File No. 944/103.

The American Minister to Peru to the Secretary of State.

No. 290.]

Sir: I have the honor to report that when I called upon the President last week to pay my respects and to inform him of my return to my official duties the conversation took a most interesting turn, and Mr. Leguía gave me clearer information on the situation and of the hopes and purposes and policies of Peru than had before come to my knowledge.

Referring to the recent exchange of proposals, which were the subject of my hastily prepared despatch No. 285, of November 4, 1909, Mr. Leguía set forth the reasons that were controlling his course.

In the first place, he said, * * * no government could live a day that was thought to contemplate any surrender respecting their ultimate destiny. Peruvians have, therefore, to compare the disadvantages of external friction with that of internal disorder. If, however, he continued, I felt that the real interests of my country lay in such a settlement as can now be achieved with Chile, if I thought we should part with our rights respecting Tacna and Arica in consideration of a pecuniary indemnity and for the advantages accruing from the elimination of the past friction and agitation with a neighbor, I would make the arrangement and take the consequences; but I do not take that view. Chile, he continued, is a small, poor country, developed about to its limits, while Peru is a large and rich country [Page 1176] capable of tremendous development and growth, and in twenty years, or at some future time, is sure to be the military superior of Chile, and then we will enforce rights we will never part with. Perhaps you do not know, he said to me, that Arica has deposits of borax that have been estimated of a value in excess of £250,000,000; but while that is true, we do not consider money in taking our attitude.

* * * Chile may annex Tacna and Arica, she may pursue whatever course of aggression she may determine upon, but she shall never have the color of Peruvian consent and we will always reserve the moral right to repossess ourselves of them when we can do so.

He said my frankness and my friendly attitude led him to be equally frank and to confide in me his innermost feelings on this question. I thanked him and said my Government would be most interested in his views, and would always, I felt sure, appreciate and protect any confidence with which we were entrusted.

While Mr. Leguía made patriotism the keynote of his conversation and the base upon which his conclusions were founded, he confirmed the opinion I have expressed in former despatches that political use is being made of the controversy by his administration to bid for popularity, or at least to distract the people from thought of revolution.

Subsequently, at the reception at the Brazilian Legation, I had a confidential conversation with Mr. Aspillaga, the Presiding Officer of the Senate, and one of the foremost men in Peru in politics, business and society. He told me that he recognized that Tacna and Arica were lost to Peru and that he was in favor of accepting that fact and of making a material settlement of the question by which Peru would get such advantage as was possible, but that the present Government could not possibly entertain such a plan; that the slightest indication of such a purpose would afford pretext for successful revolution; that public opinion must be prepared, and that the arrangement must be entered into as a national policy for which all parties would share the responsibility, or it must be conducted in settled, prosperous times by a government strongly entrenched in power, able to impose its views and face and suppress opposition. * * *.

I think I should add that Mr. Leguía further stated that he entertained the views he had expressed so deeply that if he ever found Congress and other influences too strong in favor of any other course he would resign the Presidency rather than approve or share the responsibility of concession.

I have [etc.]

Leslie Combs.