Nonetheless, before the Bolivians could renegotiate the tin contract, they had to first present evidence that a price adjustment was necessary. Having smoothed the way with numerous U.S. officials, Andrade asked the tin producers to draft a memorandum that emphasized “the injustice of the present contract” and its “effects . . . on Bolivian mining,” as well as those of postwar inflation and rumored British offers of 64 to 66¢ per pound to Malaya.54 Whereas Hochschild had, up to this point, quietly complained to the State Department about Bolivian tax policies, he now took this opportunity to openly assail the Villarroel regime. The memorandum he and his fellow “political enemies of the Government” sent to Washington focused almost exclusively on the Bolivian tax structure and clearly aimed to draw the Truman administration into their struggle against Villarroel. Although the Bolivians did, with State Department support, receive permission to renegotiate, internal Bolivian policies would be on the table, and Andrade would stand almost alone against the combined might of Hochschild, his government’s “mortal enemy,” and the U.S. technocrats.55
When negotiations began in earnest in March 1946, the RFC’s George Jewett and Jesse Johnson, standing in for the Foreign Economic Administration, immediately asserted that their agency would be willing to hold the price at 60½¢ per pound, but only if the Bolivians would “make concessions” of their own through a reduction of export taxes. Still claiming to be operating at a loss, Hochschild demanded a price of 68¢ from the RFC and a tax cut from Andrade, retroactive to 1945. Although the State Department, using data that Hochschild had provided earlier, was able to expose this claim as a lie, his complaints about significantly higher labor costs may have had some merit.56 The tin barons asserted that their labor costs had increased by more than 20¢ per pound during the war, and even Patiño had been forced to close a mine that could not produce a profit at less than 72¢ per pound. Doing so had, under Villarroel’s revised labor codes, cost the “Rey del Estaño” more than four hundred thousand dollars in indemnification payments to the workers he had laid off. Moreover, the tin barons were unable to understand why tin was apparently the only product on the planet whose price had declined in the previous year.57
By April, the RFC’s Jewett had increased his offer twice, but now it was
“up to the Bolivian Government” to also “lend a hand” by reducing taxes and exchange restrictions. Paz Estenssoro’s representative in Washington claimed that this would amount to “political suicide for his government,” which would be “immediately accused of selling out to the rosca.” When Jewett, following State Department recommendations, did present an offer of 63½¢ per pound, Hochschild refused to budge from 67¢. Bolivian chargé German Rovira then suggested an adjournment for the producers to prepare a counterproposal; Hochschild replied that he “had just finished making one” and Jewett should consider his offer rejected.58
The State Department apparently did at one point briefly take up the tin barons’ cause. At one of the sessions, Braden’s assistant, James Wright, took the floor and proposed that the RFC pay 63½¢ per pound and that the Bolivians “modify their tax schedules and exchange rates” to essentially grant the tin producers another 4¢ per pound of pure profit. Although Ambassador Andrade’s superiors were apparently “ready to make some concessions in taxation” and to “express the sacrifices that we are willing to make,” Andrade was not. Stunned that the State Department was now openly endorsing Hochschild’s position, Andrade immediately sought out Senators Arthur Vandenberg and Tom Connally, leaders of the Senate Foreign Relations Committee, who had long been critical of Braden’s penchant for intervention. With the senators’ support, he approached Braden and politely but firmly threatened to publicize this most recent “intervention.” Because Andrade had not yet told Senators Vandenburg and Connally the substance of his complaint or sent word of Special Assistant Wright’s “suggestion” to La Paz, he offered Assistant Secretary Braden the opportunity to retract it quietly. To Hochschild’s amazement and displeasure, the assistant secretary reconvened the meeting, and Wright disavowed his statement.59 The next time Hochschild claimed that “the Government of Bolivia should do something” about its tax policy, State Department officer Sam Lipkowitz bluntly replied, “That is your problem, I am not working there.” The RFC quickly confirmed that Bolivian fiscal policy was “not involved in our present negotiations.”60
During a conversation with Ambassador Andrade in May, Assistant Secretary Braden apparently said that “others here had asked him to insist that the Bolivian Government for its part help to reduce the high costs of production in Bolivia by decreasing taxes, the exchange rates, etc.,” but he had replied that “he could not do so.” He explained to Andrade that “he had been strongly criticized for the very staunch support he had given the Bolivian side” at various meetings. He was certainly remembered for years as a man “known to feel the RFC treated Bolivia rather shabbily.” On several occasions, Braden had argued for an increase in price on behalf of a regime he despised against a branch of his own government and even seems to have taken a personal liking to Andrade.61 Moreover, if Special Assistant Wright had suggested internal policy changes, he had done so with the blessing of Undersecretary Clayton, who believed that, since the Bolivians were using production costs as the basis for their arguments, “all cost factors became a matter of interest.” Though Braden personally believed Villarroel could easily reduce export taxes without harming social welfare measures by trimming his nation’s exorbitant military budget, he appears never to have made this suggestion. Remarkably, even at the peak of the Blue Book hysteria he had unleashed, Braden remained at least neutral toward and at most supportive of Villarroel’s government during the tin negotiations, if only to ensure that tin continued to flow.62
Meanwhile, Ambassador Andrade continued his tireless efforts to secure 67¢ per pound by stonewalling and by darkening the door of every remotely influential U.S. senator, congressman, cabinet member, or journalist he could find. In mid-July, he finally made headway by demanding that, unless the RFC met his price or lifted all restrictions blocking Bolivian sales to European nations, he planned to bring this “discriminatory practice” before the United Nations. Even though Assistant Secretary Braden supported the Bolivian desire to sell its tin on an open market, because of quotas set by the Combined Tin Committee, no nation would permitted to purchase it.63 Still, Andrade’s threat appears to have been effective. A day after his ultimatum, the RFC gave its approval to a formula that essentially granted the Bolivians their coveted 67¢ per pound. Villarroel and Andrade had reluctantly agreed, “more or less as an indirect result” of U.S. protests, not to tax the tin producers on more than 62½¢ per pound, but this bittersweet concession was soon dwarfed by political catastrophe. Villarroel’s government was toppled just three days later, and in Andrade’s words, “as a result of a painful paradox, the fruit of all of our efforts served, in the end, to benefit our enemies.”64
The Blue Book may not have inspired a revolution against Villarroel, but it seems that opponents of the regime were not lacking for inspiration of their own. Fearing that the Machiavellian tin baron was plotting and financing a new counterrevolution, overzealous radepistas had kidnapped Hochschild in 1944. Only Villarroel’s personal intercession had brought about his release. When a revolutionary plot was discovered and foiled, however, the government violently repressed the PIR and very likely sanctioned an attempt to assassinate pirista leader José Arze. And when an insurrection broke out in Cochabamba and Oruro, government officials executed ten conspirators. This escalating repression by the government provoked outrage from both large sectors of the country and the State Department and, according to historian Carlos Mesa Gisbert, marked the “beginning of the end” for Villarroel, as the Catavi Massacre had for Peñaranda.65
Responding to an upsurge in FDA agitation within the middle and upper classes, Villarroel declared a state of siege at the end of May 1946. FDA leaders, teachers, professors, anti-MNR labor leaders, and other “Democrats and decent people” were arrested en masse, torture was reported, and the major