The Ambassador in Cuba (Guggenheim) to the Acting Secretary of State
[Received February 3.]
Sir: Referring to the Embassy’s telegraphic despatch No. 15 of January 29, 1930,23 I have to report that the investigation of the Cuban financial position is proceeding satisfactorily. Following the direction of President Machado, the Secretary of the Treasury has been very helpful in furnishing information. In anticipation of the probable satisfactory outcome of the investigation, I believe it would be advisable to be prepared to act promptly in order that the conclusion of the arrangements by the Chase Bank may not be delayed by the necessity for action on the part of the Department or of the Embassy.
With reference to the general question of Article II of the Permanent Treaty,24 I am strongly inclined to believe that the relations between Cuba and the United States will continue to be improved if the provisions of this Treaty, which is frequently considered by the Cubans as a brand of inferiority and inequality, are obtruded as little as possible into the correspondence between the two governments. It would seem that this policy could be followed without in any way derogating from the full validity and efficacy of the Treaty provisions.
A study of the precedents in the files of the Embassy on Cuban financing, indicates that in the past the United States Government has followed varying methods for acquainting the Cuban Government [Page 689]with its objections or lack of objections to particular financing proposals. The prevailing aim seems to have been to keep alive the rights and responsibilities under Article II of the Treaty. In view of the present attitude of President Machado in fully cooperating with the Embassy in its study of the present financing, I believe that the rights of the United States under the Treaty may be adequately protected without suggesting to the Cuban Government that it is under financial tutelage. I would therefore recommend that after the Department has informed the Chase Bank that it does not object to the proposed financing, I be instructed to address the Cuban Government as follows:
“I am instructed by my Government to inform you that it has been advised by the Chase National Bank of New York of a proposal for new financing by the Government of Cuba. The Bank was informed that in view of the circumstances the Government of the United States does not see any occasion for raising any objection to the proposal in question.”
I will inform the Department by cable when the investigation here has been completed.
I have [etc.]