Papers relating to the foreign relations of the United States, 1930, Volume III
817.1051/459
The Secretary of State to the Minister in Nicaragua (Hanna)
Sir: There is enclosed herewith a letter from the Secretary of State to President Moncada which you are requested to deliver to President Moncada as soon as possible. An extra copy of the letter is enclosed for the files of the Legation.
Very truly yours,
The Secretary of State to the President of Nicaragua (Moncada)
My Dear Mr. President: Your letter of November seventh has been received by me and has been given my most careful thought and consideration. You must know that I fully appreciate the difficult economic situation with which you are confronted as well as my sympathetic desire to render you every assistance within my power in the solution of your difficult problems. I believe that when you have read the latter portion of this letter you will realize this even more strongly, and will recognize how far I am willing to go in my desire to help you find some equitable balance between the vital necessity of maintaining an effective Guardia and of keeping its cost within the financial powers of your Government during this period of reduced revenue.
[Page 684]But in order to more effectively grasp the details of our problem, let us begin by summarizing the general factors in order that we” may understand the limitations within which our actions must be confined.
It is now three years and a half since you and I met at Tipitapa and formulated the general principles of peace, which we then negotiated, and of the solution of the future problems which we then foresaw. At that time all of the armed forces in the Republic which had been conducting the civil war agreed to lay down their arms and return to peace. The only exception was the small group headed by Sandino, which you then informed me amounted, according to the best of your information, to not more than one hundred and eighty men. It seemed to us both at that time a very easy problem to suppress this insignificant force of lawless individuals who thus elected to continue a life of banditry rather than to follow the example of their compatriots in returning to the path of peace.
But how different has been the event! Nearly four years of constant warfare in the three northern provinces of your country, where these bandits took refuge, has ensued. Your country has raised an admirable force of over two thousand Guardia carefully trained in the best methods of modern warfare by the experienced officers of our Marines. In addition to this, the United States has, at your request, maintained in your country a large force of American marines, sometimes aggregating over four thousand men, and still amounting to over fifteen hundred, for the purpose of adding stability to the efforts of your peaceful and well-disposed citizens. Yet the conditions in the three provinces of Nueva Segovia, Estelí, and Jinotega still continue, and the situation seems as unsettled as it was three years ago.
I have heard of no criticism of the efficiency or character of your Guardia. The men and their officers are thoroughly brave. They are most energetic in their pursuit of the bandits. They are supplied with all the equipment that modern science can devise, including a regular line of airplanes, maintained by our forces, to communicate with them in the difficult terrain. Whenever they meet the bandits, they are successful in defeating them. If reports are to be believed, they have accounted for in killed, wounded and captured far more than the original force which Sandino led away three years ago. Yet the fountains of banditry in those difficult localities seem to be indefinitely supplied, and we are as far from peace and settled conditions as ever. A new group of bandits seems to step into the shoes of the ones who are disposed of as soon as the latter fall, and the problem remains as difficult as ever. The situation in the remainder of your Republic seems to be satisfactory and reasonably stable, but certain portions of these three provinces remain as a No Man’s Land over which the authority of the forces of peace and order apparently cannot be permanently extended. There is thus constituted a continuing [Page 685] focus for possibly infecting with disorder the remainder of your country.
My dear Mr. President, this seems to me to be a situation which cannot be explained by minor differences of viewpoint as to the military tactics employed. We have furnished you with the best leadership which our Marines could produce, and their reputation for skillful hard fighting is world-wide. As I have already said, the courage and staunchness of your men in the Guardia has elicited the highest praise from their officers. Under these circumstances, I cannot but feel that the problem presents certain underlying factors of geography, as well as economic conditions, which unless remedied and changed render the military problem practically insoluble. Not only is the terrain so difficult and the means of communication so lacking that even the bravest and most enduring forces cannot continue in the field and be supplied for the requisite time to secure a permanent peace, but the same factors place the population at the mercy of its lawless elements to such an extent that the entire population is forced to become the allies of the bandits and the sources of additional banditry. The danger is that unless these conditions are changed, the strain will continue until the efforts of the lawful forces of your Republic are exhausted, and these three provinces will remain unchanged a menace to the peace of the rest of Nicaragua.
It, therefore, seems imperative that the economic conditions should be changed before the problem can be solved. It would seem to me, in the first place, that routes of communication in the shape of good roads must be constructed, which will make easy passage for the disciplined forces upon which we rely, which at present are necessarily at a disadvantage with the unorganized bandits who cannot meet them in battle but who can harass them and then get away. The construction of such roads would not only serve this military purpose, but it would furnish employment for the present unstable population, and would also powerfully conduce to the economic agricultural development of those provinces. Such roads should be constructed not only with reference to the supply of your forces in the field from their bases in the other parts of Nicaragua, but they should be constructed with a view to the protection of your northern frontier, where it is commonly said that the bandits of Sandino are reinforced from the bandits of Honduras.
In the second place, every effort should be made by your Government to educate the people of those provinces through schools and agricultural assistance to desire and follow the pursuits of peace. I agree with every word that you say in your letter on this subject, but I suggest that until this situation in these three provinces is cured, your Government should concentrate its efforts in these directions in [Page 686] that portion of Nicaragua, even at the cost of slowing up the process in other portions of the Republic.
At the present moment you are engaged in important construction in the other and peaceful parts of your country; to wit, a highway to Rama, and two railroads, the one between Leon and El Sauce, and the other between San Jorge and San Juan del Sur and a third one planned for from Chinandega to Nagascolo. Important as these projects are, they are not, in my opinion, so important as the solution of the vital problem of peace and order in the North; and, in my opinion, from the funds which are now being expended in their prosecution should be drawn the funds necessary for this vital communication and development, and thus for the solution of this problem in Nueva Segovia, Estelí, and Jinotega.
At this point, I feel bound to remind you that the time is rapidly approaching when it will be necessary for the United States Government to withdraw its Marine forces and officers from Nicaragua. The presence of those forces have always necessarily created an abnormal situation and one which can not be permanent. They have remained there at the request of both parties of your country solely because of the sincere desire of my Government to assist you temporarily in the solution of these crucial and fundamental problems. I can not see how they can remain later than to assist you in carrying out the elections of November, 1932. This country will then have helped Nicaragua for five years to police its territory and to keep banditry in check. Public opinion in this country will hardly support a further continuance of that situation. The result of these controlling factors necessarily indicates that the problem of these Northern Provinces must be solved by that date.
I have spoken very frankly because I believe that you thoroughly know my goodwill towards and my interest in your country and its problems. You are the head of its Government and the decision of all these questions is in your hands. Nevertheless, the assistance which my Government, at your request, has been and is continuing to render to yours, makes it proper for me to tell you very frankly my advice upon these questions.
Having thus outlined my views as to the general questions which seem to me to control our further action, I will give you my views upon the details of the problem of the Guardia, which you have laid before me in your letter.
You state that you wish to reduce the annual allotment of the Guardia to $800,000 and that you believe that for this sum a Guardia of 1700 men, with a corresponding number of officers, can be maintained. You propose to bring about this reduction by abandoning some 60 posts, garrisoned by from 1 to five men, and some 12 posts, garrisoned by from 6 to 9 men, which will release approximately 300 [Page 687] men. You further state that the pay of officers in the Guardia should be reduced temporarily 20 per cent.
It is not clear that your proposal to abandon the 72 posts would introduce an effective permanent arrangement, or that it could be introduced and maintained in the face of local pressure for Guardia protection. Nevertheless, in order to emphasize the desire to cooperate with you to the fullest extent, I am willing to express my approval of this proposal on the specific understanding (1) that the Government of Nicaragua assumes full responsibility for the abandonment of any post after consultation with the Jefe director of the Guardia; (2) that ample time be given to effect transfers to and from troops serving in the bandit area, in connection with selecting the men to be discharged; and (3) that if and when any abandoned post is reestablished or any new post of this nature is established, the Jefe director of the Guardia will automatically be authorized to make a corresponding increase in the total strength of the Guardia and that funds for the maintenance of this increase will be made available to him.
The task with which the Guardia Nacional is confronted is twofold—first, it must restore order in the bandit infested region and secondly, it must maintain order elsewhere in the Republic. The forces now engaged in executing the first task should not be reduced and this should be insisted on. As shown above, I do not criticise your proposal for reducing small posts elsewhere in the Republic established for the maintenance of order.
In your letter under acknowledgment you imply criticism of the Jefe director of the Guardia on account of stationing small groups of Guardia men in certain exposed places. You say that such detachments were inevitably the victims of bandits and that even as you wrote your message word was received that a garrison cuartel had been burned and that probably five Guardia men had been killed by the bandits. You doubtless refer to the recent attack on the Guardia post of 10 men at Matiguas, east of Matagalpa, in which five members of the Guardia were reported to have been killed. I understand that it is now known that the Guardia detachment fought valiantly until its ammunition was exhausted and then escaped without casualties. This incident illustrates the force of local pressure for protection of the Guardia, alluded to by me above, because I understand that the establishment of this post was requested by the Minister of Gobernacion on the insistence of the deputy from that area.
You also state that if an emergency should arise requiring the repression of any undue disorder by the use of force, you can place under the direction of the Guardia one or more groups of volunteers whose employment will cost the Government much less than a corresponding number of Guardia men. In this connection I must point out to you that this expedient has already been tried in the past, and [Page 688] I am reliably informed that the volunteers were neither as efficient nor as economical as the Guardia. I consequently feel that we should dismiss from consideration any thought of such outside forces and concentrate our attention, as we agreed to do in the past, on a single military force in Nicaragua, which should be non-partisan and non-political in character.
There are 72 officers and 1,000 enlisted men now operating in the bandit infested region. My military advisers insist that this force cannot be reduced. After abandoning the small posts throughout the Republic, recommended by you, there will be in the remainder of Nicaragua 79 officers and 650 enlisted men. The total in the entire Republic would then be 151 officers and 1,650 enlisted. This would mean an early reduction of 350 in the enlisted strength. The Guardia Nacional serving outside the bandit region will be further reduced if and when the Guardia Municipal is created.
In your letter of October 16 to Mr. Hanna34 you suggested that the number of officers can be reduced from 10 to 8 per 100 men. This reduction I am likewise prepared to agree to if the calculation is made for the present on an enlisted strength of 2,000, with the understanding that a less strength may be fixed as a basis of the calculation when conditions so justify. This would mean an almost immediate reduction of 35 officers, the 160 officers remaining to constitute an irreducible minimum until the new arrangement has passed through the experimental stage and proved dependable. A number of American officers will be necessary to organize the Guardia Municipal and several officers are essential for other tasks, such as the Military Academy and the Penitentiary Guard. To show you how low this number has been cut, I will point out that no provision is made in this quota for replacing sick officers and officers on leave. The 160 officers are allocated as follows: 1 Jefe director, 6 Colonels, 9 Majors, 38 Captains, 43 First Lieutenants, and 63 Second Lieutenants (permanent and temporary).
You further request a temporary reduction of 20 per cent in the pay of the officers. I desire to point out that in consenting to reduce the number of officers from 10 to 8 per 100 men, a reduction of 20 per cent is effected. Despite this, I am willing to go even further and approve a salary reduction to apply to the American officers who are detailed to the Guardia in the future. The officers now serving consented to serve with the Guardia on the understanding that their pay would be a certain definite amount in the various grades. I cannot ask these officers now to consent to a reduction in their salaries. I appreciate fully the financial situation in Nicaragua and the great efforts you have made to meet it and the very great sacrifice which [Page 689] has been made by the Nicaraguan officers and employees of your Government in accepting a 20 per cent reduction in their salaries. The American officers of the Guardia, however, are in a different category. They are not citizens of Nicaragua and they entered into an agreement to help out the Nicaraguan government in the latter’s great need by serving in and training a Guardia, and when they consented to do so it was on the basis of a stipulated salary. While I do not feel that I can rightly ask them now to consent to a reduction in their salaries, I am perfectly willing to agree to a lower scale in salary for those who may serve in the Guardia in the future, and I would therefore consent that the salaries in such cases should be reduced as follows: Jefe directors, $3,000; Chiefs of Staff and Colonels, $2100; Majors, $1800; Captains, $1500, and First Lieutenants, $1080. These reductions vary, you will notice, from 10 to 16⅔ per cent.
With the Guardia reduced to 160 officers and 1,650 men, as outlined above, the sums necessary for the upkeep of the Guardia will be as follows:
| For maintenance and rations | $310,546 |
| Pay of officers | 204,250 |
| Pay of enlisted men | 284,856 |
or a total of $799,652, which you will note brings it within the $800,000 you desired. An additional $15,000 for the Military Academy and $40,000 for the maintenance of prisons should also be allotted annually. I desire to point out that in making this estimate General McDougal has met another of your frequently expressed desires by reducing the daily cost of rations per man from 25 to 20 cents, or a 20 per cent reduction.
In order that you may not be misled or disappointed in the immediate working out of this plan, I feel that I should call to your attention that the cost of the Guardia Nacional will continue at a higher annual rate than that set forth above until the contemplated reduction is completed, but, on the other hand, its cost will be reduced below the annual rate set forth above if and when the Guardia Municipal is created. Furthermore, the foregoing estimate is calculated on the present rates of pay for officers and consequently there will be a still further reduction in the annual cost of the Guardia Nacional as the present officers are replaced by others at the lower rate of pay.
There is one more matter of a financial nature which you touched on in your letter which I am now acknowledging. The Nicaraguan Minister, in Washington, approached me on this subject on November 6th, requesting that all sums in excess of $240,000 collected by the Collector General of Customs annually shall be made available to the Nicaraguan Government. Hitherto, under the agreement with the [Page 690] bondholders, by which the Collector General of Customs was established, certain portions of the excess beyond this amount, as well as collections from certain other specified sources, were made applicable to the sinking funds of the bonds issued by your Government. The Minister stated that if this were done, the excess thus diverted to the Government would be wholly devoted to the upkeep of the Guardia Nacional.
On the basis of these representations made to me by Dr. Sacasa, namely, that these funds would be used exclusively by the Guardia Nacional, I told him, on November 6th, that so far as this Government is concerned, it would not interpose objection to the Nicaraguan Government’s so using these funds as a temporary measure, it being understood that the Collector General of Customs would not turn these funds into the General Treasury but would deliver them directly, on the first of each month, to the Commander of the Guardia, or else deposit them in the National Bank to the order of the Commander of the Guardia. I felt that the very great reduction in the revenues of your Government arising from the present financial depression, which I was assured rendered the maintenance of law and order in the Republic impossible unless these funds were diverted to that purpose, justified me in withholding my objections.
At the same time I pointed out to Doctor Sacasa that this action on the part of your Government would give a serious blow to the credit of Nicaragua; and I pointed out very frankly to the Minister the effect that this will have not only on the present bondholders and the probable market quotation of the bonds, but also on Nicaragua’s ability to raise future loans. It will probably mean that Nicaragua will have to pay more for future loans because the interested bankers will say that Nicaragua, in this instance, did not strictly observe the agreement with regard to extra amortization and, therefore, the undertakings of the Nicaraguan Government for future loan negotiations can not be accepted as freely as in the past. I pointed out that the extra amortization in past years of prosperity met from the additional 50 per cent of the land transfer tax will certainly weigh in the balance in the favor of Nicaragua just as account would be taken of the present financial condition in Nicaragua and the general world economic condition. Nevertheless, I pointed out that the failure to live strictly up to the terms of the agreement will tell against Nicaragua and, in order to justify it, Nicaragua should show very clearly how this money is used. Should this money be covered into the general revenues of the Government to be used for miscellaneous purposes, it will undoubtedly prejudice Nicaragua’s position in the future. On the contrary, if Nicaragua can show that these funds were earmarked for a certain specific purpose of a justifiable nature, namely the upkeep of the Guardia, and that funds for this purpose were not available from other [Page 691] sources, it would go far toward relieving the situation. It was on this condition that I withheld objection to the proposal made by your Government, and I did it in the very same interview at which your Minister brought it to my attention.
I feel that you will agree with me, Mr. President, when I say that on the financial side I have done the utmost to meet your wishes. What I have agreed to above conforms to every one of your requests of this nature.
I believe that this résumé of the situation, both in general and in detail, shows that my Government has cooperated effectively and sympathetically with the problems of your Government. I believe that it also shows, so far as I can judge it from here, the course which must be followed in order to eradicate banditry and to restore peace and order in your Northern Provinces by the year 1932. I have frankly stated my position, as I feel that only in this way may misunderstanding be avoided. The responsibility and obligation for the solution of these problems rests upon your Government, and I have indicated to you the only means by which the responsible officers of this Government feel that the situation can be met. In so doing, I feel that I have fully discharged the responsibility of the Government of the United States in this matter and that the questions now rest clearly with you. I earnestly request that you give these matters your fullest thought and most careful attention; and I think that you know that my cordial good wishes in the future, as in the past, go with you.
I am [etc.]
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