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The Minister in Colombia (Caffery) to the Secretary of State

[Paraphrase]

59. President Olaya says that following continued pressure from the bankers he has settled the British Supía Marmato mining claim; forced the organic budget law through Congress and that the organic [Page 32]customs bill will be passed in a few days; he is ready to put into effect by executive decree the principal provisions of the comptroller law; and now, in the face of this, the bankers still say they cannot pay the four millions because they have discovered that the revenues for the first quarter of this fiscal year are below their estimates; the bankers want him to reduce the budget again; he says that this is an impossible situation and that no government can function if its budget is subject to revision from month to month; that the bankers themselves accepted Kemmerer’s35 figures for the budget and in any event, in his opinion, the increased revenues later this year will make up for whatever they are short during this quarter; that if he attempts further salary reductions at the present time, he will have social troubles on his hands; that these four millions are destined to pay the amounts still due by the National Government to the Departments and in case the Departments do not receive they will commence to default, as all his calculations have been based on that; for instance, the Department of Antioquia will be forced to default next month; the only reason why many members of Congress are supporting the Barco contract is that he has promised them part of the four millions for their Departments; he added that I could readily understand that after all he had done to force the Barco contract and the oil law and other legislation that I wanted through Congress, if he is compelled to state that my people have refused to cooperate with him there will be nothing left for him to do but resign, and that he did not think that our bankers would get very sympathetic treatment from his successor.

Again I respectfully ask that the bankers be made to understand what they are doing. If the bankers drive the President from office, the chances of their ever recovering their fifteen millions already invested will be remote. It is quite clear that after all that President Olaya has done for American interests (and in the face of bitter opposition), if he turns to Congress with empty hands he cannot retain the Presidency.

Caffery
  1. Edwin Walter Kemmerer, president of the American Commission of Financial Advisers to Colombia.