LBJ.'s Gamble

In fragmented Latin America, summit conferences are rare occurrences-and successful ones rarer still. Simon Bolivar organized the first one in 1826 to press for a federation of Latin American countries, but gave up in despair when only four nations deigned to send delegates. Dwight Eisenhower gathered 19 Latin American heads of state at a summit meeting in Panama City in 1956, but his pleas for hemispheric solidarity were almost drowned out by cries for more U.S. aid funds. This week, as President Johnson flew southward to meet with the Presidents of 19-Latin American republics, there were grounds for hope that the biggest conference of all might produce some lasting results.

The site of the three-day meeting is mildly symbolic: it is the Uruguayan seaside resort of Punta del Este, where the treaty for the Alliance for Progress was signed by the countries' economic ministers in 1961. Despite impressive economic growth in several countries, notably Venezuela and the Central American republics, the Alliance has fallen short of its goal of freeing Latin America from the gross disparities between rich and poor, from the rigid tariff barriers that inhibit trade, and from the debilitating dependence on only one or two crops.

In his first presidential trip abroad to an international conference in an area other than Asia, Johnson sought not only to reaffirm the continuing U.S. commitment to Latin America, but also to resuscitate the Alliance in his own pragmatic way. It was no easy task. During the pre-summit talks, a few countries threatened to withdraw unless the U.S. granted more generous trade concessions. The Communists prepared protest demonstrations.

Hemispheric Scale. Simon Bolivar, with his dream of Latin American unity, would have applauded the President's intentions. Johnson will put his full weight--and considerable U.S. money --behind a U.S.-sponsored proposal for the creation in 1970 of a common mar ket that would eventually unite the 22 non-Communist republics from the Rio

Grande to Cape Horn in one barriers-down trading area. The new market's population (243 million) would be greater than that of either the U.S. or the European Common Market, and its gross national product would be an impressive $75 billion.

Two separate trading zones, the eleven-nation Latin American Free Trade Association and the five-nation Central American Common Market, have sprung up south of the border in recent years. But they are too loosely organized and too small to have much overall effect on the continent's economic growth. Johnson's proposal calls for converting those two organizations into one European-style economic community. It would be run by a strong Brussels-type secretariat whose policy would be to encourage the integration and diversification of the area's industries. One country, for example, would concentrate on producing enough steel to supply its own needs and those of its neighbors, while another would build up, say, a chemical-fertilizer industry. Such a market, runs Johnson's argument, would help Latin Americans help themselves by making it profitable and desirable to switch from relatively isolated national markets to trading on a hemispheric scale.

Watered Down. Johnson wanted to take to Punta del Este a promise of $1.5 billion in additional U.S. aid to help bring LATCOM (Latin American Common Market) into being. He asked for a special congressional resolution that would pledge the extra U.S. aid--and ordinarily he would have got it. The House passed the resolution by a 2-to-l margin, but Senator J. W. Fulbright, chairman of the Senate Foreign Relations Committee and a critic of John son's Viet Nam policy, balked.

The resolution, Fulbright claimed, would give the President the same sweeping powers as the 1964 Gulf of Tonkin resolution, which authorized Johnson to use more force in Viet Nam.

Fulbright watered down the resolution so drastically during committee hearings that Johnson passed the word to let it die without coming to a Senate vote. Johnson still hopes to steer the generally responsive Latinos toward making the historic decision for the common mar ket, but the outcome will now depend more on his power of personal persuasion and less on the power of the dollar.

Other Issues. After Johnson finishes talking about LATCOM, the Latinos' turn will come to talk about what they have on their minds. The conference agenda has been carefully purged of several potentially disruptive subjects--such as a hemisphere peace force, territorial disputes between neighbors and offshore fishing rights--to enable the Presidents to concentrate on economics. They want the U.S. to use its influence to help stabilize the world price of such crops as coffee, cocoa and sugar so that fluctuations on the world market will no longer wipe out their export earnings. They also want to enlist U.S. assistance in building new border-spanning roads, rail lines and communications systems to help Latin America become a more closely knit society.

The Latin American Presidents also hope for additional U.S. aid to undertake a crash program to upgrade health and educational facilities throughout the Southern Hemisphere. Finally, they will discuss what can be done about the arms race. At present, Latin America is in the ridiculous position of spending more money per year ($1.7 billion) on jet fighters, battleships and other weaponry than it receives in U.S. aid ($1.2 billion). Even some governments run by former military men now seem to agree that such outlays must be drastically scaled down.

Casino Conference. The Presidents will find Punta del Este a delightful place in which to deliberate. A peninsula 85 miles east of Montevideo, it has miles of glittering beaches, pine-dotted lawns and flaming hydrangeas. The busy summer season--late November to March--has just ended, but an influx of 2,100 security guards, 1,800 newsmen and 2,000 diplomats and aides will make up for the departed vacationers. During the four days at Punta del Este, President Johnson is staying in a seaside white chalet called Beaulieu, which has been put at his disposal free of charge by an Argentine industrialist. Within walking distance are luxurious bungalows housing a dozen other chiefs of state. The headquarters for the conference is the seven-story San Rafael Hotel, which looks like an overgrown Tudor mansion. The talks themselves will be held in the hotel's gambling casino, where some $30,000 is bet each night during the season on roulette and blackjack. Johnson hopes to place a far bigger bet on Latin America's ability to build and profit from a common market.

*Only two who were invited will be absent: Bolivia's Rene Barrientos, who is angry because the question of his landlocked country's access to the sea is not on the agenda, and Haiti's Francois ("Papa Doc") Duvalier, who fears what might happen if he left home. Cuba's Castro was not, of course, invited.

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