837.51/567: Telegram
The Representative on Special Mission in Cuba (Crowder) to the Secretary of State
[Received 5:22 p.m.]
107. The Department’s numbers 145 and 146 have been helpful. Since their receipt Zayas and the Congress have apparently abandoned the hope that they could get better terms through the Gelabert Commission than I was offering here. In the light of last night’s conferences and my conference yesterday with the President I reach the following conclusions:
- 1st.
- That Zayas has ample discretion as the budget bill now stands to limit amount of the budget.
- 2d.
- That it is practicable to amend the bill in conference so as to appropriate any excess of revenue to payment of floating indebtedness.
- 3d.
- That if the Cuban Government is informed through the Gelabert Commission in Washington and through me here that having regard to the urgent economies that must be practiced as a means of restoring public credit, 50,000,000 would be a reasonable budget and 55,000,000 should be an outside figure, the budget will be promptly revised downward to the latter point with adequate provision for all branches of the public service including sanitation.
- 4th.
- That if it be similarly announced that article 14 of the exterior loan statute pending in the House must be broadened in scope to include a more comprehensive revision of the internal tax laws as a condition precedent to securing a loan with the proviso that surplus revenues shall be applied to the payment of the floating debt such revision will be rather promptly made.
- 5th.
- That Zayas will pledge himself, by an exchange of diplomatic notes, to veto any special law of Congress appropriating surplus revenues to any other purpose than the extinction of floating debt.
If this plan be pursued, I am convinced that a margin of receipts over expenditures could be established sufficient to liquidate the floating debt in period of three, and possibly two, years and that we should be able to dispense with an interior loan, also that plan provides ample security for the service of any additional loan that may be sanctioned. As work of revising budget downward is to be commended [commenced?] immediately, it is desirable that the instructions of the Department should be communicated rather promptly.