Foreign Relations of the United States, 1961–1963, Volume XII, American Republics

223. Memorandum of Conversation¹

Washington, April 3, 1962, 2:30 p.m.

SUBJECT

• Conversation between President Goulart and President Kennedy—Various Topics

PARTICIPANTS

• U.S.
  • President Kennedy
  • A. Jose DeSeabra (interpreter)
• Brazil
  • President Goulart²

[Here follows discussion of the situation in Argentina.]

President Goulart replied that he had taken over at the height of one of the most serious crises in Brazilian history. Thus far he said he has managed to earn and keep the confidence of the masses, but didn’t know how much longer he could do so. Thanks to his efforts, a substantial amount of political stability had been secured, but it can only be lasting if true social peace is attained, he added. He feels confident of receiving continued support from the people, but he feared that they could endure only so much hardship. He said that in order not to betray the people’s trust it was imperative that basic reforms be undertaken, which in turn would bring about greater social stability. This position appears to be understood by conservative elements, he said, which may be more or less sincere in their attitude. In President Goulart’s opinion, the most urgent need in Brazil is to find a solution for its many pressing social problems. The U.S. may help greatly, not only by money, but through an effective cooperation that will help Brazil to develop and solve its social problems. He said that a solution to these problems was the only way to maintain democracy. With regard to communism in Brazil, he said that, as a party, it is relatively weak and furthermore divided on many issues. He reiterated that Latin America was plagued by serious social problems and if no solution was found, democracy would be in great danger. He declared that Brazil looks to President Kennedy with great expectations, as he is the leader of a liberal party with advanced ideas. President Goulart added that effective cooperation from the U.S. would help Brazil to solve major problems, but economic liberalization had to be attained first and foremost through Brazil’s own efforts. The government, he said, is trying to curb inflation, but it was impossible as yet to achieve complete stabilization. He affirmed that the struggle for development had to continue, and therefore inflation had to be faced for a long time. He feared that if the strict measures advocated by the International Monetary Fund were to be applied in Brazil, there would result a situation possibly similar to that of Argentina.

President Kennedy asked whether inflation was up to about 50% per year.

President Goulart replied that it was around 40% to 42% and that efforts were being made in earnest to reduce it gradually. Again he brought up the point that stabilization at this time would create serious social problems.

President Kennedy said that the IMF had done well with inflation in Bolivia. He then inquired whether a reduction of inflation from 40% to 25% would require action from Congress on the stabilization program and whether such program would be adopted.

President Goulart replied that part of the stabilization program was being carried out by action of the government in reducing its budgetary expenditures by 20% to 22%, but that there also would be action by Congress, with a majority supporting the program.

President Kennedy referred to the talks between Secretary Dillon and the Foreign Minister.³ He said that Dantas also mentioned that sustained growth would bring about a reduction in inflation, while avoiding the danger of widespread unemployment. According to Dantas, unemployment would deprive the government of labor support.

President Goulart interjected that Argentina was known throughout Latin America as the most faithful disciple of the IMF.

President Kennedy said that it was the hope of the U.S. that the governments in Latin America would all have true popular support, and that it was the intention of the U.S. to continue to support President Goulart and his government. The U.S. realizes that Brazil has had internal difficulties, and that it is a complex matter to maintain the proper balance between stability and deflation on the one hand and growth and development on the other.

President Goulart stated that Brazil was inclined to follow the latter path.

President Kennedy then brought up the subject of labor organization in the Hemisphere and the concern of the U.S. over an emerging Latin American trade union movement that would exclude the U.S. and Canada, while including Cuba. The President said that this is fraught with danger and that strong ties between U.S. and Latin American labor organizations are essential to the survival of democracy.

President Goulart responded that the attitudes of labor in Latin America are bound together with development and the ever present social problems. He added that he counted on strong support by the workers of Brazil. He admitted that the left was strong and particularly active in the labor movement, but that its strength varied in direct ratio to the seriousness of social problems. He emphasized that he maintained a good relationship with all areas of the Brazilian labor movement.

President Kennedy stated that stronger and continuing ties between U.S. and Latin American labor organizations would help substantially to keep the Latin American labor free. But, he said, if Cuba were to be brought into a new Latin American labor organization, this would multiply considerably the danger of communist infiltration and subversion, and that therefore, a decided effort should be made to improve the relations between U.S. and Latin American labor organizations.

President Goulart commented that the Cuban phenomenon in its early stages was supported not only throughout Latin America, but even in the U.S.

President Kennedy said he recognized that Castro started out with a popular program which he did not follow.

President Goulart commented that up to the time Castro came out as an outright Marxist, the Cuban leader was in fairly good standing in Latin America.

President Kennedy then inquired about the possibility of Clodsmidt Riani and others trying to form a separate Latin American labor organization. He felt that stronger ties between U.S. and Latin American labor organizations would be a source of strength not only for labor but for democracy in general. And if those ties were broken, and the U.S. and Canada were to be kept out while Cuba came in, there would be a strong increase in radical left and communist influence on Latin American labor.

President Goulart replied that such a separate movement had been tried, but nothing concrete had happened, and that he himself was not in favor of it. He said that he has recommended to Ambassador Gordon that there be a greater exchange of labor leaders between the countries, as it is obvious that by and large, Brazilian labor leaders do not know sufficiently about the U.S. labor movement. He said that at the time the Soviet Bloc countries are making a successful effort in wooing Latin American and Brazilian labor leaders.

President Kennedy stated that such exchanges would be increased. He also mentioned that there was dissatisfaction on both sides with the AFL-CIO representatives in Latin America. The importance of good contacts between labor leaders cannot be overemphasized, since business and government contacts are only a part of the contacts between nations and peoples, he added.

President Goulart commented that the part played by the representatives of U.S. labor organizations in Latin America was very significant. If their attitude was one of understanding and friendly cooperation, he said better relations would result; but if they interfered too openly in internal affairs, there would be conflicts.

President Kennedy hoped that President Goulart would have the opportunity to discuss fully labor problems in his subsequent meetings with labor leaders and with the Secretary of Labor. He also expressed his concern over the need to strengthen labor relations, so that no break would occur. He would like to receive from President Goulart a memorandum suggesting how best to promote greater harmony in the United States-Latin American labor relations.

President Goulart said that the labor situation as heretofore discussed did not present any insurmountable difficulties. He then mentioned that labor attaches at the U.S. Embassy often intervened too directly in the affairs of Brazilian labor organizations. He said, by the same token, caution should be exercised in implementing Alliance for Progress programs, so that feelings of national pride were not hurt. It must be borne in mind, he said, that the poorer people are the prouder they are and that such interventions were particularly strong under the Eisenhower administration. He said that it did not appear that the representatives of the AFL-CIO in Latin America were fully aware of the different approach that must be adopted. He noted that it was also necessary to make a joint effort to dispel many misunderstandings existing about the U.S. which are prevalent among certain significant areas of public opinion. As for the misconceptions about Brazil, he said, it sufficed to mention the many accusations of communist sympathies leveled at him.

He concluded by expressing the certainty that these minor difficulties could be easily solved.

Note: At this stage the two Presidents joined the Foreign Minister, Secretary of State and other aides in the next room.

1. Source: Department of State, Presidential Memoranda of Conversation: Lot 66 D 149. Official Use Only. Drafted by DeSeabra of L/S. Approved by S on April 12 and by the White House on April 16. The meeting was held at the White House. The time of the meeting is from the President’s Appointment Book. (Kennedy Library)
2. President Goulart visited the United States April 3-7; he spent April 3-4 in Washington, April 5-6 in New York City, and April 7 with President Kennedy at Offut Air Force Base in Omaha, Nebraska, before departing for Mexico.
3. See Document 222.