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June 7, Sao Paulo

In the morning I called on Governor Carlos Alberto Alves de Carvalho Pinto, Governor of the State of Sao Paulo, at the Governor's Palace. The palace is a somewhat shoddy edifice built in early 19th Century style. We met total confusion with officials bustling about looking for the Governor, taking us to several different rooms. Finally, we were ushered into a very large sitting room into which furniture seemed to have been thrown at random. It certainly did not form any discernable pattern. Chairs had to be dragged from all corners, to form a circle for the Governor, the Vice-Governor, my interpreter from the Foreign Office, some delegates from INES and myself. Pinto did most of the talking with the Vice-Governor confining himself to an occasional bravo.

Pinto began the conversation by explaining that the future of Brazil might well depend on the outcome of the election in Sao Paulo. Two demagogues, Barros and Quadros, were running against an honest man. Quadros was crazy and utterly unprincipled. He might wind up a Communist or a Fascist, but above all he sought personal power. There was no danger of a revolution in Brazil no matter what certain intellectuals said, because an upheaval could not succeed without Sao Paulo and Sao Paulo would never hold still for a revolution. Of course, if Quadros became Governor, things would change and, therefore, everything possible had to be done to prevent him from coming to power.

Pinto said that, despite what I heard from demagogues, the real problems of Brazil were economic and they could be solved whenever there was the will to create an efficient administration. Goulart could go down in history as the man who solved Brazil's problems by giving it a government which would really govern. But there was the serious question that Goulart was so

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resentful about having been deprived of the Presidential powers that he
might not grasp this opportunity. Instead, he might aggravate existing
problems in order to get back the authority which the President enjoyed
prior to Quadros' resignation.

Many of the economic problems were relatively petty. For example,
a serious crisis was impending because of the food shortage-- particularly
of beans. If the United States wished to have an immediate impact, it
should send in beans. I told him that I had heard in Rio that the shortage
of beans was caused by speculators. He said this was true in part. There
was a vicious circle. As long as inflation continued, the speculators had
no incentive to release supplies. But, as long as there was no government,
inflation could not be cured. Moreover, Goulart's role here-- as elsewhere--
was ambiguous. Finally, while some of the bean shortage was caused by
speculators, some of it was real.

As for the Alliance for Progress, Pinto thought the United States was
making a mistake by concentrating so much effort on getting an overall
economic plan for Brazil at a time when the central government was so in-
competent. There were many states that were capable of dealing with the
economic problems and they should not be precluded from making progress
simply because the central government was paralyzed. He thought that the
constitutional crisis would come to a head sometime this year. He was not
going to the Governors' Conference at Araxa because he wanted to retain a
free hand and because he was afraid of Brizolla's influence at this
conference.

Pinto talked also about the forthcoming visit of Kennedy and said that
he would get a tremendous welcome in Sao Paulo.

Pinto is in many ways a very impressive man. He is one of the few

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Brazilians I have met who seemed more interested in concrete problems than in theoretical tours de force. He appeared calm, competent and even a little pedantic. He would be a marvelous administrator of a going concern. He seems to lack the charisma for a national role. I do not think the constitutional crisis is likely to be solved quite so reasonably as Pinto suggested or that economic problems will be quite so tractable given the political situation. There seemed to me a great deal of Paulista complacency involved. Nevertheless, of the political leaders I have met, Pinto seems one whom it would be a good gamble for the United States to back.

From the Governor's Palace, we went to the Ford subsidiary in Brazil. They gave a lunch for me. This was a straight public relations effort. Some Federal Deputies were present, but there was no opportunity for talking and such talk as took place concerned the difficulty of getting Brazilian licenses to build passenger cars. The assembly plant for trucks is extremely modern, a smaller version of Willow Run. I asked the American manager whether there was any problem about coordinating schedules in the light of the rather loose Brazilian concept of time. He replied that the right to be unpunctual did not begin until one had an executive job. The workers were extremely efficient once they were trained.

In the afternoon, there was a round-table with leading personalities from the banking and business world. The conversation repeated many of the discussions about the situation in Sao Paulo that I have already recorded.

In the evening I gave a talk to a rather small audience, since the number of Brazilians who speak English is rather small. I was introduced

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by Herbert Levy, a Federal Deputy who is Chairman of the UDN, the more
conservative party. By the time my talk was finished, it was 10:45.
Nevertheless, Levy took me home for a talk which lasted until about
1:30. Present were the chief planner of the State of Guanabara as well as
the chairman of the Brazilian oil trust and the American Consul who
had accompanied me to the talk. The American Consul composed himself
into an attitude of conscientious attention. I was reminded of a comment
by Van Der Beugel, the President of KLM and former Deputy Foreign Minister
of the Netherlands, that when he saw American diplomats composing dispatches
of conversations mentally while they were talking to him, his interest
began to flag.

Levy is a very elegant man with very languid manners. He is shrewd
and intelligent, but without force or drive and, after seeing him, I could
understand why the UDN had to find a man like Quadros (about whom they knew
little except that he had charismatic qualities) to get into office. Quadros'
resignation has left the UDN in the position of almost permanent minority
that has been its traditional fate.

Levy explained that he was working very hard on the forthcoming election.
He was also seeing a great deal of Goulart with respect to the formation
of the cabinet. Goulart was a very complicated man. He was, of course,
completely unprepared to be President. He had always been a demagogue
who had sought support among the more extreme labor groups. He was from
the South and therefore he was extremely patient. He could wait a long
time to achieve his objectives.

In judging Goulart it was necessary to separate the effort to gain
power from the purpose for which that power was to be used. Levy did not
think that Goulart had any idea what he wanted to do with power. But his

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pride had been badly hurt by the events of last summer when a parliamentary
regime had been installed to curb his authority. Goulart, he said, had not
yet decided whether to become a President of all Brazilians or whether
he wanted to further his own ambitions. If he chose the first road, he would
appoint a strong Prime Minister who would give Brazil a businesslike admini-
stration. Actually the only thing Brazil lacked for effective progress was
a strong central government. If he chose the latter course, if he was deter-
mined to return to a presidential system, or perhaps even strive for a
dictatorship, he would encourage left-wing elements and he would strive for
a breakdown in governmental institutions. Goulart had not yet tipped his
hand.

The ideal choice for Prime Minister would be Carvalho Pinto from Sao
Paulo. Levy had reason to believe that the Prime Ministership would be
offered to him. I asked whether Pinto could possibly accept, given the
campaign which his candidate, Bonifacio, had to fight. Levy said the only
way Pinto could accept would be if Goulart promised to support Bonifacio
during the electoral campaign. I asked why Goulart should do this. He said
at least Goulart and Pinto agreed that Quadros must not succeed, since
Quadros would be the chief rival for Goulart's power. I said that it was
not clear why Goulart should appoint as Prime Minister a man as strong as
Pinto who had his own political base. Levy replied that Goulart would do
so only if he was prepared to subordinate his own ambition to the national
interest. I must say that I find little in Goulart's career to indicate
that this is even a possibility.

The Chief Planner for Guanabara said that Brazil was in a very strange
period. Authority had collapsed. The parliamentary regime had no standing
and for the first time in history the Army was split, partly because Goulart
had used his appointive power very skillfully to advance his supporters. In

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the past, the conservative elements had always looked to the Army to insist
on constitutional rule and for defense against the extreme Left. Now
parts of the Army were sympathizing with the Left or at least with extreme
nationalistic groups. All Brazilians were in a state of perplexity and
confusion. " We cannot give you an answer as to what will happen." The
thing that gave the most hope was that Goulart was one of the largest
landowners of Brazil. He would therefore probably not push his syndicalist
tendencies to an extreme. I said that if you have power, perhaps you do
not need wealth. Perhaps what Goulart wanted was power. He replied,
"Yes, this is our great perplexity and we simply do not know."

Levy said that he thought that the new congress would be more pro-
gressive than the present one. At the same time, it would have fewer
nationalists and leftists, and therefore it might be more vulnerable to
attack. An Army coup was possible only in reaction to a leftist movement.

Levy strongly objected to the foreign policy of Goulart. He also
said that Goulart had returned from the United States enormously impressed
by the President. However, once back in Brasilia and surrounded by his
familiar environment, he was again sliding back into some of his demagogic
tendencies.

My own impression is that Goulart is far from being the ineffectual
man that the Embassy described on my first day. I think he is playing an
extremely skillful game: promoting, on the one hand, the paralysis of the
parliamentary institution and, on the other hand, radicalizing political
life by encouraging the trade union movement which in Brazil has a completely
different connotation than in the United States. Finally, he is attempting
to split the Army and appealing to its nationalist wing through his so-
called independent foreign policy. If he can put all these components

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together, he may well emerge out of this crisis as a strong man. This
seems to me all the more likely as no one whom I have met so far of the
moderate and conservative group (with the possible exception of Carvalho
Pinto) seems to know what he wants or is capable of bringing it about.

There is a race going on between Brazilian inefficiency and the
ability of some strong man to seize power in the present vacuum. If some-
body can pass himself off as a leftist liberal, he might then be able
to use the Communists for organizational support while appealing to the
Army on nationalist grounds. If the Army is really split, this might lead
to a very rapid development in the direction of some kind of Titoism.
Another possibility is, of course, complete chaos. A more remote poss-
ibility is civil war. The most unlikely possibility is the orderly process
envisioned by the Alliance for Progress even though in Sao Paulo the
Alliance for Progress is a much more significant and meaningful force
than in Rio.

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June 8, Sao Paulo

Most of the day was spent in going to Santos, which is the port of
Sao Paulo. Sao Paulo is at an altitude of about 2500 feet and the weather
was quite raw. Santos is in the plain and it was humid and sticky. My
guides drove me past the docks and then by ferry to an island which is a
summer resort area for Sao Paulo. This has some magnificent beaches very
similar to Jamaica and surrounded by some extremely daring architecture.

********

We returned to Sao Paulo where some members of the American Chamber
of Commerce called on me to tell me that they had the problem of Communism
in Sao Paulo well in hand. I suggested that I would feel more comfortable
if Brazilians told me this. They spoke with aloof condescension about
Brazilians and seemed to think that the businessmen of Sao Paulo were
typical for the mood of Brazil. They also asked me to use my influence
against the taxation of foreign profits upon my return to the United States.
I told them that I knew nothing about economic questions.

********

I then called on Dr. José Bonifacio Coutinho Nogueira, Carvalho Pinto's
candidate for Governor. Bonifacio is one of the richest men in Sao Paulo.
I saw him in his private office. He is a small, sensitive-looking, schol-
arly man who speaks in a very gentle manner and with great clarity, free
of the rhetoric typical of most other Brazilian politicians. While he seemed
by far the most lucid of the candidates and one of the more intelligent of
the Brazilian politicians, I cannot conceive how he could beat either
Quadros or Barros. Unless he has reserves of demagoguery that are not
apparent in a private conversation, he is too colorless, too pedantic, perhaps
too scrupulous. Bonifacio said that he was fighting two demagogues: Quadros

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and Barros. Barros was simply a crook; Quadros was completely unprincipled. Quadros might become a right-wing dictator or a left-wing dictator. He might play the role of Vargas or the role of Castro. Right now he had an alliance with Brizolla and with Arias, the Communist mayor of Recife. If Quadros should come to power, these three would organize a popular movement, perhaps supported by Magalhaes Pinto of Minas Gerais, and thereby sweep into power. For this reason, Quadros had to be defeated at all costs.

Quadros was not very strong in Sao Paulo at the moment, Bonifacio continued. The fact that the opposition to Quadros was split between himself and Barros presented a problem given the overriding need of defeating Quadros. Once it was apparent which of the two opponents of Quadros was stronger, all the anti-Quadros vote would then go to the person who was ahead. I asked whether that meant that Bonifacio had a deal with Barros that the man who was behind would withdraw from the race. He replied that a formal agreement was unnecessary. It would become apparent in the last 20 days of the election who was ahead and the anti-Quadros vote would concentrate on that candidate automatically. He refused to elaborate how this would come about.

Bonifacio said that his own election was very important because it would guarantee that Carvalho Pinto would become President in 1965. Pinto was the ablest man in Brazil at the moment. If Quadros won, things would look very bad.

I asked Bonifacio about the national scene. Bonifacio replied that there were three major groups: a conservative group, largely represented by the Army; a center group, represented by people like Pinto and himself; and a left-wing group, represented largely by Goulart. The conservative group

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was split into two elements: a vast majority following the usual policy of the Brazilian Army in favor of constitutionalism and also with a strict anti-Communist orientation. There was, however, a second group which represented perhaps 20 per cent of the Army and at least half of the younger officers. This group was not so much leftist as extremely nationalistic. Their nationalism took a very rabid anti-American form and, on this level, they had a tendency to meet the extreme left.

The Center elements were represented by people like Carvalho Pinto and Juracy Magalhaes of Bahia. They represented the greatest hope for Brazil. On the other hand, Pinto could not come to power until 1965 unless the President would make Pinto Prime Minister. It seemed to Bonifacio extremely unlikely that Goulart was interested in bringing into office a strong leader who would only detract from his influence.

Then there was the Left which was again split into two parts: there was a moderate wing which included the Chief of the Civil Household of the President, Hermes Lima. Its program was only an extreme version of what Pinto would advocate. Then there was the extreme Left represented by people like Brizolla, the brother-in-law of Goulart, which attempted to radicalize all of its political life and thought that it could exploit the Communists for its own end. These people were thinking of creating a syndicalist state on the model of Peron. Goulart had originally held this view as well. How much Goulart had moderated in the meantime was not clear.

One had to remember that Goulart was from the South which meant that he was a very cunning man and very patient. The South had a tendency to produce caudillos in the Spanish tradition. I said that I had heard a great deal about an impending crisis but that I was still not clear how the crisis would come about. Bonifacio said that he knew how the crisis would come

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about and he would like to describe it to me. It was possible that in
the Governors' Conference taking place this weekend in Araxa, a very
left-wing program would be adopted. Many programs of reform which were
desirable in themselves lent themselves very easily to the kind of slogans
which a radical movement could exploit for its own ends. Carvalho Pinto
had not attended in order to retain a free hand afterwards. Bonifacio
thought that the left-wing governors under Goulart's influence might try
to stampede the conference into making a left-wing declaration. This
would then be adopted by Goulart who would use it to appeal to Congress to
do its duty. Failing that, Goulart would attempt to encourage a series of
popular manifestations against Congress. This movement would also be
supported by the left-wing of the Army and there would be some declarations
by some officers that Congress should do its duty.

If the Governors' Conference failed to act as Goulart had intended,
then Goulart might propose a program of reform himself and he might even
gain the support of people like Lacerda who see in a return to presidential-
ism the only hope to avoid chaos. In that case, Goulart could still use
the left-wing of the armed forces in order to bring about a return to
presidentialism. There was no question that Goulart belonged to the Left
and drew his support from it. It was not yet clear whether Goulart had
decided to throw in his lot with the syndicalist left-wing or with the more
moderate left-wing group.

My impression is that this is the wrong way of stating the problem.
From all I have heard so far, Goulart has either through accident or through
design created a situation in which he has emerged as the key person to
whom all people will have to come if they want stability. He has prevented
the formation of a strong central government. He has appealed to the

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nationalists by having Dantas as Foreign Minister and underwriting what is
in effect a neutralist foreign policy. He appeals to the leftists through
his traditional affiliations with the labor unions. He clearly is trying
to create the maximum number of options for himself.

I am concerned that Goulart may be starting a process which he cannot
control. I asked Bonifacio whether perhaps Goulart was using Brizolla's
extreme position so that he could appear somewhat moderate. Bonifacio
said this was quite possible. His hope was that Goulart as the largest
landowner would not want to bring about Communism.

********

A Federal Deputy called Cunha Bueno gave a cocktail party for me. There were about 20 people present, including the heads of the largest industries in Sao Paulo, the Commanding General of the Second Army whose headquarters is in Sao Paulo, a Senator from Pernambuco and a few others. The bankers gave me the usual conservative picture of Brazil. They described the danger of the Left and their confidence in handling it. But they had no particular idea of how to prevent the crisis which seems to be shaping up or of how to deal even with purely economic problems. After a while of this, I began talking with General Nelson de Mello, the Commanding General of the Second Army. I asked him about the state of mind of the Brazilian Army. He said that the Brazilian Army had always been strongly pro-American even though the United States had made the terrible mistake of taking Brazil for granted in the 1950's. The United States had treated Brazil as if it were Nicaragua. (For some reason, Brazilians always use Nicaragua as the country they do not want to be equated with, never Honduras or Salvador.) However, de Mello's friendship for the United States

* Since this was dictated, de Mello has become War Minister.

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continued. At the same time he was aware that at the colonel level there were perhaps ten to twenty officers who were not reliable. He knew them all and they could not do any damage.

I asked whether the Brazilian Army would be united in a crisis. He said he thought so but that the unity depended on course on the assessment by each general of the spirit of his command.

While we were talking Cunha Bueno came over. He asked whether we had spoken about the political crisis. To allay any fear I might have, he wanted to stress that there could not be a revolution in Brazil this year for the following reasons: during June the Brazilian people would be concerned with the soccer championship; during July they would celebrate the expected Brazilian victory; August would be taken by President Kennedy's visit. After that everyone would argue about elections. Then it would be too close to Christmas. After that it would be too hot and, in any case, it would be Carnival time. In short, there could be no revolution until May 1963.

I asked about Quadros. Bueno Cunha said that Quadros would never be permitted to take power. I asked, even as Governor? He said no, not even as Governor. I asked who was going to stop him. Bueno said the Army was going to prevent his taking office. All this time General de Mello was sitting next to us without contradiction. Bueno said that Quadros had indicated clearly that he wanted to be a dictator. If we are going to have a dictator, he added, we would rather have a stable than a crazy one. In other words, Brazil would rather have a military dictatorship than Quadros. Again the General did not contradict. By this time Bueno had to go to a political meeting to which he wanted to take me. I was so exhausted, however, that I went back to my hotel.

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June 9, Sao Paulo

The day started with a brief discussion at my hotel with the labor attache of the American Consulate. He said that of the twenty trade unions in Sao Paulo, five were dominated by Communists and these five were the largest and most significant. Democratic unions were fragmented. The Communist unions were able to set the pace for the others by advocating extreme programs. If the democratic unions supported these programs, they would help the Communists; while if they resisted, they would lose worker support. The situation was complicated by the personal corruption of many of the democratic leaders. Many of them could in effect be bribed either outright or by a Communist offer to share some of their power.

At that point three leaders of the largest democratic unions in Sao Paulo appeared. Their names are Sr. Domingos Alvares (President of Sao Paulo State Federation of Metal Workers), Sr. Marcelino Marques (Vice-President of Sao Paulo State Federation Construction Workers) and Sr. Olavo Previatti (President of Sao Paulo State Federation of Paper Workers). It was 9:30. They had been asked for 8:45 in the expectation that they would not show up before 9:30, and indeed two others showed up at 10:30 when I was on the verge of going to another appointment. I asked them to explain the relation between the labor unions and the government. They said that a democratic worker movement could not develop as long as the government exercised predominant control. The government could choose to deal with certain unions and not with others. It could disapprove the heads of unions and order their removal. It could recognize certain unions as bargaining agents and withdraw recognition from others. Goulart and his assistant Crockett da Sa had been using these powers in order to support Communist unions. I asked what their motive might be. The union leaders

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said that the Communists possessed the organizational skills to provide
political support within the labor movement for Goulart. Da Sa and
Goulart were trying to create a syndicalist state on the pattern of
Peron's Argentine. Here again the Communists came in handy because they
could impose much tighter discipline on the workers than the democratic
unions. They were also much more reliable in the short term in delivering
votes.

The situation was complicated by Quadros, who was encouraging the Communists for his own purposes. The democratic union leaders had gone to see Quadros in order to urge him to disavow Communist support. He told them that they were doctrinaires and that he was not interested in this kind of advice. He also told them that he had made an alliance with Brizolla and Arias but that he was not going to be rash because if they acted too soon, the military were going to use it as an excuse for a coup.

The union leaders said that they had great hopes for the Alliance for Progress. However, the United States had nothing to gain by working with the central government which was corrupt and not interested in progress. According to these labor leaders, there were many doctrinaire leftists in the central government who actually wanted the Alliance for Progress to fail and who were actively working to sabotage it. For the success of the Alliance would in the eyes of these leftists only strengthen a capitalist system which they wished to see destroyed. The Alliance for Progress should be used to support democratic forces by working directly with them. In particular, the United States should support the democratic unions against the Communists. I asked how that could be done. They were very vague, mentioning such items as relief funds for needy members and American participation in union housing projects.

********

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I then had a brief talk with Father Boer, the Foreign Editor of "O Estado de Sao Paulo." He said that the situation in Brazil was a race against time. If Brazil could get through four or five years without a crisis and if the Alliance for Progress were reasonably well administered, there was a possibility of real stability. The leftist forces might then dwindle or disintegrate. However, he was very worried whether the time would be available. All the traditional forces in Brazilian society had disintegrated. Many of the industrialists had no conception of the kind of reforms which was necessary. Even the Church did not really understand what was needed. Moreover, the Church was beset by the pervasive Brazilian disorganization. Lately the Army had been split. In this situation it was possible that the leftist forces might seize control and that Brazil would follow the road of Cuba.

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June 9, Minas Gerais

My Foreign Office companion and I left Sao Paulo around one o'clock for Belo Horizonte in Minas Gerais. We were greeted by the Secretary for the Interior for Minas Gerais, the American Consul and a few newspapermen. Belo Horizonte was artificially created 60 years ago and is today a thriving, teeming city of over 500,000 population. We did not stay very long and drove to Ouro Preto. Ouro Preto was the capital of Minas Gerais until the founding of Belo Horizonte. In the 17th and 18th centuries it was the center of gold mining. It is built completely in Baroque style. No new buildings have been erected since the end of the 18th century. As a result, it is one of the most charming cities that I have seen. It is built on a series of steep hills and the buildings, strangely enough, show some of the characteristics of Rome except that the colors are much brighter.

The hotel was an 18th century house which has only four rooms and is furnished in traditional Brazilian style. Dinner is at a long table and no more than six people are served at any one moment. A recorder plays Baroque music during the meal-- a somewhat obvious note. The hotel is owned by a French lady who is extremely independent; she closes her hotel when people she does not like appear. For example, she objects strongly to Dantas, the Foreign Minister of Brazil. When he wanted to have dinner at the hotel with some friends, she closed it for the weekend so that she would not have to serve him.

At the dinner there was an extraordinarily good looking, very impudent Brazilian lady from Rio whom my Foreign Office companion knew. She had just had her fourth divorce, even though divorce is illegal in Brazil. She said she had obtained her first divorce in Reno. But then she had fallen

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in love with the Mexican divorce document. These, according to her, are
very flowery so that at least one gets something for one's money. Accord-
ingly she has had all her divorces, including her most recent one, in
Mexico. She told us all the latest gossip of Rio society which was not
of overwhelming interest to me.

During and after dinner the Chief of Protocol of the State of Minas
Gerais, who happened to be at Ouro Preto that day, and the divorcee tried
to scare me with a ghost story. But for some Brazilian inefficiency, it
would have been quite effective. At dinner they brought the subject
around to ghosts and indicated that a ghost lived nearby in the entrance
of an old mine shaft. They told a detailed story of an unhappy love
affair, a murder and a suicide. They described the ghost in some detail--
a green face and a rope around his neck. All of this sounds preposterous
now, but in the old house I was nearly convinced that they believed it.
When I indicated some doubt, they suggested that we investigate the entrance
of the mine shaft. This was located about 200 yards down a hill from the
hotel. We waited about half an hour, but the ghost did not appear.
Finally, we walked up the path back to the hotel and there we encountered
a panting, frantic ghost with a green face and a rope around his neck,
rushing down the hill. He turned out to be an architecture student at the
local School of Mines who had been hired by the Chief of Protocol and who
like a good Brazilian had been politely late.

My Foreign Office companion, the Chief of Protocol, the divorcee and I then walked through the streets of Ouro Preto. Ouro Preto houses the School of Mining of the State of Minas Gerais and there are fraternities -- or what we would consider fraternities-- scattered throughout the old Baroque houses. The Brazilian lady was regaling us through all of this

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with an incredible succession of blasphemous stories in French and in
English.

We then went to a little bar and had a bottle of wine. I told her
that I had seen Samuel Wainer both at his office and for dinner at the
Embassy. She said, "This is absolutely frivolous. When Wainer gives
interviews to American professors then it is time for me to become
Portuguese again. Wainer has no character whatever and he should not be
rewarded by being invited to the American Embassy."

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June 11, Minas Gerais and Brasilia

I called on the Rector of the University of Minas Gerais, Orlando M. Carvalho. He is a trim, gray-haired, precise gentleman who is a political scientist specializing in Brazilian political parties. He is also Vice-Chairman of the UDN in Minas Gerais. I told him that before I left, I had been told that the hope for progress was the emergence of a strong center group at the next election. I had been looking for such a group, but I had not found it. Did it exist?

He replied that party labels meant next to nothing. Such phrases as Left, Center and Right did not fit Brazilian conditions. The only way one could tell who won any election and what forces had been strengthened was to analyze the results district by district. It was a general fact, however, that the democratic parties were suffering from complete sterility. He himself belonged to one of them, but he had to admit that many of his colleagues simply failed to understand the urgent need for reform and preferred to let things drift rather than take an active stand.

He said that voting statistics in Minas Gerais showed that industrialization produced a steady trend towards the Left. There had been a uniform decline in the vote of the center parties and a corresponding increase in the vote of the labor party which Goulart heads. Wherever new industry moved, the old conservative parties were gradually being destroyed. Thus Brazilian political life was inevitably being radicalized. At the same time none of the parties -- not even the Labor Party-- were national parties. They lack organization or discipline or cohesion. They are nothing but a loose coalition of local pressure groups. Nevertheless, parliamentarianism

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was the best system for Brazil. The presidential system had been too
strong and was in danger of becoming dictatorial. I asked how-- in view
of his explanation that the party system was not working-- a parliamentary
system could be the best solution. He replied with a long theoretical
discussion of the prerequisites of a parliamentary system: effective
party discipline, a strong bureaucracy and the existence of a definable
opposition. In typical Brazilian fashion he pointed out that Brazil lacked
all three of these and had no prospect of getting any one of them. Never-
theless, he was in favor of a parliamentary system.

I asked about the University of Minas Gerais. The Rector explained
that there was a tremendous gap between secondary school and universities.
The universities can take only about one out of eight applicants. However,
once admitted to the university a student can stay practically forever.
There are no minimum course requirements as in United States universities.
Some students stay for ten years or more, taking only one course per
semester. This is particularly true of the leaders of the student move-
ment who are professional organizers, usually Communist. A small minority
controlled UNI, the student movement. There was a strike of students at
present which was entirely politically inspired. The issue of the current
strike concerned the demand of the students to have a third of the repre-
sentation on the governing councils of the university. At present the
student organization had one representative who had no vote on the govern-
ing council. If the students could obtain a third of the seats they would
control the university. They would vote as a bloc and enough faculty
members were either ideologically sympathetic or else intimidated to give
them control.

The manner in which a small minority could get control was shown by
the way the student strike was called at the University of Minas Gerais:

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There are 1200 students enrolled in the Law School of the University.
Of these, 78 showed up for the student strike vote. 38 voted against the
strike. In effect then 40 out of 1200 students closed the law school.

The student strike and the general unrest, the Rector argued, were
being encouraged by Goulart who wanted to use it to impose a leftist
government or to show the impotence of the existing institutions. For
example, at the University of Minas Gerais, the student leaders had called
a strike before their demands had even been refused. This indicated that
they wanted a strike and not a satisfaction of their demands. They then
went to Brasilia and were received by Goulart who complimented them on
their"progressive" attitudes. The Rector insisted that he would never
meet the demands of the students. He would rather resign.

The student strike was symptomatic of the general disintegration of
authority in Brazil. In an election year, none of the officials had the
courage to stand up to the students. None of the Governors had spoken
out. None of them would take strong measures against either the student
strike or the other strikes which he thought were coming. All of this
helped Goulart who wanted to emerge as the strong man.

My own impression is increasingly that either Goulart is trying to
force a demonstration of impotence of the parliamentary system and institute
presidentialism or something stronger. My guess would be that he will
either appoint a weak moderate Prime Minister and sabotage him, or he
will appoint a leftist Prime Minister who is his tool. Perhaps he will try
both in succession.

This is supported by a comment of the Rector. He told me that in his
capacity as Vice-Chairman of the UDN of Minas Gerais he had called on Goulart
and had asked him to separate himself from his radical connections. Goulart

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had said, "And if I separate myself from my connections, will your
friends support me?" The Rector had to admit that this was a just
comment.

********

From the office of the Rector we went to the house of Milton Campos, who in 1960 had been a candidate for Vice-President running against Goulart and Adhemar de Barros. Senator Campos is one of the national leaders of the UDN and as suave and exasperatingly vague as every other UDN leader that I have met. He again made the usual analysis of the difficulties of the Brazilian situation: the weakness of the central authority, the crisis created by Quadros' resignation, the impotence of the cabinet. The cabinet had resigned not simply because of the constitutional provision that members of Congress running for re-election could not hold office three months prior to the election. Campos thought that the constitutional proviso was used only as an excuse in order for them to save face. Even the Army was eager for the present cabinet to leave.

I asked whether Goulart was likely to create a strong Prime Minister.
He said he thought so. I asked what interest Goulart could have in
appointing a potential rival to himself. He said he thought Goulart
would be loyal to the constitution. I asked what reason Goulart could
have to be loyal to a constitution that represented a vote of distrust
in himself. He replied that we were now speculating about motives.

I asked Campos about Santiago Dantas as Prime Minister. Campos
replied that it would be apparent to Goulart that this would not work. Of
course, Goulart would want to have his own man as Prime Minister. This
would be in effect a return to presidentialism with the Prime Minister as

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a kind of Executive Secretary. However, Dantas was not the man for this.
He was too controversial and probably in the long run too unreliable.
In any case, Congress would never accept such a solution.

As for the long term problems of democracy in Brazil, a situation of
mounting chaos was likely with governments alternating between extremists
of the Left and Right. I asked him if he could see this so clearly, why
did the democratic forces not get together to prevent it? He said this
was easier said than done. Brazil needed a strong man but he did not know
where that strong man was to be found. So it went without any indication
of what he wanted except a general statement that he was in favor of
reform. There was a discussion of the nature of the crisis but no
particular statement of how it was to be solved.

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June 11, Brasilia

My Foreign Office companion left me at the airport at Belo Horizonte.
From here I must take the trip alone.

When I arrived in Brasilia the drawbacks of this arrangement became
apparent. No one from the Foreign Office was there nor a representative
from the University, as I had been told. If it had not been for the two
State Department men who had been good enough to come to the airport, I
would have been at a complete loss.

From the airport, we drove along one of the monumental new highways
to the center of town. My hotel overlooks one of the two main axes of
the town facing the cathedral, the Congress building and in the distance
the Presidential Palace.

Brasilia is a fantastic city. It is hard to believe that four years
ago this was a desert. It is located on a plateau at an altitude of about
four thousand feet. The sky is translucently blue, the buildings sparkle
in the sunlight. The houses are grouped in quadrangles called superblocks--
each of which has its own shopping center, its own community buildings,
gardens and school. All the buildings are extremely modernistic. At
one end of the town there is the Congress building; the Presidential
working palace; the Supreme Court, and beyond this, the Presidential
residential palace.

Brasilia is a curious town. I have no way of knowing what it will
look like when it is finished. As it is now, it has some monumental qualities.
Its buildings have beautiful lines. The squares are finely proportioned.
The axes of the town are symmetrical. Yet something is profoundly miss-
ing. European towns give one the feeling that they are designed to shelter
their inhabitants. American towns are designed to be traversed, but they

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still have a center which relates its people to each other. Brasilia,
on the other hand, looks as if it were an industrial exposition. It is
impressive, but it is terribly public with all the windows open. It has
no sidewalks; it has no sense of community. It is so completely planned
that it has lost all spontaneity and, therefore, all mystery.

The first evening in Brasilia I met the Rector of Brasilia University,
Darcy Ribeiro, at his house. He had also asked the head of the Civil
Household of the President (a position similar to that of Sherman Adams),
a member of the Supreme Court of Brazil whose functions are fairly similar
to that of the United States Supreme Court; a member of the Supreme
Electoral Court of Brazil and a distinguished sceintist who is a member
of the Geneva Atomic Energy Commission and a few others.

I first talked to the judges who said that the Brazilian Supreme Court
is required to take every case that is put before it. It cannot exercise
the right of *certiorari* of the United States Supreme Court. They also
explained the working of the electoral courts. In effect, the courts are
responsible for the conduct of the election in Brazil. They supervise both
the registration and the counting of votes.

After about half an hour of desultory conversation, our host turned
to the head of the Civil Household, Hermes Lima, who clearly had the highest
status and asked him whether he would mind explaining some of Brazil's
problems to me. Professor Lima, who had apparently been forewarned, there-
upon drew a piece of paper from his pocket. He brandished it with a
flourish and began to read in the rhetorical style of the Brazilians. His
speech went about as follows: What shall we tell, dear Professor Kissinger,
about us? We shall talk about the new Brazil because it is clear that a
new Brazil has developed. What is that new Brazil? It is not the poverty

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of the Northeast because that we have always had. It is not the desire
for material improvement, because that too we have always had. The new
factor in Brazil is the social consciousness of the masses. Conditions
which had been accepted in the past, have now become intolerable. This
social consciousness explains our insistence on reform.

These reforms depend on the answer to this question: how is Brazil
to be developed? Is it to be developed by foreign capital or is it to be
developed by its own resources? If by its own resources, should it take
the road of capitalism or of state planning? In the past the assumption
had always been that Brazil required foreign capital for its develop-
ment. Everything was done to stimulate foreign investment and to facilitate
the operation of foreign capital. In the past, all of Brazil's growth
depended upon foreign investment. As a result, many aspects of the
Brazilian economy were completely dominated by foreigners. The pharma-
ceutical industry was completely in foreign hands and also several utilities.
The remittance of profits from Brazil had become a major item in the
American balance of payment.

What, then, was the solution? Everybody, including the United States,
had to recognize that the days of private enterprise in Brazil were dead.
A national economic plan was needed and everything had to be subordinated
to this plan. People were even willing to sacrifice liberty for that.
Foreign capital might be useful. But it should play a marginal role.
Above all, it should support the process of planning and not impede it.
Unfortunately, the Alliance for Progress was inimical to the planning pro-
cess by supporting local projects rather than the central government.

When Professor Lima was finished (after about 20 minutes), I asked
him what his statement meant concretely. Exactly what did he want us to
do or not do? He replied that the Alliance for Progress was opposed to

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planning. I told him that he must be misinformed. My understanding was that one of the conditions of aid under the Alliance for Progress was precisely the need to submit a plan. Also I told him of the criticism I had heard in Rio and in Sao Paulo to the effect that our insistence on a plan impeded progress. Lima replied that this was the typical criticism of reactionaries. It had no relevance to the Brazilian situation. The United States should insist on a plan. He sharply criticized the Alliance for Progress for supporting a housing project in Guanabara State and an educational project in Pernambuco. These attempts to strengthen the State governments against the federal government were bound to antagonize Brazil. Such measures made it more difficult to achieve planning because, needless to say, the Governors preferred to deal with the Alliance for Progress directly rather than with the central government. The big issue was which group in Brazil the Alliance would support.

I told him that the Alliance for Progress was in favor of social and economic progress and democratic institutions. It was up to Brazil to get itself a government that could come up with reasonable plans. Lima replied that I should not confuse a temporary weakness of authority with a long-term trend. President Goulart knew what he was doing and he was certain that a strong central government would in time emerge. I kept returning to the question of what it was the United States should do or for that matter what it was the Brazilian government should do. The Supreme Court Justice and several others made impassioned talks about the advantages of planning, the need for education, roads and similar efforts. I asked if this was the case, what was wrong with supporting such projects? They said no, these projects had to be part of a plan. How they were going to get this plan, what the goals of this plan should be, where the personnel was going to come from, they seemed totally unable to say. Everybody

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insisted on the need of curbing foreign capital and expropriating it in
the public utilities.

There were some passing references to the cold war. They spoke well
of the "independent" foreign policy of their Foreign Minister, but on
details of foreign policy the discussion was incredibly trivial and super-
ficial. The Brazilian vagueness, it seems to me, coupled with the apparent
lack of leadership of the democratic forces, augers pretty ill. It seems
that if some demagogue ever gets hold of the Brazilian machinery of govern-
ment-- particularly if he can do it in a legal way so that the Army is
paralyzed-- the possibilities for a sharp left-wing will be greatly
enhanced. The dogmatism of a man as close to the President as Hermes
Lima is very disquieting.

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June 12, Brasilia

I went around Brasilia for several hours with Georges Landau, who had been a student at Harvard, and whom I liked no better in Brasilia than I had at Harvard. I was also accompanied by an extremely amusing architect, Wilson Reis Netto, one of the assistants to Niemeyer in the basic plan of Brasilia. He had just designed a school for one of the superblocks which had won first prize in an international competition. He was on his way to Japan.

********

Towards midday I spoke to a rather distinguished audience-- mostly heads of departments-- in an auditorium in the temporary Foreign Office. Professor Hermes Lima, the Supreme Court Justice I had met the previous evening, and one other Supreme Court Justice, as well as Herbert Levy, were present. Lima introduced me. The meeting began, as usual, about forty minutes late. There was an interesting question period having to do with Brazil's independent foreign policy. I made the point that of course we respected Brazil's independent foreign policy. On the other hand, no country could expect to have all the benefits of neutrality plus all the benefits of friendship of the United States. We would respect neutrality; but, of course, we would give preferential treatment to our friends.

I had lunch with the Chief of the Foreign Office in Brasilia who has the rank of Minister, and with the Deputy Chief of the Military Household of the President. The military household represents a combination of the Joint Chiefs of Staff and the Office of the Military Representative of the President. It coordinates all interservice matters and conducts the liaison between the President and the services. This colonel-- who of course had a vested interest-- said that there was no question about the loyalty of

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the armed services to the President. The armed services would under no circumstances undertake a coup. They would defend the existing institutions against any other group attempting a coup. He also described some of the methods of operation of Goulart to me, which are an interesting commentary on the informal nature of Brazilian life.

After lunch the Colonel took me first to the Presidential offices and showed me the President's office and the offices of his staff. Then we went to the President's residential palace.

The residential palace, like all of Niemeyer's creations, is an enormously impressive building on the outside and unbearable on the inside. Its combination of grandeur and inhumanity make it inconceivable how anyone can endure living there. As a matter of fact, Goulart has refused to live there, preferring to remain in his house at the outskirts of town and using the President's residential palace as a supplementary office space.

In the President's office, the Colonel showed me some of the weird things that Quadros had done. For one thing he had rigged up a system of lights near his office which gave signals to his secretaries about who could enter his office and who could not. A red light meant that no one could enter his office regardless of the nature of the emergency. A green light meant that only a secretary could enter the office. Only on the rare occasions when he had no lights on the outside of his office would he receive visitors in his office.

The Colonel showed me the elegant movie where Quadros had installed an icebox which was always well stocked with alcohol. Quadros allegedly spent almost every evening watching movies until four or five in the morning and drinking himself into a frenzy. His drinking took such forms

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that when upon his return to Brazil he said that he had been forced out
by *forci occulti* (sinister forces), this term became a synonym for
alcohol. The military aide said that of course Quadros was a genius.
No one should underrate that. He was the greatest leader that Brazil had
except that he was as crazy as his sister who was in an institution and
his father who also died insane. Except for this feature, Quadros might
be the hope of Brazil.

While walking around with me, the Colonel said that the United States
should face the fact that the Peace Corps was of marginal substantive
significance. It was simply silly to give the impression that twenty
college kids would change any of the fundamental problems of Brazil. It
was a little bit condescending. If we wanted to do something for Brazil,
we had to address ourselves to the basic problems. He could not under-
stand how serious magazines-- like *Life* and *Time*-- could give such enor-
mous publicity to so sentimental an effort.

********

After the visit to the two presidential palaces, I went to the
Congress where I met with some senators, mostly from UDN. Two of them,
Mem de Sa and Daniel Krieger, were from Rio Grande do Sul; one from
Pernambuco and the others I did not catch. They were all agreed that
reform was necessary, but they were very vague about its nature. In many
ways Brazil needed a strong man who also had democratic convictions. They
did not know who possessed this unlikely combination of qualities. They
foresaw chaos but they had no idea how chaos could be averted. Some
thought that Goulart wanted Presidentialism; others thought he preferred
parliamentary institutions because he was overwhelmed by the responsibility
of conducting affairs. The over-all impression was one of extreme

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ineffectualness. They explained the problems of inflation and of the Northeast. They expressed the hope that the Alliance for Progress would help with these problems. But they were incapable of explaining what they wanted the Alliance for Progress to do or what their own responsibilities might be (except that one of them was in favor of freezing all wages.)

From the Congress I went to the office of the Mayor of Brasilia, a retired ambassador, very suave and extremely able, who explained some of the plans for Brasilia to me. He thought that the solution of the crisis would be the appointment of Juracy Magalhaes as Prime Minister. He did not add a great deal to what I already knew and his description of the crisis followed very familiar lines. He said he thought that the leftist elements were gaining in strength, but he showed the usual impotence of the democratic forces in this country.

********

From there I went to the house of Representative Bocayuva Cunha who is an avowed leftist and a close friend of Samuel Wainer. He had invited two other Representatives of the same group, Sergio Magalhaes and Saturnio Braga. They said that they wanted national planning, social progress and an independent foreign policy. Their exposition followed very much the lines of Professor Lima of the night before except that Braga specifically mentioned Yugoslavia as a model for the kind of state they wanted to bring about. Bocuyava siad that Dantas would undoubtedly be nominated as Prime Minister within the next few days. The Left was trying to strengthen Goulart's hand for a major reform by giving him the maximum degree of popularity and by threatening a general strike. This would make it much harder for Congress to refuse the nomination of Dantas or of some other left-wing Prime Minister. The major problem was to get a leftist-oriented

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government into power; then the necessary reforms could be carried out
rather quickly.

The major problem was to have an overall plan. What was the United
States attitude? I said that I had no idea, but the Alliance for Progress
seemed to me to encourage a plan. Bocayuva said that he realized that
Brazil needed some assistance in the planning process along the lines of
the advisory groups that Harvard has set up in other countries. He
suggested that a commission of eminent economists study the problem of the
development of Brazil and make a report. He was certain that such a group
would support most of the policies that the Brazilian Left favored. An
outside commission to study Brazil's economic problem was desirable because
any really progressive reform program was going to be attacked as Comm-
unist by the Brazilian Right. An outside expert opinion would strengthen
the hand of people like himself.

It would also be very helpful for Ambassador Gordon to invite a group
of generals and other conservatives and tell them that he favored Brazil's
independent foreign policy. I said it seemed to me improper for the
Ambassador to say publicly that he disagreed with Brazil's foreign policy;
and equally improper for him to support Brazil's foreign policy in such a
way. Also, I wanted to tell them quite frankly one concern: I had the
impression that many leftist forces in Brazil and many other circles that
were otherwise promoting objectives consistent with the Alliance for Progress
were trying to play on Brazilian nationalism in order to obtain a popular
support for their domestic program.

It seemed to me that such a course damaged the prospects of long-term
cooperation. Brazilians concerned with reform must not make impossible
demands on the United States from the psychological point of view. They
cannot ask for our support and use us as a whipping boy domestically.

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Bocayuva-- who is a very smooth individual-- said that I was right. He and his colleagues would think the matter over and see what they could do to moderate some of their attacks on us.

Bocayuva, and to a lesser extent his friends, are undoubtedly attractive people. The dilemma of Brazil may well be that the extreme Left is the only group which knows what it wants and has at least some idea of how to get it. At the same time, I have the impression that the reforms they envisage go far beyond the somewhat pragmatic framework of what we understand by social reform or of the specific measures they advocate. Their natural tendency is anti-capitalist and because they consider us the epitomy of capitalism, however progressive, their foreign policy will always be directed against us to some extent. Our best course is to deal with them unsentimentally, to support specific reform measures but not to show excessive forebearance when they act counter to our interests in foreign affairs.

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June 13, Salvador

Today I flew from Brasilia to Salvador.

Salvador is as different from Brasilia as can be imagined. It is the
oldest city in Brazil, built on two levels along a beautiful harbor which
is not as dramatic as Rio's but very sweet. It is more similar to Naples
than to Rio. The old part of the town is on top of a hill; the new part
is right at the water's edge. The two parts are connected by two elevators.

I was met at the airport by the American Consul, the Secretary to the
Governor with the charming name of Brotherhood, and by somebody from a
Brazilian travel office who had been engaged by the Foreign Office to look
after me. The Consul had arranged an absolutely mankilling program which
would have made it impossible to see anything of Salvador. I cancelled
this afternoon's program and went around sightseeing with one of the people
I had met a Barbosa's house who was good enough to show me the town. For
this evening the Consul had invited the Governor, Juracy Magalhaes and
his chief opponent to meet me. I asked the Consul why he had done that and
he said in the interests of fairness. I said that it might be embarrassing
to have an electoral campaign in his living room. He replied, "Well, to
tell you the truth, I could not get any of them to come to my house before
and this seemed to me an extraordinary opportunity."

In walking through Salvador this afternoon, I asked myself why it is
that this city, with its narrow streets and appalling slums, seemed so much
more livable than Brasilia with its magnificent apartment buildings
marching across the plain like columns of soldiers. I think it is not
only that there is nothing organic about Brasilia, it is also that
Brasilia is a city without any secrets. The glass fronts of the houses
are only a symbol for the fact that the lives of the inhabitants must

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follow rigidly Niemeyer's ideas of the good life. If one wants to walk, one has to walk in one's neighborhood. If one desires community life, this, too, must be done in the area of the superblock. There is nothing that can be done spontaneously or individually. Every apartment has the same basic plan; the only variation is the number of bedrooms. In Salvador, on the other hand, one has a sense of the organic nature of life. Each person has a certain scope for finding his own fulfillment.

After my tour of the city, I went to the Consul's house. As it happened, the opponent of Magalhaes had sent word that he could only come late while Magalhaes had indicated that he could only come early. Therefore a good opportunity presented itself for concentrating on the Governor.

Magalhaes is a gray-haired, sharp featured man whose previous army experience still shows in his rather erect bearing. Otherwise he looks like a well-to-do midwestern banker. He speaks splendid English, having spent a year at the Commanding General Staff College. He also has served as Brazilian military attaché in Washington. He is clearly a well meaning, decent individual, friendly to the United States, dedicated to democracy and opposed to Communism. At the same time, he has a somewhat pedantic quality. For all his good sense, he did not strike me as the kind of person to stop the ruthless, cynical politicians of the Left that I had met in Rio and Brasilia. Moreover, after having been in public life for 30 years he says he is tired and eager to retire. I have had this confirmed from others.

Magalhaes began the conversation by telling me about the discussions that had been taking place about the cabinet. He said that Santiago Dantas had called him the other day and asked whether Magalhaes would serve in his cabinet as Minister of Mines. Magalhaes had agreed provided that Dantas

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agreed to two conditions: One, a willingness to carry out an anti-inflationary policy; the second, to conduct an anti-Communist policy. Dantas, according to Magalhaes, had asked him what he meant by the latter condition. Magalhaes had expressed his unhappiness about the so-called independent foreign policy of Dantas. Dantas had replied that he could not understand Magalhaes' attitude since Secretary Rusk was fully aware of what Dantas was doing and had expressed his satisfaction.

Magalhaes went on to say that Dantas had assured him that he would honor all existing Brazilian obligations. I said that this was a rather vague statement since, if there was any concern about Brazil's foreign policy, it had to do with intangibles and not with the fact that Brazil might break its treaty obligations. Magalhaes said that of course Dantas was a very slippery fellow. He had been a Fascist in the Thirties and then a conservative. He was a very rich man, but--like so many Brazilian politicians--he was a demagogue and very proud of his cleverness. The tragedy of Brazil was that the Communists by themselves had almost no electoral support, but that allied with the democratic parties they could make quite an impact. The democratic leaders, in turn, were so sure of their cleverness that they thought they could exploit the Communists. The result was an unseemly and extremely dangerous competition for Communist support.

Magalhaes went on to say that he thought it would be very hard for Dantas to obtain Congressional approval. The invitation to him was designed to reassure Congress or else to confuse the issue. I asked him whether he would accept. He said he had been put under great pressure by Goulart. Goulart allegedly had said to him, "Juracy, whenever I think of you, it is not as a problem but as a solution."

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Since Magalhaes wants to retire from political life, he is thinking of entering the Cabinet. The reason is that cabinet officers cannot run for electoral office and that the Cabinet now being formed is bound to be transitional. Also he had been told by Lincoln Gordon that he may be doing a useful service by serving within the Cabinet and making his point of view heard.

I have my doubts about that. Obviously, Goulart and Dantas want Magalhaes in the Cabinet in order to be able to appeal to the moderate and conservative elements and to prove to them that they are not leftist. I think Magalhaes in such a cabinet may well play the role of the conservatives who thought that they might be moderating Hitler. It is not that Dantas or Goulart are like Hitler. It is rather that the people whom they consider their natural allies are all committed to policies, both domestic and international, which in the long run are likely to be inimical to us.

Magalhaes then spoke of Brizolla, whom he described as a demagogue, who has now gone beyond the point of no return. He said that when he saw Goulart a few weeks ago, Brizolla had called Goulart and asked him whether he should come to the Governors' Conference at Araxa. Goulart had asked Magalhaes' opinion and Magalhaes had urged him to ask Brizolla to stay away. Magalhaes' reason was his fear that Brizolla would make any orderly discussion impossible by pushing for a very extreme program. Goulart had agreed and told Brizolla to stay away. I asked whether Brizolla's absence might not enable him to adopt an even more extreme stance by dissociating himself from his fellow Governors. Magalheas replied that to some extent this was correct. On the other hand, the Governors' resolution can serve as the platform for a moderate policy.

Actually, since most of these Governors are at the end of their terms,

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I have somewhat changed my view about the significance of their declaration.
I do not believe it is in Goulart's interest to enhance the prestige of
the Governors--many of whom oppose him--by adopting their declaration. I
think one can interpret Goulart's suggestion that Brizolla stay away from
the conference in two ways: as an attempt to make the meeting succeed; also,
it can be viewed as a move to give the President the option to attack the
Governors for being too conservative.

Magalhaes thought that Goulart was essentially moderate, and was using
Brizolla in order to keep contact with his former allies on the Left. This,
at any rate, is what he had implied to Magalhaes. I asked Magalhaes whether
it was not possible that Goulart was telling Brizolla that when seeing
Magalhaes he was only keeping in touch with the conservatives while remain-
ing committed to the Left. Magalhaes said this was entirely possible and
he could not be really sure which of the interpretations was correct.

Magalhaes then talked about Quadros. He spoke scathingly of Quadros,
whom he described as a drunkard and mentally deranged. Quadros did present
a real problem, however. For if Quadros won in Sao Paulo and Arias in
Pernambuco, and if Dantas or some other leftist became Prime Minister, and
if in Bahia a Communist were elected--all four events very possible--then
the future of democracy in Brazil would be desperate. However, God was a
Brazilian and not everything bad was going to happen simultaneously.

Magalhaes said that the leftward drift of Brazil was gaining momentum.
A good example was a recent meeting celebrating the formation of the elect-
rical trust of Brazil. On that occasion a labor leader had given a straight
Communist speech in which he had spoken about fighting against foreign
economic domination and had indicated very clearly that labor was preparing

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the possibility to call a general strike. Goulart had sat on the platform
and both he and the Commanding General of Rio had vigorously applauded.
Goulart had then spoken in a fairly conciliatory fashion, but even during
his speech, the split in Brazilian society became evident. When Goulart
spoke about the need to defend democracy, half of his cabinet applauded.
When he spoke about foreign economic exploitation, another half of his
cabinet applauded. But there were very few occasions when the whole cabinet
applauded.

This split, symptomatic of a split in Brazilian life, was likely to
be compounded by the gubernatorial elections in the fall. Pernambuco, in
his judgment, was almost certainly going to elect the Communist Arias because
the democratic parties were running two candidates. In Sao Paulo, Quadros
stood a 50-50 chance of being elected. In Bahia Magalhaes had vainly
attempted that afternoon to get the democratic parties to unite on a single
candidate to oppose a Communist-sponsored candidate. However, agreement
could not be reached. It was very likely that Bahia, too, would have a pro-
Communist governor. If one considered that the Governor of Goia was also
a Brizolla supporter and the Communist trend within the labor unions, it
became clear that the left-wing was almost certain to gain in strength.

Of course, not all these things would necessarily happen simultaneously.
But the myth that left-wing support was essential for electoral success
should not be underrated. For example, at the Governors' Conference at
Araxa, Magalhaes had attempted to introduce a resolution against Communism.
It was not clear to me whether he finally managed to insert it into the
communique by the threat of walking out or whether even the threat of
walking out had not managed to get the word communism into the communique.
The basic point Magalhaes made was that a terrible fight started, led by

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many Governors who had not Communist sympathies themselves but who did not want to lose the left-wing support in their states. In other words, the extreme Left had a powerful impact on Brazilian political life.

Magalhaes next talked about the Alliance for Progress. He was fairly conventional, saying that the Alliance for Progress should support such things as the irrigation project in Bahia. Bahia has a population of six million; two million of school age, but only classrooms for one million. The Alliance for Progress might help in this field as well. I asked him whether economic progress could come fast enough to alleviate the situation he described. Here he shrugged his shoulders and said that one had to try.

We then talked about agrarian reform. He took the usual conservative position that the infrastructure was more important than land redistribution, and he pointed to some model farms he had created in his state as an example. Altogether he suffered from the Brazilian preoccupation with methods rather than with substance and I found this part of the conversation rather uninteresting.

With respect to inflation, Magalhaes said that the most effective countermeasure would be to cut government payrolls. In his state, 83 per cent of the state budget went to the civil service. In Brazil, the government payroll was a form of public welfare program. On the other hand, he admitted that a reduction of the governmental payroll was politically very difficult. He had no other suggestions to offer.

This conversation illustrates the basic difficulty of the democratic forces in Brazil. Here is a well-meaning, earnest, dedicated, pro-American national leader who understands the dangers ahead. Yet he is getting old and wants to retire from politics and, in any case, he had no real idea of what he can do to stem the tide. The danger is not that we will wake up

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one morning and find that Brazil has gone Communist. From many points of view, a Communist coup would be better than a gradual erosion since it might lead to a reaction of the more conservative elements. The danger is that if the Communists play a waiting game, they may get into control of a number of states and obtain a veto over the policies of more moderate groups. Then, if they are skillful, they can perhaps push Brazil into directions which evoke an American reaction which, in turn, will drive some of the nationalists over to their side as well.

********

After dinner I walked around on the streets near my hotel and through a park which represents an awful combination of British, Italian and French landscaping. I was accompanied by the Public Affairs Officer--one of the people who seem to be attracted to U.S.I.S. He claimed to have been with the Thompson Advertising Agency. But whatever his past accomplishments, he is now a tiresome, pompous, self-righteous man. He had been at dinner, where he had lectured Magalhaes about the nature of the Brazilian character. I am developing increasingly serious doubts about the utility of the whole U.S.I.S. operation. A man like this has no chance of reaching serious intellectuals or political leaders. All he is good for is to send out press releases. He has no chance of convincing serious Brazilians that our concerns are relevant to their problems.

The same must be said about the lower levels of the Foreign Service.
The Consular officials whom I saw in Sao Paulo and Salvador and the individuals
in Brasilia are all well meaning. They have certainly made my trip much
more pleasant. I have nothing but gratitude for this. On the other hand,
they struck me as pedantic, colorless, bureaucratic and unimaginative. In
every town that I visited, my visit was used as a pretext to see people whom--

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in my judgment-- they should be seeing all the time but cannot get to see.
I do not know to what extent this is a vestige of the McCarthy era or
whether there is something debilitating about the Foreign Service, part-
icularly outside the capital cities. But it seems to me a fact that United
States diplomatic personnel rarely make the impact of their British or
French colleagues. Their lack of compassion and their pedantry may be the
reason why. It is rare to find individuals speaking of the American
diplomatic personnel with affection. I must again make an exception for
Ambassador Gordon, who is, however, not a professional and who demonstrates
what could be done with a few good people.

This morning the American Consul and I went to the office of the
economic planning commission for Bahia, called CPE. Though I spent about
an hour and a half there, there is almost nothing to record. Most of the
time was taken up with a technical discussion of the administrative
structure of CPE, which is as complex as the organization is ineffective.
Theoretically the planning organization and its holding company are supposed
to be independent. However, all of its members are government appointees.
Moreover, they all hold jobs both with the Bahia administration and
with CPE. As a result, CPE is for all practical purposes an arm of the
Secretary for Economic Affairs of Bahia. Below the planning organization
there are a number of holding companies to encourage agricultural develop-
ment, the location of silos in the state and other similar matters. These
are run as semi-public corporations and sometimes as completely public
corporations, with the holding company of the planning group acting as the
principal or as the major shareholder.

However, the operation as a whole cannot be called planning in any
realistic sense. It does not represent either a projection of trends of

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the Bahia economy or of any goals. If anything, it is a banking operation
in which a number of projects are supported separately. CPE is vaguely re-
lated to SUDENE, the planning organ for the whole Northeast, through some
overlap in the Board of Directors. But the two operations are not coordi-
nated in detail. Both the personnel and their concepts struck me as ama-
teurish. While CPE is undoubtedly a step forward, it casts another light
on the proposals for central planning that I heard in Brasilia. People
whose technical competence is as low as CPE can hardly make plans that mean
anything or keep their plans from turning into corruption.

********

I then had a talk with the Rector of Bahia University who repeated in
essence the observations about the student organization of the Rector of
Minas Gerais University.

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June 14, Recife

In the afternoon I flew to Recife. I was met at the airport by the representative of the Governor, the American Consul and some newspaper people. Despite the opinions of the caliber of our Foreign Officers which I have recorded, I must add that to some of them I owe a profound debt of gratitude. Ever since leaving Belo Horizonte communication between the Brazilian Foreign Office and the local government has broken down or, at any rate, they have misunderstood each other. When I arrived in Recife not a single appointment had been made. If it were not for the American Consul, I do not know how I would spend my days here.

I took a quick trip through Recife, particularly seeing the slums.
The squalor and filth approach Indian conditions. The Consul told me that
he thought that a guerrilla uprising was entirely likely here. The other
day he had met a peasant on the road carrying a new semi-automatic rifle
and that indicates to him that supplies of arms are finding their way in.
The people of the Northeast want to change things but do not know in what
direction. They are therefore easy prey to extremist propaganda. Indeed,
the potential for social upheaval in the Northeast is the greatest of any
area in Brazil. Where in the South it is the politicians who are radical-
izing political life, in the Northeast the peasantry is spontaneously near
the point of explosion. The combination of greedy landlords, overpopulation
and low standard of living all combine to produce a revolutionary situation.

In the evening the United States Consul General, Eugene Delgado-Arias,
gave a dinner for me at the Hotel Boa Viagen. He is one of the more impress-
ive foreign service officers that I have met. He is tough, clear-headed and

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without illusions. He has volunteered for this post as being the most challenging he could have in Brazil. Also present was the head of our A.I.D. mission, Mr. Bruno Luzzatto, of Italian origin, cynical, vain, very intelligent but perhaps too technically oriented to deal with the essentially political problems in the Brazilian Northeast. He argued that Brazil was basically a compromising society dominated by the Center. He may be right but this would not necessarily prevent the dislocations that some people predict for this part of the country. For the Center seems to me confused and the extremists determined. Present also was the Head of the Civil Household of the Governor of Pernambuco. He is a professor of Portuguese at Pernambuco University and an honorary citizen of Madrid. He is a gentleman from an old Recife family, a man of very great learning and culture, with a magnificent head, courtly manners and enormous dignity. He will give a lunch for me on Saturday.

********

There are many similarities between Brazil and Italy. Italy is narrow, stretching for a thousand miles into the Mediterranean. The South is really a different country from the North. The North is rich and energetic; the South impoverished, but with grace and a fierce sense of loyalty. In Brazil it is the South which is industrialized and the North which is underdeveloped. Yet this corresponds to the climatic conditions of the Southern Hemisphere. Moreover, even though Brazil is really a Continent, its population is concentrated in a relatively narrow belt along the coast. And, of course, in many of their personal characteristics Brazilians are very similar to Italians.

********

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I had been told at the Itamarati that my program in Recife would be planned by the Institute of Gilberto Freyre. No one from that Institute was at the airport and the Consul knew nothing about it. At about ten this evening--while I was at dinner--three people from the Institute arrived. They had finally found the letter from Tavares asking them to arrange my program. However, Freyre had been in Rio and so had the Director of the Institute. Each had only come back tonight and these three individuals were sent to present their apologies and to assure me that they would work out a program.

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June 15, Recife

This was a day of chaos. First, the three individuals from Freyre's Institute called at the Consulate at 9:30 in the morning and asked for me. When they were told that I was not there, they disappeared and have not been seen since.

Then I had an appointment with Francisco Juliao, the founder of the Peasant League. When I got to the rendezvous after an hour's drive, he was not there. He had taken his wife to the airport and the plane was delayed by several hours. Recife has only about six thousand telephones for a population of over a million. It is next to impossible to make any appointments by telephone and most communication is by messenger. Under the circumstances, I did some sight-seeing, looking at some of the beautiful old colonial churches.

Finally the Consulate managed to locate Gilberto Freyre, one of the few Brazilian intellectuals with an international reputation. He lives on the outskirts of town on a hill in a beautiful old house with very high ceilings, big windows, and old colonial furniture. He speaks splendid English. I spent about an hour and a half with him.

Freyre talked to me about the situation in the Northeast. The crisis, he argued, has been building up for about 80 years. It is the result of a region which used to be the richest and culturally the most advanced of Brazil but which has been in a steady decline ever since the late 1880's when Brazil shifted from a sugar economy to a coffee economy. At that time the focus of attention and of effort was transferred from the Northeast to the South. The crisis of the last few years is thus a culmination of some-

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thing that has been going on for a very long time.

I asked what conditions had produced this sudden awakening. Freyre replied that there had been a number of factors. Communism was important. Cuba was of some consequence, though not nearly as crucial as most Americans thought. In a curious way, the impact of Protestant missionaries had been greater than that of Castro. They brought with them an awareness of social problems and a social consciousness heretofore lacking in the Catholic Church. Another factor had been the spread of the Peasant League. In self-defense, the Catholic Church has had to organize something similar in the worker-priest movement. All of this has combined to create enormous ferment.

I asked what reforms might be adequate to deal with this situation. Freyre said it was all a question of leadership. And in this respect Brazil was now paying the price for the Vargas dictatorship. It is the essence of a dictatorship that strong people do not reach positions of eminence, for strong people are not subservient. They are a potential threat to the dictator. On the whole, Vargas surrounded himself with mediocrities,

This was the problem of Goulart. Goulart had learned politics from Vargas. He was an enormously skillful politician with an instinctive political sense. But he had probably never read a book in his life. He had a great sense for power, but no sense of history. His skill resided in the mastery of the short-term. He was a balancer of political forces. He was patient and able but he was not a national leader. And, above all, he was not a democrat. In short, the great challenge for Brazil was to find some kind of democratic leadership.

I mentioned a remark that I had heard to the effect that the Brazilian

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people were too conciliatory to adopt extreme solutions. Freyre replied that this might be true of the people, but it was not true of most of their leaders. Moreover, the conciliatory nature of Brazilians might lead to adaptation to any determined minority which seized power. And this was by no means impossible. The difficulty of Brazil was that the social structure--particularly of the Northeast--had disintegrated. Under feudalism, the landowners had still had a sense of patriarchal obligation. With the ending of feudalism, the established classes became purely mercenary while the primary aim of the left was to produce chaos. All the talk of general strike may have as one of its purposes to provoke an army coup d'état. Too many subtle people were playing dangerous games, not understanding or caring that they might be setting in motion a train of events which they would not be able to master.

I asked about the political situation in Pernambuco. Freyre replied that at the moment the strongest leader is the Mayor of Recife, Arias, who had been elected with Communist support and who is running for Governor in the fall election. If he wins, it will be a catastrophe. Either the army will prevent him from taking over--in which case there is likely to be a general strike; or else Arias will take office--infiltrating Communists throughout the Northeast. In that case, he would have the choice of either accepting American aid and receiving all the credit for any improvement in conditions, or of turning into a pure agitator using the misery of Pernambuco as a platform.

In order to stop him Gilberto Freyre had agreed to let his name be put forth as candidate for Governor, provided all the democratic parties would agree to support him against Arias. When this proposition had been put to Goulart, Goulart had been noncommittal. Finally he had said that the

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decision had to be made by the PTB (that is, the Brazilian Labor Party) of Pernambuco, even though he is the national chairman. Freyre was puzzled about this. Goulart's desire to strengthen his own political base was understandable. Yet if it led to the election of Arias as Governor of Pernambuco, the power of the President would suffer a serious blow. I asked Freyre whether he could conceive a constellation in which Arias was Governor in Pernambuco, a left-wing man was Prime Minister, and Quadros became Governor in Sao Paulo. Freyre replied that this was quite possible and in that case, the future of Brazil was likely to be chaotic.

We then spoke about Brasilia and the paradox that so human a people should have devised so inhuman a capital city. Freyre said that if he had to go into exile, he would choose St. Helena in preference to Brasilia.

********

I had lunch with two members of the Consulate and a local businessman. They explained to me some of the work of Peasant Leagues and their concern with the Communist infiltration of the trade unions. They also told me--particularly the businessman--that Furtado, the head of SUDENE, was a Communist and that his organization was heavily infiltrated by Communists.

After this we went to the house of a very big businessman called Chavez, who has been proposed as a candidate for Governor, and who is very active in IPES, an organization of businessmen designed for the stated purpose of defending democracy. IPES seems to me an extremely right-wing group.

Before leaving for his house, there was another one of the crises for which Recife will stick in my mind. The man who had been engaged as my interpreter had simply disappeared. No one knew where to find him. Finally, one of the consuls who spoke Portuguese was good enough to come along.

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Chavez lived in a very elegant old house at the edge of Recife. I was greeted by his wife and his daughter and a very cynical brother-in-law. Chavez was another of what I have come to consider the UDN type. He is vocal, suave, intelligent and politically almost completely ineffectual. He said that of course he was a reformist, in contrast to the many reactionary businessmen in Recife who wanted to keep everything unchanged. When I asked him, however, what he wanted to reform, he launched into a long discourse about the more Machiavellian aspects of the gubernatorial race of Pernambuco. He explained that Goulart was eager to stop Arias. However, his dislike of the incumbent Governor, Sampaio, had made it very difficult to get a candidate. Goulart would like to finish off both Sampaio and Arias. Therefore, any candidate acceptable to Sampaio was likely to be unacceptable to Goulart. The result had been that at the moment a weak candidate had been nominated to oppose Arias. This man was in the race only as a holding candidate. He would give way before the July 7 deadline to a more serious opponent. Who this might be, Chavez was unable to say, except that he knew that Goulart preferred somebody called Limas who was extremely left-wing while Sampaio would undoubtedly prefer a more moderate candidate. This at least gives me an explanation of why Goulart opposed Freyre. Try as I might, I never could get Chavez to explain to me what reforms he favored, except for the almost obligatory statement that educational and infrastructure changes had to precede other reforms.

Chavez told me that he thought Furtado, the head of SUDENE, was a Communist. He said that he knew for a fact that the Ministry of War had made a plan to throw out Furtado and replace him with a military engineer. Goulart allegedly agreed. Goulart could not throw Furtado out until a Prime Minister was chosen and the issue would probably be in abeyance until

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about August.

From Chavez's house I went to see Furtado, the head of SUDENE.
SUDENE is the organization charged with economic planning in the North-
east. It acts as the clearinghouse for all federal funds spent in the
ten states of the Northeast. It was created in 1958 to deal with the
crisis produced by the drought of that year. It is directly responsible
to the President.

Furtado is perhaps the most impressive Brazilian official that I
have met. Certainly he is technically the most competent. He is one of
the few people who has a clear concept of where he is going. If he is
indeed a Communist (as some people have claimed) then God help us,
because he is very tough, clever and ruthless. I could gather no indi-
cation of Communist sympathies in our conversation, which dealt almost
entirely with the planning problems of SUDENE.

Furtado began the conversation in a somewhat hostile fashion. He
asked whether I was one of the Americans who was constantly second
guessing him. He sometimes had the impression that, if our experts did
not do everything themselves, they tried to sabotage other people's work.
I told him that--given my limited knowledge of economics--if I could
second guess him, he was really in trouble.

Furtado thawed a bit and explained some of his work. He said that
while his primary task was economic planning, in order to put his plans
into effect he had to act politically as well. For example, in order to
get the first SUDENE plan through Congress, he organized both a strike
and a lockout in Recife, in effect stopping all business until Congress

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approved his five year plan and gave him funds for his first year. During the first year 50 per cent of all federal funds spent in the Northeast go through SUDENE. By the end of the third year, he expects ninety per cent of the funds to go through SUDENE. At that point, he will probably be the most powerful figure in the Northeast.

Furtado said that the infrastructure for economic development was well advanced. The rate of economic development was greater in the Northeast than in any other part of Brazil. It was the only region where a survey had been made of the available raw materials and power supply. It would take two or three years before the effect of these efforts would make themselves felt. But at the end of that period he expected the rate of progress of the Northeast to be at least equal to the rest of Brazil even though the gap between the two areas would not be closed. This dynamism would give people hope. As the people of the Northeast gained confidence in a better future, they would lose their current despondency and lassitude. This would not only give an impetus to the economic development of the Northeast; it would also encourage the movement of population within Brazil.

He then spoke about agricultural reform. He explained the problem represented by the large sugar plantations which were being very inefficiently farmed. He proposed to deal with this by a scheme, according to which, in return for getting assistance for farming more intensively, the sugar plantation owners would have to give up part of their land. He also described his method for dealing with the drought as well as his manipulations of the state governor in his area of jurisdiction. In this respect, he is engaged essentially in log-rolling. In return for supporting some pet projects of key Governors, he obtains their backing for his economic plans. He gave some examples which have slipped my mind.

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The details of these schemes are really not too important. What is
important is that here is a man of first class intelligence, enormous
drive, and great ruthlessness. If he retains his office, he is likely to
become a potent political force in Brazil.

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June 16, Recife

I had breakfast with some American labor leaders that were in contact with the labor unions in Recife. They told me essentially the same story that I had already heard in Sao Paulo, except that the situation in Recife is even worse. No democratic labor union of any significance exists in Recife.

********

Afterwards, I had an appointment with Father Melo who has organized a peasant priest movement in order to counteract Juliao's Peasant Leagues. I was supposed to meet Father Melo, at eight because he had to say mass at nine. He arrived at nine and stayed until after ten. I was getting jumpier and jumpier for his sake. Finally, when he left, I asked him if he was not nervous about the mass and he replied not in the slightest because if he had been there on time, only about ten or fifteen parishoners would have been present.

Father Melo, if he were not a priest, would undoubtedly be a fanatic rabble rouser, probably a Communist. He is a Savanarola type. His goal is to organize the peasants into groups doing much the same type of things on a non-Communist basis as the Peasant Leagues. He was not very coherent in his account of what he understood by land reform, except to say that once the workers were organized, the big landowners would automatically carry out land reform. He was accompanied by a member of IPES who explained some of the reform ideas a little bit more coherently.

********

Afterwards, I called on Sampaio, the Governor of Pernambuco. He is a small, very intense man who speaks fluent French. He told me that the

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political situation in Brazil was getting more and more complicated and explosive. The government was doing nothing to prevent the food supply crisis that was threatening to produce political chaos. In fact, he was under the impression that the government might be actually encouraging it. Also Goulart was determined to use the present moment to return to the presidential system. He was willing to go to great lengths to achieve this end. He was willing to have the risk of a general strike, and Army reaction in order to achieve it.

As far as the local situation was concerned, Sampaio said that he had wanted to run Gilberto Freyre for Governor of Pernambuco. However, he had been told by Goulart that he would not support Freyre and that unless Sampaio supported the PTB candidate, who was Senator Carvalho, Goulart's party would throw its support to the Communist, Arias. Sampaio said that Goulart must feel much more confident because six weeks previously Goulart had only demanded as the price of his support that the vice-governorship should go to the PTB. Sampaio then said a number of things about Ted Kennedy's trip to Recife.

********

The Head of the Civil Household of the Governor then gave a lunch for me. I had another talk there with Gilberto Freyre and Furtado, much along the lines of the day before.

********

I returned to Rio that evening.

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June 17, Rio de Janeiro

I had lunch with Israel Klabin, who first took me on a boat ride through Guanabara Bay--a spectacular sight. We passed the Brazilian aircraft carrier which Brazilians sarcastically call Belo Antonio and we talked about the inevitable subject of the formation of the cabinet and the future of Brazil. Klabin is of the opinion that Santiago Dantas would be an excellent Prime Minister--precisely because he is from the Left and might be able to conduct more conservative policies than a conservative. He also told me of a conversation with Santiago Dantas. According to Dantas, Secretary Rusk had endorsed Brazil's present foreign policy and said that this was also Kennedy's view.

At lunch we were joined by the head of the Brazilian sugar trust, Edmundo P. Barbosa da Silva, who is a former ambassador. He explained the land reform that the sugar trust is sponsoring in the Northeast--very similar to that outlined by Furtado. In fact, it is conducted in close cooperation with SUDENE. He was the man who had accompanied Ted Kennedy on his trip through Brazil on behalf of the Brazilian Foreign Office and he had some fascinating stories to tell.

By the time I had returned to my hotel, all hell had broken loose. Brazil had just won the soccer championship. Firecrackers were thrown out of almost every window. Tons of paper cascaded into the street where they were set on fire. Samba bands started strolling and a huge procession formed which blocked almost all traffic. A Brazilian acquaintance made his way through all this bedlam to the hotel. He insisted that I watch the carnival downtown. A wild celebration was in progress. Traffic was completely stopped and various samba bands in different uniforms were

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marching around using very rudimentary instruments but with an enormous
sense of rhythm. One of the songs was "we have no beans... we have no
sugar... but we have the world's championship." (This rhymes in Portuguese.)
The sweet thing about the song and its performance was that it was
genuinely without any malice.

********

I then went to the Ambassador's residence and together we drove to the
house of the Finance Minister, Moreira Salles, who was giving a dinner in
my honor. Salles is a banker, very suave, very intelligent, extremely
wealthy, a very close friend of Nelson Rockefeller's and twice Ambassador
to the United States. His house is one of the most beautiful that I have
ever seen, very modern and daring.

Salles told me that he considered Santiago Dantas the most dangerous
man in Brazil. He thought, too, that the danger of a coup in the next
months by either the Army or labor was extremely great. Goulart was
deliberately provoking a crisis because he thought that this was his last, or
perhaps his only, chance to get back the powers which were stripped from
him. He is a man from Rio Grande do Sul, very proud, very cunning and
without any convictions or program. Salles said that Quadros was not sur-
prised by the fact that Congress accepted his resignation. His game had
been more subtle. He had expected that precisely because it was known that
Congress would accept his resignation, the resignation would never reach
Congress; in order to forestall his departure, the Army would close Con-
gress. This game was destroyed because the Chief of the Military Household
was too unimaginative and took Quadros at his face value. This man con-
vinced the Army that Quadros really wanted to resign. As a result, Quadros

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had waited for hours in his plane at the airport of Sao Paulo, waiting to be called back.

Both Salles and some of his guests said that the present weakness of Brazil was due to Quadros, who had had a mandate to do all the things which were now so difficult. Salles was extremely pessimistic. Goulart was ruthlessly risking everything for personal ambition. The best he saw was a long period of instability and he did not rule out a Communist takeover.

About the Alliance for Progress, he said that so far--while helpful-- it had not made a major impact. He did not think that the personnel either in Washington or in Brazil were very good or psychologically attuned to what was needed. He said there was a remarkable difference between the attitudes now and at the time of the Marshall Plan, the reason being probably the legacy of McCarthyism. I did not reply, but I think the problem goes deeper. At the time of the Marshall Plan there was really genuine conviction and a theory relevant to the then existing problem. There was agreement on the factual situation. There was also willingness to let the Europeans bear the major burden of the planning. Now we are applying by rote certain technical theories of economics without the conviction and the passion and the ingenuity of the previous period. There is no consensus as to facts or as to purposes.

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Summing up

It is not easy to sum up three weeks in a country with whose culture
and history I had been only barely familiar before my visit. I came away
with more questions than answers. It is easy enough to observe that the
Alliance for Progress is not working. Yet it is much less clear what kind
of American aid program could be successful or how in Brazil one can trans-
late economic aid into political influence.

Many of the assumptions of the Marshall Plan simply do not apply to Brazil. In Europe we were dealing with societies with a long tradition of political legitimacy. The bureaucracies were reasonably efficient and honest. The social structure was dislocated by the war but its essential nature was still intact. The chief threat was the economic imbalance caused by the war. The established elites could use the Marshall Plan to expand their base and to establish their legitimacy.

None of these conditions apply in Brazil. There is very little social
consciousness and no political legitimacy. Indeed, political life in Brazil
is reminiscent of the struggles for power of Renaissance princes of Italy.
Though there is economic discontent, it is not the chief source of the dif-
ficulty. In order to alleviate political unrest with economic aid, the re-
cipients of economic aid must be in favor of a moderate, democratic policy.
There has to be a leadership group sharing some of our purposes and agreeing
on an analysis of the facts. In Brazil, however, those conditions do not
exist. Those who most stress social grievances are not moderates but doc-
trinaire leftists. They are not so much concerned with alleviating social
distress as with bringing about social upheaval. Indeed, many object to
the Alliance for Progress not because they resent its failure but because

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they fear its success. To them, improving social conditions is to give a new lease on life to an economic system they are eager to overthrow. To many of the so-called reformers the goal is not social amelioration but political upheaval.

The Brazilian Left as I have seen it is not to be compared to United States liberals. They are doctrinaire Marxists who judge progress not in economic terms but by such slogans as "ownership of means of production," "total planning", etc. The Brazilian Right, on the other hand, is insistent on maintaining a privileged position which it does not even attempt to justify by laissez faire doctrine or any other notion of the national welfare.

The absence of political legitimacy turns all political contests into a naked struggle for power. Part of this may be a heritage of the Vargas dictatorship. In all dictatorships policy gets to be an exercise in currying favor or in manipulating governmental power. Most Brazilian politicians were formed under Vargas. To them every principle is a tool to be used, every belief is a factor to be manipulated, every political force is there to be exploited. Vargas' heirs forget that the Left at the time of Vargas had no choice but to let itself be used because this represented the condition of its survival. Circumstances have fundamentally changed since. The Left now represents a major force of its own, and anyone using it may wind up to be its prisoner.

In this context, economic aid often becomes a tool for whoever has power whether of the Right or the Left. Criticism of our support for right-wing forces is sincere enough. Meeting it does not necessarily gain us friends, however. For the present alternative is likely to be a left-wing dictatorship. The dilemma is not that we have encouraged right-wing forces

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at the expense of the democratic elements. The real difficulty is that
democratic elements have yet to be created.

The Center groups do not exist in any adequate numbers, if at all.
They will not come about automatically as the result of economic develop-
ment. Economic development requires some degree of authority. In the ab-
sence of a democratic consensus, the groups most likely to supply it,
however, are extreme Leftists, who have a doctrine and a legitimacy, or
the Army which has the physical power. The question then becomes not so
much whether we can support democratic forces today; effective ones are
not at hand. It is whether we can develop leadership groups that believe
both in progress and in moderation; both in reform and democratic prin-
ciples. A subsidiary question is how we can prevent even democratic pol-
iticians from seeking the short-cut of extreme nationalism. For most of
these problems we do not have even a conceptual answer, much less a prac-
tical one.

In present conditions, much of the Alliance for Progress challenges
constituted authority without providing an alternative. We may demoralize
the ruling groups (which are not very attractive) without helping to bring
about an alternative. Our country started with an elite and our democrat-
ization was a story of expanding the base of this elite. Is this possible
in Brazil? I do not know. There is a danger that the existing elite will
be destroyed or demoralized while the only alternatives are naked power or
some form of left-wing extremism.

We are not without assets. The United States is rather well liked in
Brazil and Kennedy is extremely popular. The problem is to develop a cadre
of people sincerely dedicated to democracy; to use the goodwill to separate

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copy' # 10

friends from enemies and to have the will to back our friends on the rocky
road towards stability. This is unhappily a series of platitudes, for
in all honesty, I have no clear idea on how to accomplish this goal.