Crippled by U.S. Cutbacks, OAS Faces Budget Crisis, May Lay Off 300

The Organization of American States, facing the worst financial crisis of its history, may be forced to lay off as many as 300 of its 1,000 employees over the next few months, according to OAS sources.

The crisis is based largely on the decision by the Reagan Administration, citing budgetary problems, to reduce its 1988 contribution to the OAS by $10 million and to cut the same amount next year. Compounding the problem is the failure of several other major contributors, including Chile and Venezuela, to keep their payments current, the sources said.

The impending layoffs have generated gloom and uncertainty among OAS employees, most of whom are Latin Americans faced with the prospect of the immediate loss of their U.S. visas if their jobs are eliminated.

Arturo Garzon, a Mexican who is president of the OAS staff association, noted that many of the employees are longtime residents of the Washington area and would have to start from scratch if forced to return with their families to their native lands.

The OAS, whose origins date back 99 years, is designed to enhance cooperation among the United States and more than 30 other countries in Latin America and the Caribbean.

In its heyday, the OAS was seen by successive U.S. Administrations as a vital tool against communism in the hemisphere, but the United States has largely ignored the organization in recent years. This is partly because the anti-communist consensus among member states has eroded over the years.

The United States, with 85% of the combined gross national product of OAS member states, has a quota of about $40 million, or 66% of the organization’s annual budget of about $65 million.

The money is used to pay for programs in such fields as human rights, education and anti-drug education, among others.

“We have to decide every month which bills we’ll pay,” said one OAS official, insisting on anonymity. He predicted that the layoffs would be announced around Jan. 1 after decisions are made on which programs should receive priority.