When the second annual meeting to review the Alliance for Progress convened in Sao Paulo last week, Brazilian President Joao Goulart sharply criticized United States efforts to aid Latin America. The Alliance is ineffective, he argued, because it is improperly managed; in other words, the United States Agency for International Development mishandles the billion dollars a year that the Alliance funnels into Latin America. He called for the establishment of an inter-American fund bank to replace the Alliance. This bank would be financed largely by the United States, but its direction would be entirely Latin. "Today, and each day more so," Goulart stated, "Latin America should present to the world a united, solid cohesive front in the collective defense of our common interests."
Sadly, the Brazilian's comments typify much current Latin thought. His recommendation that the administration of American funds be totally removed from American hands dramatizes the basic misunderstanding of United States endeavors in South America. The United States intends to spend $20 billion on the Alliance over a ten year period not altruistically, but to encourage the development of a modern industrial society. The charter of the Alliance states specifically that unless development takes place along well-defined democratic lines, no United States funds will be forth-coming. Cuba has been excluded from the Alliance since its inception, and aid to Honduras and the Dominican Republic has been suspended until they re-establish constitutional governments. If such policies are to continue, the disbursement of funds must remain essentially an American function.
The Alliance's basic premise is one of matching funds: that is, Alliance money will supplement government and private capital for approved projects. With real per capita income falling, the cost of living doubling yearly and the world's least stable currency, Brazil has trouble matching American allocations. But Goulart knows that the rest of the hemisphere does not share Brazil's problems. His condemnation of the Alliance before the assembled representatives of the Latin republics was calculated to secure greater recognition of Brazil as a hemispheric leader.
The meeting itself showed better sense than Goulart by approving a multinational executive council, consisting of seven Latins and an American, to coordinate multilateral efforts and long-range planning. Hopefully, this council will provide a responsible vehicle for future appraisals of the Alliance.