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J ^ F O : A m e m b a s s y RIO DE JANEIRO DEPARTMENT (F STATE ^ g ^ ; f^*4y^-/S^>f«^u~/ INTER-AZSN°FAFRIRS FROM : A m c o n s u l CURITIBA D A T E : Ju ly 8, 1965 SUBJECT : P O L I T I C A L : Monthly S u m m a r y June 1965 REF

1. Cand ida t e s for Vice G o v e r n o r Chosen 2. E l e c t i o n s in Santa C a t a r i n a 3 . Supe r in t enden t Borghoff of SUNAB in C u r i t i b a 4 . M i s c e l l a n e o u s

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1. C a n d i d a t e s for Vice G o v e r n o r Chosen I A m i d s t l a s t m inu t e s u r p r i s e s and c o m p l a i n t s c and ida t e s a r e s e l e c t e d

and the P a r a n a G u b e r n a t o r i a l c a m p a i g n i s u n d e r w a y . C l imax ing the nomina t ing convent ions w a s the s e l ec t i on by the P T N of PLsnio Cos t a (PSD F e d e r a l Deputy) to r u n for Vice G o v e r n o r on the t i cke t h e a d e d by P a u l o P i m e n t e l . The PSD e a r l i e r in the mon th n o m i n a t e d Rafae l R e z e n d e (a lso PSD F e d e r a l Deputy) to r u n with Bento Munhoz da Rocha on the P R - P S D - P T B t i c k e t .

G o v e r n o r Ney B r a g a h a s been work ing to b r i ng about such a sp l i t in the PSD s ince he dec ided to suppo r t P i m e n t e l . He s e e m s to have s u c c e e d e d magn i f i cen t ly , p lac ing with h i s cand ida te p robab ly the c u r r e n t m o s t popula r and b e s t vote g e t t e r in the s t a t e P S D . C o s t a r a n a h e a d of h i s p a r t y when he was e l e c t e d F e d e r a l Deputy in 1962. He was the PSD cand ida te for G o v e r n o r of P a r a n a in I 9 6 0 . He i s a m e m b e r of the Revo lu t i ona ry Bloc and s e e m s to be widely r e s p e c t e d a s a good a d m i n i s t r a t o r and h a r d w o r k e r .

I_ J CONFIDENTIAL FOR D E P T . USE ONLY

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Oover Clearances:

CONFIDENTIAL P a g e Two C u r i t i b a A - l

The r e a c t i o n f rom the PSD faithful to C o s t a ' s dec i s i on to defy p a r t y l e a d e r s h i p i s s t i l l not a p p a r e n t . The P S D - P T B combina t ion r e p r e s e n t e d a m a j o r i t y of the s t a t e v o t e r s . C o s t a ' s pos i t ion on the P i m e n t e l t i cke t s igni f icant ly r e d u c e s the t h e o r e t i c a l advan tage and r e d u c e s the n u m b e r of PSD p a r t y m e m b e r s tha t wi l l suppo r t B e n t o .

R e p e r c u s s i o n s within the o the r p a r t i e s suppor t ing P i m e n t e l have been s t r o n g . The UDN had hoped one of i t s p a r t y faithful would be runn ing with P i m e n t e l and the P S P had s i m i l a r a s p i r a t i o n s . T h e r e a p p e a r s to be l i t t l e a l t e r n a t i v e but for t h e s e p a r t i e s to fal l in l i n e . T h e i r b i t t e r n e s s e x p r e s s e d , h o w e v e r , a p p e a r s genu ine .

Ra fae l R e z e n d e 1 s good r e p u t a t i o n and s t r e n g t h in the n o r t h of P a r a n a m a k e h i m a good runn ing m a t e for B e n t o . It i s hoped tha t R e z e n d e , who i s f rom Nor th P a r a n a , wi l l be able to weaken P i m e n t e l 1 s hold over tha t r e g i o n . R e z e n d e , who i s sa id to be v e r y wea l thy , owns coffee f a r m s and a C u r i t i b a r a d i o s t a t i on . Thus far only f avorab le c o m m e n t s about h i m have been r e c e i v e d a t the C o n s u l a t e .

COMMENT: The publ ic s e e m s to have a c c e p t e d the p ropaganda tha t the s e l ec t i on of P l e n i o C o s t a unde r the guidance of a s m a l l g roup of the P T N was a s u r p r i s e unknown even to C o s t a h imse l f . H o w e v e r , Consu la t e s o u r c e s i n f o r m e d us two mon ths ago tha t B r a g a was t r y i n g to a r r a n g e t h i s c o m b i n a t i o n .

The c a m p a i g n has been confined to p e r s o n a l and s t a t e i s s u e s with l i t t l e or no c o m m e n t on na t iona l p o l i t i c s . (CONFIDENTIAL) 2. E l e c t i o n s in Santa C a t a r i n a

C a n d i d a t e s for G o v e r n o r in Santa C a t a r i n a a r e now known. They r e p r e s e n t the t r a d i t i o n a l p a r t y m a c h i n e s of the s t a t e wi th C a r l o s Konder R e i s runn ing on the UDN t i c k e t and Ivo S i l v e i r a for the P S D . Wi lson B e n d e r , who fought h a r d for the UDN nomina t ion h a s given h i s suppo r t to Konder R e i s . The P T B , which can be a decid ing fac tor in s t a t e e l e c t i o n s , h a s not ye t d e c l a r e d suppo r t for e i t h e r c a n d i d a t e .

COMMENT: The c o n s i d e r a b l e p r e s s u r e expended to i n s t i g a t e a change in t r a d i t i o n a l Santa C a t a r i n a po l i t i c s fa i led with the s e l e c t i o n of t h e s e two c a n d i d a t e s . The old power p a t t e r n s a r e r a p i d l y changing , h o w e v e r , a s the popula t ion con t inues to c e n t e r in the n o r t h e a s t of the s t a t e . (UNCLASSIFLED)

3 . S u p e r i n t e n d e n t Borghoff of SUNAB in C u r i t i b a SUNAB Supe r in t enden t G u i l h e r m e Borghoff v i s i t e d C u r i t i b a th i s mon th

on a good wi l l and b u s i n e s s t r i p . Dur ing h i s s tay SUNAB and the Sta te of

CONFIDENTIAL

CONFIDENTIAL P a g e T h r e e C u r i t i b a A - l

P a r a n a e n t e r e d into a g r e e m e n t s w h e r e b y SUNAB and the s t a t e wi l l jo in t ly u n d e r t a k e to p lan and fu rn i sh f ac i l i t i e s which wi l l g u a r a n t e e supply and w a r e h o u s i n g of p r o d u c t s in P a r a n a . An a g r e e m e n t was a l s o r e a c h e d tha t the a p p r o p r i a t e d e p a r t m e n t of SUNAB wi l l i m p r o v e i t s p r o g r a m of p r i c e suppo r t in P a r a n a .

In the publ ic r e l a t i o n s s p h e r e , Borghoff exp la ined on t e l e v i s i o n and to r e p o r t e r s the g o v e r n m e n t ' s po l i c i e s to c o n t r o l inf la t ion and u n e m p l o y m e n t and to i n c r e a s e p r o d u c t i v i t y . (UNCLASSIFIED) 4 . M i s c e l l a n e o u s

a. A l a r g e s a l a r y and expense accoun t r a i s e s t a t e l e g i s l a t o r s in Santa C a t a r i n a g r a n t e d t h e m s e l v e s i s giving r i s e to n u m e r o u s p r o t e s t s . The depu t i e s r e c e n t l y r a i s e d t he i r own s a l a r i e s f rom C r $ 300, 000 to C r $ 1, 000, 000 month ly and g r a n t e d t h e m s e l v e s a month ly expense accoun t of C r $ 500, 000. The r a i s e i s r e t r o a c t i v e to J a n u a r y 1965. At the m o m e n t the pay r a i s e s t a n d s . (UNCLASSIFLED)

b . C o m p l a i n t s , thus far fut i le , a r e a l s o be ing lodged in Santa C a t a r i n a a g a i n s t the PSD l e a d e r s h i p which a l l eged ly h a s added five h u n d r e d of i t s s u p p o r t e r s to the s t a t e p a y r o l l . (UNCLASSIFIED)

c . Affonso C a m a r g o Neto pub l i shed a l e t t e r th i s mon th , which he had sen t to P r e s i d e n t C a s t e l o B r a n c o , sugges t ing c h a n g e s in A r t i c l e 20 of the Cons t i t u t i on . He c l a i m s tha t if i t had not been for the p r e s s u r e which could be p l a c e d on PDC d e l e g a t e s b e c a u s e of the t e r m s of A r t i c l e 20, he could have e a s i l y won the PDC nomina t ion for G o v e r n o r in May . (UNCLASSIFIED)

d. M i n i s t e r R o b e r t o C a m p o s v i s i t e d C u r i t i b a June 14 and 15 w h e r e he t a lked with the G o v e r n o r and a p p e a r e d on t e l e v i s i o n . In h i s TV s p e e c h he defended the a d m i n i s t r a t i o n ' s coffee po l i c i e s say ing tha t do l l a r r e c e i p t s w e r e h i g h e r in 1964 even though l e s s coffee had been sold in 1964 than in 1963 . On h i s e c o n o m i c pol icy , he sa id he wi l l r e m a i n f lexible not changing h i s long r a n g e ob jec t ives but only changing s h o r t run m e t h o d s . (UNCLASSIFIED)

G e o r g e R . Hoover A m e r i c a n Vice Consu l

D e p a r t m e n t p l e a s e p a s s to a l l C o n s u l a t e s in B r a z i l

CONFIDENTIAL