Battle Underground

Last week there was no mistaking the fact that a new underground battle of World War II was being fought in the Western Hemisphere. Two of this battle's most serious skirmishes in Latin America went against the Nazis. The flare-up between Peru and Ecuador appeared to be under control, as both sides announced that they were willing to cease hostilities and arbitrate. The Bolivian Government mopped up the busted fragments of the coup planned by Naziphile Major Elias Belmonte (TIME, July 28).

That the Bolivian coup had been planned by the Nazis, none doubted. While Berlin grumbled unconvincingly about "U.S. aggression," Bolivia's President, General Enrique Penaranda, released a letter to the newspapers. It had been mailed on June 9 in Berlin by Major Belmonte, Bolivian Air Attache in Germany, to the German Minister at La Paz, Ernst Wendler. According to President Penaranda, it had been intercepted by "the intelligence service of a foreign power fighting against Germany" and turned over to him.

Wrote Hothead Belmonte: "We have received all maps showing the most favorable sites for landing. These show me once more that you [Wendler] and your staff are doing excellent preparation for the realization of our plan in favor of Bolivia. . . . We must destroy the tungsten contract with the U.S. . . . Bolivia does not need American loans. With the victory of the German Reich, Bolivia will need only work and discipline. ... I will fly to Brazil upon your advice and take Cochabamba and Santa Cruz, where I have good friends. . . ."

The German Government and Major Belmonte, in a full-dress, press-radio-news-reel interview in Berlin this week, vehemently called the letter a fake, hinted strongly that it had been forged by the U.S.

Not quite so conclusive was the evidence that Nazi propaganda had touched off the inflammable question of the Peru-Ecuador boundary.* But to U.S. newsmen in Lima, Peruvian authorities said frankly that they were less worried about the war than they were about the way German propagandists would distort any U.S. offer to arbitrate. To Argentina the belligerents finally sent their promise to arbitrate.

More news of the battle underground elsewhere in the Americas:

Argentina. For a month a committee of the Chamber of Deputies has been investigating anti-Argentine activities. Nicknamed the "Comite Dies" (the Committee received a telephonic blessing and promises of cooperation from Martin Dies himself), it had already made blunders. Acting on anonymous tips (presumably fed to it by thoughtful Nazis) it raided the homes of several innocent and indignant citizens, uncovered a "secret radio station" only to find that it had been set up by the Argentine Army. But last week the Comite Dies raided German business houses and social organizations, discovered ample documentary proof that the Argentine Nazi Party, outlawed in 1939, was stronger than ever, was operating under the cover of various "cultural" and sports organizations.

Uruguay sent Dr. Hugo Fernandez Artucio, its No. 1 anti-Nazi sleuth, out to continue his work abroad. A onetime professor of philosophy at the University of Montevideo, Dr. Fernandez started his investigations in Uruguay as a labor of love, published a book of his findings, aroused the Government to squelch Nazi organizations. Recently he conferred with Government officials in nine Latin-American countries. Last week in Washington he testified at the trial of the German Transocean news service, which was found guilty of operating an unregistered propaganda outlet (see p. 17). Next he goes to London at the invitation of the British Government.

Paraguay, this week, without specific reference to the Bolivian coup, decreed the death penalty for anyone "inducing a foreign state to declare war on Paraguay or conspiring for the same end," heavy prison sentences for anyone trying "to change the Constitution by violent means."

Cuba rounded up 62 Axis agents, German, Japanese, Italian, Spanish, many posing as refugees, charged them with spying.

Colombia reported the departure to Chile of Peter Paul von Bauer, who operated the German-owned Scadta Airline until it was seized by the Government last year. In Chile he did his best to ingratiate himself with Chilean authorities by presenting them with a German freighter which had been tied up in Valparaiso Harbor since the war began.

Mexico expelled General Roberto Hurtado, exiled some years ago from Nicaragua. The Mexican authorities accused General Hurtado of being an avowed Nazi who had appealed to the German Minister to Mexico for planes to use in an attack on the present Nicaraguan regime.

Brazil was the scene of a commercial air battle. Germany's Condor Airline already covers the Brazilian coast, throws a big loop into the up-country jungles. As Brazil called for bids for another inland airline, Condor prepared to bid for it against U.S.-owned Panair do Brasil, meanwhile ran its plane over the route, carrying a steady trickle of German "tourists" inland.

* Oddest story of the brief war came from Ecuador authorities, who charged that Peru had 3,000 Japanese soldiers in its front lines. It had been rumored earlier that Japan had offered Peru the use of 5,000 trained Japanese reservists for an attack on Ecuador. Said Peru: the report was ''laughable, ridiculous and contemptible." But any sons, born in Peru, of the numerous Japanese residents there would be liable for service with the Peruvian Army.

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