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The Personal Representative of the President (Caffery) to the Acting Secretary of State

5. The Uruguayan Minister continues his efforts for conciliation. Mendieta’s sector is the only opposition group taking part.

In the meantime a number of “solutions” and “plans for conciliation” have been suggested to me. None of these seems feasible at this juncture. The opposition groups have been making demands that the government will not accept; and the de facto authorities have been continually asking what they must do to achieve recognition but at the same time making declarations as to their maximum concessions which I know to be unacceptable to the opposition. However, I see a gleam of hope in the fact that while solutions and plans from both sides are still impracticable, the suggestions I have recently received are an improvement over suggestions received formerly.

I agree with former Ambassador Welles as to the inefficiency, ineptitude and unpopularity with all the better classes in the country of the de facto government. It is supported only by the army and ignorant masses who have been misled by Utopian promises. However, [Page 96] unless Dr. Grau decides voluntarily to give up power it is my opinion that he can be forced to do so only by the armed intervention of the United States unless there is a break in the army which is now standing strongly behind the government. The military have plenty of arms and ammunition and realizing that they will be sheep exterminated in a successful revolution, they will be fighting for their lives. The opposition declare that they are organizing a revolution but it will be very difficult for them to overcome the organized military forces. I find in the opposition little tendency to compromise and an insistence that the only way to clear up this situation is for us to intervene. They refuse to believe our insistent declarations against intervention.

On the other hand matters cannot with impunity be allowed to drift interminably in the direction they are now drifting: the de facto authorities in view of the fact that they have no support from the better elements of the country are relying more and more on radical and communistic elements and we may soon be faced with the [a?] very grave situation in connection with the protection of our manifold interests on the island.

The opposition groups at this time are not acting in complete harmony. For instance, difference of opinion exists as to whether another revolution should be attempted. The government has been able to draw away a section of the Mendieta group by appointments to office while some in the other groups apprehend that the Mendieta group may make a private deal with the government in order to secure a strategic position for the elections.

In the background there is constantly the distressing economic situation in the interior; much actual hunger, misery and want—all due manifestly to the sugar situation which is so bad at present that some American owned mills do not seem interested in grinding. The recent difficulties at Chaparra and Delicias (in which the Department is taking interest) arise from the fact that the company can pay average field wages of only about 15 cents a day.

As the Department is aware, the government has called for elections April 22 for a Constitutional Assembly to meet May 20 but the opposition groups declare they will not take part asserting that they do not believe the government in spite of its repeated declarations on fair elections. However, they declare that they will participate in the elections if means can be found to provide for fair ones.

I am meeting Grau and Batista again on invitation tonight. I have been told that they will make offer of “changes in the government”.

I hope to make definite recommendations to the Department soon.