File No. 839.51/1640.
Minister Russell to the Secretary of State.
Santo Domingo, October 29, 1915.
Sir: I have the honor to report that the financial situation of the Dominican Republic is rather desperate and calls for immediate attention. I enclose you herewith copies and translations of memoranda furnished me by the President.6 From these memoranda it appears that there is a daily deficit of $1280, with a daily income of $6000. The Minister of Finance informs me that the daily deficit is at least $3000.
The customs receipts this year will approach very near to the $4,000,000 mark, and if all of the internal revenues could be relied [Page 327] on to reach the treasury the total revenues of the Government would be more than sufficient to meet budgetary expenses. The total indebtedness of the Government is somewhere in the neighborhood of $5,000,000. The auditor of the treasury is at least six or seven years behind with his books and it would take a force of expert accountants at least a year to bring order and intelligence out of this chaos.
A very considerable part of the debt is represented by stamped paper in the hands of speculators who purchased it at an enormous discount, and which has been canceled by the Government, thereby creating a claim. It would seem that the holders of this paper should only be reimbursed in the amount invested, with a fair rate of interest, or that some equitable arrangement should be made by which the holders could receive on certain securities of this character a reasonable advance plus interest to be agreed upon.
Large sums of money not provided for in the budget are being expended daily on what is known as “raciones”—sums for maintaining the military, republican guard, and other quasi military bodies. The budget carries an appropriation of $25,000 a year for a corps of generals under the orders of the President. This sum is being drawn in monthly quotas. The sum of $2000 per day is being expended in “raciones” (rations).
The present Minister of Finance is a very honest man, and is earnestly striving to reduce expenditures and eliminate filtration. Internal revenues amount to only $450,000 annually that reach the treasury—they should be at least $1,200,000 with economical, honest and efficient methods of collection. The Minister of Finance informs me that the budget is to be reduced in the sum of $800,000 by the Congress called for October [November] 20.
Back salaries due under this administration amount to about $200,000.
Congress may be induced to sanction the reforms planned by the Minister of Finance from selfish motives, as all their salaries and mileage will have to be paid from the proceeds of a loan, or advances to be refunded from a loan. The Minister of Finance is really in earnest in his program for economy and reform, and says that he has the promise of support from Congress.
I have [etc.]
- Not printed.↩