824.00/514: Telegram

The Chargé in Bolivia ( Hibbard ) to the Secretary of State

47. The military junta remains well in control of the situation. On Sunday there were threatening demonstrations before those Legations in which political leaders had taken refuge and it was necessary for the diplomatic corps to call on the junta to demand greater protection. This was granted at once and there has been no further trouble. Siles left by automobile at 4 o’clock this morning accompanied by the Secretary of the Brazilian Legation and the Military Attaché of the Chilean Legation and with the protection of the junta. The troops at first refused to let him leave but were pacified and he was taken outside the city and placed on a special train for Arica, where he is now. The other refugees remain where they are but some will leave tomorrow with full guarantees. General Kundt offers the greatest problem. The feeling against him is intense and if he leaves the German Legation it will be difficult for the Government to protect him. On the other hand they do not wish him to leave the country, as it is feared he will sell or divulge Bolivian military plans to neighboring countries. The junta intends to proceed legally against members of the previous Government for malfeasance in office in an effort to secure the return of Government funds. Should the money not be returned, property will be confiscated. Charges are being prepared now.

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All politicians exiled by Siles are returning but it is interesting to note that there is no mention of party or individuals. For the time being the country is solidly behind the junta. A decree giving the plans of the junta has been issued and has received general approbation. Freedom of the press is guaranteed, martial law, which has been in force for thirty-three months, is lifted and each member of the junta pledges himself not to run for any office.

With the aid of the banks, the Government has today telegraphed funds to New York to cover the June 5th and June 15th service payments on the external loan. The Chambers are cooperating fully with the Government in every way. The junta is reducing the number of public employees 25 percent and promises to reduce army expenditure. An economic council has been formed to study the needs of the country and make recommendations. Each Ministry is in charge of a member of the junta with a high-class civilian technical adviser. Decrees will be signed by the Under Secretary, the officer in charge, and General Galindo.

Elections will be called as soon as there is complete calm. I believe this will not be for some months as it is the desire of the junta and the people in general that all traces of the previous regime be removed and a new start made. Certainly there is an opportunity for a fine example to Bolivia and other South American republics if the junta can follow its original intentions.

I am informed that the junta has approached Chile, Brazil, Argentina and Peru for recognition. No answers have yet been received. The question has not yet been raised with the Embassy [Legation] although I know the junta is eager for the recognition of the United States. My impression is that the United States will not be asked until they know what reception the request has received in the countries mentioned.