U.S. AID in the Dominican Republic - An Inside View
Past NACLA Newsletters have described the U.S. Agency for International Development (AID) and its role in "funding the empire". 1 The following interwtew gives some insights into the day-to-day...
...DF: The standard Supporting Assistance loan--a ten year grace period and then 2-1/2% a year, something like that, very low, but still a loan that had to be paid back...
...1962, January 1: Council of State sworn in with Balaguer as President and Rafael Bonnelly as Vice President...
...7. The Dominican capital of Santo Domingo is the country's largest city (over 600,000 people) with approximately four times the population of Santiago, the next largest city...
...Just a few weeks after the U.S...
...Roughly, and this is very rough--it depends on definitions even if it were precise--of all the AID money given to the Dominican governments since 1962, $100 million to $180 million were grants and will never be repaid...
...I talked with them endlessly, trying to figure out how they saw things in order to figure out what they meant when they wrote...
...the loans are authorized in Washington...
...it wasn't a big political issue...
...The national government was not giving them anything, was constantly investigating them, sending in teams of auditors, and so on...so Harrison, the assistant director, reacted favorably to the major's suggestion that AID make a loan to him...
...AID program there (appointed May 23, 1965...
...There's no way...
...It was started under Garcia Godoy and now was probably suffering the first impact of the Balaguer regime...
...DF: Exactly, he was seriously discussing with the Peace Corps director, (Sargent) Shriver, a 4000 man Peace Corps program in the Dominican Republic...
...No one is...
...So that little remainder is really rather tightly hoarded...
...The IMF sends down its team and generally they have a courtesy visit with the ambassador and the director and the assistant director and possibly even talk to some of the technicians who have to do with budgeting...
...And the criteria they used would be multiple...
...DF: Apparently...
...Box 57, Cathedral Park Station, New York, N.Y...
...They would go there and sit in the office four hours a day and drink coffee most of the time...
...He did not force the Dominicans to shape up...
...This became his thing...
...In Minimum contribution for one-year subscription: $5.00...
...He's not an outgoing person...
...And it was coming down to the line every month for the last three months of the regime, to the extent that everyone was desperately trying to avoid a situation where they wouldn't be able to pay their salaries...
...Civilian junta (the "Triumvirate") takes over the government...
...Copyright Q 1970 by the North American Congress on Latin America, Inc...
...Ever since the assasination of Trujillo, in May 1961, the Dominican Republic has been highly unstable politically (see brief chronology box...
...Recent measures of the Balaguer and Garcia Godoy administrations have reduced the city's tax authority as well as its share of the national government revenues...Since the Balaguer administration was inaugurated (in 1966), the decrease in city revenues under the new municipality subsidy law has forced the city government to discharge 2700 of its 7000 employees, and to negotiate short term credits from the Reserve Bank to cover current expenditures...The $5 million (proposed AID) program is expected to create 4000 unskilled jobs for the twelve months starting in August (1967...
...Useful background reading to this interview can' be found in an article by two NACLA staff members on the U.S...
...The basic fiscal structure has been unchanged since Trujillo...it's tax the poor...
...It's all political: to what degree do the pols, the expert political foreign service types, estimate the situation merits another tranche of this or another slop of that...
...DF: Legally the state owns all of it--they don't know where it is in many cases...
...If the IMF is thinking of recommending a devaluation it would go to AID-Washington and say "We're thinking of recommending a devaluation," or "We're Gen...
...Another reason was that there was a lot of entrenched corruption...
...NACLA: That was all financed by the U.S...
...DF: Well, because that was at the time of Trujillo's death...
...NACLA: People feel the Dominican Republic is pretty well stabilized, don't they...
...As a result of his experience in the Dominican Republic he became so disaffected with U.S...
...So they're an expensive bunch of guys...
...PARALLEL GOVERNMENT NACLA: Can you give some examples of parallel government...
...1 The following interwtew gives some insights into the day-to-day operation of an AID mission in a specific country--the Dominican Republic...
...NACLA: So he was planning to just buy off the whole country...
...And no one is making any effort to sort it out...
...No criminal proceedings were initiated...
...Oh sure, we need public works...
...Balaguer soon after forced out and Bonnelly heads the Council...
...DF: Take a typical ministry, the ministry of Agriculture...
...And AID was supposedly not competent to handle that and there was no reason that we should...
...AID Loans Other Public Loans DeveFiscal Supporting lopmer.t Year Dollar PL 480 Sugar Assistance Loans PL 480 Amount Source 61 0 0 0 0 0 0 62 3.2 1.6 36.0 24.7 0 5.4 3.5 IADB 63 23.8 10.3 - 5.6* 0 2.1 12.7 3.0 IADB 64 2.5 9.2 3.0 0 O 0 16.0 IADB 6 LMF 10 65 7.5 7.3 25.9 14.3 7.5 5.9 2.1 IADB 66 85.8 6.7 37.4 25.0 14.5 0 7.0 IADB 67 6.6 4.1 42.1 30.0 17.1 0 0 68 4.7 4.0 48.8 16.4 22.3 0 0 62-67 129.4 39.2 138.8 94.0 41.2 24.0 24.0 Source: "United States Economic Assistance to the Dominican Republic", David Fairchild, June 1969 (unpublished paper, University of California, Berkeley...
...As for parallel government, that's an interesting thing...
...and Bolivia just before and during Firfer's mission there, see the following pamphlet: "The United States and Bolivia", Laurence Whitehead, Haslemere Group (Publications), 515 Liverpool Rd., London N7, England, (2s 6d...
...He was not a tough man...
...If you ever want to find out anything about the Dominican military you'd always call MAAG first...
...an economic consultant to the government of Puerto Rico under the Economic Development Administration ('54-'58...
...AID was in the Treasury, was in there to the extent they knew every day how much revenue was collected and how much was paid out, check by check...
...Since 1962 between $500 million and $600 million have been involved in the total AID program...
...It seems clear (this would happen) when a country only has a $200 million budget and most of it is tied up--say of that $200 million only $20 million is flexible, the rest being essential just to pay salaries, keep the traffic flowing, really basic kinds of things-and along comes the United States with $40 million AID a year, twice as much (as their flexible budget...
...NACLA: What did they use their own revenues for...
...2. The books referred to are various unclassified AID program reports David Fairchild had with him during the interview and used for reference...
...Another big drain would be the extremely inefficient government operations...
...They would come in and say "Well, look, I want $10,000 for this" and they'd have to tell me why they wanted it...
...They were paid by AID because there was no way of keeping the accounting AID-trained and equiped police force demonstrating students to the ground in Santo Domingo separate without exposing them...
...And their reports are not generally available to the AID types...
...NACLA: Did the military make that known to the AID directly...
...So what can a guy like that do...
...1966, September : The last of the U.S...
...They don't even know who owns the land...
...Subscription price: $5 per year for individuals...
...economic and military aid...
...DF: It's always true to say he wasn't ideal...
...His grant budget in a normal mission would be very limited...
...And that's in fact what happened...
...Two reasons might be suggested for that...
...My job was to make sure it was in line with objectives...
...DF: Apparently that was similar in many respects...
...It was just that simple--it was a wall...
...So the middle class, which likes to buy imported goods and can't stand locally produced products, pays through the nose for them...
...President Johnson at one time was talking of a $4 billion dollar agricultural loan program...
...1968, May : President Balaguer's Partido Reformista wins the municipal elections (including Santo Domingo...
...Rightist military forces led by Elias Wessin y Wessin strafe the government palace which is controlled by Constitutionalist forces...
...Balaguer is completely ignoring it...
...1965, April 25: Reid Cabral government falls...
...DF: Yes, they were in intelligence, communications, management training..here are the figures: in fiscal '67, there were 15 (AID Public Safety officers), in fiscal '68, there were 18, fiscal '69 18, of which six, one third, were CIA...
...NACLA: Why was that...
...upwards of $3.5 or $4 million in grants and then it got $12.5 million in loans...
...Another example might be the Office of Rural Community Development which got a total of over $12 million in loans and grants committed to it for a three year period shortly before the time I was there...
...Most of them are under AID contract with Texas A&M...
...He wouldn't support their findings...
...They are then made available at CIAP or some other level in Washington and then shipped down to the mission by AID-Washington...
...So he could in fact threaten to wreak a lot of havoc...
...Not only because the importers are in collusion and have monopolies and charge monopoly prices, but also because the government taxes them at 100% or more...
...I need somebody who knows something about rice technology," or "I need somebody who knows about working with ports and port facilities...
...1963, February 26: Bosch inaugurated as President 1963, September 25: Bosch overthrown by a military coup led by Elias Wessin y Wessin...
...And the amount of military aid is something like $3.5 million, which to a little country like that is a lot of money...
...The rural land is even worse--I'll get to that next...
...The Americans' sole bargaining device was to say, Well we'll have to consider not refunding you, or not continuing your money, or delaying your money...
...They can't even estimate within several thousand acres how much it is...
...And this crop spraying service, as far as I, and others, could tell, never did anything but spray the crops of the Minister of Agriculture, the Vice Minister of Agriculture and their buddies...
...And that's what happened...
...ABBREVIATIONS: CIAP - Inter-American Committee on the Alliance for Progress IMF - International Monetary Fund IRS - (U.S...
...They set up modern innovations, computers, etc...
...1965, April 28: U.S...
...IV Nos...
...200 million is not a great deal of money...
...It served as the main headquarters for the rightist forces commanded by Gen...
...magazines including Forbes, Harpers and Saturday Review.- 10 - The Dominican Republic was an unuaual situation in that during the revolution (1965) and the provisional government it was getting all the money it could ever use and more...
...But that doesn't say who does it...
...And AID knew this...
...policy objectives...
...The AID technicians themselves were feeling really hurt because people were pointing out this discrepancy...
...DF: The military...
...They have all kinds of indirect taxes on food...
...NACLA: Where was his political support...
...negotiators and headed by Hector Garcia Godoy.- 4 current regime would call revolutionary youth to become investigators--kids 18 to 24 years old affiliated with the PRD, participants in the 1965 revolution and so on, who wanted to get in there and saw this as a chance to get some sort of reform going...
...DF: I think it was six...
...This ad has appeared recently in many U.S...
...So the first step is to do a cadastral survey and survey every piece of urban land, because that's where the money is...
...249-291...
...And they have gasoline taxes and a lot of taxes on internal production, indirect taxes, and very little corporate tax because most of the corporations are state corporations...
...Garcia Godoy is not asking for $15 million...
...the money that he's dealing with...
...NACLA: Had e also been on an extraordinary mission in Bolivia...
...Government Grants U.S...
...Military and Police Assistance Programs...
...There is no way of saying that it's an independent country...
...The normal amount of work that a big city like that would generate cleaning the streets, collecting garbage and so on is quite substantial...
...IMF at the most can offer him $15 million in emergency funds...
...I've been thinking we should take all our Peace Corps from everywhere else and put them in there, just for six months...
...He wants the incumbent, whoever wins the election, to sign (the loan...
...IV, No...
...The foreign exchange position of the Dominican banking system in '65, when you could walk around the streets and it would look like the country had been through a famine, depression and war--troops wandering around, smoke, bullet holes--was the best it had been since Trujillo died: they were $40 million ahead...
...I was in charge of receiving their initial proposals...
...NACLA: Were they in any special intelligence work with the police...
...It really got going and recruited a lot of what the Chronology 1961, May 30: Dictator Rafael Leonidas Trujillo is assassinated...
...Get it under the rug...
...Since it was not (a normal mission) he had a fairly large amount of dough to play around with...
...But the IMF in the Dominican Republic was different in that the Dominican Republic's financing from AID was so fantastic--it was getting so much bread from AID-that anything IMF could have offered or refused to offer was irrelevant...
...3 It is no longer true because so many years have gone by and during those years the land has not gone unused...
...There were very few actors and everyone knew what was happening and they all just sat there and horse-traded...
...And of the money they get out of Congress 80 percent of it goes to Vietnam...
...They really can't figure him out, at least until I left they hadn't figured him out...
...NACLA: Why do you say "state-owned" (in quotes...
...Could you continue this and also discuss the role of the director, Firfer, and the whole mechanism of setting up a parallel government...
...But they couldn't even pay...
...11 Issue...
...In April 1965, no longer able to control the Dominican situation through indigenous intermediaries, the United States landed over 20,000 soldiers to secure its interests...
...As soon as Trujillo with Vice President Richard Nixon...
...DF: The embassy handled it pretty much--the ambassador and his economic staff...
...Balaguer is kind of a nationalist, an old Trujilloist hack...
...with the Small Defense Plants Administration ('51-'53...
...They usually send Spanish-speaking technicians...
...Power in the Dominican Republic", Fred Goff and Michael Locker in Latin American Radicalism, Horowitz etal editors, Random House, New York, 1969, pp...
...He actually knows people in the United States who he phones...
...I'd say half of the taxable population owes back taxes in large amounts...
...That's one side...
...Donald Reid Cabral is Foreign Minister...
...Elias Wessin y Wessin thinking of making a standby loan," and so on...
...Bosch's PRD wins a majority in Santo Domingo...
...There would be a pet idea of one of these men and he would broach it with one or more of the others privately or in a staff setting and say look, I'm interested in this thing, look into it...
...NACLA: How many people did he have working with him...
...So they had to work with the second-best people...
...When they found someone they'd take it to him and say this guy owes $150,000 and he'd say, well, so what, you can collect it...
...As a result, everyone was just totally sick after two years of living in the filthiest city in the world...garbage was not collected, rats were constantly active...
...He's dead, you know...
...1966, June 1: Balaguer's Partido Reformista wins the national elections amid charges of fraud and repression...
...1962, December 20: Juan Bosch, presidential candidate for the Partido Revolucionario Deminicano (PRD) is elected president by 2-1 majority...
...Donald Reid really grooved on Americans, he loved the United States, he loved Americans and loved to have them in his house...
...DF: Right, the total annual budget, which is substantially less than the budget of the city of San Francisco, which is $500 million or so...
...NACLA: You mean start a division which would collect property taxes...
...AID AS CIA COVER NACLA: What role do you think AID had in gathering raw intelligence and transferring it to the CIA or other sectors of the embassy...
...Santo Domingo contains the vast bulk of the country's industry, commerce and trade...
...It no longer is...
...Because they were just having such a good time and they didn't want anyone to see what a good time they were having...
...The interview also reveals some of the ways AID is used to apply pressure for changes in Dominican policy...
...Strategic Bombing Survey in Germany (1945...
...He could actually delay money...
...The 65-man MAAG mission lives, eats,- 7 sleeps with those guys...
...It's that simple...
...8 They will give you the full story on how this $5 million loan was first set up to assist the ayuntamiento, the Santo Domingo municipal government, to start a public works program to solve their tremendous unemployment and to somehow deal with the deliberate economic squeeze being put on them by the national government...
...In the 1966 elections Balaguer's Partido Reformista won nationally but the PRD gained control of Santo Domingo...
...Bosch's PRD boycotts the election...
...occupation forces withdraw, one and a half years after the April 1965 invasion...
...So the big problem was not passing new laws, at least while I was there, although the existing laws were no good, it was simply collecting all the back taxes...
...DF: There were six positions in the Public Safety Division of AID which were CIA officials...
...So one of the things AID tried to do, not AID qua AID, but some of the people in AID, some of the more motivated people, was to do some reform in this area that was so clearly in need of reform...despite the fact that Dominicans themselves weren't too interested in this tax reform...
...David Fairchild grew up in the Panama Canal Zone and majored in urban planning at Harvard...
...Joaquin Balaguer, old time Trujillo appointee, is president at the time...
...There is so much corruption regarding personal income...
...DF: Every single bit of it, for two years...
...occupation dies of a heart attack while campaigning as a leading candidate for the upcoming presidential elections...
...The ministry's budget was somewhere in the neighborhood of $6 million...
...He was a nationalist...
...1966, July 1: Balaguer inaugurated as President...
...NACLA: Can you discuss a typical day and week in AID operations, the type of things you were involved in...
...The ministry of Agriculture had in the neighborhood of something like 45 American technicians...
...That would be one big drain on the budget...
...1964, March 21: President Johnson reinstates U.S...
...Firfer didn't really groove on it...
...Wessin during the 1965 insurrection...
...They had this slew of IRS tax advisors running around the tax office...
...But that all changed when Balaguer came in...
...Well, what apparently happened was, it started under the provisional government of Garcia Godoy with his blessing...
...I had to become familiar with this because one of my jobs was getting the positions and the budgets straightened out...
...The PRD boycotts the elections...
...But the (Dominican) Budget Director was instructed by the minister of the Treasury to not give us these...
...They didn't know which way he was going to jump on many occasions...
...He also had to decide issues involving the operation of ongoing projects which had been funded...
...NACLA: That's above and beyond the $40 million from AID...
...He flounders around, tries to figure out what the hell is going on...
...They come in and slip through all the cultural barriers that are there for the American technicians and disappear into the inner workings of the financial structure and reappear three weeks later and leave...
...I remember the way we finally did get this information was through people who had been in the Budget Bureau under Garcia Godoy and had formed some kind of respect for their American counterparts, at least in contrast to the respect they held for their own Dominican superiors...
...Nevertheless, it was approved...
...intensified training...property tax...
...So at the last minute they assumed he had no objections--these AID types being kind of innocents politically--to this being done by the PRD-controlled local government...
...During the time I was there he would come into our office constantly to get more money...
...Marines land when it is clear Wessin's forces are being routed by Constitutionalist forces...
...DF: The coordination is not at the mission level...
...8. The numbers for the cables dealing with the loan to the Santo Domingo ayuntamiento in mid1967 are: SD SD SD STATE SD 2464 1792 1988 109586 3120 (TO AID 781) (TO AID 576) (TO AID 634) (AID TO 552) (TO AID 989) 9. According to the New York Times (January 23, 1967), between July 1, 1965 and June 30, 1966, the Dominican Republic received the highest per capita economic aid from the United States of any Latin American country--$32.10 compared to $13.40 for Chile, the closest competitor...
...There are many little case studies you could look at...
...One is that the military didn't want anyone fooling around with the budget at all for any reason...
...The military budget actually increased substantially after Trujillo died...
...They'd immediately hang up and call their MAAG advisor...
...There's a hell of a lot of land that's not registered and there's no way of saying who owns it...
...This is true...
...It's no longer a glamorous establishment...
...So it was stopped...
...And I think it's stablized now at 30% or 35% (of the budget...
...There wasn't even much of an investigation...
...DF: Well, just take the money side...
...Should he or should he not commit these funds...
...SANTO DOMINGO LOAN NACLA: Can you describe the way AID funds were used in Balaguer's effort to undercut the ability of the PRD government to properly administer the capital city of Santo Domingo...
...And it is also clear that the president has less power over the Dominican military than the MAAG does...
...So they didn't have a great deal of money to start with and when you take 35% of it away and spend it on the military there's just not much left...
...The rural land has the same problem but complicated by the fact that 35% of all the land is "state-owned...
...NACLA: What were some of the guidelines that would be used in giving grants and loans...
...Since September 1968 he has been a regional director for AID in Vietnam...
...penetration of the Dominican government structure, to the extent that AID has created a virtual parallel government in various strategic ministries...
...Indirect taxes are like 70% of 80% of the budget, and of these well over half are import duties...
...He did think in those terms, of just drowning the place in funds...
...As I mentioned before, during the Garcia Godoy regime there was such a degree of penetration that we knew at the end of business every day how much was taken in that day by the Treasury and how much went out...
...invasion and has been one of the strongholds of Constitutionalist and PRD (Bosch's party) support...
...So one of the things the AID technicians were most interested in doing was getting rid of these planes, selling them, getting crop spraying into private hands, so that it was done on a reasonably economic basis, and getting the government out of crop spraying entirely...
...Furthermore, the interview gives some idea of the way the AID program is viewed and used by Top decision-makers in Washington: a mechanism for buying off and cooling off situations which are in conflict with U.S...
...This was during the last months of the provisional government...
...Along with the invading and occupying military forces came a small army of technicians" and "advisors" whose job was to administer the millions of dollars (see chart below) injected into the Dominican Republic to restructure the country's infrastructure, buy off dissidents, and "pacify" those who couldn't be bought off...
...it's incredible...
...director of AID in La Paz, Bolivia ('62-'65...
...NORTH AMERICAN CONGRESS ON LATIN AMERICA (NACLA) NACLA NEWSLETTER P.O...
...foreign aid to the Dominican Republic...
...So they had this huge organization which they could compartmentalize...
...AID in the Dominican Republic - An Inside View...
...Per capita that was the heaviest AID program in Latin America...
...They are specifically to "improve collection and auditing, expand and refine taxpayer information, expand the use of data processing, strengthen the administration of the tax services...management controls...
...DF: No, just get an expert down...
...They probably have relatives and friends there...
...1 The Mercenarization of the Third World: Documents on U.S...
...He no longer allowed that degree of penetration...
...Take, for example, the irrigation canals There was an extensive irrigation canal system providing a large amount of water to very land-rich old families while the very poor families living near the canal couldn't even get a canal to their property...
...He had led them all to believe he was going to allow this (the loan to the ayuntamiento) to happen...
...How does this work...
...He'd just say "I need money, I'm out of money," and we'd write up the documents...
...The following, taken from an AID background report prepared by David Fairchild in June 1967, elaborates on the ayuntamiento situation: The city government depends on a varied set of local excise taxes, services charges, and rents for approximately one third of its income, the rest being transfers from the central government...
...see, no effort to reform the legislation...
...Sugar, although it had all the effects you could wish on the economy, was kind of a self-contained little arena of operations...
...Well, there is no such thing as a typical day or week...
...lie was saying: "What are we going to do Sargent...
...So the land is effectively alienated from the state...
...DF: I have a list of the cables that would give you the whole picture...
...he didn't want to sign it...
...The military is handled by MAAG...
...Here's one, April 15, 1966...
...They worked with the police...
...It was up to their judgement...
...NACLA: No property tax...
...They'd go around to collect it and get shot...
...ties with Cuba and the imposition of the trade embargo against Cuba in 1960 the Dominican Republic has assumed an increasingly important position in U.S...
...So he's got all the money he needs from AID...
...It was the center of fighting in the 1965 insurrection and U.S...
...I can tell you exactly...
...And so they worked with these guys, these really foul people...
...1965, September 3: Installation of Provisional Government put together by U.S...
...DF: No...
...Balaguer, for one, isn't personable...
...So he had a lot of power, because once projects were going people were being paid salaries, they were developing a life of their own...
...He said great...
...In fact, I remember in detail some of the arguments that would revolve around the budget, because we couldn't really figure out how to program our funds until we knew whether or not the Dominican government would make funds available for this, that, and the other Fiscal Years 1961-68 Economic Aid to the Dominican Republic Fiscal Yearons of U.1961-68...
...It's like the Dominican government and the AID formed this banking structure that was running things...
...Get it out of the public eye...
...NACLA: What about having people in the Treasury ministry, the Justice ministry...people who are really technically skilled and know Spanish...
...It has been used quite heavily by large and powerful figures in the Dominican political scene and these people aren't going to give it up, they've got it...
...supporting assistance) loan--when Balaguer outmaneuvered everyone by snaffling it and giving it to the Ministry of Public Works instead of the ayuntamiento...
...It would be hard to say on that...
...7 You were discussing how the AID technicians knew exactly what was going on in the Treasury and other ministries...
...AID would fund one contract technician to program in detail a property appraisal and tax mapping project just to get the thing started...
...he wrote it up and personally wrote all these cables, some of them running to 20 pages...
...10025 P.O...
...He was favored by the U.S...
...Since the severing of U.S...
...NACLA: How many went down there...
...There was just so much money no one knew what to do with it...
...In each decision he would be considering his budgetary constraints, how many people he has that might be able to get to come down to the Dominican Republic...
...So we had to have some kind of budgeting information from them prior to their final approval of their budget and have to have some kind of interaction with them in order to make sense out of the country's investment programs...
...1970, May 16: Balaguer wins re-election to a second four-year term...
...It's not only So months, in fact, years dragged by on this issue, during which AID funded entymology programs, spraying programs, pest control programs on the order of hundreds of thousands of dollars sending people to the States for training and so on...
...Five million dollars was ready to go--again an S.A...
...military personnel responsible for implementation of the military assistance program...
...Their true dollar cost to the United States is something like $35,000 a year each...
...He knew AID wasn't serious...
...policy he felt free to share some of his insights on AID with Newsletter readers...
...So there was the classical, centuries-old problem of who gets water...
...Of these 45 perhaps two or three speak Spanish well...
...He doesn't get along that tremendously well with Americans...
...I would suggest the single most praiseworthy thing AID did while I was there was set up a team of Dominican tax investigators...
...Washington didn't think it was very good...
...The project got under ay with fantastic hopes all around...
...IRS Team...In order to achieve these objectives, a seven man U.S...
...The tourist agency was composed of 30 or 40 people, most of whom didn't do anything...
...2 & 3, April & May-June 1970...
...All these options were his...
...At least one or two of them have been there before...
...The whole thing came to a grinding halt with the discovery that Fiore Mara, the director, had absconded with $500,000...
...The closest to someone who would have been ideal for the U.S.would have been someone like Donald Reid...
...Box 226, Berkeley, California 94701 The NACLA NEWSLETTER is published ten times a year by the North American Congress on Latin America...
...What do you say...
...NACLA: On what terms...
...If Balaguer, when he steps into office, has $15 million in the pipeline of Supporting Assistance financing and within a month after he's in office he signs for $25 million more for a total of $40 million to carry him through his first year of office, what the hell is the IMF going to do...
...Another loan, given the history of the Dominican Republic with all their loan problems--the 1916 invasion seemed to be largely a loan-collecting invasion--they just didn't like loans...
...embassy staff during his assignment in Santo Domingo...
...And they were getting no-9 - support at all from the national government...
...The rest vary from good American Spanish-poor grammar, very ppor pronunciation, but fluent-to nil, nothing at all...
...NACLA: What are the main sources of revenue...
...in Caracas, Venezuela ('58-'62...
...And I think this was one of the main reasons the PRD lost in the municipal elections in 1968, because they couldn't--without the national government giving them any support, in fact, quite the contrary, with the national government working them over continuously--clean the streat, pay their own salaries or even administer their normal operations...
...Firfer had up to $100 million worth of grants...
...NACLA: So Balaguer wasn't cooperating to the extent certain elements in the United States would like to see him cooperate...
...As far as I know the guidelines for choosing between projects and the fundability of a project were entirely in the heads of the mission director and the deputy mission director...
...There wasn't anything they had to spend themselves with their own revenues...
...DF: Certainly not pro-American...
...GARCIA GODOY BALKS DF: Yes, let me go through my program staff notes...
...DF: Oh yes...
...One agency I got to know fairly well was the tourist agency...
...So we would actually get copies of the draft budgets passed to us by these guys just as special favors...
...A peace Corps Volunteer in the Dominican Republic...
...DF: Because he just didn't want to sign it...
...The whole program, as far as I know, is dead...
...He knew where his political support lay and his political support wouldn't tolerate it...
...So he's not ideal from the Americans' point of view, he's not our boy...
...The canals had been built under Trujillo and added to with AID funds since...
...IMF-AID COORDINATION NACLA: What type of coordination is there between the IMF and World Bank and AID...
...10 for institutions...
...5. Alexander Firfer has occupied a number of strategic positions during his career: a bombing analyst with the U.S...
...1963, October 4: President Kennedy withdraws all U.S...
...It was being drowned by funds...
...2 "Tax Administration...062.4" This is their August '66 book so this would be just as the thing was getting under way...
...It was a political and personal thing between the three or four top men in the mission regarding a project...
...DF: Well, the people in AID Washington may feel that...
...He will actually go out and expropriate with compensation privately owned land--clearly privately owned land, with title...
...If you called the Dominican military they wouldn't know what to say to you...
...So we didn't have anything to do with sugar...
...DF: The amount of money the Dominican government got directly or indirectly, above-board and underboard, for everything it did during the provisional government period was just fantastic: $100 million...
...They call themselves "Constitutionalists" because they advocate a return to the constitutional government of 1963...
...NACLA: You were discussing a typical day in AID, an AID staff meeting...
...And these issues revolved largely around AID withholding further support as a punishment for something the Dominicans were doing that the Americans didn't like...
...The following is a greatly shortened version of an interview conducted during the summer of 1970 in Berkeley by Fred Goff for NACLA...
...But in general they have closer rapport with the Dominican government than the Americans do...
...San Isidro (military basg) seldom has less than 10 Americans running around...
...he even had 45 Peace Corpsmen...
...Balaguer got in he cut it back...
...See page 10 for President Johnson's ideas on how to use the Peace Corps during crises such as the 1965 invasion...
...But he didn't in practice...
...It is located a few miles outside the capital of Santo Domingo...
...DF: Well, they're not spelled out or written anywhere...
...It graphically describes the depth of U.S...
...So there isn't much in the way of corporate income and virtually no personal income and no real estate tax...
...So he was just fired...
...And the second-best people in a country with very few human resources like the Dominican Republic are pretty rotten...
...presence in the Dominican Republic: "The Violence of Domination: U.S...
...The following is an interview with one of the AID officers who went to the Dominican Republic during this period of massive AID infusions: David Fairchild, Assistant Program Officer, USAID, Santo Domingo, from April 1966 to September 1967...
...TOTAL AID TO DOMINICAN REPUBLIC NACLA: Can you discuss the magnitude of the AID program just after the invasion in 1965...
...That's a question these books will answer...
...For helpful background to the "extraordinary relations between the U.S...
...6. San Isidro is the main military base in the Dominican Republic, having been built up as the major air force and tank base by Rafael Trujillo and his son Ramfis...
...We've got to do something, that place is a mess...
...Sugar was pretty much handled by the embassy because it was such a horsetrading operation...with the ambassador, the president of the DR and the sugar lobby...its just a rotten deal...
...They are tied in...
...2 - NACLA: (A question about the size and degree of compartamentalization in the U.S...
...invasion of Santo Domingo in 1965 he was appointed director of the massive U.S...
...3. Shortly after Rafael Trujillo's assassination in May, 1961 all the Trujillo family's vast holdings were nationalized and the Trujillos and their associates were exiled...
...This is a meeting with Firfer, the AID director for the Dominican Republic...
...We (AID) didn't even handle the economy...
...The litigation in simply selling it is quite considerable, and the litigation involved in taxing it would be almost out of sight...
...Unemployment was astronomical, like 30 percent, and a large part of it was among the ayuntamiento employees, street cleaners and so on...
...Another way of seeing it is that they simply did not have a great deal of money...
...it wasn't going to let him fall...
...AID kept saying (something like), "Well, in order to make it possible for you to get to the end of your period without this embarassing thing happening, which would probably topple you, we'll give you all this money in the form of a loan...
...So at that point they did, in fact, finally stop the funding on some of these crop-spraying related6 - projects until the Dominicans sold the planes...
...We handled, in effect, the public budget, except for crucial exceptions such as sugar--that was handled elsewhere...
...Ciudad Trujillo, 1955...
...The little guys end up paying and the big guys evade...
...But the Agriculture ministry did no more than insure that the rich continued to get their water at no cost or at minimal cost, while the poor paid for it...
...We had the most to do with just straight government projects...education, roads--we financed all the road building, all the road maintenance--every single bit of public investment in this conventional public investment area: roads, streets, water, light, housing...
...World sugar price higher than U.S...
...They are interested in land reform and urban land reform, doing something about the slums...
...1970, April 20: Hector Garcia Godoy, former provisional president during the U.S...
...Internal Revenue Service team of advisors is working to develop a revenue service capable of effectively and equitably administering the existing tax laws...
...If people had questions it would be fed back down to the staff to do some more work on it...shorten it or change it and shape it up so it became acceptable to these three or four decision makers...
...Second-class postage paid at New York, New York.- 3DF: Well, the AID doesn't ever directly get involved with the military, it doesn't have anything to do with the military, at least in the Dominican Republic...
...They are classified cables but they will be declassified and with this new law (Freedom of Information Law) you can go after them if you have the numbers...
...They were CIA employees...
...So when the Dominican Republic no longer has two or three assasinations a week it's time to cut out funds and send them to Colombia or Chile or someplace else...
...For details see Goff and Locker, op...
...So they were outfoxed by Balaguer...
...And just last summer in Venezuela I met one of the graduates of the program, one of the guys who was an investigator...
...He was recovering from three bullet wounds and says he and anyone else he thinks is any good has quit...
...There was a period there when that, in effect, was happening...
...7 / November 1970 Published monthly, except May-June and July-August, when it is published bi-monthly, at 160 Claremont Ave., New York, New York 10027...
...It was a long, drawn-out series of nasty little infights which represented a typical application of AID power...
...He gets on the phone and says...
...It seems to me that the only way such a reform program as this tax thing ever got as far as it did, given the entrenched interests it was opposing, was the fact that the United States was in it to such a degree...
...But they aren't too interested in the intricacies of fiscal reform...
...he really wanted to support it...
...They owed so much in back debts to pay for stuff done even before they came into office that they just couldn't handle it...
...Their location there was unknown to other members of Public Safety...
...Washington makes the decisions...
...The United States probed him repeatedly during the course of this project: "Is this alright with you...
...DF: Well, he had 180 to 200 volunteers...
...Another side is the fact that the military is clearly sitting around waiting for MAAG to tell it what to do...
...NACLA: And now he has gone to Vietnam to head up one of the AID missions there...
...There were only 6 of them out of 20...
...It reached the point where the contrast between this incredibly unjust expenditure of thousands of dollars for these planes and AID's other efforts became so acute that AID people were really hurt...
...Two AID technicians from the Wisconsin Land Tenure Center, named Penn and Dornr, wrote a good report (on land holdings in the Dominican Republic) and they came to the general conclusion that nothing could be done until they sorted out this problem of state lands...
...DF: The main sources of revenue are indirect taxes...
...IMF recommended devaluation and Balaguer said "the hell with you," and AID recommended it too and he said "the hell with AID...
...NACLA: Who handled that...
...The urban land would really turn in some money if they could do it and also it would be useful for other purposes: urban planning and generally finding out what the hell is going on in the city...
...Every last penny...
...It seems to me that there is a parallel government and that the Dominicans are, in fact, being ruled by the United States and by their own people...
...One of the most interesting involved a crop spraying service, which consisted of six planes-crews, maintenance and so on--run by the ministry of Agriculture...
...Basically the urban land registration procedure is an antique procedure requiring a great deal of paperwork, so it's way behind...
...1964, April 24: Military uprising against the ruling junta is staged by supporters of former president Juan Bosch in capital city of Santo Domingo...
...just pocketed it...
...FOOTNOTES: 1. See "Funding the Empire" (Parts I & II), NACLA Newsletter, Vol...
...He has a very strong privatism...
...NACLA: That's the total Dominican budget...
...I mean absolutely nothing...
...an expert on industrial development promotion with the U.N...
...and trained these Dominicans to go out and investigate and get the money...
...Garcia Godoy was having nothing of it...
...They sensed there was no way they could get these people to use their planes equitably on small as well as large parcels...
...They know that they own it because Trujillo owned it and when Trujillo died it was turned over to the state...
...He'll go out and pay the guy in bonds rather than fool around with his own state lands, which are 35% of the arable land, because they're so tied up with ex-military, primarily, and powerful oligarchy figures who now have cattle on them, have houses on them, have actually sold them or engaged in loans using them as collateral...
...in effect giving it to them, because these supporting assistance loans are only loans in spirit...
...Trujillo didn't need the military as much as subsequent regimes did...
...So he would be confronted with these decisions of whether or not to approve this, that or the other funding, this, that or the other personnel and so on...
...Well, they have one but it's a farce and can be evaded by anyone...
...Internal Revenue Service MAAG - Military Assistance Advisory Group, the U.S...
...DF: Including the embassy, USIS, Peace Corps, AID there were, I think, 400 to 500--200 in AID alone...
...It's not a big agency but it's got a lot of Americans and they're all paid by AID...
...There was just a lot of inefficiency...
...The budget situation was critical in the sense that it was constantly hovering right around the point where salaries would not be able to be paid.- 5 - They knew exactly what their payroll was and what their revenue was on a day-by-day close-of-business basis...
...Basically, I formed the opinion that they didn't have much rapport, that the best people in their agency, the hardest working and the best trained, did not like Americans and were generally pro-revolution, anti-invasion, and so on, and viewed the Americans as intruders and undesirable...
...I think it was through 1967.5 It's now just a normal AID program...
...So this is the kind of decision he would make during the course of the week...
...policy considerations, both economically (especially in replacing Cuba as a major supplier of raw sugar) and politically ("no more Cubas in our hemisphere...
...quota price.- 8for the next year or two...
...He does a lot of his own recruiting...
...So that absorbs a fair amount of money...
...4. Dorner, P. et al, "Agrarian Reform in the Dominican Republic," Land Tenure Center, University of Wisconsin, #42, 1967...
...NACLA: So how much land really belongs to the state...
...DF: Firfer's decisions would revolve around perhaps at the most one or two commitments of new funds...
...IRS people on contract to AID did it...
...They've got very limited resources and the needs for it are seven times larger than the money they get out of Congress...
...And typically their decisions are based on this budgeting problem at the global level and they don't have much money...
...NACLA NEWSLETTER Vol...
...7 He doesn't authorize the loans...
...As a result, I think it was clear that they would be voted out in 1968...
...1963, December 22: Foreign Minister Donald Reid Cabral is named head of the governing "Triumvirate" junta...
...State Department over Balaguer to be the next president...
Vol. 4 • November 1970 • No. 7
