852.75 National Telephone Company/103: Telegram
The Secretary of State to the Ambassador in Spain (Laughlin)
113. Your telegram No. 108, December 8, 11 a.m. We approve your action in sending a letter to Zulueta to tie the “criterion” mentioned in the Spanish note of December 7 to the “joint examination” in that of December 2. “Joint examination” is, of course, acceptable to us only if it is understood as meaning “with a view to revision of the contract on a basis of mutual consent”; that is, revision by bilateral rather than unilateral action. This has been our fundamental contention from the begining.
The Spanish note of December 7 also refers to Azaña’s statement to the Cortes on December 6, the full text of which we have received from Page. Are we correct in understanding that while the Cortes by its vote of December 6 bound itself to take no action in the telephone matter pending report to it by the Government on the success of the Government’s “joint examination” with the company, the Government is not specifically committed against any future reintroduction of the nullification bill (or against unilateral measures in general), in the event that the contemplated joint examination should [Page 581] fail to lead to a solution considered satisfactory either by the Government or by the legislature?
In raising this point I do not wish to appear unduly “technical”, nor in any way to minimize the importance of the substantial victory for American interests which the present situation represents. I should like, however, to receive your comments on the foregoing in order that, should the situation suddenly develop acutely again, we may be in the best possible position for rapid action.
If you think it would be helpful at this juncture, and would not be embarrassing to Azaña, I should be pleased to have you call personally on him, and express on my behalf appreciation for his efforts in bringing about a situation wherein I am confident that it may be possible to reach a solution on a basis mutually acceptable to the Spanish Government and to the American interests affected. You may, of course, phrase this in the manner you consider best suited to our purposes, stressing “mutual consent”.
In view of the precarious political situation in Spain, as well as the possibility that all may not yet be clear sailing for the company, I am still reluctant to make any “official statement” here. This is also the attitude of the executives of the I. T. & T. in New York. In this connection you will be interested to learn that Ambassador Cárdenas called on the Under Secretary on December 7, expressing the hope that we would make no statement which, when published in Madrid, might be interpreted there as indicating that we were “triumphant” at the solution. The Ambassador pointed out that such a statement would immediately be seized upon by the opponents of the present Government as proof that Azaña had “accepted foreign dictation”.