837.011/408½
Memorandum by the Assistant Chief of the Division of the American Republics (Bonsal) to the Under Secretary of State (Welles)
Mr. Welles: Ambassador Messersmith telephoned this morning to state that the debate regarding the proposal for the liquidation of the Cuban credit moratorium which was described in the attached memoranda50 and concerning which you expressed yourself unfavorably to the Cuban Ambassador on Saturday, was proceeding today and that Cortina and Casanova are making strong efforts to have the measure adopted, alleging that they have the support of Colonel Batista.51 The Ambassador is impressed with the necessity for further action on our part today.
Twelve New York banks have addressed a telegram to the Department50 regarding this proposal, stating that its “confiscatory character” is obvious and earnestly requesting the Department to take immediate action for the protection of the interests involved. The representatives of certain of these banks have asked Ambassador Messersmith’s advice as to whether they should address themselves directly to the Constituent Assembly; the Ambassador replied that this was a matter which they would of course have to decide for themselves but that, in his personal opinion, such a step would be inadvisable.
It is recommended that you again call the attention of Ambassador Martínez Fraga to the fact that many of the features of the current proposal appear unduly favorable to the debtors and consequently harmful to Cuban credit and that you sign the attached telegram to Ambassador Messersmith authorizing the latter to express these views to the President of Cuba and to other appropriate officials.52