837.61351/3868
The Ambassador in Cuba (Braden) to the Secretary of State
[Received May 7.]
Sir: I have the honor to refer to my despatch No. 2545 [2856] of April 23, 194397 and previous correspondence relative to Central Tinguaro of the Cuban American Sugar Company, and to report that Mr. David Keiser called at the Embassy yesterday and informed me that it is not the intention of his Company to rebuild the mill.
For reasons with which the Department is already familiar, the Company concludes that it would be uneconomic to reconstruct Tinguaro, which operated for nineteen out of the last twenty years at a loss, and Mr. Keiser is now negotiating with Mr. Edward G. Miller, head of the Compañia Azucarera Atlántica del Golfo, for the sale of the property with the understanding that the cane quotas would be transferred to one or another of the Atlántica mills in the vicinity, and that the Tinguaro mill itself would not be rebuilt. No agreement between the companies has yet been reached, but Mr. Keiser characterized the negotiations as “promising.” (I have received similar information from Mr. Crosby of Atlántica.)
I pointed out to Mr. Keiser that the decision not to rebuild is directly counter to the announced intentions of the Prime Minister, and moreover that Dr. Zaydín has expressed himself recently as somewhat irritated over Mr. Keiser’s failure to abide by the terms of the Acta of February 16 last98 (please see despatch No. 2260 of February 19, 1943), under which Mr. Keiser had agreed to inform the Prime Minister of the intentions of his Company within a period of three weeks. A further ingredient of the Prime Minister’s annoyance is the altercation over the number of days’ pay to which the workers are entitled under the Acta, it being Dr. Zaydín’s contention that had the mill operated, the zafra99 would have lasted approximately 50 days, whereas Mr. Keiser has thus far declined to pay the wages of the batey workers,1 368 in number, for more than 41 days. (Dr. Mañas in a private conversation was somewhat critical of Keiser for not adopting a more conciliatory attitude on this point.)
[Page 202]Mr. Keiser went on to say that the Prime Minister had visited Tinguaro in company with Sr. Lόpez Castro and a Cuban engineer on April 17 last, on which occasion the Prime Minister declared publicly to a crowd of several thousand persons, including Tinguaro workers, that the Government would see to it that the mill is in operation next year. In this connection Dr. Zaydín is reported to have said “Next year I will be drinking guarapo with you instead of coffee.” Furthermore, the Government engineer has apparently reported that the damage was far less than at first supposed, that the machinery is practically all in usable condition, that no parts or materials will have to be imported from abroad, and that it will be a relatively small matter to put the mill” in working condition. Mr. Keiser denied this, stating that a number of parts, such as the heavy flywheels, were subjected to extreme heat which might render their continued use extremely dangerous. However, Mr. Keiser admitted that the Chief Engineer of his Company has not yet made an inspection of Tinguaro (the fire occurred last January).
Finally, Mr. Keiser observed that there are no legal provisions which would authorize the Government either to seize the mill or to force his Company to rebuild it.
I spoke to Mr. Keiser with considerable frankness. I told him that from every economic point of view I agreed with him 100 percent in his estimate that Tinguaro, on its record, is probably not worth rebuilding. I adverted to numerous speeches and private conversations during the past year, in which I had advocated a basic reorganization of the Cuban sugar industry, which would include the abandonment of a number of marginal and submarginal mills as well as the removal from the books of the non-grinding mills. Unless some such reorganization takes place, I stated that I am not optimistic concerning the future of the industry here, but I admitted that it would probably take little less than an economic earthquake to bring about such a reorganization. Conceding that the Prime Minister may have been somewhat reckless in the statements he is reported to have made at Central Tinguaro, nevertheless it is a fact that the Cuban Government is faced with increasingly difficult social problems resulting from wartime conditions and the declining level of commercial activity. I said that I would discuss the matter again with the Prime Minister as soon as the latter recovers from his present illness, but that I felt Mr. Keiser should in the meantime make every effort to obtain local support. Specifically I said that he should discuss his problem frankly with the Association of Hacendados2 with a view to eliciting their endorsement of the proposed sale. In that connection I mentioned the effectiveness of the work of the [Page 203] Asociaciόn Nacional de Industrials de Cuba in the matter of the recent Bacardí3 strike. I suggested that it might be equally effective should Mr. Keiser obtain the backing of organized sugar labor, which he could seek to do on the grounds (1) that labor involved in cutting, hauling and grinding of Tinguaro cane by other mills would represent no reduction, and (2) that Keiser was prepared to continue to make every effort to find jobs for the Tinguaro batey workers.
Mr. Keiser appeared to be impressed by these suggestions, and he stated that he would promptly investigate the possibilities.
With respect to batey labor, Mr. Keiser informed me that he has managed to place fifteen men with mechanical training with the Nicaro Nickel Company, that he is endeavoring (without success thus far) to interest others in peanut planting, and finally that he had obtained fifty Tinguaro volunteers who desire to proceed to Florida. In the last connection he showed me a cable from his New York office to the effect that this plan, which had apparently been approved by all the interested agencies of our Government, has now been blocked by the Attorney General in Washington. I told Mr. Keiser that I was somewhat surprised to receive this information in view of the recent expressions of interest on the part of our Government in the utilization of Cuban labor in the United States, and that I would telegraph the Department of State requesting information in the premises. That message is my telegram No. 278 of April 29, 8 p.m.4
Respectfully yours,