Page 181 - Gobierno ivisible

Date: 4/5/2011 Page: 181 of 237

In January, 1963, the Agriculture Department gave 5,000,000 pounds of dried milk to the Red Cross for shipment
to Cuba and pledged more as needed. In all, the Agriculture Department contributed a total of 35,000,000 pounds
of surplus food to the prisoner exchange -- 15,000, 000 pounds of dried milk and 20,000,000 pounds of
shortening.

But the administration was fearful that it would come under political attack for helping Castro. The milk and.
shortening deal was played down.

Furthermore, the Agriculture Department announced on January 8, 1963, that "the Red Cross had indicated that
the Cuban Families Committee expects to raise funds to reimburse the department." In other words, the
government was saying that it would be paid back in cash for the surplus food.

What happened was somewhat different.

The dried milk cost the government $2,505,000 when it was bought from producers as part of the farm price
support program. The shortening cost the government $3,150,000. Consequently, the government gave away
commodities for which it had paid $5,655,000.

However, in calculating the value of the milk and shortening given to the Red Cross, the government figured its
contribution as worth just under $2,000,000 -- the lower price the milk and repackaged shortening might have
brought had it been sold by the government on the world market. Normally, the government uses the higher price
that it paid to producers when it figures the value of a contribution of surplus food to charity. In this instance, it
obviously sought to minimize the size of the donation because of the domestic political implications of giving
anything away to Castro.

Nor was the government paid back any amount in cash for its donation of milk and shortening. Instead, in a bit of
complex bookkeeping that leaves the onlooker breathless, the government accepted as "reimbursement" 4,000,000
pounds of an insecticide called Sevin. The Union Carbide Company had contributed $2,000,000 worth of the bug-
killer to the Red Cross for the prisoner exchange. The Commerce Department ruled that the insecticides would be
of strategic economic value to Castro by helping his sugar-cane crops.

"So the following took place: The Red Cross accepted the insecticides, then immediately turned them over to the
Agency for International Development, which dispatched them to India, Pakistan and Algeria. The government
accepted this as repayment for the milk and shortening. This was not quite the same as the "funds" which the
Agriculture announcement had indicated would be raised "to reimburse the department."

A conservative estimate of what it cost the government to extricate itself after the Bay of Pigs would be $29,793,
000. This consists of a $20,000,000 tax loss * to the government as a result of the drug companies' charitable
deductions; $5,655,000 in skim milk and shortening; $4,000,000 in secret CIA payments to families of the Bay of
Pigs prisoners over a twenty-month period, and $138,000 in costs to the Department of Health, Education and
Welfare when the prisoners returned. (Each man got a $100 check; the other costs were clothing, housing and
food.)

Because of the political risks at home of dealing with Castro, the government felt it necessary to mask its
participation in the prisoner exchange both by acting through Donovan and by a certain amount of fiscal hocus-
pocus. It decided that the realities of the situation were such that even an act of humanity had to be approached
with the utmost political caution.