The Ambassador in Costa Rica (Johnson) to the Assistant Chief of the Division of Caribbean and Central American Affairs (Cochran)
Dear Bill: I am a bit confused as to the Department’s attitude toward a further loan to Costa Rica. Your memorandum of January 24 addressed to Avra Warren and myself and Avra’s concise remarks made it clear that at that time the Department was opposed to making any further loan.
I have just received telegram No. 140, April 10, 3 p.m. “for the Ambassador from Rockefeller” in reply to my letter to Mr. Rockefeller23 asking for information as to Soto Harrison’s mission. This telegram makes it appear that the Department’s views have changed entirely, as a matter of fact not only caught up with but gone far further than my own. I believe that no loan should be made to Costa Rica at least until the projects of law for financial reform have been passed by Congress, to which body they will be presented shortly.
The Minister of Finance, Bonilla Lara, is going to San Francisco [Page 890] and intends to proceed to Washington after the Conference, but as I understood what he said to me a few days ago, he merely intends to talk over his project for a Caja de Amortización24 for the Costa Rican public debt and does not intend to ask for an extension of the present credit or an additional loan. I will, however, have another talk with him before he goes and will telegraph the Department what I can learn of his plans.
I feel that the Costa Rican Congress will have a stronger motivation to pass the financial reform laws if another loan has not been made or promised to Costa Rica before that action. In my opinion an intimation along these lines should be given to Bonilla Lara if he brings the matter up.
With best regards, I am,