Minister Dawson to the Secretary of State.
Santo Domingo, February 13, 1905.
Sir: Continuing the subject of my No. 107 of January 23, 1905, I have the honor to confirm Captain Dillingham’s telegram, as follows:
Santo Domingo, January 24, 1905.
Secretary of State, Washington:
Sail to-night for north coast, with Sigsbee, aboard Newark. Situation acute, but quiet.
Dillingham.
and to report that he, the minister of finance, and a special agent of President Morales departed that same evening for the northern coast on board Admiral Sigsbee’s flagship, the Newark. It was the intention of Commander Dillingham and the Dominican special agent to proceed to Monte Christi to obtain Governor Arias’s peaceful compliance. The subsequent correspondence in relation to their mission is the subject of a separate dispatch. The minister of finance went to Sanchez, La Vega, Moca, and Santiago to explain the proposed financial arrangement to the people and authorities of those provinces and to secure their adhesion thereto.
I further confirm the Department’s telegram, as follows:
Washington, January 24, 1905.
Dawson, Minister, Santo Domingo:
Cable full text of agreement signed by you and Dillingham.
Loomis.
This instruction I immediately complied with, the full text being telegraphed on the evening of the 24th. [For full text see inclosure 3, p. 311.] On the evening of January 26 I received the following telegram from the Department:
Washington, January 25, 1905.
(Received January
26.)
Dawson, Minister, Santo Domingo:
It is necessary, in order to secure approval of protocol, to make some alterations. Secure signature to draft which follows. This is to take the place of agreement signed by you and Dillingham on the 20th. It should be thoroughly satisfactory Dominican Government, as the changes are not considerable and only relate to matters which will contribute toward our success in relieving Dominican Government of its difficulties. You will explain to the Dominican Government that whatever you signed was ad referendum. Desirable to avoid undue publicity during negotiations. Suggests this to Dominicans also.
Loomis.
On the morning of the 27th I received by telegraph the draft protocol referred to, and I inclose herewith exact copy of same. [For full text see telegram printed, p. 313.]
I immediately went to the President, who called in the minister of foreign affairs and the ad interim minister of finance, Señor Lamarche. After impressing upon them the necessity for avoiding premature or undue publicity, I submitted the Department’s draft, briefly explaining the more important points wherein it differed from the ad referendum arrangement of January 20. Though disappointed that the arrangement could not go into effect on February 1, they did not take the position that the former arrangement was, so far as the United States was concerned, anything more than an ad referendum agreement, and added that, now that the general outlines of the proposed action of the United States were known to the country without having excited a revolution, it was convenient for the Dominican Government also to submit the matter to its own Congress.
What alarmed President Morales most was the intimation that the American Senate might reject it. In such a case he thought his government would surely fall, as that of Santana had fallen in 1864, because the Spaniards had not backed him up, and as Baez had been overthrown in 1873, when the American Senate rejected the annexation treaty.
I answered that I appreciated the reasons which ten days ago had induced him not to raise the question of the necessity for ratification, and well understood that his only hope to prevent a revolution had been immediately to present the matter to the excited country as an accomplished fact, thus cutting off discussion and leaving the malcontents confronted with the alternative of undertaking a hopeless fight for which they had had no chance to prepare themselves or of submitting without resistance. I said that in view of the then political situation of this Republic I was not disposed to criticise him for making public the preliminary terms suggested by the United States, although such publicity had seriously embarrassed the State Department. But the political situation had changed in the meantime, and it was now evident that the Dominican Congress would doubtless ratify a protocol drawn in accordance with the draft now submitted by the State Department, which, so far as Dominican interests were affected, was substantially the same as the ad referendum agreement already published.
[Page 318]They then demanded to know what guaranty I could give them that the American Senate would ratify. I told them none, except the assurance that President Roosevelt and the State Department would do everything in their power to secure ratification.
They then said that so far as they were individually concerned they were inclined to accept the new protocol, but that they could give no assurances as to the attitude of Minister Velasquez, Vice-President Caceres, and the leaders in Congress. At my suggestion they agreed to send at once for Minister Velasquez.
This brought us to what I had known from the beginning would be the main difficulty, namely, a financial arrangement which would give them enough money to run the government for the next few weeks. They said there was not a cent in the treasury, and they had hypothecated for previous advances all the promissory notes given for importations made until the end of January; that under their tariff system no cash duties were collected, but promissory notes were taken, some of which run as long as sixty days. After the 1st of January no money would be coming into the treasury, and none of the local merchants would lend them money with the protocol pending. They would therefore be unable to pay the governors, troops, and officials, and such interruption of payments would, of course, be followed by the immediate disintegration of the government. They asked me to help them make some arrangement by which they could obtain enough money to tide over the interval from February 1 to the date of ratification. I answered that this would be very difficult, since I had no authority to take any action under the agreement signed January 20, but said that, with the consent of the Department, I would be willing to act as their mouthpiece in endeavoring to induce some local banker to advance the necessary funds.
Accordingly, after some reflection, I sent for Mr. Santiago Michelena, an American citizen and merchant, who conducts one of the two largest banking businesses on the island. Mr. Michelena I found to be perfectly willing to act as temporary financial intermediary for the United States, and, indeed, that he had expected to be called upon to act in such capacity. I told him that I was not authorized to make any appointment, but that I thought the Dominican Government could give him ample security for the necessary advances.
After ascertaining what compensation Mr. Michelena desired, I returned to President Morales and the ad interim minister of finance and assured myself that in their present extremity they would agree to Mr. Michelena’s terms. I then telegraphed to the Department as follows:
Santo Domingo, January 27, 1905.
Secstate, Washington:
Twenty-seventh. Draft of protocol submitted to Dominican Government. I can get it signed if Department can arrange or authorize some way to tide over financial difficulty for few weeks. Duties are payable in promissory notes instead of cash. Dominican Government has no funds on hand or due; Improvement Company absorbs largest part. Because protocol is pending local bankers have ceased advancing daily sums on which Government subsists. Stoppage payment of troops would mean overthrow government and anarchy. Temporary credit for $40,000 sufficient, which could be procured here if I were authorized to join Dominican Government in transferring to banker temporary right to collect revenues. Immediate reply necessary.
Dawson.
To this the Department replied as follows:
Washington, January 28, 1905.
Dawson, Minister, Santo Domingo:
Inasmuch as protocol is neither signed or ratified by Senate, Department has no authority to act, but it approves the Dominican Government transferring to banker temporary right to collect revenues, but this right should be limited and so guarded as not to interfere with the carrying out of the arrangements commenced in the protocol by the two governments and so as not to intefere with the rights of the Dominican Improvement Company under its award beyond what is absolutely necessary to raise the $40,000.
Loomis.
Immediately on receiving this I again sent for Mr. Michelena and told him that his contract must be made directly with the Dominican Government, but that I believed that it could be so drafted as to amply secure him. He answered that he would accept any contract for whose faithful execution the Dominican Government would agree to be responsible to me; that he would expect me to do every thing in my power to see that his rights were respected and to continue to act as intermediary between him and the Dominican Government.
Accordingly I drafted in English the inclosed contract, which was translated into Spanish and signed on January 29, by the acting minister of finance. On the same day I addressed Mr. Michelena the inclosed letter. I informed Mr. Michelena and the Dominican Government that the rights acquired by the former must not be so exercised as to interfere with the execution of the Improvement Company award, and that therefore the receipts at Puerta Plata could not be included. Mr. Michelena calculated that without Puerto Plata the receipts for the month of February would reach $110,000, although a considerable portion of this sum will still be in the form of promissory notes not yet due at the end of the month. The central Dominican Government has never been able to make a similar contract, covering the customs receipts of all the ports, because it could never give practically satisfactory assurances that the local custom-house authorities would permit the promissory notes to be made out in a single banker’s name. Each port has always insisted on making its own loans and arrangements with local capitalists. But with the financial agreement pending and public, Mr. Michelena felt sure that the customs officials and importing merchants would not dare to resist, and the fact that the central Dominican Government was responsible to me for the faithful execution of the contract removed all danger of repudiation by it.
Santo Domingo, January 30, 1905.
Secretary of State, Washington:
I have arranged financial difficulties as follows: Dominican Government transfers to banker, who is a citizen of the United States, temporary right to collect all revenues except Puerto Plata. Banker will pay $75,000 a month for administrative expenses. Contract terminable on notice from me. Dominican Government responsible to me for faithful fulfillment. Unless unexpected revolt breaks out Improvement rights need not be interfered with at all. Certainty of regular income immensely strengthens Dominican Government. Latest news from different parts of the Republic encouraging. Minister of finance will return in a few days and sign new protocol.
Dawson.
On the same day Mr. Michelena started on a journey around the island to arrange for the collection of the promissory notes and the payment of the budget at the different ports. He has not yet returned, but his representatives here inform me that so far as they have heard the arrangement is working well. Importers seem to be paying [Page 320] them without protest, but difficulty is experienced in collecting the port charges from the steamship lines who have contracts. The placing of Monte Christi under the award reduces the available income, and it may be that I will have to call on both it and Puerto Plata to make up a deficit. However, this is extremely unlikely.
On the next morning I received the following telegram:
Washington, January 31, 1905.
Dawson, Minister, Santo Domingo:
You will substitute for the second clause of the preamble sent you in our draft of protocol January 25, beginning, “Whereas the Government of the United States of America,” the following, which is to take the place of the paragraph of the preamble containing the territorial guaranty: “Whereas the Government of the United States, viewing any attemt on the part of the governments outside of this hemisphere to oppress or control the destiny of the Dominican Republic as a manifestation of an unfriendly disposition toward the United States, is, in compliance with the request or the Dominican Government, disposed to lend its assistance toward effecting a satisfactory arrangement with the creditors of the Dominican Government.”
Loomis.
I immediately submitted the proposed change to the minister of foreign affairs. At first he said that, so far as he was individually concerned, he preferred the new form, but that he could not answer for the minister of finance, President Morales, or the vice-president. I then saw the President, who also declined to agree positively, and seized the opportunity to suggest several changes to the draft protocol.
In the most friendly spirit I explained to him and Mr. Sanchez the advisability of accepting the protocol just as it had come from the Department, and refused to submit to the Department most of their suggestions. On four points, however, I was unable to move them. They insisted that they could not wound the national pride and violate the Dominican constitution by granting complete extraterritorialty to the customs employees appointed by the American Government; that if the protocol must be submitted to the American Senate, it must also be submitted to the Dominican House of Congress, and that the arrangement must be limited to the time required for the payment of the debt. All of these positions seem to me more or less reasonable, and I accordingly telegraphed the Department as follows:
Santo Domingo, February 2, 1905.
Secretary of State, Washington:
Suggested change of preamble most probably will be accepted. Minister of finance returns February 4. On account of urgent political reasons, Dominican Government wishes following additions: Article 2, after “receipts,” “these employees shall be subject to the civil and criminal jurisdiction of the Dominican Republic, and may claim no exemption on account of their personal status.” Article 8, after “Senate,” “and the Congress of the Dominican Republic.” Article 9. “This agreement shall continue in force during the time required for the amortization of the debt of which the Government of the United States takes charge.” I hope to send the protocol San Juan 5th.
Dawson.
I hereby confirm the Department’s reply:
Washington, February 2, 1905.
Dawson, Minister, Santo Domingo:
There appears to be no objections to changes suggested in your telegram of February 2. Article 2, however, after the word “receipts,” should read: “These employees shall be subject to the civil and criminal jurisdiction of the Dominican Republic.” This is to be substituted for your paragraph.
Loomis.
On February 3 the Department sent me the following telegram:
Washington, February 3, 1905.
Dawson, Minister, Santo Domingo:
Press report here states that United States took control of the custom-house receipts at Santo Domingo city yesterday. Department assumes that this is incorrect, as of course you have no authority whatsoever under draft agreement signed the 20th. Answer.
Loomis.
To this I replied as follows:
Santo Domingo, February 3, 1905.
Secstate, Washington:
I have taken no action whatsoever under the agreement signed 20th. Dominican authorities have not seen fit to publish pending negotiations, hence popular misapprehension as to source authority American banker.
Dawson.
On February 1 I had received the following telegram from the Department:
Washington, February 1, 1905.
Dawson, Minister, Santo Domingo:
Your telegram January 30 shows minister will sign new protocol. The protocol being acceptable to the Dominican Government, forward it as soon as possible. Advise Department as soon as it is signed. Time would probably be saved by having Stewart convey it to San Juan.
Loomis.
and on February 2 another telegram, urging haste, which I hereby confirm:
Washington, February 2, 1905.
Dawson, Minister, Santo Domingo:
Owing to the fact that Congress expires so soon, it is highly important to have protocol here at earliest possible moment. Is signature of minister of finance necessary?
Loomis.
This telegram I showed to the minister of foreign affairs and the President, but they assured me that to substitute anyone else as commissioner for Mr. Velasquez would most certainly offend him and bring about an Horacista revolt in the Cibao.
When the minister of finance returned, he proved to be, even more than I had expected, stubbornly determined to reject the suggestions of the Department and to reintroduce modifications which he had been obliged to abandon in the former negotiations. However, in our first interview after his return he reserved his fire on every subject except the change of the preamble. I gave him clearly to understand that the United States would not assume the responsibility implied in making a general guaranty of Dominican territorial integrity, although we were willing to guarantee the Republic against European interference, and disclaimed any intention of ourselves committing aggression. The minister of foreign affairs suggested that the phrase might be less objectionable if inserted as a mere recitation in the first clause of the preamble, and at his earnest solicitation and the demand of the minister of finance I sent the following telegram to the Department before giving them my final answer:
Santo Domingo, February 4, 1905.
Secstate, Washington:
Fourth. Minister of finance insists on insertion after the word “assuring,” in the first paragraph preamble, of following: “the territorial integrity of the Republic, and.”
Dawson.
To this the Department replied:
Washington, February 5, 1905.
Dawson, Minister, Santo Domingo:
Is not the guaranty in the second paragraph of preamble in our draft sufficient? The phrase suggested by the minister of finance does not fit in smoothly. Important to insist on our draft.
Loomis.
The same day I had a long and almost painful interview with the Dominican commissioners, in the course of which I learned that the whole cabinet had become seriously alarmed as to our intentions, and that Leonte Vasquez, the Dominican consul-general in New York, and brother of ex-President Vasquez, had sent a private telegram to Vice-President Caceres, in which he stated he had learned from American sources that the real intention of our government was to use the present arrangement as an opening wedge for annexation. I reluctantly came to the conclusion that some assurance on the subject must be included in the protocol, or that the negotiations would fail. I chose the form that seemed to me most likely to meet with objections on the part of Americans who dread the responsibility implied in a general protectorate, and sent the following telegram:
Santo Domingo, February 5, 1905.
Secstate, Washington:
Dominican Government insists that suggested guaranty is effective only against European powers and not against the United States itself. Vice-President has received a telegram from Dominican consul-general at New York, which convinces him that change in preamble means ultimate annexation. Dominican authorities suspicious, and alarmed as to our intentions. They insist on inserting following at end of second paragraph preamble: “agreeing to respect the complete territorial integrity of the Dominican Republie.”
Dawson.
To this the Department replied as follows:
Washington, February 6, 1905.
Dawson, Minister, Santo Domingo:
You may add at end of second paragraph of preamble the words “agreeing to respect the complete territorial integrity of the Dominican Republic.”
Hay.
In the meantime the minister of finance, in spite of my repeated categorical statements that I had no power to agree to any changes and that I knew that my government would consent to none, and in spite of my warnings that the signed protocol must catch the mail boat at San Juan on the 8th in order to reach the United States in time to have a chance of confirmation by the Senate, persisted in presenting numerous changes. He was especially desirous of procuring the insertion of a clause requiring “extraordinary” expenses to be charged against the capital account due the creditors, and of another insuring the appointment of Dominicans as subordinates in the customs service. He also said that, while they had no intention of increasing the debt and were willing to pledge themselves unconditionally on the subject, they thought it unnecessarily wounding to their national pride virtually to agree that they would increase the debt when the President of the United States should require it.
To resist the importunities of Minister Velasquez, who is a thoroughly honest, patriotic man, whose exceptional integrity has justly earned him the prestige he enjoys among the better classes of Dominicans, was extremely embarrassing, especially as the President and [Page 323] Minister Sanchez, fearing that he would resign, did not dare oppose him, but joined their arguments to his. Members of Congress and confidential representatives of Vice-President Caceres and the Cibao governors also came to see me, seeming to see no impropriety in coming to me and giving me their own views. But I tried not to lose sight of the fact that this was a matter in which every Dominican is vitally interested. * * *
On the morning of the 6th, came your telegram in regard to my full powers—
Washington, February 6, 1905.
Dawson, American Minister, Santo Domingo:
The President has to-day telegraphed to the President of Santo Domingo full powers for you to sign protocol. See him and sign at once.
Hay.
to which at once I replied:
Santo Domingo, February 6, 1905.
Secstate, Washington:
Full powers received. Dominican commissioners refuse to sign unless clause “agreeing to respect territorial integrity” is inserted. Please send instructions as to this point.
Dawson.
Shortly afterwards, and while the Dominican commissioners were still in my office, your telegram came authorizing the amendment of the protocol on the most important point. I have already confirmed it herein.
In the meantime, such was the anxiety to secure the signing of the protocol at once that I deemed it wise to send the following telegram, believing that whatever the reply might be, the Dominican negotiators would, when it came, realize that at last they must either sign or refuse:
Santo Domingo, February 6, 1905.
Secstate, Washington:
Minister of finance prefers unconditional agreement not to increase debt, and asks that words “without the consent of the President of the United States” be erased at the end of article 6. Last night he refused to sign substituted protocol, but this morning consented if “agreeing to respect” was inserted and above change made.
Dawson.
I confirm your reply, as follows, which came late in the evening of the 6th:
Washington, February 6, 1905.
Dawson, Minister, Santo Domingo:
The President regrets his inability to consent to any further changes in protocol. The words “without the consent of the President of the United States” at the end of article 6 are indispensable to the success of the plan to relieve the Dominican Republic from its hopeless financial condition, which is rapidly growing worse and threatens serious disasters. Other governments have repeatedly threatened to intervene, and the United States can not extend financial protection unless it can have the confidence of the Dominican Government and of other parties concerned, so as to enable the United States to carry out the plan successfully.
Hay.
Early the next morning I showed it to the minister of finance, telling him firmly, although in the friendliest spirit, that he could see for himself that it was useless to prolong his resistance. It produced a decidedly favorable effect in his mind, but, nevertheless, he would not decide until the important congressional leaders and Emiliano Tejera had been consulted and a cabinet meeting held. I spent the day in having the English copies of the protocol prepared, and at 2 o’clock I [Page 324] received a telephone message to the effect that the Dominicans were doing the same with the Spanish. Shortly afterwards the minister of finance came and told me he had determined to sign, but that he desired first to have me answer, in writing, a communication which he had prepared. I told him that he could, of course, state his own position in any way he liked, and that I saw no objection to my putting in writing what I had said so often verbally, viz, that the American Government regarded any further changes in the draft protocol as inadmissible.
Accordingly he and Minister Sanchez sent me the note, of which I inclose a copy and translation, and I replied as inclosed copy.
At 4 o’clock on the 7th the protocol was signed, and half an hour later the Stewart started for San Juan, where she arrived in the morning of the 8th in time to catch the New York mail steamer, the Philadelphia.
I confirm my telegram as follows:
Santo Domingo, February 7, 1905.
Secretary of State, Washington:
Seventh. Protocol signed 4 this afternoon. Stewart is taking it to San Juan.
Dawson.
It is with satisfaction that I am able to report to the Department that, notwithstanding the determined fight made by the Dominican commissioners, there has been no interruption of the relations of friendship and mutual confidence which have existed between myself and them ever since this negotiation began six weeks ago. They appreciate—and the conviction is now very generally entertained among all Dominican factions, even those bitterly opposed to any arrangement with the United States—that the State Department and its representatives here are sincerely well disposed and sympathize with and understand Dominican susceptibilities; that the United States has no selfish or ulterior purposes, and that the protocol was framed and will be carried out in a spirit of forbearance and helpfulness. I am also much gratified that President Morales has been able to hold his supporters together in this crisis and avoid any outbreak, which might have left an enduring hatred of the United States, even if it had been suppressed. He and Mr. Sanchez have shown at every stage admirable coolness, shrewdness, and knowledge of the peculiarities of their people. It is true that at times they apparently threw obstacles in my way, but it was always with the purpose of reaching with the least political friction the result both sides were aiming at.
I also desire to express my appreciation of the good sense shown by Commanders Dorn and Nicholson in taking measures which avoided any difficulties between their crews and the Dominican populace. Though the presence of the ships has had a powerful moral effect on the rash and ignorant elements, who unhappily are in the majority and who do not yet understand the real benefits the country will derive from the arrangement, not a disagreeable incident has occurred.
I have, etc.,