838.51/2347: Telegram
The Minister in Haiti (Munro) to the Secretary of State
126. We have not yet made much progress in negotiations regarding the budget because of the Haitian Government’s determined efforts to evade the real issues involved and to maneuver us into situations from which it could derive some advantage in internal politics or foreign propaganda. There are four main questions involved:
1. The reduction of the budget to 32 million gourdes. The Haitian Government has made substantial cuts in the budget as voted, and McGurk and Pixley before my return proposed an entirely workable plan which would have balanced the budget offering as a concession on our part if the Haitian Government made the necessary cuts to accept a reduction of 175,000 gourdes or approximately 3 percent in the approvals for the Garde upon which we had hitherto insisted. McGurk also reduced the estimates for the Sanitary Mission from 900,000 to 735,000 gourdes.
[Page 534]The Haitian Government however replied by demanding that part of the customs 5 percent fund and of the internal revenue 15 percent fund be made available for expenses of other Government departments and that the salaries of all employees in the Treaty Services be reduced by the same percentage as employees in other Government departments. I have refused to consider the first proposal because the 5 and 15 percent funds have been automatically reduced by decreasing revenues to a point where operation is very difficult. With regard to salary reductions I have pointed out that de la Rue, Pixley and Craddock are voluntarily contributing 3 percent of their salaries each month in order to help meet operating expenses in their services and that other American and many Haitian employees are being denied increases which were due them and in many cases are being called upon because of the reduction in staff to do double work. I have pointed out that a horizontal reduction in salaries which the Haitian Government plans to make in order to keep as many persons as possible on the pay roll for political purposes is neither fair nor calculated to promote efficiency although we are not disposed to object to it so far as the Haitian Ministries are concerned.
Repeated efforts have been made to obtain the details of the budget which the Haitian Government proposes to promulgate but the Government has failed on various pretexts to produce all of the information requested. It is clear that they wish to establish the precedent of not consulting the Financial Adviser about these details. We are insisting that the first step towards a settlement is the submission to the Financial Adviser of a budget in such form as to enable him to discuss it intelligently with the Minister of Finance.
2. The objectionable provisions in the financial laws. These were discussed in detail before my return and a general understanding was reached that the Haitian Government when the time came would agree in writing to interpose [a formula?] which would make them unobjectionable.
3. The preambles of the financial laws. The Government insists that it would be political suicide for it to make any statement repudiating the declarations made by Congress regarding the validity of the treaty. Yesterday however Léger proposed that if we inquired about the Government’s work in the matter he would reply that the preamble was solely the work of the Congress and that it could not affect the position which the Government had always assumed in negotiating in a friendly spirit with the United States regarding the problems arising out of the treaty.
While such an answer would clearly be evasive and inconclusive, I am inclined to think that we could adequately protect our interests [Page 535] by a strong statement reserving all our rights. It would be extremely difficult for the Government to give us a more explicit statement and I do not think that we should permit the negotiations to be broken off on this issue. I recommend therefore that I be authorized to make the best settlement obtainable on the whole without further delay. It must be made clear that any accord which we give to the budgetary laws does not involve an acceptance by us of the statements made in the preamble.
4. The question of the douzième for October (in this connection see Legation telegram No. 120 of October 3rd and the Department’s telegram No. 78 of October 13). The Haitian Government is demanding that payments for October be made at the rate of 32,000,000 gourdes per annum. On Saturday he asserted that we were committed to payments at this rate by having accepted it from the Minister of Finance quoted in the Legation’s telegram No. 120 and openly accused us of bad faith. The text of the letter however speaks for itself and I find furthermore that Pixley made it perfectly clear to the Minister of Finance that he and the Legation could not agree to a douzième at the rate of 32,000,000 gourdes without further instructions from the Department. He did not promise in view of the Government’s agreement to balance the budget at 32,000,000 gourdes, that such instructions would be requested as they were in the Legation’s telegram No. 120.
This summer de la Rue received a note from the Minister of Finance stating that the Government wished to suspend all payments however urgent unless they could be made on the basis of a douzième of 2,666,666 gourdes 66 centimes. He already issued many salary checks to paymasters throughout the country and these officers cannot now be reached in time to stop delivery but he will suspend further payments in accordance with the Minister’s note except in the cases of the Financial Service, the Garde and the Scientific Mission. I am giving him written instructions to continue payments to these services on the basis of the provisional budget.
The Haitian Government has taken this action of stopping payments apparently in the belief that it would create such a serious crisis that we would be compelled to give our accord to the budget without further delay. I am inclined to think that they [will?] recede from their position if they see that the plan has not worked. However, a very serious situation will arise if they do not recede and it may become necessary for us to make payments to essential governmental services such as telephones and water supply regardless of the Government’s note to de la Rue in order to prevent serious injury to the public. I should like to know whether the Department would approve of such a step if it becomes necessary.
- Telegram in five sections.↩