and low grade ores. From Venezuela the Bethlehem Steel Company’s new iron mines in the Orinoco back country are in shape to begin ore shipments to the Tnited States at the rate of 2 million tons a year. The much larger United States Steel reserves near by can be hastened to the production stage within a little more than a year, should the defense emergency require it.

Textiles and other light industries during the post-war years have markedly increased both capacity and production. Similarly, production of agricultural and other raw materials for manufacture is being more efficiently conducted and better channeled into the home country factories. For supplies both of consumers’ goods and of finished basic materials Latin America will be far less dependent on the Tnited States than was the case during the World War II crisis.

New confidence, new prosperity

Furthermore, most of the Latin American countries enter the new emergency in a state of unprecedented solvency, almost of prosperity. Partly because of stockpiling and the high price’ of coffee, their balances of trade have been favorable for a long time both with the United States and Europe. With the United States alone the twenty republics piled up a commercial trade surplus of 250 million dollars in the first nine months of 1950.

Stern and still increasing import restrictions have prevented these funds from being wasted in the luxury extravagances of the upper-class moneymaking groups. Consequently dollar and foreign exchange balances are growing, and debts, both commercial and banking, are being paid off with impressive prompt ness.

Brazil, for instance, during the past year has sealed down her commercial obligations to the United States from 118 million dollars to 34 million dollars. Cuba’s gold and foreign exchange hoard is an all-time Latin American high of nearly a billion dollars. Uruguay’s gold reserves in October were up to 208 million dollars. Colombia, in spite of internal disorder, has recently been blueprinting a 2.3-million-dollar five-year plan of construct ion and development —predicated on Point Four, United Nations, and World Bank aid, The world emergency no doubt will indefinilcly defer it. But the fact that the plan has been so specifically conceived is a symptom of Latin America’s new confidence in the future.

Meanwhile, of course, most of the republics are troubled with gross inflations, and consumer goods are short because of the import restrictions. Hence, except in Argentina and Uruguav and in the industrial sectors in Brazil, Colombia, Cuba, and Mexico, little of the prosperity on the books has filtered down to the masses. Nevertheless, in this emergency, no Latin American republic will have to be bailed out of partial or total bankruptcy before contributions to Hemisphere defense begin.

Resistance to Communism

On the morale and political sides there is far stronger resistance to Communism in Latin America than there was to the Nazi-Fascist effort at world conquest ten years ago. With the possible exception of Guatemala, every government below the Bio Grande is hostile both to the domestic operations of Communism and to the Kremlin’s brand of militant imperialism. The strongest social and moral force in the twenty republics, the Roman Catholic Church, is Moscow’s sworn enemy. So in each republic are the ruling economic and political groups many of whose members felt in the early 1940s that they might have something to gain from the world-wide spread of Fascism.

No wobbling, then, on the question of supporting the United States position is to be seriously expected at the Washington conference or afterward. Argentina, in spite of its long series of disagreements with Washington, can find no economic or political advantage in being neutral in the present conflict.

Even more in point is the case of Perón’s strong neighbor, I’resident - elect Getulio Vargas of Brazil. As dictator of Brazil from 1930 to 1945, Vargas eventually supported the United Slates war effort prodigiously, and sent a Brazilian expedition overseas to the fighting front in Italy. But down to Pearl Harbor he faltered. As late as the summer of 1940 he made a speech proclaiming the Fascist doctrine that the disciplined “virile races” should inherit the earth, and did his utmost to organize a corporaltive state in Brazil on the model of Italy’s.

Then, when he was ousted from office by a military coup in 1945 and foiled from running immediately again for the presidency by the activities and speeches of United States Ambassador Adolph Berle, Jr., his indignation with the Washington government and its policies increased.

Nevertheless, as president-elect — he takes office on January 31 — Vargas has publicly endorsed l oiled Stales and United Nations operations in Korea both before and after the debacle there. To private visitors from North America he has repeatedly said that if he had been president, a Brazilian division would have been fighting beside United States troops from the earliest days of the Korean war.

Yet, in spile of these favorable omens, the Communists still have one operating front in Latin America which cannot be neglected without grave peril — the front of the impoverished masses, rural and urban. As the pinch is felt on food and basic living commodities and cheap consumer goods from the United States, the living standards of vast elements in this group will tend to drop below bare subsistence levels. In proportion as this happens, these scores of millions will be increasingly open to Communist appeal that this is the gringos’ war, and gringo imperialism is taking advantage of it to starve the masses and enslave them in starvation afterward.

It is the same appeal to passionate nationalism and gringo-bat red which has won a decisive following for Communist front movements in Guatemala even in peacetime. In warfare or even in a phase of total defense economy, this could lead to drastic interruptions of the Hemisphere procurement system or to indescribably destructive revolts of the masses.

That is why the improvement of wage standards and working conditions in Latin America’s more distressed areas, and the maintenance of essential exports, may be, in the Hemisphere’s over-all defense strategy’, the Washington conference’s most important assignment.