File No. 839.51/1641.
Minister Russell to the Secretary of State.
Santo Domingo, November 10, 1915—5 p.m.
Minister of Finance today requested advance of $60,000 a month for two or three months giving receivership control all budget disbursements. In case Congress passed reform program to be presented at the end of this month advances from the receivership would be covered from public works funds in Guaranty Trust Company, these latter to be paid back with a part of the loan to be negotiated for canceling the public debt. In case Congress did not pass loan bill or in case advance in question were not used for the purpose indicated, namely, payment of salaries, receivership would have right to withhold advances and could reimburse itself by retaining two thousand dollars daily of Government portion of collections. Minister of Finance wanted me to authorize this without consulting Washington and upon my explaining that it was impossible to do so stated that he could no longer continue in office and would resign immediately. Crisis of some sort imminent and if Congress authorizes loan when approval is asked of our Government I think moment most opportune to withhold all approval until we can secure amendments to convention suggested in your instruction number 139, in the meanwhile presenting at once note in accordance with instructions just referred to as requested in my telegram of November 5, 5 p.m.
[Page 330]Minister of Finance agrees to continue in office until Department answers this telegram and his request now is for two advances of sixty thousand dollars each.
Receivership informs me that they interpret their instructions as allowing advance at once up to total probable balance of Government share for November under system of weekly quotas of twenty-eight thousand dollars and pursuant to this interpretation they expect to advance up to total balance for November within the next few days. Control offered by Minister of Finance is an administration order giving receivership power to verify in the office of the controller that advances will be used for the purposes for which they are made and that war or other expenditures shall not exceed budget provision and if ascertained that budget being violated, advances not yet made to be withheld. This control, if effective, would endanger passage of the proposed and original agreement and probably under such an order Johnston will not dare to go so far. Please reply by telegraph immediately.