837.51/643: Telegram
The Representative on Special Mission in Cuba (Crowder) to the Secretary of State
[Received November 17—2:21 a.m.]
135. In a message dated November 15 to be read at today’s session of Congress, in compliance with article 68 paragraph 5 of the Constitution, President Zayas submits a provisional budget for the next [Page 758] fiscal year 1922–23 giving the total expenditures for that fiscal year at $64,422,664.68. He requests Congress not to discuss or consider said plan until the legislative session commencing first Monday in April 1922 for the reason that during the present session he intends sending further messages proposing reorganization of certain services with a view to effecting further reduction in the budget for said year.
The President informs me that the above-mentioned budget for fiscal year 1922–23 is identical with the one he is now publishing by installments in the Official Gazette under authority of the budgetary readjustment bill recently passed by Congress and forwarded as enclosure B with my despatch of October 26 last.70 In answer to the question whether the budget for the current fiscal year now being published by installments will be subject to further reductions, the President answered that possible reductions could come only from acts of Congress enacted during the current fiscal year approving Presidential suggestions for reorganization of certain services such as Department of Communications and Army and Navy; and then only if such acts of Congress were made effective from date of publication in Official Gazette instead of from the beginning of the fiscal year July 1st, 1922.
The 1918–19 budget increased by special laws and decrees since that year aggregated more than $80,000,000 and expenditures during the first four months of the current fiscal year have corresponded approximately to an $80,000,000 budget. Zayas’s reductions and economies have just about restored the original figure. In other words Zayas has incurred obligations during the first four months of the current fiscal year amounting to about one third of 80,000,000 and during the remaining eight months of the current fiscal year he proposes to incur obligations amounting to about two thirds of a little more than 64,000,000. The total will greatly exceed the revenues that may be collected during the current fiscal year and makes it abundantly plain that the current expenses of government and the service of the existing public debt during that year must be met in no small measure from the proceeds of a loan or loans sought to be negotiated. As to probable amount of receipts for current fiscal year see my despatch dated September 24th and my 133, November 2, 1 p.m.71 I have just finished conference with Zayas at which we discussed my recommendations as to budgetary reductions particularly reductions in Army and Navy budget (see enclosure to my despatch of October 2870). …
[Page 759]The Department has before it the application of the Cuban Government delivered by Minister Céspedes72 for sanction for the advance loan. My definite recommendation is that the Department answer through same channel that it is advised that the budget for the current fiscal year promulgated by President Zayas under authority of recent budgetary legislation authorizes expenditures of about $70,000,000; that as this amount appears to exceed the maximum authorized in said budgetary legislation and greatly exceeds the indicated receipts of the National Treasury for the current fiscal year, the Department must withhold its sanction for the advance loan, deferring final action until report mentioned in paragraph second [seven] of enclosure to my despatch of October 17, 1921,73 is received.