CONDITIONS AND TRENDS IN LATIN AMERICA AFFECTING US SECURITY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80R01443R000100040007-1
• Release Decision: RIFPUB
• Original Classification: S
• Document Page Count: 15
• Document Creation Date: December 9, 2016
• Document Release Date: August 5, 1998
• Sequence Number: 7
• Publication Date: December 12, 1952
• Content Type: NIE

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CONDITIONS AND TRENDS IN LATIN AMERICA
AFFECTING US SECURITY
The following member organizations of the intelligence
Advisory Committee participated with the Central Intelli-.
gence Agency in the preparation of this estimate: The
intelligence organizations of the Departments of State,
the Army, the Navy, the Air Force, and the Joint Staff.
All members of the Intelligence Advisory Committee
concurred in this estimate on 4 December 1952.
CENTRAL INTELLIGENCE AGENCY
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NATIONAL INTELLIGENCE ESTIMATE
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CONDITIONS AND TRENDS IN LATIN AMERICA
AFFECTING US SECURITY 1
THE PROBLEM
To identify the factors affecting Latin American political stability and cooper-
ation with the United States, and to estimate the trends likely to affect Latin Amer-
ican political and military cooperation and the availability of Latin American stra-
tegic resources.
CONCLUSIONS
1. The political instability now evident
in Latin America results from serious
disturbance of the traditional social or-
der by new economic and social forces.
This instability is therefore much more
fundamental than that which character-
ized the personal politics of Latin Amer-
ica in the past.
2. The principal political trend in Latin
America is toward nationalistic regimes
maintained in large part by demagogic
appeal to the dd.
population, of which the Peron regime
in Argentina is an outstanding example.
Similar, though not identical, regimes
already exist in Bolivia and Guatemala.
Present circumstances favor their devel-
opment in Chile and Ecuador. Peru,
Colombia, and Venezuela are the states
next most vulnerable to this trend.
3. The general trend toward radical and
nationalistic regimes in Latin America is
favorable to Peron's efforts to arouse an-
This estimate relates only to the Latin American
republics. European colonies in the area are
excluded from consideration.
tagonism toward the United States.
The same nationalism, however, would
probably preclude Argentine political
control over any neighboring state.
4. The Communist threat to US security
interests in Latin America is greater
than the limited and declining party
membership in the area would suggest,
because of the ease with which a
relatively few Communists, operating
through various fronts, can exploit the
social unrest and Yankeephobia already
existing in the non-Communist popula-
tion. The Communists, as such, have no
present prospect of gaining control of
any Latin American state by electoral
means. Guatemala, however, is an ex-
ample of how a small Communist minor-
ity can penetrate a Latin American gov-
ernment and strongly influence its
policy.
5. The pressures of social unrest and ex-
treme nationalism make it difficult for
Latin American governments to render
on all occasions the degree of diplomatic,
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military, or economic support desired by
the United States. With the exception
of Argentina and Guatemala, they have
been reasonably cooperative in the politi-
cal sphere. Generally, however, they
have not implemented effectively their
economic and military undertakings.
6. Eventually the trend toward exagger-
ated nationalism, if it continues, will
seriously affect Hemisphere solidarity
and US security interests in Latin Amer-
ica. For the next several years, how-
ever, change is not likely to be so far
reaching as to reduce substantially the
present degree and scope of Latin Amer-
ican cooperation. In particular, Latin
American strategic raw materials will
continue to be available, although the
governments concerned will seek to drive
hard bargains in terms of prices and eco-
nomic concessions.
7. In the event of global war, the Latin
Americans would more fully appreciate
their community of interest with the
Western Powers and would probably
show a greater readiness to meet their
international military and economic
commitments. The Latin American
armed forces, however, would not be able
to defend critical strategic areas and vital
sea routes against serious enemy attack
without the direct participation of US
forces, although they would be of value
in supporting roles.
8. The more immediate threat to US
security interests in Latin America, in
the event of global war, would be Com-
munist capabilities for the sabotage of
strategic industries. It is unlikely that
a large-scale and widespread program of
sabotage could be sustained, but the sit-
uation would favor sporadic Communist
successes.
DISCUSSION
Basic Social Trends
9. In most Latin American countries the old
order of society was dominated by landed
gentry in alliance with the Church and the
Army. There was also a small professional
and commercial middle class, but the mass
of the population was dependent, inarticu-
late, and politically impotent. Within the
ruling group politics was highly personal and
unpredictable, but the social order itself was
stable.
10. In recent years, however, the traditional
social order has been seriously disturbed, pri-
marily by the accelerated pace of Latin Amer-
ican economic development as affected by
structural changes in the world economy,
secondarily by ideological influences derived
from the world-wide social unrest of the
twentieth century. Although 60 to 70 per-
cent of the population is still engaged in agri-
culture, the development of mining, manu-
facturing, and service industries in Latin
America during the past three decades has
considerably increased the importance of
non-agricultural labor and the urban middle
class. In many important countries the pre-
ponderance of political power is shifting to
politicians whose strength is derived primari-
ly from influence over city populations. This
development, still incomplete and ill-defined,
has given rise to political instability more
fundamental than that which characterized
the personal politics of the past.
11. In some countries new political leader-
ship arises primarily as an accompaniment
of industrial and commercial growth. In all
countries its rise has been associated with
a rapid expansion of governmental opera-
tions. The leaders of the newly-important
population groups include functionaries
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staffing government ministries and state-
controlled enterprises, military, professional,
and business men, and trade union leaders.
The majority do not have strong ties to the
traditional order. The most characteristic
attitude among political leaders of this new
type is a strong tendency toward nation-
alism.
12. Older social elements and institutions
have adapted themselves with varying de-
grees of success to the rise of this new and
essentially urban political leadership. Intel-
lectuals, who formerly had their spiritual
home in European capitals and were at-
tached to the oligarchy by ties of family and
patronage, are now predominantly both so-
cialistic and nationalistic in temper. The
military, nationalistic by tradition, have
shown considerable interest in the prospect
of industrialization. They are sometimes
neutral toward the old order, or even hostile
when alignment with "progressive" forces
suits their purposes. The various national
Catholic hierarchies have for the most part
striven to preserve the traditional social order,
but in a few countries Catholic laymen have
organized Christian socialist parties in an ef-
fort to counter anti-clerical and agnostic tend-
encies of the urban population and to divert
the masses from a more radical course. Only
the landed interests have in general made no
effort to accommodate themselves to the new
situation.
13. Relations between the masses of the peo-
ple and the new, essentially urban, leadership
are much less stable and clear than were
those between the people and the landed
aristocracy. Personal politics and "feudal"
loyalties are being superseded by the imper-
sonal relations of Capital, Labor, and Gov-
ernment. The aspirations of urban popula-
tions, especially those of organized labor, are
often exploited by demagogues and directed
toward objectives incompatible with the de-
velopment of stable and moderate govern-
ment. The masses in general are poverty
stricken, politically inexperienced, and high-
ly susceptible to demagogic appeals.
14. The degree of disruption produced by the
social forces mentioned above varies from
country to country. The traditional or-
der still persists in Peru, Nicaragua, and the
Dominican Republic, for example. On the
other hand, Argentina, Bolivia, and Guate-
mala are now controlled by politicians who
base their power in large part on leadership
of the depressed masses. This latter pat-
tern is likely to be repeated, with local varia-
tions, in other countries which have not
achieved, like Mexico, a relatively high level
of social and political stability.
Basic Economic Trends
15. Latin America has traditionally served
as a supplier of raw materials and foodstuffs
to the highly industrialized countries of North
America and Europe, and has depended on
those countries for nearly all of its require-
ments of manufactured products. The Latin
Americans, however, are no longer willing to
accept what they describe as a colonial eco-
nomic status. This attitude is accentuated
by their experience during and after two
World Wars, when, despite large income from
exports of raw materials, they were unable
to buy the manufactured goods they wanted.
They seek a greater degree of economic inde-
pendence and stability through such meas-
ures as protective tariffs, exchange restric-
tions, export controls, and government-spon-
sored industrialization.
16. One aspect of the prevalent economic
nationalism has been a tendency toward the
expropriation and nationalization of foreign-
owned utilities and industrial enterprises.
This tendency arises from political as well as
economic motives. Immediately after the
war Argentina and Brazil bought out British
railway interests. Recently, the Bolivian
Government has nationalized that country's
tin mines. In Chile discussion is rather in
terms of an expropriation of the product of
the copper mines through the establishment
of a government monopoly of copper exports.
In Venezuela there is occasional talk of even-
tually expropriating the oil industry, but
there is no indication that the government
contemplates such a policy. A related tend-
ency is illustrated by the unwillingness of
Brazil to permit the exploitation of oil re-
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sources except on terms providing for close
government control of such operations.
17. Progress in industrialization will be in-
creasingly difficult to sustain in Latin Amer-
ica. Domestic private investors, seeking
quick, high profits, are reluctant to finance
long-term development enterprises. Foreign
private investment capital for desired indus-
trial expansion has not been forthcoming in
effective quantity in the postwar period, in
large part because of the restrictions and
uncertainties engendered by the prevalent
economic nationalism. Industrialization,
therefore, has been to a considerable extent
financed with public funds, and consequently
its form and direction have often been gov-
erned by political rather than economic con-
siderations. Development of new domestic
industries and the basic transportation and
energy services will probably involve the di-
version of capital and other resources from
development of the raw material export sec-
tor of the economy.
18. Latin America's recent preoccupation
with industrial development to the neglect
of agriculture has adversely affected the
domestic supply of agricultural products as
well as the earning of foreign exchange
though agricultural exports. Even a rela-
tively small increase in agricultural invest-
ment could have brought substantial in-
creases in agricultural productivity, particu-
larly in the growing of food for domestic use.
19. Inflation has increased the economic and
political strain in Latin America. It has
jeopardized the levels of living of the laboring
classes in urban areas, thereby compelling
the governments to expand costly social wel-
fare programs. Agriculture in general has
not benefited from inflation because of the
increased cost of manufactures and because
of government interference in domestic
markets.
20. An economic crisis in Latin America was
averted only by the rise in prices for Latin
American export commodities following the
outbreak of hostilities in Korea. If the terms
of trade should seriously deteriorate many
Latin American economies would be severely
shaken. In countries where large-scale pro-
grams of industrialization are underway, a
marked slackening of those programs would
produce grave social and political problems.
The countries most vulnerable in this re-
spect - Mexico, Brazil, Argentina, and
Chile - are those which could render the
greatest material support to the United States
in the event of war.
Basic Political Trends
21. The most important political trend in
Latin America is toward the rise of radical
and nationalistic regimes like those in Argen-
tina, Bolivia, and Guatemala. Such regimes
are based in large part on mass support ob-
tained by promises to relieve the wants and
fulfill the aspirations of depressed segments
of the population. Recent elections in Chile
and Ecuador have brought to power nation-
alistic regimes more likely than their prede-
cessors to develop in this same direction.
Radical mass movements in Peru and Vene-
zuela have been forced underground by rep-
resentatives of the traditional order. In their
frustration these popular movements are sus-
ceptible of exploitation by imitators of
Peron's techniques. Even in such relatively
stable countries as Brazil, Uruguay, and
Mexico there are extremist elements of con-
siderable political potential.
22. The mounting pressure for radical politi-
cal change in Latin America alarms partic-
ularly those governments controlled by the
traditional ruling group, as in Peru and
Colombia, and stiffens their resistance to any
substantial change. This repressive tendency
hinders even moderate change and so renders
more likely the eventual outbreak of revolu-
tionary violence. In Colombia there is al-
ready a widespread guerrilla resistance to the
regime.
23. Where power has already passed, as in
Mexico, from the traditional to a new politi-
cal leadership, the governments are also hos-
tile toward mass movements and toward poli-
ticians seeking power on a new wave of revo-
lution. The weakness of these otherwise
stable political machines lies in their many
unfulfilled promises to the urban masses,
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promises impossible of fulfillment during the
present phase of economic development.
Chile affords a recent example of one such
liberal and moderate regime which has suc-
cumbed to this weakness. Only in Mexico is
the existing political machine strong enough
to permit a reasonably confident estimate
that it would be proof against overthrow by
a demagogic opposition.
24. The military retain considerable political
influence in all Latin American countries.
In those such as the Dominican Republic,
Nicaragua, and Paraguay, where the tradi-
tional order has not been seriously disturbed
by new social and political ideas, military
and national leadership are essentially iden-
tical and no conflict between the two is likely
except in terms of a palace revolution. In
countries where the old order is under attack,
but has not been superseded, the position and
future conduct of the military are less clear
and predictable. The Venezuelan Army, for
example, put the liberal Acci6n Democratica
into power in 1945, but turned it out again
three years later. The vacillation of the
Army between the old and new orders, in
Venezuela and elsewhere, appears due to the
fact that the new sort of civilian political
leaders, while promising to satisfy military
aspirations, also sponsor radical changes in
the social order. Yet even where the Army
has taken direct control, as in Peru and Vene-
zuela, the resulting governments have been
sensitive to popular demands for social im-
provement. Where demagogues gain mass
support, as in Argentina, or where govern-
ments are responsive to a relatively broad
and articulate electorate, as in Mexico and
Uruguay, the capacity of the military for in-
dependent, action and their influence upon
the government tend to lessen.
25. Peron's success in Argentina has stimu-
lated the existing trend toward demagogic
and nationalistic regimes in other countries,
as in Bolivia, Chile, and Ecuador. Peron has
fostered this trend by giving material or
moral support to like-minded national lead-
ers. The trend, however, is primarily the
consequence of national conditions and aspi-
rations in each case. Even if other govern-
ments should adopt domestic and foreign
policies closely resembling those of Peron,
their essential nationalism would preclude
their becoming mere satellites of Argentina.
26. The trend toward radical nationalism in
Latin America is adverse to US security in-
terests, for a common expression of such na-
tionalism is Yankeephobia. This spirit is in
conflict with the idea of hemispheric soli-
darity and cooperation. As expressed in Ar-
gentine policy, it involves withdrawal into a
"third position" of neutrality between, even
active opposition to, both the US and the
USSR. In practical application this policy
adversely affects only US interests. Peron is
actively endeavoring to induce other Latin
American states to adopt this "third posi-
tion." He has had no apparent success so
far, but the general trend is favorable for his
purposes.
Basic Military Trends
27. The primary function of Latin American
armed forces has always been the mainte-
nance of internal order. Although interna-
tional wars have occurred within the area,
they have been rare and are outside of nor-
mal expectation. Latin American military
establishments have never been developed in
the expectation of having to resist invasion
by a first-class military power without the
support and assistance of some other major
power.
28. The Latin American governments have
now agreed to a coordinated approach to the
general problem of Hemisphere defense, with
the assignment of tasks to particular states
under an over-all plan and the preparation of
their forces to perform the tasks assigned.
Such planning is proceeding through the
agency of the Inter-American Defense Board.
At the same time various Latin American
forces are being modernized and developed
under US influence. This influence is exerted
through joint US-Mexican and US-Brazilian
defense commissions, US military missions in
all other Latin American countries except
Nicaragua and the Dominican Republic (the
present armed forces of which were estab-
lished under US auspices), the training of
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Latin Americans at Service schools in the
Canal Zone and the United States, various bi-
lateral mutual security agreements, and the
provision of limited quantities of US military
equipment.
29. The major Latin American powers gen-
erally desire to improve their air and naval
forces and to achieve a reasonable degree of
self-sufficiency in ground strength. Unskilled
manpower is available in adequate numbers,
but these states generally lack the industrial
and financial resources, the skilled techni-
cians, and the qualified officers to achieve this
goal by their own efforts. Any considerable
improvement and expansion of Latin Amer-
ican armed forces will therefore require US
assistance in training and in the provision of
military equipment. Moreover, even in the
best circumstances, the Latin Americans
would never expect to meet attack by a first-
class military power without direct US air
and naval support.
Communism in Latin America
30. The Communist threat to US security in-
terests in Latin America is greater than pres-
ent party membership in the area would sug-
gest, because of the ease with which a
relatively few Communists operating behind
labor, intellectual, and other fronts can ex-
ploit the social unrest and Yankeephobia al-
ready existing in the non-Communist popula-
tion. Guatemala is a prime example of how
a small Communist minority can penetrate a
Latin American government and strongly in-
fluence its policy.
31. During the period 1944-1947 the Stalinist
Communist parties in Latin America had
some 330,000 members and polled an aggre-
gate of about a million votes in various na-
tional elections. Since then party member-
ship has fallen to about 200,000. Most of this
decline has occurred in the three most im-
portant Communist parties, those in Brazil,
Chile, and Cuba, each of which has lost about
half of its members. In many countries the
Communist Party is now officially suppressed.
In none is it an important electoral factor.
The Communists, as such, have no present
prospect of gaining control over any Latin
American government by electoral means.
Their direct participation in national politics
is significant only in Guatemala.
32. The Communists have had some success
in their efforts to gain control of Latin Amer-
ican labor by establishing reliable Commu-
nists in key positions in strategic labor unions
and in national labor federations. They domi-
nate completely the international Confedera-
tion of Latin American Workers (CTAL). In
recent years Communist control of labor
unions has been somewhat curtailed by gov-
ernment action, but such action has also af-
fected and antagonized non-Communist labor
leaders. In Chile and Venezuela, for example,
government restrictions on union activity
have tended to give Communist and non-Com-
munist labor groups a common sense of per-
secution and a common cause. Moreover,
even where Communists have been ousted
from official positions of union control, they
retain some influence as rank-and-file labor
leaders or as officials in non-Communist
unions. Furthermore, the Communists have
sought influence among the mass of unorgan-
ized workers. Through their influence in
labor they have a capability for interrupting
the operations of strategically important in-
dustries by means of strikes and sabotage.
33. The Communists have also been success-
ful in penetrating Latin American educational
systems, intellectual circles, and those patri-
otic organizations formed to give expression
to the new spirit of ultra-nationalism. In this
way they seek to instill prejudice in the rising
generation, to intensify socialistic and na-
tionalistic tendencies among the intelli-
gentsia, to assume a patriotic coloration for
their own activities, and to give such direc-
tion to nationalism as will most effectively
hinder Latin American cooperation with the
United States.
34. In the Latin American armed forces, how-
ever, the influence of Communists and Com-
munist sympathizers is slight. In general,
the officer corps constitutes the strongest op-
position to Communism in Latin America.
35. Since the outbreak of the Korean war the
USSR has shown a markedly increased inter-
est in Latin America. This increased atten-
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tion has been reflected in the larger volume
of Soviet broadcasts to Latin America, the
movements of important Communists, and
the resolutions of recent Communist-spon-
sored conferences.
COOPERATION WITH THE UNITED STATES
Political Cooperation
36. Since World War II the inter-American
system has been subjected to new strains.
Isolationist and anti-US sentiment among
Latin Americans has been kept alive or
strengthened by the political, economic, and
social problems reviewed above. Latin Amer-
icans believe that the US does not appreciate
the urgency of these problems. They in turn
do not fully understand the demands of the
global situation upon US attention and re-
sources, and resent the failure of the US to
give them the financial and military assist-
ance which they believe they should have.
37. The outbreak of hostilities in Korea posed
a clear test of Latin America's willingness and
ability to cooperate with the US in support of
UN objectives. Initial enthusiasm was dis-
played in the united support given by Latin
America to the UN decision for action in Ko-
rea and to the resolution passed in the Council
of the Organization of American States ap-
proving this action. The five nations which
had not yet ratified the Rio Treaty quickly did
so. (Guatemala, however, has not as yet de-
posited its instrument of ratification.) Later,
all but Argentina voted for the UN "Uniting
for Peace" resolution and all supported the re-
affirmation of inter-American unity which
came out of the March-April 1951 meeting of
the American Foreign Ministers. In addition
to this political support, Latin America agreed,
in principle, to increase its output of strategic
raw materials.
38. More recently, Latin American govern-
ments, except those of Argentina and Guate-
mala, have given excellent support to the US
on all the important political questions on
which the US and the USSR were opposed dur-
ing the sixth (1951) session of the UN General
Assembly. Moreover, they have moved with
caution on the issues of Iran, Egypt, Morocco,
and Tunisia, despite their strong desire to
support the national aspirations of other peo-
ples. Finally, since the beginning of 1952,
five Latin American governments - Cuba,
Colombia, Ecuador, Peru, and Chile - have
entered into bilateral military assistance
agreements with the US. Two others - Uru-
guay and Brazil - have signed such agree-
ments, but have not yet ratified them.
39. Some considerations tend to counterbal-
ance this record of governmental cooperation.
In the weeks after the opening of the Korean
conflict initial Latin American enthusiasm
gave way to an attitude of caution and calcu-
lation. Fear of a global war has been ex-
ploited by Communist and Peronist anti-US
propaganda, which stresses the theme that
Latin America has nothing to gain and much
to lose from embroilment in a world conflict.
To date, troop contributions for Korea have
not been forthcoming, except from Colombia,
and the recently negotiated military agree-
ments have been subjected to severe attacks
by Communist, nationalist, and other anti-
US elements.
Economic Cooperation
40. The role of Latin America as a supplier of
strategic raw materials, particularly in time
of war when access to materials in other sup-
ply areas may be denied, makes Latin Amer-
ican economic cooperation vital to US and
Hemisphere defense. Latin America at pres-
ent supplies the United States with over thirty
strategic mineral, fiber, and chemical prod-
ucts. Its output of copper, petroleum, and
zinc forms an essential complement to US and
Canadian production. The area is the only
Western Hemisphere source of thirteen essen-
tial materials, including tin, cordage fibers,
mica, quartz crystals, and monazite, and it is
the principal Hemisphere source of antimony,
chromite, manganese, tantalite, and tungsten.
The great bulk of these strategic materials
comes from Mexico, Venezuela, Peru, Chile,
Bolivia, and Brazil.
41. At the 1951 meeting of American Foreign
Ministers the United States obtained from the
Latin American nations pledges to increase
the production and the allocation to the US
of strategic materials in short supply. The
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implementation of these pledges has not been
as effective as the emergency required. Pro-
duction as a whole has not been expanded
above general postwar levels. The feelings of
Latin Americans respecting this form of eco-
nomic cooperation were displayed at the For-
eign Ministers meeting by a request that the
US proposal for increases in the output of
strategic materials be accompanied by assur-
ances of assistance for general Latin American
economic development. In general, emphasis
upon their role as producers of raw materials
is resented by Latin Americans as imputing to
them a "colonial" status.
42. Latin Americans in general do not oppose
the entry of foreign capital for the purpose of
exploiting natural resources, but they are be-
coming increasingly insistent on exercising
control over the scope and form of such invest-
ment. This insistence stems not only from a
militant nationalism, but also from the con-
cern of some leaders for conservation of re-
sources and the desire of all to obtain a maxi-
mum quid pro quo.
43. With respect to trade with Communist-
controlled countries, the great majority of
Latin American nations have promised either
formally or informally to comply with the
provisions of the Battle Act. Nevertheless,
some strategic materials, particularly Chilean
copper, reportedly have been transshipped to
the Soviet Bloc via third parties in Western
Europe. Latin American officials, however,
have generally been cooperative when ap-
proached by US officials with instances of lax
enforcement of trade controls.
Military Cooperation
44. The Latin American armed forces are not
at present capable of providing adequate de-
fense for the area in the event of war, though
they would be of some value in supporting
roles.
45. All Latin American countries except Gua-
temala have established their eligibility for
reimbursable military aid under the Mutual
Defense Assistance Act of 1949. Most of them
have submitted requests for such aid. Gen-
erally they wish to purchase the most ad-
vanced types of US equipment, types which
they do not actually need, in US opinion, and
which the US cannot provide, either at all or
in the desired quantities, under present pri-
orities. Shipments to Latin America under
this program have therefore been small. The
inability of Latin American governments to
obtain desired US equipment for which they
were willing to pay has caused considerable
resentment and has led to some purchases of
European materiel, to the detriment of arms
standardization.
46. Only the five countries which have en-
tered into bilateral military assistance agree-
ments with the US are eligible for grant aid
under the Mutual Security Act of 1951. They
are Cuba, Colombia, Ecuador, Peru, and Chile.
Shipments under this program have only just
begun. Brazil and Uruguay have signed bi-
lateral agreements, but have not yet ratified
them. Such an agreement is under negotia-
tion with the Dominican Republic. Of the
nine countries so far approached, only Mexico
has declined to negotiate.
47. Latin America's low priority in relation
to Europe with respect to US military aid has
caused general disappointment and dissatis-
faction in Latin American military and po-
litical circles. Rivalries and mutual sus-
picions among Latin American states have
also led to complaints about inequitable treat-
ment in the bestowal of US aid. So far, how-
ever, these discontents have not seriously
affected Latin American military cooperation
with the United States.
48. Fourteen Latin American countries have
received US Army or Air Force missions, or
both, and nine have received US Navy mis-
sions. Generally they have been well satisfied.
with the work of these missions, but have not
made optimum use of them. Argentina, how-
ever, has allowed its contracts for Army and
Air Force missions to lapse without renewal.
PROBABLE FUTURE DEVELOPMENTS
General
49. Most Latin American governments will be
under increasing pressure from urban middle
class and labor groups to pursue policies aimed
both at increasing and at redistributing the
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national income. These policies will involve
expensive programs of industrialization and
social welfare, often beyond the current fiscal
capabilities of the countries which undertake
them. Under these circumstances Latin
America will continue to be a fertile ground
for demagogues of the ultra-nationalist as well
as the Communist type.
50. The best immediate prospects for a check
upon the extremist forces of social and eco-
nomic change are to be found in countries
such as Mexico, Brazil, and Uruguay, where
moderate urban groups have been established
as a political factor. Other nations, such as
Colombia, Venezuela, and Peru, have the ma-
terial resources for satisfying immediate so-
cial needs, but it is doubtful that the leader-
ship now in power - the Army in Venezuela
and Peru and the Conservative Party in Co-
lombia - will act in such a way as to allay
popular disaffection and ensure political
stability. Countries with only limited human
and physical resources, such as the Dominican
Republic, Nicaragua, and Paraguay, seem
firmly set in the traditional social and eco-
nomic pattern. The example of Guatemala,
however, shows how readily this pattern can
be radically changed in such countries by a
small but purposeful minority.
51. The general trend toward nationalistic
regimes maintained in large part by dema-
gogic appeal to the depressed masses may be
expected to continue. Such regimes already
exist in Argentina, Bolivia, and Guatemala,
and present circumstances favor their devel-
opment in Chile and Ecuador. Peru, Colom-
bia, and Venezuela are the states next most
vulnerable to this trend.
52. In any case, the trend toward nationaliza-
tion of basic industries, especially those now
under foreign control, is likely to develop fur-
ther. This trend would not in itself deny US
access to strategic raw materials - the indus-
tries nationalized would still have to sell their
products - but the availability of these mate-
rials would be affected by political considera-
tions to a greater degree than at present. It
is also likely that production would decline, at
least temporarily, in nationalized industries.
Cooperation with the United States in a
Situation Short of Global War
53. Both the Communists and the ultra-
nationalists, notably the Peronists, by propa-
ganda and intrigue, will seek to curtail Latin
American cooperation with the United States.
The social, economic, and political conditions
which have been described will afford them op-
portunities for anti-US agitation. It is im-
probable, however, that the Communists can
gain direct control over the policy of any Latin
American state, at least during the next sev-
eral years, or that Argentina can gain political
control over any neighboring country. It is
possible that Peron may succeed in aligning
other states in a combination to exact a high
price for cooperation, but any such combina-
tion would almost certainly be unstable.
54. The pressure of exaggerated nationalism
already affects the capacity, and at times the
willingness, of Latin American governments
to render on all occasions the degree of dip-
lomatic, military, or economic support desired
by the United States. Eventually this trend
toward exaggerated nationalism, if it contin-
ues, will seriously affect Hemisphere solidarity
and US security interests in Latin America.
Nevertheless, in a situation short of global
war, the present degree and scope of Latin
American cooperation with the United States
is likely to remain basically unchanged for the
next several years. Definite commitments by
Latin American governments will be under-
taken hesitantly and their implementation
will probably be slow. The present availabil-
ity of strategic raw materials to meet US re-
quirements will continue, but the govern-
ments concerned will seek to drive hard
bargains in terms of prices and of economic
concessions.
Cooperation in the Event of Global War
55. The outbreak of global war would bring
to Latin Americans a greater awareness of
danger to themselves in the global situation
and of their community of interest with the
Western Powers. A greater readiness to meet
their international military and economic
commitments would probably follow. As long
as the US military position in the Western
?
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10
Hemisphere remained secure, even Argentina
and Guatemala might be expected to mod-
erate their anti-US propaganda and, eventu-
ally, to cooperate in defense of the Hemi-
sphere.
56. The Latin American armed forces would
not be able to defend critical strategic areas
and vital sea routes against serious enemy
attack without the direct participation of US
forces. They would, however, be of value in
supporting roles. In general they would prob-
ably be adequate to maintain internal order,
to guard against sabotage of strategic indus-
tries and land transportation routes, and to
protect air and naval installations from sabo-
tage or small-scale raids.
57. After the outbreak of global war the
United States could probably obtain anywhere
in Latin America, except possibly in Argen-
tina, the air and' naval facilities necessary for
US participation in the defense of strategic
areas and sea routes, including consent for the
stationing of air and naval forces at such in-
stallations. There would, however, be great
reluctance, to the point of possible refusal in
some cases, to permit the entry of US ground
forces unless large-scale invasion appeared
imminent. Latin American governments
would be even more unwilling to admit to their
territories the forces of other Latin American
states.
58. In the event of global war Latin American
governments would generally agree to an ex-
pansion of their armed forces, but would re-
quire US assistance in the provision of equip-
ment and training and would seek to impose
as much of the increased expense as possible
on the United States. Expanded Latin Amer-
ican ground forces, US equipped and trained,
could eventually assume major responsibility
for the defense of continental areas. It is un-
likely, however, that Latin American air and
naval forces could ever relieve the US of the
major responsibility for air and naval defense.
59. Because of the mutual suspicions of Latin
American governments, their limited military
resources, and popular sentiment against
service overseas, it is doubtful that any signifi-
cant Latin American force would be avail-
able for operations outside of the Western
Hemisphere. It is possible, however, that
Brazil might be persuaded to provide a divi-
sion, as in World War II, and that other coun-
tries might provide token contingents. The
number and effectiveness of such forces as
might be made available for such service
would be limited by the amount of US aid
available for training, equipping, and trans-
porting them.
60. The economic dislocations incident to
global war, including curtailment of economic
development and social programs, would al-
most certainly increase internal tensions and
political instability in Latin America. Never-
theless, with proper inducements, the produc-
tion of strategic materials could probably be
increased.
61. In circumstances of global war it is prob-
able that all Latin American governments
would agree to suppress existing overt Com-
munist organizations and would have the ca-
pacity to do so. The extent to which the
activities of the underground Communist ap-
paratus could or would be controlled would
vary with the determination of the govern-
ment, the effectiveness of the local intelligence
agencies and police, and popular attitudes in
each country.
62. The greatest danger from Communists in
Latin America in time of global war would be
that of sabotage in strategic industries. Al-
though it is unlikely that a large-scale pro-
gram of sabotage could be sustained through-
out the area, the dispersion and vulnerability
of key targets, especially in essential trans-
portation systems, and the general inade-
quacy of police and security forces, would
favor sporadic success, especially in the period
immediately following the outbreak of war.
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