837.51/696a
The Secretary of State to the Representative on Special Mission in Cuba ( Crowder ), temporarily in the United States
Sir: Immediately upon your return to Havana, the Department desires you to hand the following note to the President of Cuba, and to advise him of the importance which the Government of the United States attaches to the declarations contained therein:
“The return of General Crowder to Cuba as Special Representative of the President of the United States near the Cuban Government, to continue his mission of the past twelve months, appears to offer to this Government an appropriate occasion to refer somewhat more clearly and concretely than heretofore to this Government’s understanding of its rights and duties respecting the Republic of Cuba by virtue of the permanent Treaty of 1903.
“This Government has readily appreciated the nature of the difficulties with which the present Government of Cuba was confronted when its President took office on May 20, 1921. The Island was then passing through an economic and industrial crisis, the full extent of which may perhaps not even now be fully comprehended. The industry and commerce of Cuba were gravely affected and the depression which existed in all branches of business was extreme. Moreover, the National Government, itself, was faced with a very large deficit in the Public Treasury, due to the fact that the shrinkage in its ordinary revenues made it impossible to meet, from normal sources, the increased expenditures contemplated in the National Budget. The Government of Cuba, therefore, was threatened with bankruptcy unless measures were taken with the utmost expedition [Page 1007] to increase such ordinary revenues by legitimate measures and to bring, by a policy of the most rigid economy, such expenditures within the national income, leaving at the same time a surplus sufficient to provide for any loan which the Cuban Government might be compelled to obtain to meet its immediate necessities.
“This Government realized that the course above indicated was the only one which would enable the Cuban Government to avert threatened dangers, and because of its peculiarly close and special relationship to the Cuban Government, endeavored at all times to advise and assist it in every possible way through the Special Representative of the President of the United States. It is, therefore, a cause of profound gratification to the Government of the United States that so many of the problems which have lately confronted the Cuban Government have either been solved, or are even now in process of solution, and that so many signs point to a steady improvement not only in its finances, but in general economic conditions throughout the Island. While this Government has, as above indicated, been at all times eager and desirous to afford to the Government of Cuba whatever assistance might profitably be extended, it has seemed at times, during the past few months, as if the Cuban Government could have more effectively availed itself of such assistance had that Government clearly comprehended that such aid and counsel was offered not only through friendly interest, but also by virtue of the rights vested in this Government by Article II of the permanent Treaty of 1903, to whose provisions it now seems appropriate to call the attention of the Cuban Government, namely:
‘That said Government (of Cuba) shall not assume or contract any public debt, to pay the interest upon which, and to make reasonable sinking fund provision for the ultimate discharge of which, the ordinary revenues of the Island, after defraying the current expenses of the Government, shall be inadequate.’
The obligations here assumed are, it will be seen, no less imperative than those imposed by Article III, viz.:
‘The Government of Cuba consents that the United States may exercise the right to intervene for the preservation of Cuban independence, the maintenance of a Government adequate for the protection of life, property, and individual liberty, and for discharging the obligations with respect to Cuba imposed by the Treaty of Paris on the United States, now to be assumed and undertaken by the Government of Cuba.’
especially as the rights and interests of third parties may be even more vitally concerned.
“Since ‘any public debt’ might call for interest and sinking fund for which the ‘ordinary revenues’ would be ‘inadequate’, it is clearly necessary that the United States should inform itself in advance of the contraction of any public debt whether the conditions required both by the aforesaid permanent Treaty and the Constitution of Cuba, are complied with. The Government of the United States is entitled to know, in the case of any public debt contemplated by the Government of Cuba, what ‘the ordinary revenues’ are, from what sources they are derived, and what said sources have produced and may be expected to produce.
“Even more important is it for this Government to know what assurances the Government of Cuba offers for the maintenance of its [Page 1008] ‘ordinary revenues’ and of their relation to its expenditures. For creditors must rely upon the complete performance of such assurances, quite as naturally and necessarily as upon the advance information above mentioned. In case it should appear that, subsequent to the contraction of ‘any public debt’ the expenditures of the Cuban Government have so increased that the ‘ordinary revenues’ have become ‘inadequate’ to provide the required interest and sinking fund, it would be necessary that the Cuban Government should at once secure either an increase in its revenues or a decrease in its expenditures in order that the required conditions should be fully met.
“At the present the service of the public debt appears to be in arrears for the period of about six months and to the extent of approximately two millions of dollars; current obligations, including the pay of army, navy, police and civil employees of all branches of the Government are unpaid, as are also accounts for transporting the mails, for supplies to public institutions like hospitals, and for the construction of needed public works. Even the Government’s Treasury checks issued in partial discharge of such obligations are held by the banks awaiting payment. Obviously, such a condition of affairs infringes Article II of the Treaty and causes this Government, therefore, to consider very seriously what its duties may be in this contingency.
“The Government of Cuba will doubtless understand that it is in the light of the clear provisions of the Treaty and the duties it imposes that the Government of the United States is maintaining the Special Mission near the Cuban Government, and it feels it desirable upon this occasion to emphasize in this manner its belief that in order that the said Mission may be enabled to act effectively in its effort to render profitable aid to the Cuban Government, it should have free and full access to any and all sources of information which it may require, before the Government of the United States itself can either take intelligent action regarding whatever loan may be proposed, or determine what measures may be necessary for the appropriate protection of those who have extended credit to the Government of Cuba. To this end, it is essential that said Mission should at times offer suggestions and recommendations regarding needed fiscal measures and appropriate legislation and make such inspection of actual governmental operations as may in its judgment be required. And it may be assumed that such functions are understood by and acceptable to the Government of Cuba in view of its President’s announced intention of May 12, 1921,7 to the Special Representative of the President of the United States given out as a public statement and widely published in the press of Cuba, ‘to utilize the valuable and disinterested services he is capable of rendering in resolving many difficult problems which confront us’, by reason of ‘his great knowledge of our affairs, his clear intelligence and his good intentions.’
“The Government of the United States believes that the Cuban Government will readily appreciate the friendly spirit in which this communication is made. This Government makes no demands upon Cuba, and only asks that its people may ever continue along the paths of liberty and progress and maintain steadfastly their national independence. [Page 1009] It has been the firm purpose of this Government throughout its relations with the Republic of Cuba to foster and promote in every way possible the welfare and prosperity of the Cuban people and to take at all times whatever action might seem to it necessary to insure their independence. In order that both Governments may accomplish these ends in a spirit of the closest and friendliest cooperation, the Government of the United States feels certain that the Government of Cuba will coincide in its opinion that the first three articles of the permanent Treaty of 1903 are equally binding, and that this Government is entitled to assure itself that the provisions of both Article II and Article III are strictly complied with.”
I have [etc.]
- Not printed; see telegram from the Secretary of State, no. 121, June 17, 1921, Foreign Relations, 1921, vol. i, p. 695.↩