By the usual criteria—literacy, per capita income, racial homogeneity—Argentina should have been the most stable democracy in Latin America. But the landed oligarchy had stunted the country’s democratic development for generations; and then after the war Perón, while breaking the grip of the oligarchy, also wrecked Argentina’s economy, debauched its politics and corrupted its administration. The military, having first installed and then ejected Perón, had acquired the habit of intervention in civil politics’; and their action now confronted Washington with a difficult decision. In the meantime, we had acquired a new Assistant Secretary of State for Inter-American Affairs. His superiors in the Department had come to feel that Robert Woodward’s temperate personality was better suited to an embassy than to the rigors of the Department in Washington. As one denizen of the seventh floor put it to me, “We need someone down there to clip Dick Goodwin’s wings and keep him in channels.” Early in March 1962 Woodward was told to prepare himself for an overseas assignment (he soon became ambassador to Spain, where he did his usual thoughtful job), and Edwin M. Martin, the Assistant Secretary of State for Economic Affairs, was appointed in his place.
Martin, who had been in government since the New Deal and in the State Department since 1945, was an administrator of toughness and ability. Rather liberal in his political views, rather conservative in his economic views, he was determined above all to run his own show. Though he believed deeply in the Alliance, he now allowed himself for bureaucratic reasons to be separated from his natural allies, clipping Goodwin’s wings, for example, all too effectively in the next months. Dick bore his situation with quiet dignity, complaining neither to the press nor to the White House; in time he moved on to the Peace Corps. The incident reminded one again of the limits of presidential power because, though Kennedy retained his fondness for Goodwin and often called on him for special jobs, he could not, without cost to other objectives, preserve Goodwin’s usefulness in a department which did not want to use him. The government lost, however, the imagination, drive and purpose Goodwin had given so abundantly to the Alliance.
The Argentine coup was Martin’s first major crisis. He quickly recommended that the President issue a public condemnation. DeLesseps Morrison opposed this, however, and, unable to persuade the Department, stimulated Senators Hickenlooper and Morse to ask the President to delay comment.* (There were other free wheelers than Goodwin in Latin American affairs.) The senatorial intervention worked. Our embassy in Buenos Aires then recommended that we accept the new regime as the constitutional continuation of the Frondizi government. Kennedy, despite his distaste for military coups, had a realist’s concern not to place himself in positions from which he could neither advance nor retreat. Since Frondizi’s overthrow had been greeted with vast apathy by the Argentine people, the prudent policy seemed to be to accept the constitutional argument, however tenuous. This in due course he did.
Soon, however, a problem at once clearer and harder arose in Peru. Unlike Argentina, Peru, with its high degree of illiteracy, its low per capita income, its unassimilated Indian population and its feudal system of land tenure, seemed destined for upheaval. In Haya de la Torre’s APRA party, it had the first of the partido populares of Latin America; but, though the Apristas were deeply anti-communist, their violent clashes thirty years before with the military had given each an enduring hatred of the other. Moreover, APRA was losing its hold on the young, some of whom were moving toward Fernando Belaunde Terry and his Acción Popular party, others of whom were tempted by Marxism. James Loeb, our ambassador to Lima, had been so shocked by the failure of the Peruvian academic community to protest the Soviet resumption of nuclear testing that he had addressed an open letter to the Rector of the Faculty of Engineering at the National University, suggesting that the silence was “as deafening, I believe, and as dangerous as the explosions which are being unleashed on the civilized world.” In the meantime, an intelligent and well-intentioned but hopelessly orthodox conservative government under Prime Minister Pedro Beltrin was making little progress in meeting the bitter problems of the country.
The next presidential election was scheduled for June 1962. In a series of brilliant and pessimistic dispatches, beginning in December 1961, Loeb predicted that the historic feuds which divided the APRA both from the military and from Belaunde’s new party of the democratic left would lead to political impasse. When I saw Loeb in Lima after Punta del Este, he spoke somberly about Peru’s political future. APRA, he said, was the strongest anticommunist force and the best means of keeping the working class from communism; but he was disturbed both by the intensity of its internal discipline and by the fancifulness of its economic planning. Nor did he believe that the military would accept an APRA victory. He thought he ought to return to Washington to discuss our policy in the face of various predictable contingencies.
In March, Loeb, coming to Washington, worked out his contingency planning with Edwin Martin and then with the President. At a time when the State Department was constantly being overtaken by events, Loeb’s foresight gave us a valuable head start. In a number of ways in the next months the United States sought to convey to the Peruvian army and navy that we could not expect to maintain the principles of the Alliance for Progress and at the same time condone military action against a freely elected, progressive anti-communist regime. But the sequel once again suggested the limitations on American power. Haya de la Torre, while narrowly winning the election, polled only a third of the popular vote. The military, echoing Belaunde’s cries of fraud, went into action. In July officers trained in the United States, commanding tanks built in the United States, knocked down the iron gates of the Presidential Palace, arrested President Manuel Prado and set up a military junta.
Washington, in accordance with previous planning, now suspended diplomatic relations. The President issued a strong statement explaining that the military coup had contravened the purposes of the inter-American system. In a second statement the State Department announced the suspension of various assistance programs. A few days later at his press conference, the President said, “We are anxious to see a return to constitutional forms in Peru. . . . We feel that this hemisphere can only be secure and free with democratic governments.” Within Peru conditions remained tense. President Prado was in prison, and the APRA leaders in hiding. On July 23 Haya de la Torre called a general strike; its failure implied popular acquiescence in the military regime. Behind the scenes Loeb in Lima and Martin in Washington brought pressure on the junta to return to constitutionalism. Responding to this pressure, the junta guaranteed freedom of the press and of political opposition, even for the Apristas, promised free elections for June 9, 1963, and soon released most of those arrested at the time of the coup, including President Prado.
On August 1 I said to President Kennedy that I hoped he had not regretted his statement against the coup. He replied, “Certainly not.” But, he added, neither the Latin American governments, most of whom were now preparing to recognize the junta (the Chilean foreign minister had already warned the United States against being more royalist than the king), nor the Peruvian people themselves, as shown by the collapse of the general strike, had given us the support for which we had hoped. His concern, he said, was that we might have staked our prestige on reversing a situation which could not be reversed—and that, when we accepted the situation, as eventually we must, we might seem to be suffering a defeat. The problem now, he said, was to demonstrate that our condemnation had caused the junta to make enough changes in its policy to render the resumption of relations possible.
This demonstration came when representatives of the junta appeared before the Council of the OAS, formally set forth the steps taken to restore civil liberties and promised solemnly to hold free elections within a year and abide by the results. On the basis of these assurances, we soon resumed relations with the Peruvian government. Though Kennedy was criticized at the time for seeming to begin one policy—non-recognition—and then to go back on it
, the fact was that the suspension of relations produced exactly the desired result. There were no reprisals, civil freedom was restored, free elections were guaranteed. While most American businessmen in Peru wanted unconditional recognition of the regime, the United States government showed its independence of business pressure and its opposition to military dictatorship. The action further consolidated the confidence of democratic Latin Americans in the progressive purpose of the American President. And the Peruvian election was held, as pledged, in June 1963. This time Belaunde won a clear victory and began to give his country the programs of social reform it had so long needed.
7. TROUBLES OF THE ALLIANCE
On March 12, 1962, the anniversary of his first proposal of the Alliance for Progress, the President spoke again to the Latin American diplomats assembled at the White House.
Our “most impressive accomplishment” in the seven months since Punta del Este, he said, had been the “dramatic shift in thinking and attitude” through the hemisphere. The Charter of Punta del Este had posed the challenge of development in a way that could no longer be ignored, and had laid down the principle of “collective responsibility for the welfare of the people of the Americas.” A second accomplishment was the creation of the institutional framework within which development would take place. The United States, moreover, had committed its pledged billion dollars to the first year of the Alliance. But the “ultimate responsibility for success,” Kennedy declared with emphasis, “lies with the developing nation itself.”
For only you can mobilize the resources, make the reforms, set the goals and provide the energies which will transform our external assistance into an effective contribution to the progress of our continent. Only you can create the economic confidence which will encourage the free flow of capital. . . . Only you can eliminate the evils of destructive inflation, chronic trade imbalances and widespread unemployment.
The men of wealth and power in poor nations, the President continued, “must lead the fight for those basic reforms which alone can preserve the fabric of their own societies. Those who make peaceful revolution impossible will make violent revolution inevitable. These social reforms are at the heart of the Alliance for Progress.”
While he spoke, criticism of the Alliance was already rising on the ground that results thus far had been disappointing both in reform and in development. No doubt the rhetoric which accompanied the birth of the Alliance had excited undue anticipations. But without the rhetoric the Alliance would have been stillborn; and the criticism of 1962 simply overlooked the realities of the situation in Latin America.
In the case of reform, it was unrealistic to expect Latin American governments to enact overnight land and tax reforms revising the basic structure of power in their societies when in our own country, for example, it had taken a strong government several years of savage political fighting to pass the relatively innocuous reforms of the New Deal. As for development, a long period was inevitable before plans and projects, separately initiated in a score of nations, proceeding in different sectors and at different paces, could generate cumulative momentum. The Marshall Plan, with all its resources of experienced entrepreneurs, veteran public administrators and skilled labor, had not wrought miracles in its first few months. P. N. Rosenstein-Rodan, now one of the OAS Panel of Experts, recalled that as late as the third year of the Marshall Plan, when the Organization for European Economic Cooperation asked its member governments to consider the consequences of a 5 per cent growth rate, practical men regarded the projection as absurd; yet all the Common Market countries achieved that rate almost at once. Given the most favorable circumstances, the seeds planted by the Alliance in 1961 and 1962 could not hope to bear visible fruit before 1964 or 1965.
Nor was the Alliance given the most favorable circumstances. In addition to the problems created by the communist threat, by rapid population growth and by internal political instability, the effort was beginning at a time of decline in world commodity prices—and in a continent where most nations depended excessively on one or two commodities as a means of earning foreign exchange. After 1953 Latin American exports (other than oil) had increased in quantity by nearly one-third but were bringing in only about 4 per cent more foreign exchange. By 1961 the price of coffee had fallen to about 60 per cent of the 1953 level. The consequent pressure on the balance of payments meant that some 40 per cent of the Alliance for Progress funds in the first year had to go for direct or indirect balance of payments loans. If, on the other hand, commodity prices had stayed at the 1953 level, Latin American export earnings would have been greater than the billion dollars committed by the United States in 1961. In an attempt to deal with a major part of this problem, the United States in 1962 took the lead in stabilizing coffee prices through a five-year international agreement including both producing and consuming countries.
In these early years, moreover, only Venezuela and Colombia (at least through Lleras’s presidential term) and some Central American states, notably Costa Rica and El Salvador, had governments fully responsive to the aims of the Alliance. Brazil, the nation in Latin America with the greatest potentiality, was the one on which we expended most money and concern; but, after the odd departure of Quadros in 1961, the government had fallen into the hands of his vice-president, João Goulart, a weak and erratic demagogue; and it required all the persuasion of two brillant ambassadors, Lincoln Gordon in Rio and Roberto Campos in Washington, to preserve any rationality in Brazilian-American relations. Argentina, the second largest nation, remained in melancholy stagnation and disarray.
There were problems too in Washington. Moscoso was unexcelled in communicating the political and social idealism of the Alliance—to the Latin Americans, who had great faith in him, to Congress, where he was well respected, and to his own staff. He deeply believed that the Alliance could succeed only as a revolution and a crusade. But the aid bureaucracy was not accustomed to running revolutions and crusades; and Moscoso, always a little at sea in Washington, was hard put to reconcile the conflicting pressures swirling around him. Though he committed the billion dollars each year in program and project loans, the stipulations and rigidities in the aid legislation held up actual disbursement. Even with successive deputies of unusual ability and devotion to the program, Graham Martin and William Rogers, it was difficult to break the bureaucratic threads tying the effort to the ground. “I would rather,” Moscoso once said, “have a warm amateur than a cold professional.” Warm professionals were not easy to come by. And the Latins themselves, who were often slow to produce good projects and effective development programs, excused their own delinquencies by blaming everything on the Washington bureaucracy.
Moreover, the North American business community had not been, with notable exceptions, enthusiastic about the Alliance. As foreign private investment in Latin America diminished in 1961 and as Latin America’s own private capital continued to flow out of the hemisphere into Swiss banks, the Alliance in Washington was under growing pressure from United States companies doing Latin American business to talk less about social reform and more about private investment. They had a point, since the Alliance’s capital requirements presupposed an annual flow of $300 million of United States private funds to Latin America. But the effect was further to belittle the crusade, to attenuate the mystique and zeal of Punta del Este and to lead Latin Americans to see the Alliance, despite its Latin origins, not as a great adventure of their own, but as a bilateral money lending operation, ‘made in the U.S.A’., to serve the interests of North American business. “No money-lender in history has ever evoked great enthusiasm,” wrote Morales-Carrión in a memorandum to the President after a Latin American trip in April 1962, adding in a sentence which delighted Kennedy, “We have yet to see a charismatic banker.”
As a consequence, the Alliance sometimes seemed bureaucratic and incomprehensible south of the border. “The present lingo of economic technocracy,” wrote Morales-Carrión, “simply does not reach the average Latin Amer
ican. His slogans come from the world of nationalism, not the world of technocracy.” The biggest obstacle the Alliance faced was “that it had not been wedded to Latin American nationalism, the single most powerful psychological force now operating in Latin America. . . . Unless the Alliance is able to ally itself with nationalism, to influence it in a constructive direction, to translate its abstract terminology into familiar concepts related to nation-building, the Alliance will be pouring money into a psychological void.”
One sometimes felt that the communists, operating on a shoestring in city universities or back-country villages, were reaching the people who mattered for the future—the students, the intellectuals, the labor leaders, the nationalist militants—while our billions were bringing us into contact only with governments of doubtful good faith and questionable life expectancy. Latin American democratic leaders themselves began to express increasing concern about the “degeneration” of the Alliance into a bilateral and technical program without political drive or continental vision. In October 1962 the Inter-American Economic and Social Council proposed that leading Latin American statesmen review the Alliance in the hope of promoting its multilateralization and Latin-Americanization and giving it a vital political base in the hemisphere.
A Thousand Days Page 94