$500 Million Personal Fortune Kept Rafael Trujillo in Power
By Harlan Pryce ·
Dominican underground leaders operated at considerable risk while the U.S. blacked out financial aid and lost all military planning task force records.
Between April and December 1961, the Dominican Republic was slated to receive a "windfall quota" of approximately 466,000 tons of sugar. At the U.S. price, this would have brought a premium of roughly $22.6 million over the world market price. In a memorandum dated February 15, 1961, Secretary of State Dean Rusk wrote to President John F. Kennedy to address a specific fear: that eliminating this windfall would trigger the downfall of the Dominican dictator Rafael Trujillo and pave the way for a Communist-oriented regime.
According to the public record, Trujillo, known as "El Jefe," had ruled the Dominican Republic since 1930, serving as president and generalissimo. By 1961, his grip on the country was absolute, but the memorandum from the Foreign Relations of the United States (State Dept) suggests that the economic foundations of his power were fracturing.
A Premium of $22.6 Million
Rusk describes a Dominican government facing "serious economic difficulties." While the regime kept its foreign exchange reserves and budgetary positions secret, U.S. intelligence assumed the budget was only nearly in balance thanks to increased taxes on imports and exports and cuts to civilian costs and public works. The scene on the ground was one of stagnation: low business activity, scarce credit, high unemployment, and a rising cost of living.
Rusk is explicit about the cause of this distress. He argues that the economic hardship was not a product of U.S. sugar policy, but rather the result of Trujillo’s "excessive military and propaganda expenditures" and "unwise fiscal, financial and investment policies." Most pointedly, Rusk cites Trujillo's "systematic milking of the Dominican economy for his own personal gain."
The sugar quota was not intended to save the Dominican economy, but to pad a personal ledger. Trujillo owned, directly or indirectly, about 60 percent of the sugar-producing properties in the country. Consequently, the bulk of any U.S. premium accrued to the dictator personally. Rusk notes that Trujillo's personal fortune was estimated at $500 million, a substantial portion of which consisted of liquid holdings abroad. The implication is clear: if Trujillo wanted to stabilize the economy, he had the personal resources to do so, provided he was willing to spend them.
Venezuela's Demand
Politically, the memorandum suggests that while Trujillo’s fall was not imminent, his survival depended entirely on the continued support of the armed forces. Rusk acknowledges dissatisfaction among a few officers but reports no "cogent evidence" of large-scale defection.
The U.S. was monitoring two distinct opposition groups. The first was a domestic underground composed of students, professionals, and business people. Rusk describes this group as "predominantly anti-Communist." The second consisted of exile groups based in the United States, Puerto Rico, Cuba, and Venezuela. These groups, Rusk warns, had been "infiltrated by pro-Castro or pro-Communist elements."
The risk calculation for the Kennedy administration was a matter of who would fill the vacuum. Intelligence suggested the danger of a Communist takeover would be "less if the domestic opposition gained power" and "increased substantially" if the infiltrated exile groups succeeded.
Beyond the internal dynamics of the island, there was the matter of hemispheric prestige. Rusk warns that supporting a "tyranny" in the Dominican Republic would impair the U.S. ability to lead Latin American efforts against the Castro dictatorship in Cuba. This was not a theoretical concern; Venezuela had explicitly stated that action against Trujillo was a "condition precedent" to their support for collective action against Castro.
Mr. Berle's Task Force
To mitigate the risk of a chaotic transition, the U.S. had already begun operating in the shadows. Rusk reports that U.S. representatives had established contacts with leaders of the domestic underground "at considerable risk to those involved." These leaders sought U.S. assistance and advocated for a free enterprise system, though they planned to confiscate all of Trujillo’s properties and nationalize public utilities with compensation to owners. They also intended to implement land reform through agricultural cooperatives and the nationalization of idle land.
These underground leaders had already agreed on a president to lead them and planned to hold elections within two years. The record shows a gap here: Rusk notes that "no financial assistance has been given these underground leaders," followed by two and a half lines of source text that remain not declassified.
In contrast, the exile groups had received "limited financial assistance and propaganda assistance" via radio broadcasts. The memorandum contains another redaction, noting that a redacted entity "has established useful working relationships" with these exiles to distinguish between democratic and undemocratic elements.
The memo concludes with a stark question: if the underground leaders failed to secure the support of the Dominican armed forces and called for help, would the United States intervene militarily, either alone or with other American states? Rusk recommends that Mr. Berle’s Task Force be assigned to study the question and review the entire plan.
A handwritten footnote from Rusk simply states, "This has been done." However, the archive notes that no record of the Task Force’s deliberation on this matter was found.