Memorandum of Conversation, by the Director of the Office of Middle American Affairs (Newbegin)

CONFIDENTIAL [WASHINGTON,] October 26, 1954.

Subject: Cuban Problems

Participants: ARA‑Mr. Holland

Ambassador Arthur Gardner

MID‑Mr. Newbegin

In reviewing the political situation in Cuba, Ambassador Gardner stated that the future of Cuba depended upon whether Batista would be elected on November 1. He stated that Grau was "very bad medicine" and pointed out that there was an indictment against him for misappropriation of funds.

Mr. Holland asked the Ambassador his views with regard to the main economic problems of Cuba and any suggestions the Ambassador might have in connection with the forthcoming economic conversations, as well as arguments that might be used with Congress. Special reference was made to the manganese and sugar problem. Mr. Holland pointed out that there was little chance of our stockpiling Cuban manganese in exchange for agricultural products. The Ambassador concurred and dismissed this problem. With respect to sugar, the Ambassador said that perhaps one of the most effective arguments to be used in an effort to maintain Cuba's share of the U.S. market was that for every dollar of Cuban sugar which we do not buy Cuba would have that much less U.S. currency with which to purchase automobiles and other American products. He emphasized that the Cubans now had 2,000,000 tons of sugar which they could not sell and that this constituted a serious problem. Mr. Holland inquired about the $400,000 fund which the Cubans have set up for the purpose of conducting a campaign in the United States with a view to favorable action by the Congress. Ambassador Gardner indicated that the creation of this fund had originally been proposed by him. He added that it was his understanding the Cubans were contemplating employing two former U.S. Senators to conduct the campaign. Mr. Holland said that of course the Cubans should fight their own campaign but that they very definitely should not employ former Senators for that purpose, but should use experienced public relations agents. He then made the following comments:

1. With reference to the problem of restrictions on trade as regards Latin America, the problem is a simple one. The decision is going to be made by Congress and it will be based specifically on public opinion. The only thing that really matters is the views of the constituents of the individual Members of Congress. These were the people to be reached. The effectiveness of any approach would be far greater if the various interested groups representing sugar, other agricultural products, minerals, etc. would coordinate their efforts.

2. A big battle was in the making in connection with the Cuban sugar quota during the next Congress. He was willing to "sacrifice part of his hide", if necessary, but he very much wanted to know the Ambassador's ideas. (The Ambassador said that he would write him within a few days after his return to Habana on October 30. )

3. Senator Malone[1] was going to visit Cuba and there was every likelihood that he would encourage the Cubans in the belief that they could get an agreement with respect to the stockpiling of manganese. Ambassador Gardner should attempt to dissuade Senator Malone from making any statements which would give hope to the Cubans along this line.

Mr. Holland then said, while he intended no criticism on the political reporting from Cuba which had been of a high order, he felt that he should point out in his attempt to be helpful that the Department does not feel that it has sufficient information regarding the thinking of the top Cuban officials. He mentioned as an example the exceptional value of Ambassador White's detailed reports of his conversations which made him feel almost as though he had been present at the interview and that he knew intimately the reactions of the individual Mexican with whom White had been talking. He pointed out that it was time‑consuming and bothersome to write such memoranda but that they were very helpful to the Department. In those cases where other members of the staff were present such memoranda could be prepared by them. Ambassador Gardner replied that he had not done reporting of this nature on his conversations with Batista because he was afraid that there might be a leak and he did not want to become involved in the Cuban political situation.

Mr. Holland inquired whether Ambassador Gardner felt that the Embassy had a sufficiently broad base of contacts including all the principal phases of Cuban political and economic activity. The Ambassador stated that it very definitely did. The Ambassador expressed his view that the State Department did not know enough about what the people of Cuba thought of the U.S. Ambassador and that in contrast to previous Ambassadors he had devoted much of his time to cultivating the people themselves.

The Ambassador expressed his concern over the Department's action in transferring Messrs. Topping and Wellman[2] since they both knew Cuba and were thoroughly familiar with its problems. He said that the Embassy now felt that it did not know anybody here and was "on the end of the line"‑that the people directly concerned should have more knowledge of Cuba. It was pointed out that Mr. Hoyt[3] had previously served in Cuba and it was hoped that an opportunity might be found not only for him and Mr. Connett[4] but also for Mr. Holland to visit Cuba before too long. Mr. Holland indicated that he might be able to visit Cuba some time in January.

Reference was made to the functioning of the USOM in Cuba. The Ambassador expressed himself strongly that it was undesirable that the FOA program be extended, stating that the Cubans themselves were not interested in an expansion of FOA activities. He also referred to his opposition to the Chief of Mission previously proposed by FOA, Mr. Hackney, on the grounds that he was too wealthy and too important a figure to be in charge of the relatively small Cuban operation. He expressed the hope that the Acting Chief, Mr. Johnston, would be permitted to remain in Habana.

Arrangements were made for the Ambassador to receive Mr. FitzGerald of FOA on Friday, October 29[5] with whom he could discuss the general FOA situation directly.

[1] George W. Malone (R.‑Nev.), Chairman, Minerals, Materials, and Fuels Economic Subcommittee of the Senate Committee on Interior and Insular Affairs. Between Nov. 22 and 30, 1954 Senator Malone visited Cuba, Jamaica, Venezuela, and the Guianas on a factfinding tour (033. I 100 MA/ 1 1‑2254).

[2] Mr. Wellman was detailed to the National War College in Paris, Aug. 15, 1954.

[3] Henry A. Hoyt, Officer in Charge of Caribbean Affairs, from Oct. 4, 1954.

[4] William B. Connell, Jr.

[5] No memorandum of the referenced meeting was found in Department of State files.