File No. 838.51/453.
The Secretary of State to Minister Blanchard.
Washington, December 29, 1915.
Your December 18. Eliminating the appropriations for war, public debt and service of the Bank, contained in the Haitian budget for 1914–1915, that budget, although contemplating a large deficit, made provision for an average monthly expenditure of about $150,000 gold a month.
Inasmuch as the Haitian Government had to make no expenditure for war, public works, public debt and service of the Bank during the months of October, November and December, it should have needed on a basis of the 1914–1915 budget the sum of $450,000. During these months the Haitian Government has actually been in receipt of $385,000 advanced to it by Admiral Caperton. It should therefore require but $65,000 to cover the deficit. The Department believes that the law of December 2 contemplating the expenditure of nearly one million dollars for these three months is unwise, and is not prepared to consent to the use of an advance of $500,000 upon any [Page 537] loan to be made for the purposes contemplated in that law and will not under the terms of the treaty approve an increase of the foreign debt of the Republic of Haiti for any such purpose.
Commission informs Department that Minister Ménos has received telegram from President Dartiguenave instructing him to request Department to authorize Admiral Caperton to pay over all the funds in hand to be reimbursed by loan of two million, and stating that situation of Government is critical and ministerial crisis imminent.
The Department’s opinion regarding such loan is stated above and it considers the funds held by Admiral Caperton to be in the nature of a trust fund as these moneys do not belong to the Haitian Government but to the holders of the different debts of that Government. In view, however, of alleged urgency, you will report immediately by cable the amount in your opinion absolutely necessary to defray salaries of public employees for months of November and December which, notwithstanding advances of $25,000 per week, the Department is surprised to learn have not been paid.