723.2515/2380: Telegram
The Ambassador in Chile (Collier) to the Secretary of State
182. [Paraphrase.] Department’s No. 98, May 29, 4 p.m. Revelations of last two months convince me that it would be disgraceful to approve plebiscite. …
I am fully aware of all difficulties in way of obtaining a diplomatic solution, but I believe that one can be brought about before June 15, provided you and I make the statements to which I have referred in previous telegrams. To this end I think a delay is eminently worth while. Success will be a great triumph; while a failure, even though not our fault, will shatter our prestige in Latin America … I sincerely hope you will hold out for about three weeks more. I have invited half a dozen intimate influential friends, who wish strongly to see a diplomatic settlement, to call on me today. A large and increasing number of Chileans dread thought of breaking off good offices.
One thing, however, which I think absolutely essential, if you will pardon my temerity in suggesting it, is that you give out a statement to the press saying, in effect, that if good offices are now broken off and the plebiscite is thereafter renewed and held to be impracticable, good offices cannot be renewed because Chile, by preventing a correct plebiscite, would have lost all means under the Treaty of Ancon to acquire definitive sovereignty. … I am aware of the boldness of that statement … but at this moment boldness is absolutely essential. … [End paraphrase.]
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The general manager of Grace and Company has called on me twice with regard to great diminutions in the consumption of nitrate of soda in the United States during last year, due to increasing use of substitutes [Page 453] and synthetic nitrate of soda. He is convinced that this increased use of substitutes is due to two causes: (1) American desire to get nitrate of soda at lower prices; and (2) the belief of the United States that it ought not to remain dependent for an article necessary in peace and indispensable in war upon a source of supply in a remote country which will not earnestly strive to settle a dispute with a neighboring nation which has long caused severance of diplomatic relations and on various occasions mobilization of troops, and which is now provoking in both countries a marked increase in military preparation and which at any moment may result in a war that will interrupt the shipment of nitrate.
[Paraphrase.] I believe that the general manager of W. R. Grace and Company is quite correct in his deductions, fears, and facts, particularly should the Plebiscitary Commission declare that a plebiscite was impracticable and should Chile then insist on remaining in control of the province, as she undoubtedly would. The general manager went on to say that if the Secretary of Commerce would give out an interview in which he intimated that [end paraphrase] the reestablishment of cordial friendship between Chile and Peru would increase the export commerce of both by removing the fears of importers of nations that the source of supply might be cut off, such interview would have enormous effect here at this moment when the nitrate business is depressed and the Government and the business world is alarmed as to national revenue and business conditions. [Paraphrase.] I believe that the general manager is correct in saying that such an interview given out by the Secretary of Commerce would have the excellent effect of causing the Nitrate Producers Association to set a much lower price for the coming year at its meeting in June, and it would also be a most powerful influence in bringing about a diplomatic settlement of the difficulties.
The Chileans are influenced more by a peril to their nitrate trade than by anything else. It would be much more effective, however, if such an interview were given out by the Secretary of Commerce rather than by the Secretary of State and presented purely as a commercial proposition. I discussed this matter yesterday with the commercial attaché and told him that if such an interview were given out it would have to be carefully phrased in order to avoid being construed as a threat. I believe that it should express the desire for an increase of commerce in nitrates and also that this would be brought about by a reconciliation of all the South American nations. I also told the commercial attaché that the interview should be so worded as to avoid anything that might possibly be construed as a war scare; although, for your confidential information, I believe that war is by no means an [Page 454] impossibility and, should it occur, it would endanger our supply of nitrate and seriously cripple our cotton growers. [End paraphrase.]
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