Memorandum by Mr. Dana G. Munro of the Division of Latin American Affairs, Department of State

General Russell tells me that President Borno objects to the proposed agreement reorganizing the American treaty officials connected with Haiti’s finances and giving the United States control over the collection of internal revenue, because he fears that the signature of an agreement which might be regarded as extending the treaty would subject him to serious criticism at home. President Borno has suggested therefore, that the control of the internal revenues by the United States be granted by means of a law. Neither General Russell nor I consider that a law would establish the internal revenue system on a sufficiently sound basis, although the law might be accepted as a last resort. Under the Haitian constitution tax laws have to be reenacted each year. Consequently, unless there was an international agreement preventing a reduction of the internal revenue taxes, the Haitian legislature could destroy the internal revenue system at any time simply by failing to vote the necessary law.

President Borno has also objected to the establishment of an American auditor, believing that this official should be a Haitian under the Minister of Finance. It does not seem necessary to insist upon the inclusion of the auditor in the proposed agreement, since an official to do this work can be nominated simply as one of the aids of the General Receiver in accordance with the Treaty.

General Russell has seen and approved this telegram.8

  1. See infra.