The Secretary of State to the Minister in Paraguay (Wheeler)
18. The Ambassador in Buenos Aires cables that President-elect Ayala yesterday told him that in his opinion only possibility of solving boundary controversy between Bolivia and Paraguay would be by strong pressure brought to bear on both Governments to submit the matter to arbitration. This is one more indication that perhaps Paraguay’s present action is taken because it does not desire a pact of non-aggression. Other indications are length of time between supposed attack on the fort and knowledge of it being made public and the fact that the fort Carlos Antonio López does not appear on any of the maps of the parties and that the Bolivian delegation states that it has no knowledge of any fort of that name. Furthermore, this action follows on the heels of advice from the Bolivian Delegation received two or three days ago that it is ready to present the Bolivian point of view to the conference and that Bolivia accepts the draft pact with only suggestions for minor changes of no practical importance.
Has the Paraguayan Government fully considered the results of withdrawing from the conference? This action is a notice to the world that Paraguay does not desire to negotiate a pact of non-aggression with Bolivia and in view of the relations between the two countries is little short of a declaration of war. Have they considered how disastrous the latter might be?
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If the attack on the fort actually did take place, the proper action for Paraguay is to send full particulars to the Neutrals and ask them to demand explanations and satisfaction from Bolivia. If Paraguay is dissatisfied with the draft pact, then it should make its point of view known and negotiate for modifications therein. The only indication as yet received here regarding Paraguay’s views is that set forth in Arbo’s memorandum to you of June 1st.19 There is nothing fundamental [Page 25] in those objections and does not give a basis for terminating the conference. The Neutrals have a right to expect that Paraguay will deal frankly with them as they are going to a great trouble on behalf of both countries to bring about a solution satisfactory to all.
While neither Arbo’s memorandum to you referred to nor the Paraguayan Delegation have made any such statement to the Department, Department understands that it is perhaps felt in Paraguay that the draft pact of non-aggression establishes a new status quo line which will impair Paraguayan rights under the Soler-Pinilla Line of 1907. Article 4 definitely takes care of this point. Paraguay has in the past favored an arbitral settlement. Article 3 of the pact of non-aggression provides for such a settlement. Breaking off the negotiations will postpone and make the more difficult any such settlement.
Please discuss at once the matter frankly with the Paraguayan Government, pointing out the danger it runs in any such policy, and endeavor to learn what are the real motives back of their present action.
The matter has been discussed informally with the Neutrals who are in Washington and there will be a meeting Monday morning of all the Neutrals. Department desires as full information as possible before that time.