422.11Am8/23: Telegram
The Secretary of State to the Minister in Ecuador (Hartman)
Washington, February 7,
1922—1 p.m.
2. Your January 6, 11 A.M., and other correspondence regarding exchange regulations.
- 1.
- Department considers President’s reply to your memorandum, December 29 [27],4 as set forth in above mentioned telegram, evasive and unsatisfactory. The main question is not the relations between municipality and central government but whether the latter intends arbitrarily fixed exchange rates to apply retroactively to contracts antedating the decree. Although the Government of the United States does not in general question the right of Ecuador to regulate exchange transactions, it cannot refrain from vigorous protest when such regulations are applied so as in effect to bring about repudiation of indebtedness due American citizens. The Government of the United States regards the principle involved as of the utmost importance, and this principle, rather than the settlement of any individual claim, is the chief motive of American diplomatic intervention.
- 2.
- You are instructed to present to the President an informal written memorandum making the foregoing as clear as possible, and stating that the Government of the United States is very deeply concerned over the matter and trusts that it may be promptly assured that this regulation will not be applied retroactively so far as foreign interests are concerned. You will renew emphatically representations indicated in Department’s December 13, 6 P.M.,5 and December 24, 4 P.M.,6 and point out that the Department is receiving further complaints from American interests. The President should clearly realize the serious injury which continuing this policy will undoubtedly work upon Ecuador’s credit and good name.
- 3.
- Inform Department of action, if any, taken by your colleagues in this connection. Cable developments.
Hughes