Bruce Plan Intervención Norteamericano Peronismo

Taylor & Francis, Ltd.
'Bruce Plan' and Marshall Plan: The United States's Disguised Intervention against Peronism in
Argentina, 1947-1950
Author(s): Glenn J. Dorn
Source: The International History Review, Vol. 21, No. 2 (Jun., 1999), pp. 331-351
Published by: Taylor & Francis, Ltd.
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GLENN J. DORN
'BrucePlan'and MarshallPlan:
The United States'sDisguised Interventionagainst
Peronismin Argentina,1947-1950
United States' s charge d'affairesat Buenos Aires,John Moors

Cabot, remarked in 1946 of the Argentine presidential candidate
Colonel Juan Domingo Peron: 'Whenever we look around for a
really good stick with which to beat a certain gent, we never seem to be
able to find one handy.'1 The statement illustrates how Good Neighbor
pledges of non-intervention in the internal affairs of the Latin American
states handcuffed the administration of Harry S. Truman as it sought to
combat the Peronist movement in the late 1940s. Although Carlos Escude
and C. A. MacDonald show how the United States and Britain used
economic boycott and political manipulation to lever Peronist Argentina
away from a statist economic programme,2 the Truman administration,
which wished to draw all of the Latin American states in its train, saw that
an open attack on or condemnation of Peron would backfire and tried to
hide its leveragebehind the facade of non-intervention.
Peron won the Argentine election of February1946 by advocating 'social
justice' for working people and national development through 'populist'
statism.3 At the heart of his economic programme was the Instituto
I thank Michael Hogan, Peter Hahn, G. Micheal Riley, Carlos Escude",and Edward Ingram for helpful
criticism.
1 Cabot to Lockwood, 4 Jan. 1946 [Truman Library, John Moors] Cabot Papers, Argentina [microfilm].
2 C. Escude: Gran Bretana, Estados Unidosy la declinaciSn argentina, 1942-9 (Buenos Aires, 1984);
La Argentina: Paria international? (Buenos Aires, 1984); 'La historia, la cultura politica, los errores y
las lecciones en las relaciones argentino-norteamericanos', in Argentina y Estados Unidos: Fundamentos
de una nueva alianza, ed. F. A. M. Baize and E. A. Roca (Buenos Aires, 1997), pp. 181-206; 'La
traicion a los derechos humanos, 1950-5', in La politica exterior argentina y sus protagonistas, 18801995, ed. S. R. Jalabe (Buenos Aires, 1996), pp. 71-87; and C. A. MacDonald: 'The US, Britain, and
Argentina in the Post-War Period', in The Political Economy of Argentina, 1880-1946, ed. G. Di Telia
and D. C. M. Platt (New York, 1986), pp. 183-99 and 'The US, the Cold War, and Per6n\ in Economic
Imperialism and the State: The Political Economy of the External Connectionfrom Independence to the
Present, ed. C. Abel and C. Lewis (London, 1985), pp. 405-14.
3 J. M. Malloy, 'Authoritarianism and Corporatism in Latin America: The Modal Pattern', in Authoritarianism and Corporatism in Latin America, ed. J. M. Malloy (Pittsburgh, 1977), pp. 3-19; G. O.
The International History Review, xxi. 2: June 1999, pp. 285-568.

cn issn 0707-5332 The International History Review. All InternationalRights Reserved.
332
Glenn 7. Dorn
Argentino para la Promotion del Intercambio(IAPI), a state import-export

monopoly headed by a former tin magnate, Miguel Miranda. IAPI purchased the bulk of Argentina's harvest from an agrarianelite which had
traditionally'raised fat cows and thin peons', to sell it abroad at a considerable profit, and reinvest it in state-sponsored industry and 'national development'.1In theory, IAPFs state-tradingpractices and bilateralbartertechniques would enable technocratic Peronists to guide the nationaleconomy,
facilitate modernization, redistribute wealth, and, most important, secure
Argentina's 'economic independence'.2 Peron claimed that this approach
to economic development was tantamount to a 'Third Position' between
capitalismand Communism suited to most developing nations.
Peronists correctly assumed that the 'enormous transformation'effected
by Peron had captured the 'attention of the world at this time, and especially that of the Americas'.3Hoping to encourage the spread of the sentiment 'what we need here is a Peron,'4Peronist emissaries became, in the
words of US labour leaders, an 'indefatigable task force' railing against
'Yanqui Imperialism,racialdiscrimination, and [the] exploitation of Latin
American workers by American corporations'.5 Peron himself cultivated
relationships with prominent nationalists and revolutionaries throughout
Latin America: he sheltered the future three-time president of Bolivia,
Victor Paz Estenssoro, throughout the late 1940s,6 maintained ties with
General Carlos Ibanez del Campo, twice president of Chile,7 and gave
financial help to young radicals such as the Cuban Fidel Castro Ruz.
General Manuel Odria, president of Peru from 1948 to 1956, was a long-
andthe Questionof the State',ibid.,pp. 47-81.

O'Donnell,'Corporatism
1 Mannto Brown,20 Dec. 1945[Washington,UnitedStatesNationalArchivesand RecordsAdministration,RecordGroup59], S[tate]Department] Djecimal]F[ile] 835.00, and PrimeraPlana, 19
July 1966,pp. 40-1.
2 A. Cafiero,Cincoanosdespues(BuenosAires,1961),pp. 222-7;Ministeriode Economiade la Nacion,
Institute)Argentinode Promoci6ndel Intercambio:MemoriaAnual, Ejercicio1949(BuenosAires,
!95o), PP-9-12, appendix;P. Lewis,TheCrisisof ArgentineCapitalism(ChapelHill, 1990),pp. 15961, 178-81;F. Luna,Perony su tiempo(BuenosAires,1984),ii. 145-7,175"73 EmbajadaLima,'Memoriaanual',1947 [BuenosAires],Afrchivodel] M[inisteriode] R[elaciones]
E[xterioresy] C[ulto,Departamento
Politica],Peru1947,caja12,expediente5.
4 Oderigoto Bramulgia,
21March1947,ibid., expediente1.
5 KyneandSchwarzReporton Trip to LatinAmerica,27 Oct. 1949[Detroit,WalterReutherArchives,
James]CareyPapers,box 84.
6 R. Alexander, The Bolivaran Presidents:Conversationsand Correspondence
with Presidentsof
Bolivia,Peru,Ecuador,Columbia,and Venezuela
(London,1994),pp. 15-17;Codazzito Sosa Molina,
21Oct. 1948,AMREC,Bolivia1948, caja1, expediente1;D. O. E. Esparue,'Memorandum
Secreto',
n.d., AMREC,Bolivia1948,caja1, expediente1.
7 L. Machinandiarena
de Devoto and C. Escude, 'Las relacionesargentino-chilenas,
1946-53,y las
ilusiones expansionistasdel peronismo',in Argentina-Chile:
Desarrollosparalelos,ed. T. di Telia
(BuenosAires,1997),pp. 190-200;and M. de Devoto,'Lainfluenciadeljusticialismoen Chile,194652' (Ph.D.diss., BuenosAires,1995),esp. ch. 3.
The United States in Argentina
333
time admirer,1and even Communists such as the Brazilian Luis Prestes,

were quick to praise Peron as a fellow 'crusader against capitalism'.2
Although Peron tried to placate US officials by asserting that his denunciation of capitalismwas only 'for internalconsumption' within Argentina,
and declared in 1946 that he would stand with the United States in the
event of a third World War,3 he undeniably sought the prestige of being
seen as an anti-imperialistvoice for Latin America's working class and a
'competitor for the leadership of Latin America'.4
Just as serious as Peron's rhetorical efforts to expound on the merits of
his system, however, was Miranda's work Ho economically re-create the
Viceroyalty of La Plata', 'free ourselves from foreign tutelage', 'reorient the
commerce of Latin America' away from US and European domination,
and pose as the new financier of South American industrial development.5
Beginning in late 1946, Mirandanegotiated a series of commercial treaties
with other South American countries designed to facilitate Argentine
industrialization,encourage ecoliomic ties with its neighbours, and block
'Yankeeimperialismwhich has to be combatted in South America'.6Determined to reverse Peru's 'gravitation towards the United States'7 and to
strengthen ties with the complementary economy of Chile, in late 1946
Mirandaoffered both states loans and trade pacts. He made similar offers
to Bolivia in the hope that Argentine economic 'penetration'might lead to
a change in its 'social attitude' and traditionalpro-US diplomatic orientation.8 Underlying the offers was the assumption that North American and
Europeancorporations,with the complicity of local vendepatria elites, had
retardedLatin Americanindustrialization,which only state planning could
rectify. The Argentine ambassador to Chile, Julio Lopez Mufiiz, told a
1 Oderigoto Paz, 12Jan. 1950, encl. B, AMREC,Peru1949, caja28, expediente11;sameto same, 11
Aug. 1949,AMREC,Peru1949,caja28, expediente8; EmbassyLimato Paz, 8 Sept. 1949,AMREC,
Peru1949,caja28, expediente9; Bowersto sec. state,7 Dec. 1948,SDDF825.00.
2 Davis to Flack, 15 March1946 [USNA, RG 59], [Officeof] A[merican]Republics] A[ffairs],
memorandaon Argentina,vols. 5, 6; M. Rapoport,Politico,y diplomaciaen la Argentina:Las relacionesconEEUUy la URSS(BuenosAires,1986),pp. 24-5.
3 A. C. Paz and G. Ferrari,Politicaexteriorargentina,1930-62(BuenosAires,1966),pp. 140-1;see
also, Rayto sec. state,8 Aug. 1947[USNA, RG59, Recordsof the] P[olicy]P[lanning]S[taff,194753], lot file 64 D 563, box 8.
4 Escude,La Argentina:Paria international?,p. 34; H. Gambini,La primerapresidenciade Peron
(BuenosAires,1983),p. 62.
5 Mirandainterviewin Zig-Zag,23 Jan. 1947, AMREC,Chile 1946, caja10, convenio, legajo2,
expediente4; Reviewof theRiverPlate, 10Jan. 1947,p. 19;A. Cafiero,La politicaexteriorPeronista,
1946-55:sobrelafalacia del 'ntitoaislacionista'(BuenosAires,1996),pp. 54-5.
6 Flackto sec. state,27 Dec. 1947,SDDF 724.35;see also, MovimientoRevolutionanode Bolivia, 21
July 1946,AMREC,Bolivia1946,caja1,expediente1, anexo2, parte1.
7 Oderigoto Bramulgia,21March1947,AMREC,Peru1947,caja12,expediente1;see also, Embajada
Lima,'Memoriaanual',1947,AMREC,Peru1947,caja12,expediente5.
8 B. Carrillo,memo,28 Nov. 1947,AMREC,Bolivia1947,cajai, expediente10,especial.
334
GlennJ. Dorn
Chilean audience in April 1948: 'We cannot talk of an important building

up of commercial intercourse on an exclusively private initiative basis,
because the problems which we are facing are of such magnitude that they
escape the scope of private solutions.'1
For the Truman administration, however, Peron's statist approach appeared to be the resurrection of the nationalist tactics used by European
Fascists in the 1930s. In the eyes of the United States, excessive statismhad
spawned 'unnatural'or 'artificial'industries, constricted global trade, and
led to depression and war. Although Peronism had little in common with
European Fascism,2 US policy-makers believed that the two movements
shared a commitment to a nationally 'organized community' and government-driven economic development. In this regard, Peron appeared to be
'keeping the old pirate flag afloat93and endangering their efforts to create a
liberal capitalist world order based on multilateraltrade, freely convertible
currencies, and private enterprise.
Although the Truman administrationconceded that 'Argentineco-operation is something less than a prerequisite for a successful system of international commercial liberalism,' it claimed nonetheless that the spread of
Peron's brand of economic nationalismmight 'mean the breakdown of any
efforts toward economic peace'.4 Even if the emergence of Peronism in
Argentina did not constitute a direct threat to vital US interests, the state
department feared that Peron's victory would encourage revolutionaries
throughout the hemisphere to imitate him. Although the United States
hoped to convince Latin Americans that they would prosper only by adhering to the rules of American-style liberal capitalism, its appeal seemed
hollow when compared to populism such as Peron's that offered immediate, undeniable benefits to the working class and eventual 'economic
independence'.5
Despite fearing that the 'Peron myth might easily spread all over Latin
America',6and being 'constantly embittered by being kicked in the rear
1 Bowersto sec. state,23 April1948, SDDF 625.3531;M. Plotkin,Marianaes San Peron:Propaganda,
ritualespoliticos,y educationen el regimenperonista,1946-55(BuenosAires,1994),pp. 53-4.
2 C. Buchrucker,Nacionalismoy Peronismo:La Argentinaen la crisis ideologicamundial, 1927-55
of Peronism:Old Frameworks
and
(BuenosAires,1987),esp. pp. 318-35,392-403and'Interpretations
New Perspectives',in PeronismandArgentina, ed.J. P. Brennan(Wilmington,1998),pp. 4-9.
3 Bowersto Braden,13March1946[IndianaUniversity,LillyLibrary,Claude]BowersPapers,ii. box
6.
4 Statedept.memo.,'Argentina's
Post-WarEconomicPolicies',21March1946,SDDF835.50.
5 M. Grow, The GoodNeighborPolicyand Authoritarianismin Paraguay:UnitedStatesEconomic
Expansionand Great-Power
Rivalryin LatinAmericaduringWorldWarII (Lawrence,1981), pp. 11318; D. Green, The Containmentof Latin America:Mythsand Realitiesof the GoodNeighborPolicy
(Chicago,1971).
6 Romualdi,draftof speechat RutgersUniversity,9 June1947[CornellUniversity,M. C. Catherwood
Library,Serafino],RomualdiPapers5459/1/6.
The UnitedStates in Argentina
335
when they weren't looking'1by Argentine propaganda, by 1947 Truman's

lieutenants, like their Peronist adversaries, recognized that open US
attackson Peron were 'erroneous and counterproductive'and to the 'direct
detriment of the prestige' of the United States.2 When the ambassador at
Buenos Aires and, after 2 August 1945, assistant secretaryof state, Spruille
Braden, meddled openly in Argentine politics in 1945 and 1946 to prevent
Peron's election, he only helped Peron to rallyArgentine nationalists to his
cause and transformedthe presidential campaign into a referendumon US
interventionism.3Similarly, when Serafino Romualdi, an official of the
American Federation of Labor, visited Buenos Aires in early 1947 and
urged Argentine unionists to renounce Peronism, Peron, who learned of
these 'imperialistplans' to 'separateGeneral Peron from the workers', used
them as a pretext to establish greater control over the Argentine labour
movement.4 Conflicts with the United States not only strengthened
Peron's position at home and broadened his appeal as a defender of Argentine sovereignty, but 'unilateral blasts' such as Braden's also 'alienated
people throughout the hemisphere, including many who have hitherto
opposed Peron'.5'The worst of it', Cabot concluded, 'is that even Peron's
opponents in Argentinawill resent furtherattackson Peron, and the other
AmericanRepublics are apparentlygetting rathertired of our attitude.'6
Cabot, like other state department officials, recognized as early as 1946
that Braden'sdogmatic, belligerent approach was tearingthe Good Neighbor policy 'into ribbons'7and, in the process, undercutting efforts to erect
a global liberal capitalist order. The principle of non-intervention laid
down by FranklinD. Roosevelt in the 1930s as a component of his Good
Neighbor policy implied that 'Wall Street Imperialism'and heavy-handed
interference in Latin America had jeopardized US interests by provoking
nationalist resentment. New Dealers argued that by repudiating the 'big
stick' and building good will, US corporations would expand in Latin
1 Griffisto Miller,1 Aug. 1950[USNA, RG 59], R[ecordsof the] Assistant] Secretaryof] S[tatefor
LatinAmericanAffairs],lot file53 D 26 [subjectfile,Argentina].
2 Lutito Cooke,30 Jan.1946,AMREC,EEUU1946,caja2, expediente2.
3 G. Frank,Juan Peronvs SpruilleBraden(Lanham,1983);C. A. MacDonald,'The BradenCampaign
Relationsin Argentina,1945-6',inArgentinabetweentheGreatPowers,ed. G. Di
andAnglo-American
Telia and D. C. Watt(London,1989), pp. 137-57;M. Rapoport,GranBretana,EstadosUnidos,ylas
closesdirigentesargentinas:1940-5(BuenosAires,1981),pp. 271-8;A. P. Vannucci,'The Influenceof
LatinAmericanGovernmentson the Shapingof UnitedStatesForeignPolicy:The Caseof US-ArgentineRelations,1943-8',JournalofLatinAmericanStudies,xviii(1986),355-82.
4 PeriodicoSeminalde la CGT,16 March1947,1 (microfilm)[BuenosAires], F[undaci6n]S[im6n]
R[odnguez,Archivode Historiadel MovimientoObrero];see also,Luna,Perdn,pp. 111-20.
5 Cabotto Pepper,3 June1946, CabotPapers,Argentina.
6 Cabotto Pepper,1 April1946,CabotPapers,Argentina.
7 Cabotto Cochran,14Dec. 1945,CabotPapers,Argentina;see also, SumnerWelles, WhereAre We
Heading?(NewYork,1947),pp. 215-18.
336
GlennJ. Dorn
America promoting 'sound' economic growth. Even if non-intervention

always was, in Irwin Gellman's words, 'only an illusion',1 Braden's unpopular campaign and the Truman administration'sapparent indifference
to Latin American economic development raised valid fears across the
hemisphere that Truman had exchanged the Good Neighbor policy for the
'classic imperialist program of Yanqui capitalism'.2At a time when Latin
Americans were demanding reform and economic development, the
United States could not afford to be seen as an impediment; it would be all
too easy, Cabot warned, to destroy Latin America's 'confidence in our
intentions' and do damage that 'may take decades for us to repair'.3
Aware that the very word 'intervention' 'raised hackles on the back of
every politician as far south as Cape Horn', summoned up 'visions of warships and marines', and gave credence to rhetoric like Peron's, state
department officials recognized by 1947 that they would have to wield 'a
rapier, not a meat axe' if they hoped to derail statist experiments.4 Moreover, clashes with Peron only polarized the hemisphere, opening wedges
that Communists or British firms might exploit and endangeringUS efforts
to negotiate a regional militaryalliance.5Therefore, in April 1946, the Truman administration began lifting most of the formal economic sanctions
against Argentina, forced Braden to resign as assistant secretary of state in
June 1947, and decided not to engage in fruitless propaganda battles with
Peron. Furthermore, the state department refrained from publicly criticizing Argentina'soffers of trade pacts to its neighbours for fear of tarnishing Latin American opponents of the treatieswith 'the demagogic charge of
Yankee pressure'.6 The administration was committed nonetheless to
ending Argentina's statist experiment, and to doing it without turning
Peron into a martyr.
In July 1947, Truman appointed James Bruce, an executive with the
National Dairy Products Corporation and a relative novice at diplomacy,
ambassador to Argentina and told him to carry out the new policy. From
the start, Bruce and his experienced assistant, Guy Ray, understood the
1 1. F. Gellman, GoodNeighbor Diplomacy: United States Policies in Latin America, 1933-45 (Baltimore,
1979), p. 38; see also B. Wood, The Dismantling of the GoodNeighbor Policy (Austin, 1985), ix-xiv.
2 Periodical Seminal de la CGT, 16 Jan., 1 March 1946, 1, FSR, 1Jan. 1947, 1-3; E. A. Cobbs, The Rich
Neighbor Policy: Rockefellerand Kaiser in Brazil (New Haven, 1992), pp. 236-43; Green, Containment
of Latin America, pp. 170-83.
3 Cabot to Cochran, 14 Dec. 1945, Cabot Papers, Argentina.
4 Cochran to Cabot, 4 Jan. 1946, Cabot Papers, Argentina; Bohan to Bowen, 1 Feb. 1973
[Independence, Mo., Truman Presidential Library], Merwin Bohan Papers, Correspondence File, Argentina.
5 E. R. May, 4The "Bureaucratic Politics" Approach: US-Argentine Relations, 1942-7', in Latin
America and the United States: The Changing Political Realities, ed. J. Coder and R. R. Fagen (Stanford, 1974), pp. 143-8; R. R. Trask, 'The Impact of the Cold War on United States-Latin American
Relations, 1945-9', Diplomatic History, i (1977), 274-8.
6 Bowers to Byrnes and Braden, 31 Dec. 1946, SDDF 625.3531.
337
risk from overt intervention:'It would be a mistake', Bruce argued, to 'permit the impression that we are deliberatelybringing pressure on Argentina
to bring the Administration to its knees,' if only because 'such action
would alienate all sectors of local opinion.'1 Therefore, he disguised his
'moral disapproval' of Peron and his disdain for Argentines, whom he
believed 'harbor a desire to dominate the hemisphere'.2 Rather than give
Peronists a 'cold shoulder', Bruce and Ray opted to be 'completely
friendly with Peron, obtaining what advantages and concessions we can
from him, and using our influence to prevent him from extreme actions
prejudicialto our interest and solidarity in the hemisphere'.3He should be
turned from a potential rivalinto a client.
As MacDonald shows, Bruce and Ray, like the British, understood
almost immediatelythat the key to turning Peron away from state corporatism was to separate him from IAPI and Miranda.4This would be difficult
only as long as Miranda's programme appeared to succeed. As Miranda
had been given almost complete control over and responsibility for Argentina's economic development, the failure of the economy would discredit
him with Peron,5and discredit Peron's alternativeto liberal capitalismwith
the 'neighboring countries who may be tempted to follow Argentina's
example'.6A destitute Argentinawould no longer be able to offer enticing
loans to its neighbours, or trumpet its 'economic independence' from
foreign domination.7
By the time Bruce arrived at Buenos Aires in July 1947, it was already
clear to US officials that the Argentine economy was headed for collapse.8
Only a year after the launch of Peron's ambitious 'Five-Year Plan' and
drive for modernization, it was draining his treasuryrapidly, and IAPI was
not replenishing it as well as expected. The post-war internationalmonetary crisis, which left Argentina fearing the devaluation of the huge sterling
balances it had earned during the war, forced IAPI to squander valuable
foreign exchange on unnecessary, if popular, projects such as the nationalization of British-owned railroads and the repatriation of Argentina's
foreign debt. In September, however, Britainstruck the most serious blow
1 Bruceto sec. state,2July1948,SDDF 835.50.
2J. Bruce,ThosePerplexingArgentines(NewYork,1953),pp. 316-17.
3 Dearbornto Tewksbury,Ohmans,Martin,Woodward,andWright,'GeneralSituation:Argentina',
22 Sept.1947,ARA,Memoranda]R[elatingto] Individual]C[ountries],Argentina.
4 MacDonald,'The US, Britain,and Argentina',pp. 183-99;Ray to sec- state>22 July1948, SDDF
7U-355 Bruceto sec. state,6 Oct. 1947,bDDb 835.50;MacDonald,' 1he US, Britain,andArgentina7,
p. 194.
6 EmbassyBuenosAiresto Tewksbury,29 April1948,SDDF611.3531.
7 Bowersto Leche, 2 Oct. 1947, BowersPapers,11.box 6; Bowersto Armourand Daniels, 18 Nov.
1947,SDDF625.35318 Ohmansto Tewksburyet al., 8 July, and Dearbornto Atwood et al., 'RecentActivitiesof AmbassadorBruce',18 Sept.1947,ARA,MRIC,Argentina.
338
GlennJ. Dorn
to Peron by declaring sterling inconvertible, thus ending a long-standing

and, for Argentina, lucrative triangular trade. Traditionally, Argentines
had prospered by selling foodstuffs to the British, converting the sterling to
dollars, and buying raw materials, capital goods, and machinery in the
United States; without the triangulartrade, Mirandawas unable to replenish the dollars spent implementing the Five-Year Plan.1 Thus, the 'New
Argentina' was headed towards destitution, and Bruce had the task of
ensuring that it found no way around it.
The United States was singularly well equipped for the task, as Peron
and Miranda's best hope of staunching their 'dollar drain' lay in the USsponsored and administered European Recovery Program (ERP), commonly known as the Marshall Plan. Although the programme had been
created to facilitate the reconstruction of Western Europe, it nonetheless
promised peripheral benefits to Latin America. The Economic Cooperation Administration (ECA) would allocate Marshall Plan dollars to
European states to spend in the Western Hemisphere through a programme labelled offshore procurement, and Latin American states would
earn the dollars they needed to restimulate the triangular trade. The
secretary of state, George Marshall,estimated the amount they might earn
as high as $10 billion,2 and Argentina seemed to be set up to take the lead.
Howard Bruce, the ECA's acting administrator and the ambassador's
cousin, seemed to agree; he estimated in December 1948 that Argentina
might receive 'several hundred million dollars' in sales through the Marshall Plan.3
The ambassador, however, reminding his superiors that 'the United
States is the lifeline to the Argentine,' argued in December 1947 that the
United States should limit dollar expenditures in Argentina.4If Peron were
allowed to acquire dollars 'without any conditions attached, we would
have no ammunition for trading purposes': thus, the state department
should set up the Marshall Plan in a way that gave the US government
'discretion in permitting Argentina to benefit'.5Nonetheless, this must be
1 G. Di Telia and M. Zymelman,Las etapasdel desarolloeconomicoargentino(BuenosAires,1967),
pp. 492-7;J. Fodor, 'Per6n'sPolicies for AgriculturalExports:Dogmatismor Commonsense?',in
NationArgentinain the TwentiethCentury,ed. D. Rock(London,1985),pp. 135-61and'Argentina's
alism:Mythor Reality?',in ThePoliticalEconomyofArgentina,IQ46-83,ed. G. Di TeliaandR. Dornbusch(Pittsburgh,1989),pp. 32-53;FodorandA. O'Connell,'LaArgentinay la economiaatlnticaen
la primeramitad del siglo', DesarrolloEconSmico,xlix (April-June1973),3-66; Lewis, Argentine
Capitalism,pp. 181-205.
2 Review of the River Plate, 14 Nov. 1947, p. 12.
3 Danielsto sec. state,22 March1949,SDDF835.50;see alsoLovettto Clifford,27Jan.1948, [Truman

Library,HarryS.] TrumanPapers[President'sSecretaryFiles,ForeignAffairs],Argentina.
4 Bruceto sec. state,24 Dec. 1947,SDDF635.4131.
5 Sameto same,26 Dec. 1947,SDDF 835.4131;Dearbornto Atwoodand Martin,'Ambassador
Bruce
holds Discussionwith Dr AlbertoGainzaPazand FelipeEspil',21Oct. 1947,ARA,MRIC,Argentina;
339
done surreptitiously: 'it will antagonize even the Argentines who are our
friends if we appear to gloat over Argentina's present discomfiture.n Ray
added that provided the MarshallPlan did not inadvertentlyrescue Peron,
'Argentina'sdollar situation is deteriorating rapidly, and things will come
to a head within the next few weeks in such a way that it will be easier for
us to deal' with him.2
Bruce did not need to convince the ECA's 'Wall Street wolves'3 to limit
offshore procurement in Argentina: they had already come to the same
conclusion. The Truman administrationhad created the ECA not only to
allocate resources to Europe, but also as a weapon in its global campaign to
bring down trade barriers. In short, its function was to promote multilateraltrade and US-style liberal capitalism,while 'discouraging] totalitarianism and highly centralized governments'.4 Not only was IAPI in clear
violation of US principles, but many accused it of trying to profit from the
global food shortage. Seeing bilateralism, statism, and IAPI's 'economic
blackmail'as malevolent relics of the 1930s, ECA officials saw no reason to
reward Peron's Argentina for the sort of behaviour it had been set up to
eliminate in Europe. On the contrary, in the oft-cited words of one ECA
official, D. A. FitzGerald, it was a 'good time to beat the Argentine to its
knees'.5
To that end, the ECA's assistant deputy administrator,Richard Bissell,
told the senate Appropriations Committee on 25 May 1948 that no purchases 'are contemplated in the near future in Argentina, and none whatever will be made so faras we control them'. European states would be told
that 'present ECA policy [was] not to approve procurementauthorizations
for materialsfrom Argentina.'The ECA ignored Argentina'ssurpluses, for
example, when it told an Italian delegation that not enough wheat was
availableto meet Italy's needs for 1948. The Greeks, too, were warned off;
they were told that the 'prohibition [against] Argentina continues'. And
FitzGerald stipulated in August 1946 that meat must be purchased from
states other than Argentinaregardlessof price.
The ECA did not tell the Argentines the real reason for their exclusion,
telling them instead that IAPI's high prices were incompatible with
congressional mandates for austerity. As one ECA official inquired of the
Bruceto sec. state,26 Dec. 1947,SDDF 835.4131.
2 Rayto Lyon, 17Nov. 1947,ibid.
3 M.J. Hogan,TheMarshallPlan: TheUnitedStates,GreatBritain,and theReconstruction
of Western
1988),p. 138.
Europe,1947-52(Cambridge,
4 EmbassyBuenosAiresto Tewksbury,29 April1948, SDDF 611.3531;
see also, Labouisseto Brown,
21June1949,SDDF 635.4131.
5 Statedept. memo,'Instancesof ApparentDiscrimination',
25Jan. 1949,TrumanPapers,Argentina;
Escude,GranBretana,pp. 215-21,322-9;MacDonald,4TheUS, Britain,andArgentina',p. 192.
340
GlennJ. Dorn
Argentines, 'why should we pour dollars down here for something we can
buy cheaper elsewhere?', adding that the Peronists should lower grain
prices to attract Marshall Plan officials and European purchasing missions.1 Nonetheless, Argentina's pricing policies were little more than a
convenient pretext. Miranda, desperate, had repeatedly announced his
willingness to lower IAPFs prices,2 and FitzGerald'sdirective illustratesall
too clearly that price was not of concern. The ECA, which knew that
Mirandawould do as he was told, refused to open negotiations that would
give him the opportunity.3
Unfortunately for Peron, the ECA was not content simply to deny
Argentinaaccess to ERP dollars. In theory, IAPI could continue to negotiate directly with Europeans as long as they did not spend the MarshallPlan
dollars the Argentines wished to obtain. Throughout 1948, however, the
ECA claimed the right to 'supervise' a number of transactions that fell
outside its jurisdiction. In August, ECA officials offered to allocate ERP
dollars to enable Italy and France to buy US wheat in order to weaken
Miranda's bargaining position and drive down the price of Argentine
wheat, lard, and corn. In order to block sales by Argentina, the ECA on
other occasions offered dollar subsidies for purchases in other Latin
American countries or in the United States. The ECA also repeatedly
urged Argentina to sell to European countries at lower US prices and barter for costly European products: as US goods were cheaper than European ones, Argentines believed that if they were forced to sell at US prices,
they should be able to buy at US prices. All in all, throughout 1948 the
ECA financed a meager $1.1 million of purchases from Argentina, while
purchases from Canada, Australia, and other food-producing countries
were financed to the tune of $360 million. Even if the ECA was not responsible for Argentina'sdeepening economic crisis, it deliberatelyimpeded its
recovery and, as Escude shows, did lasting economic damage as a result.4
Unfortunately for the Truman administration, FitzGerald, Edward
Kunze, and other ECA officials were not content with their back-room
efforts, and boasted openly of Argentina'sexclusion.5When theJournal of
Commercepublished their remarks in November 1948, it violently rekindled anti-US nationalism in Argentina. Mobs of portenos (residents of
Buenos Aires), already angered by allegations that a US citizen had
1 Ibid.
2 Marshall,memofor pres., 18 Feb. 1948, TrumanPapers;Bruceto sec. state,15Nov. 1947,SDDF
835.61311;
Rayto Lyon, 17Nov. 1947,SDDF835.50.
3 Reviewof theRiverPlate,18June1948,pp. 8-10.
4 Statedept. memo,'Instancesof ApparentDiscrimination',
25Jan. 1949,TrumanPapers,Argentina;
see alsoBruceto sec. state,31Jan. 1948,SDDF611.3531.
5 La Prensa,11Nov., p. 4, 19Nov. 1948,p. 3.
341
conspired to kill the Perons, held what Bruce called 'a first-class antiUnited States demonstration' in front of the US embassy, 'carrying scaffolds and nooses'. Furious after spending three hours at the Casa Rosada
'listening to Argentine complaints', Bruce wrote in mid-December to Truman and Marshallto complain about the ECA's 'latest atrocities'.Although
he had 'no particular sympathy' with Peron's government, he saw no
reason why Argentina should be 'crucified in the press' by 'everyjackass
minor official who happens to hold a clerkship'. Bruce urged the administration to 'bring out the big stick on those boys and give them hell,'
warning Truman that unless 'a tough Democrat' taught the 'flock of longhaired boys' at the ECA 'that you're the only person who knows how to
run your own show', the ECA's 'inferior and worthless showoffs' would
undercut the state department'swork in Argentina.1
Bruce's vehemence underscores the threatposed by the ECA's carelessness. State department officials understood that 'if an economic bust
comes', Peron would not 'bear the brunt of the blame but instead will shift
it to our shoulders' if he could.2 Moreover, Mirandawould be able to preserve political support for his economic programme by claiming that 'he
was being overwhelmed by Yankee imperialism' as he put up 'a gallant
fight for the poor Argentines'.3 By publicizing its intentions to punish
Argentina, the ECA had needlessly triggereda nationalistbacklash similar
to the one Braden had provoked in 1946. Bruce did not object to the
ECA's effort to deny dollars to Argentina - indeed, he had all but suggested it - but to suit US policy-makers, the failure of Peronism had to
appear to be the result of flaws inherent within statism, not another
instance of US imperialism.
In response to Bruce's protests and a concerted effort by his backers in
Washington, Truman and the head of ECA, Paul Hoffman, announced
that they 'would now welcome ECA purchases in Argentinaas elsewhere'.4
Nonetheless, the boycott continued throughout 1949 and 1950, as the
Marshall Planners persisted in bringing 'every pressure we are able to
exert' to bear in the promotion of multilateraltrade.5Bruce had succeeded
in muzzling the ECA without loosening its stranglehold on the Argentine
export trade. In 1949, Bruce did protest once that ECA discriminationhad
forced the Argentines to sign a long-term, bilateraltreatywith the British.
1 Bruceto Truman,13Nov., to sec. state,17Nov., to Marshall,19 Nov. 1948,SDDF711.35;see also,R.
Giacalone,'FromBad Neighborsto ReluctantPartners:Argentinaand the United States,1946-50'
(Ph.D.diss., Indiana,1979),pp. 186-7.
2 Maleadyto sec. state,4 May1949,SDDF711.35.
3 Bruceto sec. state,21Jan.1949,SDDF711.35.
4 Tewksburyto Bruce,25Jan. 1949, TrumanPapers,Argentina;memoof con., Tewksburyet al., 14
March1949, SDDF835.4131.
5 Labouisseto Brown,21June1949,SDDF635.4131.
342
GlennJ. Dorn
However, the faulthere also rested with the British, who refused to request
ERP funding for purchases in Argentina for their own reasons, and senior
officialsin the Division of American Republics Affairsrequested that Bruce
not press the issue.
Although Bruce may not have appreciated the significance of his actions
at the time, he had launched what British journalists came to call the
'Bruce Plan'. His vocal efforts on behalf of the Argentines, 'charming
blandishments' to Peron, and seemingly 'sincere protests' against the ECA
earned him Peron's gratitude and trust, for Bruce seemed to have acted
boldly and defiantly to help Argentina against his own countrymen, and
even his own cousin.1 Peronists misinterpreted Bruce's protests, however,
because they failed to understand that he was not trying to help them, only
to convince the ECA to 'lay off putting anti-Argentine propaganda in the
press.'2 Peron, who later described the Marshall Plan as an act of 'economic aggression',3 seems to have overlooked Bruce's role in it. Whereas
the Argentines had seen that previous bureaucraticdisputes within the US
government had only been about the proper 'method or procedure to
attain the same end', they failed to discern the resemblance in Bruce's feud
with the ECA. Both the ECA and the state department were striving to
build a global, liberal capitalistorder: the ECA staff,primarilyspecialists in
European finance, had merely not understood the importance of hiding
their work 'underground'in order to appear the 'Good Neighbor'.4
On the surface, the Bruce Plan involved little more than trying to convince Argentines that the state departmentwas trying to help Argentinaout
of its financialdifficultiesand, to this extent, Bruce's well-publicized efforts
were successful. Ray was able to make the astonishing, and exaggerated,
claim that anti-US sentiment had 'virtuallydisappeared' in Argentina as a
result.5 The second benefit brought by the Bruce Plan quickly became
apparent, as the ambassador capitalized upon the deterioratingArgentine
economy and his privileged position to undermine Miranda's.Again, delicacy and duplicity were needed. Despite Bruce and Ray's distaste for
Miranda,the 'greatobstructive force which our Embassy has to face',6they
1 S. Griffis,Lyingin State(GardenCity, 1952),p. 260 and Luna,Perony su tiempo,p. 208; memoof
con., Miller,Griffis,Mallory,Per6n,Cereijo,Areset al., end. 2, 20 Feb. 1950,RASS,lot file53 D 26;
La Prensa,8 Oct. 1948,p. 4.
2 Bruceto sec. state,17Nov. 1948,SDDF711.35.
3 Pazand Ferrari,PoUticaExteriorArgentina,p. 154;see also, Descartes,'EconomicCooperation',in
Pool to statedept.,20 April1951,SDDF635.00;PrimeraPlana,30 Aug.1966,pp.38-9.
4 Lutito Cooke,30 Jan. 1946,AMREC,EEUU, 1946,politicaexterior,caja8, expediente2; Escude\
'LaTraici6n',p. 81 and GranBretana,p. 215.
5 Reviewof theRiverPlate,15Oct. 1948,p. 7.
6 Dearbornto AtwoodandMartin,'Ambassador
BruceHoldsDiscussion';see also,Bruceto sec. state,
24 Dec. 1947,SDDF635.4131.
343
made a concerted effort to disguise their sentiments. Bruce's description of

Mirandais telling:
Mirandais a nimble-witted,shrewdman,devoidof principle,andof no character.
His word is not to be reliedupon. As the head of the finances,he is completely
incompetent.One would have to searchhistoryto find a man who has been of
such disserviceto his countryas this manhas been to this nation.We areon the
samefriendlytermswithMirandaas he is withus.1
The embassy staff recognized that denouncing Miranda would only
strengthen his standing among Argentine nationalists, Peronist or otherwise, and easily be construed as intervention. Instead, Bruce and Ray
worked with British diplomats to exacerbate the rifts within Peron's
coalition by encouraging 'moderate'Peronists such as the foreign minister,
Juan Atilio Bramulgia, and the minister of war, General Humberto Sosa
Molina, to provoke a conflict within Peron's inner circle that would lead to
Miranda'sdismissal.2
Bruce's primarygoal was to win the backing of the Argentine army, one
of the 'twin pillars' of Peronism and a natural ally against Miranda. US
officials knew that 'the minister of war and the militaryelements in general
thoroughly detest Miranda'for reasons of their own: although the army at
one time supported Miranda'sefforts to gain access to Bolivian tin, Peruvian iron, and Chilean copper, he had alienated professional soldiers by
trying to curtail both militaryexpenditures and expensive arms purchases
overseas.3Furthermore, Miranda's closest ally was Eva Peron, the president's wife and a long-time enemy of the Argentine officer class.4
The army'slatent resentment erupted in November 1947, when the high
command learned that 'shady deals' by Mirandaand his underlings at IAPI
had led to the disappearance of more than two million dollars.5Incensed,
the high command asked Peron to deprive Miranda of responsibility for
military purchases. Peron complied, supposedly 'to prevent the matter
from becoming a national scandal' but, according to the US embassy, in
fact because Peron 'was told by the Army that if he did not do so the Army
would put in a new President'.6Knowing that the 'Army is determined to
effect [Miranda's] downfall', and in an attempt to take advantage of this
1 Bruce to sec. state, 26 Sept. 1947, SDDF 611.3531.
2 MacDonald, 'The US, Britain, and Argentina', pp. 183-99 and 'The US, the Cold War, and Per6n\
3 Ray to sec. state, 22 July 1948, SDDF 724.35; Hoover to Neal, 19 Dec. 1946, SDDF 824.00; Messersmith to sec. state, 12 March 1947 [University of Delaware Library, George S.] Messersmith Papers,
1857; A. Rouquie, Poder Military sociedad en la Argentina (Buenos Aires, 1986), ii. 78-81.
4 R. Potash, The Army and Politics in Argentina, 1945-62 (Stanford, 1980), pp. 51-4.
5 Dearborn to Atwood et al., 15 Dec. 1947, ARA, MRIC, Argentina.
6 Ray to Lyon, 17 Nov. 1947, SDDF 835.50.
344
GlennJ. Dorn
'atmosphere suggesting a coup d'etaC,1 Bruce tried to use arms sales to

cement closer ties with the officer corps.
According to Ray, 'the armed forces are anxious to have our cooperation,' and 'want American arms and assistance in establishing factories for small arms and ammunition'. As the Argentine army, desperate for
new equipment, would otherwise buy it from Britain or the Soviet bloc,
Bruce argued that the United States should lift its five-year-old arms
embargo and itself supply whatever was needed: 'We have little or nothing
to lose by offering Peron some co-operation. On the contrary,' Ray
claimed, weapons offered 'the best hope of getting the armed forces and
military leaders on our side'.2 By speaking out in public for arms sales to
Argentina, Bruce heightened the perception that he was working on
Peron's behalf, even as he condoned Argentina's exclusion from the
Marshall Plan. Furthermore, he assured the state department that arms
sales would do nothing to arrest Argentina's 'dollar drain' but would buy
Argentina's adherence to the treaty of military co-operation signed at Rio
de Janeiro in September 1947, which the Truman administrationdeemed a
key instrumentof indirect control.
The state department's willingness to work with the army, and Sosa
Molina's high standing in the cabinet, quickly paid dividends when Peronist 'extremists' called in December 1947 for the nationalization of the
foreign-owned oil companies.3 Although Peron, Bramulgia, and even
Miranda pledged that no action would be taken, an impasse had been
reached:whereas Peron did not dare to alienatehis nationalistfollowers by
making a deal with Standard Oil, a notorious symbol of foreign exploitation, the nationalists would not go ahead with expropriation without his
backing.4
Sosa Molina, at the start a lukewarm supporter of expropriation, broke
the stalemate by radically altering his position after a series of conversations with Ray and Lieutenant-General Willis Crittenberger, who had
come to Buenos Aires to arrangethe arms sales. While it is still not known
what was said at the meetings - most likely Crittenbergerand Ray warned
Sosa Molina, as Bruce had already warned Bramulgia, that the United
States would not help a government that injured US investment - Sosa
Molina came out of them as a champion of co-operation with the United
1 Dearborn to Atwood et al., 15 Dec. 1947, ARA, memos on
Argentina, vols.5, 6; O[ffice of] R[esearch
and] Intelligence], 'Probable Argentine Policy toward the US to 1952 and Its Effects on US Interests',
15 Feb. 1949 [Truman Library, Intelligence File], CIA Reports 1948.
2 Ray to sec. state, 5 Jan. 1948, SDDF 711.35.
3 Potash, Army and Politics in Argentina, pp. 68-72; Dearborn to
Tewksbury, 23 Dec. 1947, ARA,
MRIC, Argentina.
4 Bruce to sec. state, 15 Dec, Daniels to Bruce, 17 Dec. 1947, SDDF 835.6363.
345
States. Richard Potash suggests that Sosa Molina's 'subsequent warning to

the cabinet that [expropriation] could damage the interests of Argentina
was an understandable position for one whose consuming interest ever
since he took office had been to replace the Army's outmoded equipment.'
The warning seems to have tipped the balance, as Peron announced soon
afterwardsthat he would take no action against StandardOil.1
Sosa Molina's intercession led US officials to conclude that he 'appears
to hold the balance of power and will probably exert an influence favorable
to US-Argentine co-operation'.2 'At some point Peron will have to clean
out Mirandaand the other crooks associated with him,' Bruce explained to
Marshall in July 1948, 'or else the Army will probably clean out Peron';
adding that 'we do not know which way the cat is going to jump, but when
it does the chances are that we will land with it on a better spot than the
one we left.'3While the state departmentcould not compete with Peron for
the support of the working classes, it did possess an effective lever for use
in gaining the co-operation of the armyhigh command.
With the army in collision with Mirandaand urging the appeasement of
the United States, the state department turned its attention to the civilian
wing of Peronism. It already had one firm ally in Bramulgia; seen by
Americans as the most 'reasonable and respectable and least nationalist
civilian' in Peron's government,4he had long been a voice for moderation.
Unfortunately, he also seemed to be a voice crying in the wilderness, for
Miranda had usurped most of his functions. As the acting secretary of
state, Robert Lovett, lamented on more than one occasion, 'Bramulgiawith
complete sincerity has indicated that drastic action would not be taken,'
but had 'been unable to prevent final action sponsored by Miranda'.5So
although Bruce had good reason to believe that Bramulgiashared the US
view of Miranda,he was a partnerof limited utility.6
To remove Mirandaand dismantle IAPI, the state departmentneeded to
lever other members of Peron's cabinet around to Bramulgia's position.
Bruce, again capitalizingupon the perception that he was Peron's ally, set
out to do so by tirelessly extolling the virtues of free trade and illustrating
how the elimination of the IAPI and other statist organizations could still
salvage the Argentine economy. For example, in March 1949 he told the
Argentine ambassador at Washington, Jeronimo Remorino, and the
1 Potash, Army and Politics, p. 75; see also C. Lucchini, Apoyoempresarial en los origenes del peronismo
(Buenos Aires, 1990), pp. 49-52.
2 ORI, 'Probable Argentine Policy', CIA Reports 1948.
3 Bruce to sec. state, 2 July 1948, SDDF 835.50.
4 ORI, 'Probable Argentine Policy', CIA Reports 1948.
5 Lovett to embassy Buenos Aires, 5 Dec. 1947, SDDF 835.6363.
6 Bruce to sec. state, 26 Sept. 1947, SDDF 611.3531.
346
GlennJ. Dorn
economic counsellor for the embassy, Dr Juan Scarpati, that as soon as

Peronists cancelled 'all decrees, laws, and regulations setting up restrictions on trade', Argentines would be able to sell $500 million worth of
goods in the United States. His promise that 'with the removal of restrictions on trade, Argentina would be back on its feet in ninety days,' was
supposed to convince Peronists that 'every state-dominated economy is a
will-o'-the-wisp' and a 'no substitute for private enterprise'.1
These manoeuvres had to be carefullymanaged. Bruce suggested at one
point that he should have a 'firm talk'with Peron to tell him of the 'certain
conditions' he must fulfil before the United States did anything that might
'provide money to the Argentine'. Although a matterof 'extreme delicacy'
and not to be 'discussed with anyone else', Peron would appreciate the
candour and do as he was told.2 Unfortunately, Peron could have turned
such a conversation, a clear interventionin Argentine internalaffairs,into a
weapon for use against the United States. Bruce, who was not given permission to talk to Peron as he suggested, had to confine his efforts to convincing Argentines of the benefits of liberal capitalism, comforted in the
knowledge that 'the Argentine deserves about what they [sic] have gotten.'3
Prohibited from using a direct approach, Bruce shifted his attention to
the economy minister, Orlando Maroglio. Once thought to be a loyal 'tool
of Miranda',by 1948 Maroglio was 'assertinghimself' and questioning the
statist approach to economic development.4 Bruce actively helped
Maroglio to change his mind by escorting him to Washington in September and introducing him to Hoffman, William Martinof the Export-Import
Bank, Thomas Blaisdell of the commerce department,Thomas McCabe of
the Federal Reserve, and the secretary of the treasury, John Snyder.
Maroglio had to listen to numerous sermons on the virtues of free trade
and a limited government role in the economy, as all of these key US
officialsalways linked Argentina'sdollar-earningcapacity with the removal
of the onerous 'restrictionsimposed by IAPP. When, midway through the
interviews, Marogliowearilypleaded, 'don't let's ever mention IAPI again,'
US officialsreplied that it was 'prettydifficult to get on to any discussion of
Argentine trade without touching on IAPI'.5 Miranda, who believed that
'
Marogliowas 'makinga fool out of himself in Washington,6learned when
Maroglio came home that his ardour for state tradinghad cooled.
1 Memoof con., Remorinoet al., 8 Marchand25 Feb., and memoof con., Solardel Campo,Bruce,
Tewksbury,11March1949,SDDF835.50:Bruce,ThosePerblexinrArgentines,pp. 261-2.
2 Bruceto sec. state,24 Dec. 1947,SDDF635.4131.
4 Memoof con., Tony et al., 24 Nov. 1947,SDDF835.77.
5 Tewksburyto Greenup, 29 Sept. 1948, SDDF 835.50;see also Tewksbury,'Visits of Orlando
La Prensa,19Nov. 1948,p. 3.
Maroglio',30 Sept. 1948,SDDF611.3531;
6J. Fforde, The Bank of England and Public Policy, 1941-58(Cambridge, 1992), p. 267.
347
Maroglio, moving quickly against his former mentor, presented the

cabinet at the end of 1948 with a report suggesting something akin to the
'elimination [of] IAPI'.1 Miranda, who said the report should 'be consigned to the waste basket', referred to Maroglio as a 'dead duck'. In January 1949, events reached a climax when, according to one of the embassy's informants, a cabinet meeting nearly degenerated into a brawl as
'Mirandacalled Mr Maroglio a liar and Maroglio called Mirandaa clown.'2
For Miranda, however, the timing could not have been worse. He had
recently suffered a serious defeat in negotiations with the British - he had
been pressured by the British, with ECA and Bramulgia'shelp, to sign a
disadvantageouslong-term commercial agreementon the barterof food for
industrial goods - while Bramulgia had come home from mediating the
Berlin Crisis to internationalacclaim.3
With Maroglio, Bramulgia, and the army poised against him and the
economy in disarray, Miranda's days were already numbered when Eva
Peron, once his leading benefactor, struck the most serious blow. In the
wake of Maroglio's attacks, she suddenly accused Miranda of using her
name to solicit bribes from Argentine businessmen. According to US
sources, she gave her husband an ultimatum:'if [Miranda]did not go, she
was going to leave the country herself and go and live in Biarritz.'4It is
quite possible that Eva Peron, an astute politician in her own right, recognized how rapidly Miranda's position was deteriorating and sought to
distance herself from her one-time ally.5Regardlessof the reason, however,
when she turned against Miranda, so too did her followers, including
cabinet members such as Jose Barro. At a meeting with Peron in midJanuary, Barro, Ramon Cereijo, and several other members of the cabinet
pointed to the 'dangerous disorganization' caused by Miranda's'management of the economy'.6 Although Peron tried to smooth over the rift, in
Bruce's words, 'Miranda'sgoose was cooked.'7 By the end of January, he
was summarilydismissed from office.
Although Miranda predictably tried to rally nationalist sentiment by
claiming that he had been unable to 'withstand the pressure that had been
put on him by Sra. Peron and the US Ambassador', his efforts were in
vain. Bruce told the state department that 'Miranda has for months been
trying to get us into a battle with him,' but that he had 'been continuously
1 Rayto sec. state,21 Sept.1948,SDDF835.5034.
2 Greenupto sec. state, 22 Nov. 1948, SDDF 611.3531;same to same, 28 Dec. 1948, SDDF 835.50;
sameto same,12Jan. 1949,SDDF835.6363.
3 PrimeraPiano, 21June1966,pp. 37-8;Luna,Perony su tiempo,p. 233.
4 Bruceto sec. state,21Jan.1949,SDDF711.35/2949.
5 Lewis,ArgentineCapitalism,pp. 195,202-3.
6 PrimeraPiano, 19July 1966,p. 41.
7 Bruceto sec. state,21Jan.1949,SDDF711.35/2949;
PrimeraPlana,30 Aug.1966, p. 42.
348
GlennJ. Dorn
sidestepping' and could deny truthfully any direct involvement in Miranda's fall. He admitted, however, that it was what 'we have been hoping
for over a period of many months' and argued that 'it looks now as if there
is at least a chance of getting this economy on a reasonablysound basis.'1
Peron's choice of two 'Bramulgiamen' to replace Mirandaand Maroglio
(who resigned on account of illness) was interpretedto mean that 'Peron is
accepting the conciliatory views of Bramulgiaas opposed to Miranda on
international relations.' The state department was pleased; it viewed the
new appointments as a significant'step in the right direction', and one that
portended more importantchanges.2
The Truman administrationwas satisfied at first with the new ministers'
performance. Remorino told the assistant secretary of state for Latin
American affairs,Paul Daniels, in May 1949 that 'IAPI in the future would
not market products which Argentina exported to the United States' and
added that its role would be reduced even further as quickly as possible.
When Daniels, in the course of the conversation, described IAPI's operations as 'inefficient', Remorino thanked him for his 'diplomacy' in his
choice of adjective, as he himself roundly criticized Mirandaand his statist
principles.3 Scarpatihumbly promised the state departmenton 9 February
that after the 'new economic team' had 'completely reorient[ed] economic
and financial policies ... Argentina should not attempt to become an
industrial nation. Its wealth is in exporting . . . agriculturalproducts.'4 As
Peron's state apparatushad been designed explicitly to promote industries
that Argentina'straditionalagropastoralelite had ignored, Scarpati'sstatement, if accurate and acted upon, represented a diplomatic triumph
worthy of any colonialist power.
Fully understanding Bruce's unstated bargain, Remorino told the state
department on 21 February that he 'had fought hard to have Miranda
ousted and now that Miranda was out, his government was asking: what
now?'5In a stunning turnabout in May 1949, Peron himself told a visiting
executive from InternationalTelephone and Telegraph (ITT) that the US
government could 'write its own ticket in return for whatever aid it might
be able to afford to Argentina'.6Two years of sustained pressure and disguised leverage had paid off. With the Five-Year Plan in ruins, IAPI being
dismantled, and Miranda's commercial treaties shelved, the Truman
1 Bruceto sec. state,21Jan.,SDDF711.35andsameto same,24Jan.1949,SDDF 835.002.
2 Memoof con., Scarpatiand Tewksbury,9 Feb. 1949, SDDF 835.50;see also, La Prensa,29 Jan.
!949>P- 6; CurrentEconomicDevelopments,
31Jan. 1949,p. 187,TrumanLibraryandPrimeraPlana,
19July1966,p. 42.
3 Memoof con., Remorinoet al., 10 May1949,SDDF711.35.
4 Memoof con., Scarpati,Tewksbury,andDearborn,9 Feb. 1949,SDDF835.50.
5 Memoof con., Remorinoet al., 25 Feb. 1949,ibid.
6 Memoof con., Behnet al., 20 May1949,ibid.
349
administrationwondered whether it were not now in a position to dictate

terms.
Ray, dissatisfied like a number of state departmentofficials, thought that
Peronists should simply be told that 'Santa Claus doesn't live here any
more':1Argentina had yet to ratify the Rio de Janeiro treaty, Peron was
implementing a new constitution which penalized foreign investors, and
his government had been promising to dismantle IAPI for over two years.
Nonetheless, by the end of 1949, the new assistant secretary of state,
Edward Miller, was ready to offer economic aid. Unbeknownst to Miller,
the Peronists had already applied to the Eximbank, to be turned down in
accordance with the state department'sstanding instructions. However, to
take cthe best advantage' of Peron's 'constructive attitude' and 'give the
United States an opportunity to influence the Argentine government
toward sounder business practices', Miller told the bank's chairman,
Herbert Gaston, in December 1949, that the state department no longer
had any 'political objection to financialassistance to Argentina'.2
'Obviously provoked', Gaston 'launched into a spirited criticism' of the
state department'sdealings with other departments. A year earlier, a state
department official, while telling him that there were 'no political objections' to loans to Argentina, had 'winked his right eye'. Was 'it the same
"with a wink of your left eye this time?"', Gaston asked. Replying that the
Argentine government had changed its stance towards liberal capitalism,
Miller persuaded Gaston to study the Argentine request.3 Once Miller
overcame the bank's 'latent hostility', Argentinawas granted a $125 million
credit available to Argentine banks who wished to settle some of their
debts with US creditors.4
Although Miller described the credit as a 'new departure in our policy
with respect to Argentina which it would be a great mistake to underestimate', it was hardly an altruisticgesture.5Remorino and Cereijo would
be able to return in triumph to Peron with proof of US good will, itself
worth celebrating, as Peronists preaching appeasement of the United
States had not won real victories for four years. The influence in the
cabinet of Miranda'ssuccessors depended as heavily as his had upon their
effectiveness:clients need to show that their patrons will reward them. Nor
1 Ray to sec. state, 4 Jan. 1949, SDDF 611.3531.
2 Miller to Griffis, 8 Dec. 1949, RASS, lot file 53 G 26; Miller to Thorp, 25 Nov. 1949, RASS, lot file 53
D 26; memo of con., Gaston et al., 2 Dec. 1949, Miller to Griffis, 10Jan. 1950, RASS, lot file 53 G 26.
3 Memo of con., Gaston et al., 2 Dec. 1949, RASS, lot file 53 G 26.
4 Miller to Griffis, 8 Dec. 1949, ibid.; see also Gaston to Miller, 24 May 1950 [Truman Library],
Edward G. Miller Papers, asst. sec. state, correspondence file, box 1, folder 6. For background to the
credit, see M. Rapoport and C. Spiguel, Estados Unidosy el peronismo: La politica norteamericana en
la Argentina, 1949-55 (Buenos Aires, 1994), pp. 65-82.
5 Miller to Griffis, 8 Dec. 1949, RASS, lot file 53 G 26.
350
GlennJ. Dorn
had the political infighting that cost Miranda his post abated. Bramulgia
had been forced from office in mid-19491 and 'Evita's hatchet' remained
Very sharp these days'.2 As the political infighting, in giving Bruce the
opportunity to disguise what he was up to, was partly responsible for
Argentina's new economic policy, the Truman administration wished to
ensure that the 'new economic team' should not be dismantled in the same
fashion as its predecessor.3
The structureof the aid package made it clear that the credit was merely
a thinly disguised loan. Remorino and Cereijo had asked for anything but
an outright loan, partly because Peron had pledged to cut off his hands
before allowing them to accept one.4 By accepting a loan from the United
States, albeit one with a 'political appellation suitable to his internal situation',5Peron was tacitly admittingthat his statist economic programmehad
failed, makingit impossible for him to pose credibly as the standard-bearer
for anti-US nationalists across the hemisphere, and depriving him of his
claim to 'anti-imperialistleadership'.6After four years of Peronism, Argentina, again indebted to foreigners and retreatingtowards economic orthodoxy, abandoned 'the belligerent position that we had to take with the
United States'.7
'Our present policy', Miller commented with some understatement,'has
not been arrivedat haphazardly.'8Since the credit alone would not rescue
Argentinafrom its financialcrisis, forcing Peron to hold to his new line, the
Truman administration expected 'reasonably good public relations' so
long as it continued to show 'no indication of interfering in matters regarded as internal problems by Argentina'.9Even if Peron did not reverse
his policies completely and, in the 1950s, periodically intensified his anticapitalist propaganda, strengthened Argentina's economic ties with the
Soviet bloc, persisted in his efforts to find allies within the hemisphere,
1 Bramulgiawas removedfromoffice,accordingto his successor,HipolitoJesus Paz,andhistorianR.
Giacalone,becauseof a feudwith Remorino.In theversionRemorinotold Miller,Bramulgia
soughtto
'buildhimselfup as the only friendof the UnitedStates',and suppressedsome of Remorino'sreports
to thisend. WhenPer6ndiscoveredit, Remorinoasserted,Bramulgia
was removed:Millerto Mallory,
12Aug. 1949, RASS, lot file 53 D 26; Giacalone,'FromBad Neighbors',pp. 207-11;H. J. Paz, 'La
TerceraPosici6n,1949-51',in La politicaexteriorargentina,p. 61.
2 Malloryto Miller,3 June1950,RASS,lot file 53 D 26.
3 Achesonto Griffis,5 April,Millerto Mallory,17May,2 June, Malloryto Miller,23 May,Griffisto
Miller,16June1950,ibid.
4 Millerto Griffis,8 Dec. 1949,RASS,lot file53 G 26;Rayto sec. state,4 Ian.1040,SDDF611.3531.
5 Malloryto statedept.,1 March1950,RASS,lot file 53 D 26.
6 PrimeraPiano. 21June1066,p. 38.
7 Paz,'LaTerceraPosici6n\ p. 62.
8 Millerto Potofsky,4 May1950,RASS,lot file53 D 26.
9 Statedept. memoon Argentina,14July 1950and Millerto Thorp, 25 Nov. 1949, encl. 1, ibid. Furthermore,Griffiswas pleasedto remindhis criticsthatthe structureof the creditensuredthat'not a
dollarof newAmericanmoneywentintoArgentina':
Griffis,Lyingin State,p. 258.
351
and never completely dismantled IAPI, as Mario Rapoport and Claudio

Spiguel demonstrate, 1949-50 nonetheless marks a watershed in both USArgentine relations and the Peronist movement.1 An Argentina unable to
boast of 'economic independence' or of having found a viable alternativeto
the US liberal capitalist model could never mount a serious challenge to
the United States's imperialist agenda in Latin America. While giving
financial aid to Peron may have infuriated long-time US allies such as
Brazil,it offered the most effective means to tie him down.2
The Truman administrationsucceeded in quietly undermining Peron's
economic alternativeto US liberal capitalism without appearing to violate
its Good Neighbor pledges of non-intervention. The state departmenthad
co-ordinated its efforts with the US army, the ECA, the Export-Import
Bank, and even the British government, and had acted as forcefully as it
dared to destabilize an avowedly anti-Communist regime. While Peron's
economic experiment might well have failed without US intervention, the
early strength of Peronism exemplified the challenge that volatile, homegrown nationalism posed to the US vision of the Western Hemisphere
nestling under the umbrella of US ideals and leadership. The Truman
administration,fearfulthat Peron's alternativeprogrammewould handicap
their efforts to forge a more open internationaleconomy based on convertible currencies and multilateraltrade, ensured that it did not. As the time
when the United States could clandestinely battle Latin Americannationalism was rapidly drawing to a close, the Bruce Plan offers a nice demonstration of the standard imperialist conjuring trick of wielding a stick
without letting it show.
Embry-RiddleAeronautical University
1 Rapoport and Spiguel, Estados Unidosy elperonismo, esp. pp. 42, 120-4.
2 Cobbs, The Rich Neighbor Policy , p. 69.

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United States' s charge d'affairesat Buenos Aires,John Moors

The International History Review, xxi. 2: June 1999, pp. 285-568.

Argentino para la Promotion del Intercambio(IAPI), a state import-export

andthe Questionof the State',ibid.,pp. 47-81.

The United States in Argentina

time admirer,1and even Communists such as the Brazilian Luis Prestes,

Chilean audience in April 1948: 'We cannot talk of an important building

The UnitedStates in Argentina

when they weren't looking'1by Argentine propaganda, by 1947 Truman's

America promoting 'sound' economic growth. Even if non-intervention

The UnitedStates in Argentina

to Peron by declaring sterling inconvertible, thus ending a long-standing

3 Danielsto sec. state,22 March1949,SDDF835.50;see alsoLovettto Clifford,27Jan.1948, [Truman

The UnitedStates in Argentina

The UnitedStates in Argentina

The UnitedStates in Argentina

made a concerted effort to disguise their sentiments. Bruce's description of

'atmosphere suggesting a coup d'etaC,1 Bruce tried to use arms sales to

The UnitedStates in Argentina

States. Richard Potash suggests that Sosa Molina's 'subsequent warning to

economic counsellor for the embassy, Dr Juan Scarpati, that as soon as

The UnitedStates in Argentina

Maroglio, moving quickly against his former mentor, presented the

The UnitedStates in Argentina

administrationwondered whether it were not now in a position to dictate

The UnitedStates in Argentina

and never completely dismantled IAPI, as Mario Rapoport and Claudio

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