LATIN AMERICA: PROTEST AND PROGRESS

This is the season of Latin America's discontents, and those discontents are taking ever more tangible and visible forms. Most of the Latin countries are unhappy with the U.S., as Nelson Rockefeller's three fact-finding missions for President Nixon have graphically demonstrated. Either the U.S. plays too large a role in their economies --or it does not do enough in terms of aid and favorable trade. Rockefeller's trips have provided a focus for protest. Many Latin American nations are also unhappy with themselves and in search of new paths to progress. That combination of frustration, militancy and venturesomeness last week made news in five South American countries: -- In Peru, the military government of General Juan Velasco Alvarado decreed a sweeping land-reform program that included the expropriating of some U.S. interests. It was one of the most drastic --and potentially effective--such reforms ever proclaimed in Latin America. >In Argentina, terrorists firebombed 13 supermarkets owned by the International Basic Economy Corporation, a company controlled by the Rockefeller family. The fires, which destroyed seven stores and damaged six, were presumably ignited to protest the New York Governor's visit to Argentina this week on his fourth round of "listen and learn" trips. To head off demonstrations when Rocky arrives, the government arrested more than 100 students. > In Uruguay, President Jorge Pacheco Areco found himself in a showdown fight with striking unions, which blocked his efforts to bring the country back from the edge of bankruptcy. President Pacheco's response was to declare a limited state of siege under which strikes are outlawed.

>In Paraguay, student unrest boiled up in the wake of Rockefeller's visit, when police used tear gas and truncheons to break up a demonstration at an engineering school. Rallying against police brutality, students at one point last week took over a church in Asuncion, and most of the country's high school and college students trooped out on strike.

-- In Chile, the government of President Eduardo Frei Montalva came to terms, after weeks of negotiations, with the U.S.-owned Anaconda Company. Chile will buy 51% control of the giant copper interests of the company (see BUSINESS). It was a victory for the moderate Frei; Chile's more militant nationalists had agitated for outright expropriation of Anaconda.

Dejected Landowners. Of all the events, by far the most important was Peru's program for land reform. While crowds outside Lima's Presidential Palace shouted approval, Velasco, who took power in a coup last October, told Peruvians that "the land must belong to the peasant." His audience in the greenand-gold Ambassadors Hall consisted of military officers, government officials, businessmen and Juan Cardinal Lan-dazuri Ricketts, head of Peru's reform-minded church. All cheered--except the wealthy landowners present. Quoting Tupac Amaru, an Inca chief who led an abortive rebellion against Spanish colonial rule in the late 18th century, Velasco exclaimed: "Campesino, the owner will no longer eat off your property." Opposition to the decree would come from Peru's landed oligarchy, Velasco predicted, and he warned: "To this oligarchy, we say that we are ready to use all the energy that may be necessary to crush any sabotage of the law."

Land reform--a major plank of the Alliance for Progress--had been attempted by President Fernando Belaunde Terry, whom Velasco and the military ousted last year. However, pressures from wealthy landowners had consistently watered down Belaunde's proposals in Congress. The "earthquake generation," as Velasco's inner circle of radically nationalist advisers likes to call itself, has no such obstacles to overcome, of course: Congress was closed down when the military took over.

Under the new decree, proclaimed after a final 20-hour Cabinet session on the "Day of the Indian" (appropriately changed by Velasco to the "Day of the Campesino"), land holdings will be limited to a maximum of 540 acres in the coastal areas, about 150 acres in the highlands. The biggest benefits will most likely accrue to Peru's Indian eampe-sinos, 5,000,000 strong, who were dispossessed of their land when the Spanish colonizers arrived and have been living in grinding serfdom since then. The new small landowners will be encouraged to get together in cooperatives. Large estates will continue to operate as units, but estate workers will share ownership and control under a kind of stockholder arrangement.

Not Only Peru. Land owned by W.R. Grace & Co., a U.S. corporation whose Peruvian assets of some $65 million include two large, highly efficient plantations that produce 17% of Peru's sugar, is specifically covered by the decree. The company took the news philosophically. "We have been here for 150 years, and we have always obeyed the law of the land," said James Freeborn, who heads Grace operations in Peru. "If that's the new law of the land, then that's it." Grace's large Peruvian industrial complex, which produces alcohol, paper and plastics, will probably remain untouched.

The Peruvian government intends to compensate owners for the expropriation by paying cash for installations and issuing 20-year local-currency bonds for the land. It hopes that the bonds will be reinvested in either private or government industrial projects. Some cynics, unable to quite believe in genuine reform emanating from a military regime, contend that Velasco aims only at boosting the prestige of his military government and breaking the rival power of the oligarchy. They also worry that his program is concerned more with property rights than with production and productivity.

Undoubtedly, large estates operate more productively than a group of small farmers, unless the peasants form successful cooperatives. A fall-off in production would likely increase Peru's economic squeeze. Food imports may well increase while earnings from sugar and cotton could now shrink. That would be all the more painful; Peru has already lost U.S. aid and scared off private investment with its seizure of the

American-owned International Petroleum Company.

Still, most Peruvians seemed at first look to feel that the junta, for better or for worse, had taken a significant step in the effort to solve a problem that besets not only Peru but most of Latin America.

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