File No. 837.51/264
The Acting Secretary of the Treasury ( Crosby ) to the Secretary of State
Sir: I have the honor to acknowledge receipt of your letter of August 23, 1917, referring to the matter of a loan to the Cuban Government, and in answer thereto I beg to state that while the making of a loan of $15,000,000 for military supplies desired by Cuba appears to me to be desirable, I have thought it prudent to ask for advice concerning the materials for which the money would be expended from the War Department. I am making inquiry to the Secretary of War to that effect to-day.
Concerning the conditions which in your judgment should be attached to this loan, I note that they are not related directly to matters connected with the conduct of the war, and it would perhaps be wise for me, acting under the limitations of the Act of Congress approved April 24, 1917, to delay final action in respect to the military loan until you may yourself have obtained such stipulations as you desire on the subjects mentioned in your letter.
While you are thus dealing with the subject, I will be able to obtain the information above indicated from the Secretary of War, and also to confer directly with the Cuban Minister as to a number of details in respect to the form of obligation which his Government has to offer, as it has thus far appeared to me no loan can be made under the terms of the Act of Congress of April 24, 1917, by taking up bonds such as the Cuban Government has recently authorized. The maturities of foreign obligations must be the same as those which our own bonds carry. The Cuban bonds are fixed at 12 years while ours are fifteen-thirties. The legislation which I am hoping to obtain at an early date will doubtless make the situation more easily treated, or, perhaps, on the other hand, the Cuban legislation may be modified if our conditions can not otherwise be met.
In substance, therefore, I understand that if you so desire, friendly negotiations will at once be undertaken concerning the Cuban loan for military purposes, and you will in the meanwhile independently treat with the Minister, going over the political considerations that are mentioned.
Cordially yours,