HANSON’S LATIN AMERICAN LETTER - 31 March 1979 - Number 1776 - Letter

Sep 21, 2026

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A dated letter dated 31 March 1979 addresses U.S. policy toward Latin America, arguing that consistency and stated human-rights goals are undermined by political and economic trade-offs. It references the Vera Cruz incident of 1914 and the “Vera Cruz thesis,” contrasts Central America with China in exports and imports, and criticizes proposed cuts to bilateral aid alongside actions affecting the coffee market and military assistance plans. It further frames pressures regarding Guatemala and Nicaragua within broader geopolitical incentives and energy-supply concerns about China.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages5

Reading Time13 min

AccessFree to download

HANSON’S LATIN AMERICAN LETTER

Vera Cruz thesis and policy consistency

Economic side: Central America vs. China trade

Administration actions and aid decisions

Nicaragua and Guatemala policy tensions

HANSON’S LATIN AMERICAN LETTER WASHINGTON 31 March 1979 Number 1776 Dear Sir: As Alexander Solzhenitsyn said on BBC,"western statesmen surrender severalcountries a year to communism.Howlong will the supply of countries last?" Whc Lost Central America? The intent and even the capacity of the United States to be consistentISin policy regarding Latin America has never been conspicuous.Indeed,POLICYthe media on precisely this subject have recently been citing the caseCONSISTENCYof the Vera Cruz incident of 1914 which is so pertinent.Namely,FelixPOSSIBLE?Frankfurter,later to be Justice of the Supreme Court,when asked inthe War Department that year to research the issue of whether Americanoccupation of Vera Cruz constituted an act of war,explained that there is no need to look up the relevant law."It is an act of war against a great power(but)it is not an act of war against a small power." Now that Central America is considered by many in the State DepartmentTHE VERAto be the next bloc of nations vulnerable to erosion of their alignmentCRUZ THESIS:with the west,State Department officials are agonizing over the demandsEXTENDED?of consistency in policy. Commercially,Central America was a market in 1978 for $1.6 billion ofON THEU.S.exports. It could pay with U.S.imports of about $1.6 billionECONOMICfrom the area.SIDE In contrast,communist China was taking about $0.8 billion of U.S.exports,of which it could cover $0.3 billion by U.S.imports from China. Now,the "outlook for 1979 in Central America is clouded,"the Adminis-tration noted. It failed to add that the outlook partly was clouded by U.S.decisionspolitically in the area in pursuit of human rights performance. And it proposed toignore the economics of the situation or its impact on the U.S.trade balance to pursuepolitical goals. It announced it would cut bilateral aid to Central America by 20%,it has finally been persuaded to allow the Commodities Futures Trading Commission toattack the manipulation of the coffee market which had originated in Central Americaand which it repeatedly had denied to have been attempted at the cost of billions tothe U.S.consumer,and it leaked to the press for mobilization of congressional oppo-sition sentiment news of the proposed petty allocation of funds for military instruc-tion for Guatemalan military officers, In contrast,to drum up support for the embrace of China politically,CONTRASTwhich it had labelled publicly a country NOT FREE,in contrast to theWITH CHINAlabel PARTLY FREE applied to Central America,it was beating the drumsPOLICYregarding the vast commercial potential of trade with China.In 1979,the Administration announced,U.s.exports might rise to $1.2 billionor even $1.5 billion(stil1 below exports to Central America)as a re-sult of an expansion of U.s.imports from China to the $0.4 billion level,the re-mainder to be encouraged by new loans policy and new trade policy for China. The Administration concedes that the Chinese capacity to boost exportssignificantly in its leading export lines simply does not exist(repeat not). A weekly lette for basinesmen pabisbnd privdely imWasbington,D.C. After all,how much above the $15.3 million of feathers which the U.S.took from China in 1978 can the 1979 figure reach?How much above the $7.3millionof bamboo baskets which the U.S.took from China in 1978 can the 1979 figure reach?And how much above the $12.1 million of fireworks which the U.S.took from China in1978 can the 1979 figure reach? And meanwhile,the President of the European Commission(Roy Jenkins)POTENTIAL?is warning that China wil1 not become a significant supplier of energyto the EEC countries within the foreseeable future because its crude oilis not of the right quality and major transportation problems have tobe solved before it can export coal in significant quantities,And this while LordChalfont(adviser to Lazard Brothers)warns that China needs to borrow vast amountsbut it can do so only if and when i

FAQs

What is the letter’s main argument about U.S. policy toward Latin America?

The letter argues that the United States has not been consistent in its policy toward Latin America, and that political objectives often override economics and trade-offs.

How does the letter use the Vera Cruz thesis to frame current policy?

It cites the Vera Cruz incident of 1914 and the logic that the relevant act-of-war framing differs between great and small powers, using this to question why human-rights concerns are applied unevenly.

What trade comparison does the letter make between Central America and communist China?

It contrasts U.S. exports to Central America and China in 1978 and discusses how the administration projects 1979 trade outcomes tied to expanding imports and loans and trade policies.

What issue does the letter highlight regarding Guatemala?

The letter claims the administration appears to be launching an attack on Guatemala, describing pre-attack bombardment and an accompanying blast calling attention to a rapidly deteriorating situation.

Sep 21, 2026

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