Merwin L. Bohan Oral History Interview

Notice
This is a transcript of a tape-recorded interview conducted for the Harry S. Truman Library. A draft of this transcript was edited by the interviewee but only minor emendations were made; therefore, the reader should remember that this is essentially a transcript of the spoken, rather than the written word.

Numbers appearing in square brackets (ex. [45]) within the transcript indicate the pagination in the original, hardcopy version of the oral history interview.

RESTRICTIONS
This oral history transcript may be read, quoted from, cited, and reproduced for purposes of research. It may not be published in full except by permission of the Harry S. Truman Library.

Opened February, 1977
Harry S. Truman Library
Independence, Missouri

[1]

MCKINZIE: Mr. Bohan, very many people who study history and government are interested in how people came to choose in the first place Government service. I'd be very interested to know how you made that career choice?

BOHAN: Well, I grew up between Mexico City and Dallas, Texas. My father was in the oil business in Mexico, and he was transferred to Dallas back in 1913. That was shortly after the famous Decena Trajica in Mexico, when [Victoriano] Huerta murdered [Francisco] Madero after his revolution. He died a year later after we

[2]

reached Dallas, and my mother wanted me to go on to college, but we were really quite hard up, and, feeling that I was unable to do so, I went to work at that time. A little later we went back to Mexico. Then, in 1921, I married a Dallas girl, a girl I'd fallen in love with at the Dallas High School. We came back to Dallas and I went to work for the Chamber of Commerce in the publicity department. Naturally, because of my background I was made Foreign Trade Secretary as well. Some years later there was an opening for a commercial attachés in South America, and the manager of the Department of Commerce office down in Houston called me up and said, "Do you know anyone who would like a job as commercial attaché?"

I said, "Yes. I know two people. One is Bob Smith," (whose picture is right behind you) "and the other is myself."

[3]

So, he sent both our names in, but Bob decided shortly thereafter that he was not interested because the first airmail line came into Dallas and he went to work for it. He later became the executive head of the Braniff airlines. During World War II he was in charge of air transport all over North Africa, and to make a long story short, he was retired as a major general.

I, however, stuck to my guns and said that I wanted to go to work for the Department of Commerce. This was back in 1927. On looking over my record they decided that in view of the fact that I had not gone to college I wasn't prepared intellectually for such an assignment and turned down the request. But the manager down in Houston decided that the Department of Commerce was wrong and insisted on my going up to Washington with him, and he arranged interviews with various and sundry officials there. So they gave me the examinations.

[4]

I was fired up with much enthusiasm, because at that time Herbert Hoover was Secretary of Commerce, and certainly I don't think anyone will dispute the fact that he was the greatest we've ever had. We haven't had very many great ones, but in this case I think it was certainly true.

So in 1927 I went out as assistant commercial attaché for the Embassy in Havana. Subsequently I was sent as commercial attaché to Guatemala, San Salvador, and Honduras; still later to Peru and Ecuador; still later to Chile; later to Colombia; and then I was sent as head of a mission to Bolivia. After that and a short stay in Washington, I was made Counselor of Embassy for Economic Affairs in Buenos Aires, and have seen long service in Brazil. I had several special missions in Brazil and also in Mexico. So there are very few countries in Latin America that I haven't covered.

[5]

MCKINZIE: I wonder if you could talk a little bit about your work in economics in Buenos Aires in 1942? I noticed that you were there at a very sensitive time, and I think when one talks about postwar relationships with Latin America you can't just pick it up when the war ended. There's too much that's rooted in the early and middle war period. It was kind of a sensitive place to be in 1942, wasn't it?

BOHAN: It most certainly was. It so happened that we had one of the greatest ambassadors we've ever sent to Latin America, Norman Armour, who was serving at the post at that time. I served Mr. Armour in Chile when he was assigned there as Ambassador; and the first job he gave me was to analyze the policies we were following in the economic field towards Argentina. Those policies at the time, when we had finished the analysis,

[6]

we described as being a series of pinpricks; that all we did was irritate them, but on the other hand we were desperately in need of many of their exports, particularly meat, but also grains and a number of other products, including quite a number of rare minerals. The result was that on one day in Washington we would insult them and call them names, and the next day we would receive instructions at the Embassy to go over and get down on our knees, so to speak, and beg them for increased production of this, that, and the other thing. It was an impossible situation. After we had analyzed the problem we decided on a program, which, incidentally, I have quite a file on because I've had to write it up in recent years. The policy was a simple one. The policy was simply this, that we were willing to give Argentina anything that was not in short supply in the United States, and that we would not ask them for any

[7]

favors except where anything that we wanted was not in short supply in Argentina. But if they wished to be considered for supplies that were in short supply or that were under quota in the United States, that they could have the same treatment as the other countries of Latin America, providing they gave the same amount of cooperation to the Allied cause that the other countries were giving. At that time you remember Argentina was the only country, because Chile had already joined, that was not cooperating in the Allied war effort.

At the beginning this program appeared to have great possibilities, because all of the industrial community was up in arms. The Argentines for all their pride would hardly claim that we were bringing undue pressure on them, because we were free to admit they could have anything that was not in short supply, and they could have short supply

[8]

items if they did the same things that other countries did to get them. To make a long story short, Mr. [Henry A.] Wallace and the FEA took umbrage with the fact that the decision had been made by the State Department, and that he hadn't been consulted, and FEA hadn't been consulted in connection with the policy. That was the first time, incidentally, of what later became a fad in Washington, for every agency to have a hand in cooking the stew, so to speak, of foreign policy. Up until that time the Department of State had pretty nearly been independent when it came to deciding on what our policy was, particularly Mr. [Summer] Welles, who incidentally was the last official for the Department of State that you could honestly say could make policy for the United States and have it stick. Anyway, FEA didn't cooperate and for several months we had a great deal of trouble with them. We finally did

[9]

win their cooperation, but just about that time the "Colonels revolt" came along, and Mr. Welles, if you will recall, was forced out because of the difficulties he was having with Mr. [Cordell] Hull.

Mr. Hull was a gentleman whom I sincerely revere, but I can't say that I admire his policy towards Argentina. It was a regular old Tennessee feud, and every time he could sneak around the tree and see an Argentine in the sights of his musket he'd let go at him. It really became a personal vendetta, nothing more and nothing less. You know, Mr. [Sir Winston] Churchill complained quite a number of times to President [Franklin D.] Roosevelt. And this is merely a personal opinion, I can't say it's historical, yet it's based on a pretty close study of the memoirs of Mr. Hull, and also on a number of the writings of Mr. Welles. I really and truly feel that Mr. Roosevelt, more or less gave Argentina to Mr. Hull to play with,

[10]

to keep him out of his hair. Now, that's a rather sad judgment, but I think it has a certain amount of historical truth in it. To make a long story short, in 1944 we withdrew Mr. Armour. Shortly thereafter, I wrote the Department and told them I thought that insofar as my usefulness in Argentina was concerned, that it was at an end, and I asked them if there was any other place where my services could be used to better advantage.

MCKINZIE: What were you able to do by 1944 in your own work?

BOHAN: Between the time that Mr. [Dean] Acheson, who at that time was the Assistant Secretary for Economic Affairs, and Mr. Welles had approved the embassy policy, until about six or eight months after the Colonel's revolt we were hopeful that we were going to succeed, that we were going to bring Argentina into line. That was made completely impossible by the vendettas that developed on the

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part of the Secretary of State. Hence, from about the beginning of, say, the middle of '44 on, it was just a hopeless situation. We were just mad at each other, and that was about all that could be said. So the Department transferred me to Washington.

Now, I have done a certain amount of writing on that period, and that is one of the files, if you think the Truman Library would be interested in it, that I will send for them to look over.

MCKINZIE: By all means.

BOHAN: You can go today to the National Archives and the files show no evidence of this policy ever having been discussed or having been decided upon; and yet for a period of about six or eight months it was the official policy of the United States Government. It was explained in the utmost detail to the Argentines and to anyone who cared

[12]

to listen. Yet, if you look at the official record, while you see reference to the fact that we were doing such and such, there is no clear-cut evidence that we had a policy at least for eight months.

MCKINZIE: You then came back to Washington in 1944 and 1945. Planning began in early 1945 for the Inter-American Conference on War and Peace at Chapultepec. Did you have anything to do with preparations for that? There was, of course, a lot of talk about how Argentina was going to be treated there.

BOHAN: Bill [William] Sanders, who later became the Deputy Director of the Pan American Union, and I went down. He was on the political side and I was on the economic side, and we worked with [George S.] Messersmith. We talked to the Mexican Foreign Minister, Luis Padilla Nervo, whom you will

[13]

recall, played such a large part in the Chapultepec Conference. He was one of the truly great statesmen developed in this century by Mexico. We had long conferences with him, I suppose a dozen or more. We explored all of the possibilities both in the political and the economic field, all of which was reported back to Washington by me. Whether it had any real impact in Washington, I don't know, because when our delegation came down one of the surprising things to me was that Mr. Rockefeller, who was there, seemed to play no particular part in the economic side. The economic side was dominated by the E area of State, which at that time was still a comparatively new part of the Department, and they were thinking in terms of a "one world" affair. If you will examine the documents in the National Archives you will see that I played quite a role. I can promise you that I had absolutely no influence whatsoever, in the course of events in Mexico City. I attended

[14]

the staff meetings, I spoke my piece, but the E area by that time was thinking in terms of what we were going to do in the United Nations. We were going to have this one beautiful world. They had great doubts that regionalism had any importance whatsoever. That was the beginning of the end of the "Good Neighbor Policy" in Latin America.

MCKINZIE: I take it in these staff meetings that you attended before the conference convened that you became sympathetic to the Mexican idea of regional cooperation?

BOHAN: Very definitely.

MCKINZIE: There was a great deal of talk, if I understand correctly, among Latin Americans about regional cooperation in lots of ways other than what the State Department evidently had in mind. When [Edward R., Jr.] Stettinius came

[15]

down he was interested in scheduling some future conference on collective security for the hemisphere; but, as I read the records, he wasn't very anxious to have much collective economic activity or even very anxious to have too much talk about the economic program in the postwar period. Have I read that correctly?

BOHAN: Well, certainly my impression checks very closely with your own. I would only add, that of all the Secretaries of State that I have known, Mr. Stettinius came as near zero as I think you can come to that symbol, frankly. I thought that I was attending a meeting of -- without casting aspersions on the Rotarians -- a Rotary meeting or something; "up and at 'em boys," that kind of approach. Incidentally, I can point to a much more illustrious observer than I am, Mr. Acheson in his memoirs. If you want to know what I think of Mr. Stettinius read Mr. Acheson.

[16]

MCKINZIE: What then, so far as you were concerned, was the aftermath of the Chapultepec Conference?

BOHAN: The aftermath was that from the Chapultepec Conference until the time that Edward Miller was made Assistant Secretary of State, we just marked time in Latin America. And actually, when you mark time you go backwards, because other programs of cooperation were going forward. But let me emphasize that it wasn't a deliberate policy against Latin America, it was just the real beginning of a loss of interest in Latin America. Really and truly, you might use that as the historical point at which the policy of the "good neighbor" and all that went with it, came to an end.

MCKINZIE: During the last years of the war there was a good deal of activity in various parts of the Department of State, particularly the group working under Leo Pasvolsky, involving postwar planning. They were guided pretty much, it seems

[17]

to me, by what you just said, this one world idea -- the integration of economies to a considerably higher degree than had existed before. But the question, I guess, that is fuzzy in a lot of people's minds is what did Latin Americans expect? I once talked to Jose Figueres of Costa Rica, and I asked him if he believed at the end of the war that the United States owed postwar reconstruction assistance to Costa Rica?

He said, "Yes, Costa Rica had by virtue of selling entire coffee crops to the United States at OPA prices contributed the cost of at least three coffee crops" -- the difference between U.S. OPA prices and world market prices would be three coffee crops. Therefore, he thought they were entitled to some postwar considerations. Now, of course, Mr. Figueres wasn't the President of Costa Rica at that time, either. But I was wondering what your own impressions were, having dealt with Latin Americans and knowing very closely what

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they thought in the economic field. What did they expect at the end of the war?

BOHAN: Well, I've often wondered, because the Latin Americans are a lot more realistic than we give them credit for, and they are a lot more realistic than they let us see when they talked to us, especially at international conferences. I must say that I have only a minimal degree of sympathy for that approach. Incidentally, almost every country in Latin America has used it at one time or another. Look, the truth is this; we saved them from a world that I don't think they would have liked. The Second World War was, in a sense, just as much their world war as it was ours. We all made sacrifices. During the war, certainly, we supplied them at a considerable sacrifice to ourselves -- remember that we kept their economies going during the war. It is true that we also

[19]

had ceiling prices, but we had ceiling prices on exports as well as on imports, you see. Now, it is true that after the war our prices of industrial products began going up terrifically. At that time the Export-Import Bank was quite active in Latin America, and if it hadn't been for the huge degree of cooperation under the Marshall plan, what we actually made available to them would have been really quite noteworthy. It is only small in comparison with the Marshall plan. Yet let me ask you, where would Latin America be today, in all this period since World War II, if we hadn't reconstructed Europe, and reconstructed the buying power of Europe, and reconstructed Europe as a market for Latin American products? So, all of that leaves me, frankly very cold. I have never been one of these people who merrily criticizes my own Government. I think that my Government was exceedingly unwise in not realizing what we had gained during the war through the "Good Neighbor Policy,"

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and incidentally, we paid dearly for it, Many times we paid very dearly for that policy. We just threw it away, It meant something to us, and all we had to do in order to maintain it was to use a little sympathy to not make the Figueres', and all the rest of them think they were second-class citizens the minute the war was won. The minute the war was won we lost interest in Latin America. It was the loss of interest; we should have continued to consult them. Remember during the war even Mr. Roosevelt, busy as he was, was always consulting Latin America. The diplomats in Washington felt very big, because the Department of State was always consulting them. All of a sudden they were of no importance; so, basically that is the problem.

MCKINZIE: How does the U.S. policy toward Argentina at Chapultepec and then later at the San Francisco Conference, fit in? Was the United States position

[21]

that one could deal with Latin America as a bloc, and therefore, Argentina should be included? Was the U.S. view about Argentina in the United Nations a part of this giving up on Latin America, or not?

BOHAN: No. I wouldn't say so. I don't know whether it was Mr. Rockefeller who was able to influence our policies so decidedly at that time. I would guess that it was, frankly, but I can't answer it because I don't know. I would say that I think our blowing hot and cold certainly didn't do our prestige any particular good in Latin America, or elsewhere for that matter. One minute we were sending people down to Argentina to give Peron an abrazo, and the next minute we were sending somebody else to give him a kick.

MCKINZIE: How did you happen to be assigned to Mexico City in 1945?

[22]

BOHAN: I had been asking for Mexico City since the time I entered the service in 1927. In 1932 when Mr. Roosevelt turned over the Department of Commerce to his hatchet men, they cut the foreign commerce service from (these figures may not be entirely correct) about 150 to about 40 or 50 overnight, gave the officers thirty days to give up their houses and everything else, and come back to the United States or pay their own expenses. They didn't discover until later that most of them were Democrats and got better jobs when they got back here. But the fact remains, that even then when they transferred me I expected to be fired. They transferred me from Peru to Chile, and I said, "I don't want Chile, I want Mexico." Fortunately I still had a friend in the Bureau who told me to keep my mouth shut.

The reason I was sent to Mexico was because Monnett Davis, who was the Director of the Foreign

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Service, had brought me up from Argentina, to activate, if I may use a bureaucratic word, two new divisions of the Department, the Division of Foreign Reporting Services and the Division of Foreign Service Planning. The Division of Foreign Service Planning made an analysis of all the work load of the Foreign Service and came to the conclusion that we needed a lot less people than we had at that time, and that increasing the size of the Foreign Service, as was then proposed and was later carried out, would be against the best interests of the United States. In the meantime, Mr. Davis had gone as Ambassador to somewhere in Europe; and the Foreign Service clique in Washington -- I say clique, because in spite of the fact that I was in the Service for so many years, I came from Commerce, which is a taint on your ancestry to an extent -- they were thinking completely in terms of what the Government could do for the Foreign Service. The 1946

[24]

legislation increased salaries and increased tenure, and all the rest of it and, incidentally, brought a lot of good things to me personally. But the Foreign Service Division hadn't been thinking of that, it had been thinking in terms of what the Service had to do for the U.S. Government. And we came up with some very bad recommendations: to cut the number of people abroad, and quite a number of other recommendations that the people in charge of the Foreign Service didn't like even a little bit. They knew I wanted to go to Mexico, so the first thing you know I was no longer the Chief of the Division of Foreign Service Planning. I was counselor at the Embassy for Economic Affairs in Mexico City, much to my joy I might say. I hold no feeling against the Department for that, except this; and this is a harsh criticism. It's a funny thing, I have a deep affection for the Department of State and I have a deep loyalty to it, but on the other hand during the last twenty

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years, I think it is not only the most inefficient organization I've known, but I also think that the Foreign Service has thought first and foremost of what the United States Government can do for it, not what it can do for the U.S. Government. Now, I know that every Foreign Service Officer would rise up in holy horror, but that is an opinion that you do not have to delete from any version of our conversation, private or public. I really believe it.

MCKINZIE: You felt even by 1945 that it had been reached this path toward indecision?

BOHAN: Yes. It had started on that path.

MCKINZIE: Of course, it had grown like Topsy during the war with all kinds of people coming into the Department.

BOHAN: Correct. You can put me down as one of these

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persons that have a lot of very extreme ideas, If you do, I can't help it.

Look, we discovered management planning back about that time. We didn't have management planning in the Department of State prior to the middle of World War II. It was run by the Foreign Service. The Foreign Service was small; it was a clique; it had some terribly brilliant officers, and frankly it had a lot of people that weren't first-rate in spite of all the trouble they went to in terms of examination and selection. I shouldn't say weren't first class; they were gentlemen, they were nice people. But I have never been super-inspired by the degree of expertise of the average Foreign Service officer, in spite of the fact that I have a tremendous admiration for a great many of the Chiefs of Mission, and other colleagues that I've served under and with; but it's a small percentage. I worked up a percentage based on some

[27]

129 people that I knew, and afterwards, if you'd like, I'll show it to you.

MCKINZIE: Yes. I'd like to see it,

We were talking about what happened and it's important, I think, to talk about the Department of State in those postwar years. Would it be fair to say that there was a point at which things reached a low point, a nadir, and then began to level off? There were a number of reorganizations in the State Department beginning in 1946, and it was done just about every year in one way or another for the next several years. There was one in 1947, and another one in '49 or '50. Is that just changing hats or did any of those make any difference, as far as you could tell?

BOHAN: I retired in '55 under a cloud; nobody even said goodbye to me. I was against our policy in Latin America and had said so. Incidentally, I was not guilty as many people thought I was in

[28]

inspiring news stories to that effect. On the other hand, I must admit that when I was asked I didn't keep my opinions to myself; but I didn't just go out and say, "Listen, buddy, I want you to say this." If I was asked, I said what I thought. And for several years I didn't have much of a relationship with the Department, but then the relationship became more intimate again, and I was made a member of a service -- remember when we had only atomic bombs and had a secret government that could take over if Washington were destroyed: We had caves and things around to hide in, and whatnot. Well, I was a member of the State Department part of that government. Then in '60 I was sent down as the head of a mission to northeast Brazil for the Department of State and AID [Agency for International Development], representing both of them, And periodically after that I was called back on short term assignments

[29]

as late as '68. I remember that Mr. (Lyndon Baines] Johnson was President. So, it must have been '67. I headed up a small group in the Department of State that prepared the National Policy Paper on Brazil.

In the Department of State at Washington, as well as in the Foreign Service, there are literally hundreds of able, competent people, but the organization itself, for both the Foreign Service and the Department of State, is so messed up that they can't operate efficiently. Now, whether that is management planning, whether it's the cancerous growth of bureaucracy or what, I don't know; but there are no such things as clear-cut lines of responsibility and clear-cut lines of authority. And no one can make up his mind without getting other people to initial his mind, with a result that I don't care what you are doing the level of the output is brought

[30]

down by the need for getting many people to approve it. Now, it's as simple as that, and as tragic as that, but everybody, everybody, everybody in Washington seems to have a certain implied authority to discuss and decide on foreign policy. A thousand people can't make policy. And one final note, in connection with this last job I had: it was necessary to have committee meetings, and I found that the people that came to those committee meetings were not discussing the subject according to what they thought. They were merely maintaining the position of their agency, which in turn had been arrived at by a multiplicity of people and divisions and so on. It's too much. It's worse than a consensus. I think you can reach a consensus without compromising principle, but I don't believe you can reach an action policy without compromising a policy.

Forgive me for getting a little heated on

[31]

the subject, but it's the most terrible frustration that you can imagine. Every day is frustration,

MCKINZIE: So, when you recommended that the Foreign Service not be increased in size, you got the train to Mexico City.

BOHAN: Yes, yes.

MCKINZIE: Could you talk about your work there? That was a pretty exciting time in a way, because in that period there was the problem of re-conversion in the U.S. Mexico had a lot of money that they hadn't used from U.S. purchases during the war, which had to be spent, presumably at a reasonable rate. And then, of course, while that was all occurring, Europe was getting in trouble, and the United States mounted a very large program for Europe, which you've already alluded to briefly, that caused some problems with Latin America. I wonder if you could talk about your work there?

[32]

BOHAN: I was sent to Mexico in, I guess, early '45. The first year and a few more months it was unalloyed pleasure. Messersmith was Ambassador. Messersmith was an old career officer of tremendous prestige. When he wrote a dispatch there was no such thing as one page or one hundred pages; it just went on, and on, and on. You couldn't go to Mr. Messersmith and discuss a subject with him, because he'd tell you rather than telling him. But a very wise younger officer in Washington had tipped me off, and he said, "Look, Merwin, you have got to get your staff so on its toes that you are telling Mr. Messersmith in memos of everything that is coming up, and get your ideas over to him, and you will find that if your ideas are sound he'll go along and back you up." So, when I went down I found a staff of about eighty people in the economic unit; it was just after the war, and I had some wonderful people on the staff. We held several

[33]

"war" meetings and we decided that we were going to follow that policy. Never once did I have any lack of understanding what Messersmith wanted, what we were prepared to do, and what we should do. Mr. Messersmith never went to the Foreign Office, never went anyplace, that the minute he got back to his office (because we were several blocks away from him in another building), that he didn't call up on our private telephone and tell me what he had said and what had been agreed upon. In other words, he kept me fully informed. Now, he left after about a year, and, as I say, up to that point we had lots of fun. I remember particularly the wheat quota, and this will explain to you why Acheson takes the attitude he does toward Messersmith. I was in Mr. Messersmith's office one day when Acheson called him up and said the Department had decided that the wheat quota for Mexico was going to be cut and the Department of Agriculture

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agreed and so on. And Messersmith said, "No. We wont cut it. We can't cut it."

And Acheson said something to him and George said, "Now, listen, Dean, you know a lot of things about a lot of things, but you don't know a damn thing about wheat." Now that is a perfect example of the way Messersmith talked to Washington, see. Well, I don't think Mr. Acheson liked it, and I think that's the long and short of it.

MCKINZIE: Which may be why Mr. Acheson took this view towards both Messersmith and [Spruille] Braden that he took in that book of his.

BOHAN: Very likely. Oh, I'll tell you a story later about Braden, because it really shows the "iron fist" that was ruling in Colombia when he was our Ambassador down there. Then Walter Thurston took over as Ambassador.

Walter Thurston died back in March. He'd

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never been married. His mother lived with him. And he was a man that I never quite understood even though we were in grammar school together in Mexico; I didn't know him at that time as he was a grade or two ahead of me. We never clicked, just why, I don't know; on the other hand, we never had any open disagreements. But I'll say one thing for Mr. Thurston, he largely prepared the itinerary for President Truman's visit to Mexico, and he was the one who suggested that Mr. Truman lay the wreath on the statue of the Chapultepec boys who had been killed in the Mexican War. That was the highest point in Mexican-American relations in all our history. Naturally an emotional point like that couldn't be maintained, but at that particular instant in time Mexico and the United States were closer together than they had ever been before or since.

Mr. Truman came down and he took Mexico by storm with his simple manner. The Mexicans had

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never seen a President surrounded by bodyguards before, and they all began calling him "Jarrito" -- Harry, but jarrito also means a jar, you know, in Spanish - "Jarrito" and the "jimenez" -- the G-men. Honestly there was more write-ups about the jimenez and Jarrito than you could shake a stick at. But he did an immensely valuable job, and I can't understand why in his Memoirs there is not a sentence about his visit to Mexico. It was really and truly one of the most successful visits a President has ever made to a foreign country. It was made just shortly after [Miguel] Aleman had become President, and really our relationship with Mexico improved steadily throughout that administration, and hasn't suffered too severely since. We've had our little ups and downs, but by and large things have gone along very well since then and I ascribe a good part of it to Mr. Truman's visit. It started things in the right direction.

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But to get back to Mexico very briefly. After Mr. Truman's visit I became more and more frustrated. I was being called upon to ask Mexico for almost everything we wanted in the economic field. I had no responsibility for petroleum. That was handled by the Ambassador, as it naturally would be, but in every other field it was up to me to get what we wanted. Invariably, I couldn't get anything out of Washington because the Secretary of Agriculture, the president of the Export-Import Bank, the Assistant Secretary for Latin American Affairs, etc., etc., etc., was always the person that would give Mexico something. Now, I'm not saying that that isn't perfectly natural in a democracy. I'm not saying that you could totally get rid of that, because you are dealing with human nature. But let me give you a very concrete example: Ramón Beteta was Minister of the Treasury. Ramón was a graduate of the University

[38]

of Texas. He talked Texas English as well as any Texan. I don't think he liked us, even though he was married at that time to an American; later he divorced her. I'm not going to discuss his morality, etc., because I don't think that's quite proper. But a decree came out changing the regulations pertaining to the introduction of automobiles by people driving into Mexico. And, as I read it over, it suddenly struck me that, while tourists would have no trouble, it would be impossible for any businessman coming down to come in his car; and I was sure it was just an error. So the next week -- I'd see Beteta once a week. The degree of items that we had at all times under consideration required me to go down there at least once a week to see him. I went down, and I said, "Mr. Minister, I'm sure it's just a mistake in drafting, but the way this new decree is drafted businessmen just can't bring their cars into Mexico."

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He said, "I'll look into it."

The next time I saw him I said, "Have you looked into that?"

He said, "Yes. You're right it was just a mistake."

"Well," I said, "that's a big relief, because we have a lot of them on our necks, and I'm sure you'll fix it up real quick for me."

He says, "No, I'm not going to fix it up."

And I said, "Mr. Minister, but why?"

He said, "Look, I asked you for a dozen things, and you didn't get replies on any of these things for me out of Washington. I'm not going to do it for you."

I said, ,'But Mr. Minister, you were only up there a month ago and you got a hundred million dollars out of the U.S. Government."

He said, "Sure, we got it. You didn't help us. You didn't get it for us." He said, "There

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were a dozen things in there" -- there were a dozen things, little things. (And I'll tell you what one of them was in a moment.) He said, "You got no action whatsoever."

One of the things that he was sore about was this: At that time when a shipper in Mexico shipped silver to the United States, whether it was in minerals or whether it was bars, or however, he had to get a consular invoice. It cost him $2.50, and he had to present that invoice at the border. If he didn't have it he'd have to put up a bond, which I think was $10 or so, that he would supply it later. Mexico had been moving heaven and earth to try and prevent silver being exported from Mexico without paying the export duties. It was a big drain on the country. The Minister called me and he said, "Listen, all I want you people to do is require the consular invoice and not permit it to go through without the consular invoice, because

[41]

I'm sure that the consulate is not going to give a consular invoice to a bunch of crooks. It will be legitimate business and we can control shipments if they can't go into the United States unless they have a consulate invoice." Well, I thought that was as simple as ABC. Do you think I could get them to do it? -- my correspondence back and forth, all the regulations as to consular regulations, drafts and the other thing.

I said, "My heavens, we're asking them to cooperate on stolen cars that are shipped into Mexico. We've got two people down there that do nothing else but look into these cars shipped out of the United States. But week, after week, after week, after week passed -- I never was able to fix that up.

Now, that is the degree to which, you see, it was impossible to represent the United States in Mexico in the type of job that I had.

[42]

MCKINZIE: You had nothing to give.

BOHAN: I couldn't operate. I had nothing to give. Now please don't misunderstand me, I never have believed in, "If you do this for me I'll do that for you," but I've always believed in "You scratch my back and I'll scratch yours." I don't mind if they are going to give a hundred millions dollars for the President of the United States to give the hundred million dollars or the president of the Export-Import Bank; but when it comes to the daily operations you have to give your operators abroad enough so the people they are dealing with know that they are affected too.

Now, when Messersmith was Ambassador, we could get action. We could get action, and how, because he would call up Dean Acheson and say you don't know what you are talking about. But I couldn't call Dean Acheson and say that. So, they passed a new law in '46 that at age 50 if you had

[43]

more than 20 years of service you could retire. So, I asked the Department, "Please retire me on my 50th birthday," which was January the 21st, 1949. We weren't able to arrange it until February something; but anyway I stood as close on principle as I could. I couldn't take it.

MCKINZIE: Well, what in the world induced you to go back in?

BOHAN: Well, Eddie Miller.

MCKINZIE: Did he have a very different outlook on American Republic affairs than Spruille Braden?

BOHAN: Very definitely different.

MCKINZIE: You said you had a little story about Spruille Braden, maybe it's a good time to put it in?

BOHAN: Mind you, I would rather not comment on Mr. Braden's Argentine policy. I really loved Mr. Braden, rather I loved his wife, Maria. Mrs.

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Braden was a Chilean. Mr. Braden was one of the hardest working people I've ever known. He could work around the clock.

When I went as commercial attaché to Bogota it was just at the beginning of our preparations for war. This was in '40, before Pearl Harbor. But we were already starting to get the proclaim list ready, and to get the question of essential supplies and all the rest of it started. The Department of State was completely, completely unprepared for all this. For months I was alone but I had five secretaries, five lovely American girls, and I was working fourteen to sixteen hours a day. Mr. Braden was a stickler for his staff never leaving a social event until he left. It was one of his idiosyncrasies. So, I went to Mrs. Braden, and I said, "Mrs. Braden, I just can't."

She said, "Merwin, you don't have to. When you want to go home you just come and say goodnight to me and you just go on home." A few days later

[45]

I did that, and the next morning Mr. Braden looked up and he said, "I see you left early last night."

I said, "Yes, sir, with Mrs. Braden's permission." That was the last time that subject ever came up between us, and I left by 10 or 10:30, right after dinner. Well, anyway, let's get back to Mr. Braden.

It was Mr. Braden who forced -- and I mean this literally -- the Department of State to force Juan Trippe of Pan American Airways to admit that they controlled SCADTA, the German airline operating in Colombia. A German airline that could easily have bombed the Panama Canal. Their pilots were all reserve officers in the Reichswehr. And Pan American denied, and denied, and denied that they controlled it. Mr. Braden found out that they did and he forced the Department of State to take action. He forced the Department of State to take action. That's number one.

MCKINZIE: How did he do that? Just by getting up and

[46]

telling them that they were going to have to?

BOHAN: Well,, either that they had to do it or he was going to get out and tell the American people what was happening. Spruille Braden, for all we know, prevented a Pearl Harbor in Panama. As an individual, he did that. Now, you can't tell me that he didn't deserve more from the U.S. Government and from Dean Acheson, than Dean Acheson gave him. I don't care what Dean thought about his method of handling things in Argentina, although it was Dean Acheson who admits in his own memoirs that he went along with him. And if he went along with him and disagreed later it was because he didn't pay any attention to it, he didn't give a damn about Latin America.

I just got done talking about two people that I admire and respect, and there is no feeling in my heart except respect and affection for both of them.

But Spruille Braden had iron, and by George,

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there was a man that his subordinates sat up with into the wee hours of the morning and argued, and argued, and argued. Many times we have been able to change his original decision, but none of us felt that we changed it. He changed it because we had been cogent enough, and we had brought forward arguments enough to convince him that he was wrong. Now, that's the kind of a chief that you can bleed and die for. Now, we'll forget what his policy was in Argentina. It doesn't go along with what I would have followed had I been in his position; but, I just can't tell you what it means to have one man over you with whom you feel you can operate. You see I never got to the level where I could say the things to Dean Acheson that George Messersmith did; or that Spruille Braden did to Sumner Welles. I never got there, so I had to have somebody, you see, who...

MCKINZIE: Who would do it?

[48]

BOHAN: I had to be a second in command, not in command. Okay, Now, what was your specific question?

MCKINZIE: I asked you why you came back into the State Department, and you mentioned that Spruille Braden had retired and Miller had come in.

BOHAN: It happened this way; I was out at the American Institute of Foreign Trade as a professor, believe it or not, of Latin American economy. I thoroughly enjoyed it, but along towards the end of the first school year the World Bank called me up and asked if I'd like to go over to the Dominican Republic on a mission for them. I went to Washington to discuss it, and there was some delay or other on the part of the Dominicans; and while that delay was going on ARA -- American Republics [Area] in State -- asked me if I would go over to the GATT Conference at Torquay, England, and head up the discussion with seven or eight Latin American countries that were going to be

[49]

there, the bilateral arrangements. As I'd never been to England, I thought it was a wonderful idea. So I said, "Sure." So, we went over and it was very enjoyable work. While I was there, Al [Albert F.] Nufer, who was our representative on the Inter-American Economic and Social Council, was sent to Argentina as our Ambassador and Eddie Miller asked me if I'd take his place. That's how I came back in.

Eddie Miller would never leave me alone. I was doing a different job about every ten minutes.

MCKINZIE: Was it because by that time there wasn't a great deal that could be done through the Inter-American Economic and Social Council?

BOHAN: Unfortunately, the Inter-American Economic and Social Council just never seemed to get any place. The American representative was in a very delicate position in this sense: the

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Economic Commission for Latin America, with (Raul] Prebisch at the head of it was really going places, and the American representative on IAECOSOC couldn't throw his weight around, because then the Latinos right away would say, "Look how they are trying to dominate this council."

But I worked on both the ECLA and IAECOSOC. Then Truslow Adams, who had been appointed by Mr. Truman to head up the Joint Brazil-United States Economic Development Commission, died on the boat on his way down to Rio. Brazil was much upset about this, because there had been a long delay and our relations had been a little irritated by a number of things. The President, himself, President [Getúlio] Vargas, was really quite upset, and the Foreign Minister was, too. Eddie Miller called me in and said, "Merwin, you're going to have to go down and head up this commission."

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I said, "Well, Eddie, I don't know Brazil, I don't know Portuguese, and certainly it just isn't in my sphere of knowledge." I went and saw some people there in the Department and they were quite convinced I was right, and they tried to talk Eddie out of it.

But Eddie said, "No, he's going down." I finally got Eddie to agree that he would immediately try to get a permanent head, and I would only go down as a temporary head.

But he said, "Listen, you're going down and you're going to organize the Commission and you're going to lay out its program. Temporary or not that's the way it's going to be." So I went down and for four months that's what I did. And then they appointed [Joseph] Burke Knapp who later became the Executive Vice President of the World Bank. Burke came down and took over for me and stayed one year, just short of a year. Then Eddie

[52]

said to me that I had to take over. So I went down and completed the work of the Commission and drew up its report, etc., etc., etc., and it was another year. So that, all the life of the Commission I was either connected with it as head of it in Rio, or as the coordinator in Washington, along with my work on IAECOSOC. Then, of course, I also worked on problems with ECLA. As a matter of fact we made peace with ECLA. We were able to convince Eddie Miller that there was no use fighting it, that we ought to join it, so to speak. And as far as ARA was concerned, we did make peace. I don't think that E, Economic Division, ever made peace, but that's neither here nor there.

I think the Joint Commission was completely a project of the Truman administration. It was through during the early days of the Eisenhower administration, because of the dislike of the new

[53]

administration for anything that smacked of planning, particularly by Mr. (George] Humphrey the Secretary of the Treasury.

I remained with the Department only to finish the report of the Joint Commission. I had resigned because of the attitude of Washington towards the Commission, before it expired, but I had been asked to stay on, because we had really insulted Brazil by the way that we treated the American Ambassador to Brazil. You will recall Mr. [Herschel] Johnson was our Ambassador to Brazil, and several months after the new administration took office they asked Mr. Dulles if any more changes were going to be made, and he said, "Only two." He said, "We're going to change the Ambassador in Brazil and someplace else." The Brazilians were really insulted, They were very fond of Herschel Johnson, and to be informed through a news conference that he was going to be fired left a very, very bad taste in their mouth, particularly after the way the Joint

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Commission had been handled. And I might say, that the one and only reason that they didn't gratefully accept my resignation when it was given was because it coincided with the leaving of the American Ambassador, and to have two ambassadors leaving at the same time from the same country was just a little bit too much. I think that's the only reason in the world that the new administration kept me on.

MCKINZIE: What restrictions in your instructions did you have to work under when you were grinding out these reports and this study of the Brazilian economy with the Development Commission, which I think I've read is the most extensive study of the economy that's ever been undertaken?

BOHAN: That is a very interesting point. I got that out as I thought this might come up because it is the most important thing relating to the Truman

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administration that I was connected with. [Mr. Bohan referred here to a copy of the Commission’s report.]

Here's the whole story. This is to [Prof. John] J.W. Dulles at Austin and he had asked me for it. I went down to Brazil not to make studies, but to prepare loan applications for submission at the discretion of the Department of State to either the World Bank or Export-Import Bank. I was followed by Burke Knapp, who was responsible for the form and the detail of all the projects submitted to Washington, which are loan applications that are based on exactly what is needed at the time the application was made and are therefore perishable. They even detail in almost every case how many years the loan should be for and what the interest rate should be. And whatever Dr. Milton Eisenhower may have written in The Wine is Bitter -- I would call it "The Wine is Sour" -- is completely inaccurate. Either he was not properly informed or he misunderstood completely what the

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purposes of the Commission were and what it was doing in Brazil. There is the whole story. You might just make a note that was to J.W. Dulles.

MCKINZIE: There has been talk at various times among people who served in capacities like yours that they were under implicit or explicit instructions not to do certain things, among them not to encourage development of some things which would be in intense competition with manufactures or resources which the United States exports. I had heard about chicken farming in Guatemala, cotton growing in Honduras and maybe even steel-making in Brazil. Now I wonder if you would speak to the point of those kinds of charges?

BOHAN: Now, please remember that my direct and intimate association with our development programs abroad ended with my mission to northeast Brazil. Personally, I had never, never, and I want to repeat this, been told that we could not

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present any projects that we thought were sound and could be developed with a reasonable degree of financing by both foreign and domestic capital. I have never been told what to do. Now, there is a word of explanation needed there, because that doesn't answer your question. It may well be that when all of this huge bureaucracy was formed, with the opportunity for different interest groups in the United States to lobby, to set policy and so on, there may have developed instructions either verbal or otherwise to lay off certain things, etc.; but please remember that I lived in happier days. Actually -- and I don't think that this is an exaggeration -- it was so new a field that I made the policy. In the case of Bolivia, for example, I headed the mission there in 1941-42 that laid out the program that has been followed basically to this day. It hasn't gotten as far as I wish it had, but that is another matter.

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And the general principles that are laid down in that original report won the approval of the Export-Import Bank and, at least up until the Eisenhower administration, followed the same general directions. I don't say they came from me; they followed the same general directions. In Northeast Brazil, they did not follow the recommendations of the mission I headed, and if you want to see the results of that and the waste that has gone on in Northeast Brazil, there are several scholarly studies that will help you out there. But up until the end of this Commission I would say that I was working so closely with the Export-Import Bank, with the Assistant Secretary for Inter-American Affairs, that what we developed in the field had the full concurrence and approval of the State Department and of the Export-Import Bank. Now, once you got all of this E hierarchy, once you got all of the AID

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hierarchy then you have another story completely, and I can't tell you about that.

MCKINZIE: There are some interesting questions about the philosophy of development. Right after the war Latin Americans wanted an inter-American bank pretty bad. I wonder if you could talk about your experience in dealing with the Latin Americans and the inter-American bank. Now, of course, lots of people in the United States had a lot of different ideas about that.

BOHAN: Yes. To be truthful I wasn't too keen on an inter-American bank, because I felt that inevitably it would bring in too much political maneuvering insofar as the granting of loans was concerned, and it would be exceedingly difficult to impose the very harsh restrictions which should be imposed in order to prevent the countries themselves from over-borrowing. If you will recall, our Export-Import

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Bank did follow rather harsh policies, certainly up until 1945. They required that only the import part of a project would be financed by them, and they also required that the project itself have an effect on the balance of payments of the country concerned, so that it could repay the loan. Since that time I don't know whether it has followed quite that strong a policy or not. We do know that Felipe Herrera, who was president of the Inter-American Development Bank for most of his life, and who is an excellent banker, is also an excellent politician. I think that Felipe may have at times approved areas for loaning that has not increased the capacity of the countries concerned to repay loans in foreign currency. I think the World Bank since [Robert] McNamara came in, and perhaps a little bit before he came in, has also gone a little political. And the Alliance, and here I'm in disagreement with Tom [Thomas C.] Mann,

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if Tom Mann believes in bringing in the social element. Social projects should not be financed with foreign currency, because they become an unbearable load on the balance of payments. They only lead to inflation; inflation only leads to cutting the standard of living at a time when population is increasing -- the number of people that have to divide the income.

MCKINZIE: You wouldn't be in opposition to Tom Mann. He was opposed to having even an Economic and Social Council. He wanted an Economic Council and a Social Council. He said if you had the two separated you could deal with the hard nuts and bolts of the project without...

BOHAN: All of this.

MCKINZIE: ...befuzzing them with a lot of social issues.

BOHAN: Well, I'm glad to hear that, I'm glad to hear

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that, because for many years I felt that I was very much in tune with Tom; so I’m glad to hear that. In this whole question of helping in development, we can only help if people want to be helped and help themselves. We ought to be in a position to see that they get all of the foreign financing that is required for projects which directly or indirectly can be repaid without such an effect on their balance of payments that either (a) they can't pay it, or (b) it leads to inflation.

MCKINZIE: Now, there's another dimension to the development question and that is private investment by foreign capital. And, as you are acutely aware, when President Truman came up with this idea of a bold new program in 1949 -- a speechwriter gave him the idea -- and he came up with the Point IV program. It was to be technical assistance, but it was to be in conjunction with an expansion

[63]

in investment capital which was privately provided. Now, the problem of getting more private capital always seemed to involve the business of guarantees, and whenever that came up there was always a lot of talk about what could happen to your money when you invested it in Latin America. How did you answer those things when they wanted guarantees -- guarantees against expropriation, guarantees to a right to withdraw profit from the country, and all of those things that they wanted?

BOHAN: Again, let me say that I was fortunate to live in simpler days. We didn't have these huge conglomerates, we had individual companies. We had Anaconda; we had Ford Motors; we had ITT, which was a telephone company when I knew it. It was a manufacturing subsidiary that made telephones. Some of them were good, some of them were not. Personally I was exceedingly much in favor of foreigners coming in and putting in manufacturing

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plants in these countries, and of the countries doing everything reasonably possible to allow them to make a fair return on what they brought in. At the same time, I realize that it wasn't the whole answer, because private capital can only go into certain areas profitably, and there's always a need for public capital. For example, I used to argue with Americans in foreign power, and we are going way back into the early thirties now, that they ought to liquidate their holdings in Latin America, because they were basically unsound. You had capital in a stronger currency than you had income, that's the simplest way to describe it, and it's an impossible situation. In Chile where exchange has gone from 8.219 in 1929 to about 300,000, if you use the peso, today, you can't expect rates to keep up with that. So, basically, public utilities are unsound. I wanted to see foreign capital available either for state enterprises, if it had to be state

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enterprises, or for private native enterprises. Now, I thought there was a place for both, but always each side talked as though it had to be either one or the other. If you will read Mr. Eisenhower's memoirs, when he goes down and sits down very, very seriously and sincerely with this president and that president, and tells him about the glories of private enterprise and how they ought to accept private enterprise. Sometime when you have nothing else to do, look it up, because that's like waving a red flag in front of a bull with all of the nationalism and all of the extremism that has arisen on the part of the Latin Americans themselves. There is a center area where all of us could have gotten along a lot better if we on both sides had used a little bit more head and a little bit less emotion. There are areas that should be left to foreign enterprise, that are perfectly logical for foreign enterprise.

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There are areas where they should have policies that tend to encourage domestic enterprises. I think dams, I think public power, I think railways - all utilities should be local. How, if you can, have private enterprise, which I prefer to government enterprise, not for philosophic reasons, but simply that bureaucracies are even more inefficient than business organizations. They are both inefficient, as you well know, but bureaucracy is worse than business organizations. So, there is a middle ground; but have we ever looked for the middle ground? Every time we talked in Washington for years it was to say you must encourage private enterprise, and it just made the Latins sore as hell, and made them more and more against the idea that was really to an extremely great extent in their own interests.

MCKINZIE: Could you talk to me a little bit about your views of Point IV? How did it pertain to developments?

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I read an article recently that described Point IV as a kind of international kiss; it didn't do much good, it said.

BOHAN: Oh, that's ridiculous, that's ridiculous, Look, I hope 1 don't sound too didactic. I do have strong ideas on these subjects. I have them because I've lived them, you see. I didn't learn any of this out of a book, because I've had to learn it out of actual practice in the field. It's very simple -- when we started out we had two kinds of Point IV available in Latin America from the United States. It was available from other countries, too. We had engineers from companies that went down and built railways, and that took know-how with them; that trained people, while they were doing all of this and so on. We had the Department of Agriculture that sent its best, its best men down, because we wanted to know about crops and about crop diseases, etc., and we

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cooperated very, very closely with the ministries of agriculture of every country in Latin America, We did the same with every bureau of mines. There was a close, close coordination. Let me give you just one example of what I mean.

During the whole Argentine crisis, when our relations were at their very worst, our relations with the people in the mineral section of the Argentine Government, and in the Department of Agriculture were cordial, cooperative, and understanding. We had wonderful cooperation, a cooperation that had been built up over decades through our unofficial cooperative programs that had really developed quite of themselves. There was no policy or anything else. We were looking for something we wanted, and in doing so we were giving them something they wanted. There was mutual respect. Then we had to set up an organization. That organization immediately set up a wall between the technicians

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on both sides.

MCKINZIE: You are speaking now of the formal creation of the Technical Cooperation Administration in 1950.

BOHAN: Correct. What happened then: first you set up your bureaucratic front that cut off the Bureau of Mines Argentina from the Bureau of Mines here. It's true that the Technical Cooperation Administration would go to our Bureau of Mines and say, "I need an expert and so on, to go down here. But what would happen, the Bureau of Mines would do one of two things, if it happened to be a project in which they were interested they might send down a good man; but if they weren't interested and Harry Jones over here was in somebody's hair they probably said, "Well, take Harry Jones." I saw the quality overall, not individual, overall, begin dropping with the

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creation of the Technical Cooperation Administration. I saw it more and more as a beginning of cooperation between bureaucracies and not cooperation between experts. Take in the case of public health. We had more cooperation in the field of public health in all of Latin America through the informal and other programs, say by the Rockefeller Foundation, than we have ever had since. We practically controlled public sanitation and so on in a number of countries, through the quality of the people that were sent down to work with them.

MCKINZIE: You're talking now about the Institute of Inter-American Affairs, the original organization [Office of the Coordinator of Inter-American Affairs.] of which Rockefeller was coordinator during the war?

BOHAN: Well, even before, Now these two didn't hurt too much, because the Institute went the way of the Serviçio, where they sent a man down who had

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to be qualified, because he had another man from the other side, who was qualified. They had to be technical people, and they were technicians. There was only one real drawback to the Serviçio. That real drawback was this. They paid so much better salaries in the Serviçio than they did in the ministries that jealousy developed, very strong jealousy.

MCKINZIE: Now, do I understand correctly, that the Institute paid not only the salaries of the American technicians, but often some of the salaries of the Latin American nationals?

BOHAN: Added on to, yes. So really, today I would be the last one to say that we don't do an immense amount of good, but it's only a fraction of the whole that's good. Too much of our money goes into direction. A huge central staff -- they have to make a treaty with a foreign country, before you

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have a project. And what happens: each one of the divisions of the bureaucracy in Washington has to have programs, so that more, and more, and more, as the years have gone on, we have told people that they have to eat strawberries whether they like strawberries or not. They don't tell us, we tell them.

MCKINZIE: I see. You said that once you met Dr. Bennett when he was first forming the TCA and voiced pretty much these ideas to him?

BOHAN: Correct. I certainly did.

MCKINZIE: Well, he said at one point that he'd rather turn money back to the Government if he couldn't spend it properly.

BOHAN: Well, as I told you, he said something stronger to me. He said, "They won't do these things except over my dead body:" Those were the exact words that Dr. Bennett used to me in his office. And the

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tragic thing was, of course, about three weeks or two months (something like that? later they did go over his dead body, because of the plane crash out in the Near East. Oh, I had great hopes after I had met Dr. Bennett. I thought, "There's a man that really has his feet on the ground."

MCKINZIE: Well, his whole idea was to deal with what he called "the basic needs of mankind;" food, education, and health. Pretty much based on the philosophy, I guess, that you have to have those things, you had to build that "infrastructure" -- a word that comes up now in this day and age -- before you can begin to do more sophisticated kinds of development schemes. Did you share that view?

BOHAN: I fully shared it.

MCKINZIE: Not everybody did; that's why I asked.

BOHAN: No. Those ideas were my basic ideas, too.

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Look, I fully realized that as the stages of development take place you have to go beyond that, say in the case of Brazil, today, much beyond it; you're getting, in the case of Brazil, into higher technology, you see. Just as in Egypt we're going to help them with technology, and it is true that Saudi Arabia is looking for a technological Point IV of the highest order. But in the basic idea, the basic concept of Point IV at the beginning, we were on safe ground as long as we kept within those areas. The Inter-American Institute actually kept within that framework, up until the time that it became a part of TCA.

MCKINZIE: But now, I realize your concern is mostly economic, but even economic things have political overtones. Isn't it true that a lot of Latin Americans would say, "Well, yes, it's very nice to have this school, but what we really want is a steel mill. It is very nice to have this help

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in reforming our system of contouring around the hills here, but we really need railroads," That they wanted capital investments, that they wanted capital, more than these kind of technological improvements, so that there was political pressure for a different kind of aid. I'm wondering to what extent you felt that?

BOHAN: Oh, I felt that all the time. Let me give you a specific example. Let's go back to the case of Bolivia. Bolivia dreamed of a railroad from Cochabamba to Santa Cruz. If you will mentally think of the map, there is a railroad from Santa Cruz all the way over to the Pacific Ocean. There is today a railroad from Santa Cruz all the way down to Buenos Aires, and they wanted to complete the railroad from Santa Cruz to Cochabamba. We brought down four or five what we considered real experts when I was there in 141 and '42, and

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it was simply impossible under any economic basis to build their railroad. So, we said, "The railroad is a wonderful idea, but you are going to have to put up with a road first. Once you build up your traffic the day may come when you can have your railroad." Well, to this day they want the railroad. At first they were bitterly disappointed, some of them were very bitter; but we stood our ground and we said, "The day may come." They are delighted to have the road and they use the road all the time, but they still talk about the railroad. They really have no need of the railroad at all, except that when they look at the map and see that is the only spot between the Pacific and the Atlantic, they have to have it. Brazil had to have its steel mill, and the Export-Import Bank broke down and it was one of the best political strokes we ever made, when we gave them the loan for Volta Redonda. And incidentally,

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today, of course, it's a very, very sound investment.

MCKINZIE: But it was questionable at that time to a lot of people.

BOHAN: The one they put up in Colombia is still questionable, I understand. I think the French did that. You see all of this has gone on -- the Europeans have come back into the loaning market, and almost every country in Latin America has a debt that is really backbreaking as a result.

Now granted that the inflation of the dollar has helped them, but it still is far more of a burden to them than it should have been if there had been a little more coordination, just a little coordination. That's another criticism that can honestly be made of AID. AID pays very little attention to what the World Bank projects are, to what the United Nations projects are, etc.

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I’ve run up against that personally and I can speak personally about it. The AID people have their program, and frankly their general attitude is to hell with everybody else. It's a normal bureaucratic affliction.

MCKINZIE: Maybe a good final question to ask would be how did things change for you when the Truman administration ended and the Eisenhower administration began? I know that in economic policy John Foster Dulles had some very different ideas, particularly about what became AID. How did this affect your career?

BOHAN: Well, it really was the end of my career as a career officer. Number one, it was felt immediately in terms of the Joint Commission. I had been writing -- and incidentally those would be very interesting letters, I think, to put in the Truman Library -- some personal letters to

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Eddie Miller, when he was Assistant Secretary, saying what a horrible frightful mess we were making of Point IV in Brazil. How we were duplicating, how we were increasing the staffs, and how we were getting in people's hair in terms of using things that other people couldn't have such as liquor, automobiles, and this, that, and the other thing. There was too much of an American presence.

Take the mission to northeast Brazil. In a letter to -- who is the Puerto Rican that headed up AID? [Teodoro Moscoso, U.S. Coordinator, Alliance for Progress; Asst. Admin., Bureau for Latin America, 1962-64.] He was the Assistant Secretary for Latin America and head of AID -- we recommended that not over seven or eight American technicians be sent to northeast Brazil to work with the highly nationalistic organization that was up there. Seven or eight. Within a year there were over a hundred and fifty people in a small town in north-east Brazil. We have run it into the ground by

[80]

bureaucracy. We have cut the value many, many times by the expansion, expansion, expansion. Don't misunderstand me; I can point to two or three dozen technicians in northeast Brazil that were highly respected, and are highly respected, that were doing an excellent job. But the overall program is ruined by bureaucracy, it really is.

MCKINZIE: So you felt, then, when the Eisenhower administration took over that this was the most immediate apparent result?

BOHAN: Right. It would have probably have occurred anyway. I must say that in all honesty. But they had that reorganization. I forget just when it was but all, of the Serviçios were closed down. They had a different emphasis and this program was thrown out, and the other program was put in, and so on; but they made all the decisions in Washington. The decisions weren't made because people

[81]

wanted what they had to offer necessarily. Sometimes, yes, but more often no.

MCKINZIE: So you began to feel again that your effectiveness was impaired?

BOHAN: Oh, definitely, but definitely. Everything I've told you this afternoon is in the record, many times over; but it didn't do one bit of good, not a bit of good. It did when I had people like Eddie Miller, Spruille Braden, George Messersmith, Norman Armour. When I was working for chiefs like that we got things done. Why? Because we could do things. If someone in the Government really has force and prestige you can do something, but you have to have a lot of it, and you have to have a lot of steel in order to be successful, and I didn't. I just didn't have what it takes to do the things that I knew should be done.

[82]

MCKINZIE: You are saying that after the passage of those men, they weren't replaced by people who had the same kind of class? Is that a good word?

BOHAN: Yes. Up until the time that Summer Welles was forced out of the Government, I really and truly thought I was a big shot, because I had quite a number of things to my credit. I guess it was a good thing that I learned it wasn't me, except in part, that was responsible for success. It was the organization behind me, and the people behind me, up until the time that Sumner Welles left. Then there were just short periods when I had Mr. Braden, when I had Mr. Messersmith, when I had Eddie Miller -- the only times. Every other thing I've done for the U.S. Government has been a disaster.

MCKINZIE: Simply having it carried out.

[83]

BOHAN: Having it carried out. Particularly the northeast Brazil affair. Perhaps some of the things that I have been telling you are better brought out in The Politics of Foreign Aid in the Brazilian Northeast, by Riordan Roett, a professor at Vanderbilt University. There is another book that also goes into the history of the Bolivian nation, and that's Beyond the Revolution, a publication of the University of Pittsburgh.

MCKINZIE: You worked under Roosevelt, Truman and Eisenhower, and you mentioned the growth of bureaucracy during the Truman years and into the Eisenhower years, but how would you assess your own career in those Truman years?

BOHAN: Your question is a frightfully difficult one to answer. I requested retirement in 1949, during the Truman administration, because of the almost

[84]

impossibility of operating abroad due to the disorganization of the Department of State at home. I resigned in 1955, because of deep disagreement with the policies of the Eisenhower administration. I had no quarrel at any time with the policies of the Truman administration regarding Latin America, except that I felt that they should be stronger and that Latin America should be given a higher place in our scheme of things. Whereas, during the Eisenhower administration the Secretary of State had no interest in Latin America, and policy in the economic area was dominated by Secretary of the Treasury Humphrey, who thought only in terms of big business; and that may sound socialistic but it happens to be the absolute truth.

Acheson, Dean, 10, 15, 33-34, 42, 46, 47
Adams, Truslow, 50
Agency for International Development, 77-78, 79
Aleman, Miguel, 36
Argentina: 4, 5, 46, 47, 68-69

• • "Colonels" revolt in, 9, 10
    economic policy toward, U.S., 5-9, 11-12, 20-21
    Point IV program in, 68-69
• Armour, Norman, 5, 10, 81

  Bennett, Henry G., 72-73
  Beteta, Ramon, 37-40
  Bohan, Merwin L., background of, 1-4
  Bolivia, 4, 57, 75-76
  Braden, Maria, 43-44
  Braden, Spruille, 34, 43-47, 48, 81, 82
  Brazil, 4, 28, 29, 50-56, 58, 74, 76, 79-80, 83
  Bureau of Mines, U.S., 69

  Chapultepec Conference, 1945, 12-14
  Chile, 4, 5, 7, 22, 64
  Churchill, Winston S., 9
  Coffee exports, Costa Rica, 17
  Colombia, 4, 34, 44, 45, 77
  Costa Rica, 17
  Cuba, 4

  Dallas, Texas, 1, 2, 3
  Davis, Monnett, 22-23
  Department of Commerce, U.S., 2, 3, 4, 22, 23
  Dominican Republic, 48
  Dulles, John F., 53, 78, 84
  Dulles, J.W., 55, 56

  Ecuador, 4
  Eisenhower, Milton, 55
  El Salvador, 4
  England, 48-49
  Export-Import Bank, 19, 55, 58, 59-60, 76

  Figueres, Jose, 17
  Foreign Economic Administration, 8
  Foreign Service, U.S., criticism of, 23-26, 29
  Foreign Service, U.S., Division of Planning, 23, 24

  General Agreement on Tariffs and Trade (GATT), 48-49
  "Good Neighbor Policy," 14-16, 20
  Guatemala, 4

  Herrera, Felipe, 60
  Honduras, 4
  Hoover, Herbert C., 4
  Houston, Texas, 2, 3
  Huerta, Victoriano, 1
  Hull, Cordell, 9
  Humphrey, George, 53, 84

  Institute of Inter-American Affairs, 70-71, 74
  Inter-American Development Bank, 60
  Inter-American Economic and Social Council, 49-50

  Johnson, Herschel V., 53
  Joint Brazil-U.S. Economic Development Commission, 50-56, 58, 78-80

  Knapp, Joseph B., 51, 55

  Latin America:

  • economic and social development, 61-66
    Eisenhower Administration policy toward, scored, 78-84
    "Good Neighbor Policy" toward, end of, 14-16, 20
    Inter-American Bank for; 59-60
    Point IV program in, 67-77, 79
    World War II, impact on economics of, 17-19

  McNamara, Robert V., 60
  Madero, Francisco, 1
  Mann, Thomas C., 60-61
  Marshall Plan, 19
  Messersmith, George S., 12, 32-34, 42, 47, 81, 82
  Mexico, 4, 14, 22, 24, 31-42

  • Chapultepec Conference, host to, 12-14
    economic policy toward, U.S., 37-42
    Messersmith, George S., U.S. ambassador to, 32-35
    Truman, Harry S., goodwill visit to, 1947, 35-36
  Mexico City, Mexico, 1, 13, 21-22, 24
  Miller, Edward G., Jr., 16, 43, 48, 49, 50-52, 79, 81, 82
  Moscoso, Teodoro, 79

  Nervo, Louis Padilla, 12-13
  Nufer, Albert F., 49

  OPA prices and U.S. coffee imports, 17

  Panama, 45, 46
  Pam American Airways, 45
  Pasvolsky, Sol, 16
  Peron, Juan, 21
  Peru, 4, 22
  Point IV, 62-63, 66-77, 79
  Prebisch, Raul, 50

  Rockefeller, Nelson A., 13, 21, 70
  Roosevelt, Franklin D., 9, 20, 22

  Sanders, William, 12
  SCADTA, 45
  Serviçio, 70-71, 80
  Smith, Robert, 2, 3
  State Department, U.S., criticism of, 27-30
  Stettinius, Edward R., 14-15

  Technical Cooperation Administration, 68-70, 72-74
  Thurston, Walter S., 34-35
  Torquay Conference (GATT), 48-49
  Trippe, Juan, 45
  Truman, Harry S., announces Point IV program, 62-63

  Vargas, Getulio, 50

  Wallace, Henry A., 8
  Welles, Sumner, 8, 9, 10, 47, 82
  World Bank, 48, 55, 60
  World War II, impact on Latin American economics, 17-19