File No. 838.51/463

The Secretary of State to the Secretary of the Navy

Sir: I have the honor to refer to Admiral Caperton’s telegram No. 15107, relative to the preparation of a system for paying the employees and creditors of the Republic of Haiti in accordance with the telegraphic instructions dated December 31, 1 p.m. to the American [Page 340] Minister at Port au Prince, which you were good enough to have transmitted by radio.

In view of the existing conditions, it is believed that any system that may be formulated under the Admiral’s directions at this time could only be of a temporary nature and would no doubt be subject to revision and amplification by the Financial Adviser as contemplated in the treaty. It is much to be desired, however, that the method of disbursement now to be put in force by Admiral Caperton shall be as comprehensive and as efficient in character as the means at his disposal will permit.

In this connection, and in view of the fact that no expenditures are now being made for the army and navy, for the service of the public debt and for the treasury service of the bank, and, inasmuch as the disbursements for public works and the cost of collecting customs revenues are being met from other sources, it is hoped that the sum of $100,000 per month, or its equivalent in gourdes, which the Admiral has been authorized to use for necessary current expenditures of the Haitian Government, will prove more than sufficient for this purpose. Dating from January 1, 1916, it is intended that the Admiral shall not make use of this money to pay the salaries of public employees or the creditors of the Haitian Government for services rendered previous to that date, except the salaries of public employees in the provinces for December 1915. Every effort should be made to prevent salaries from being paid to Haitians whose services are only nominal and also to eliminate the present pernicious system of discounting salaries and government orders.

From the information before me, I am inclined to think that many of the expenditures contemplated in former budgetary laws and in the budgetary law of December 2, 1915, in particular, are ill-advised and probably in excess of the revenues which may be available for such purposes in the future.

I shall be glad if you will find it possible to bring the foregoing to the attention of Admiral Caperton with such appropriate instructions as you may see fit to give in the matter.

I have [etc.]

For the Secretary of State:
Frank L. Polk