The Improvement Company and its allied companies held, besides bonds, certain banking and railway interests in the island. The Dominican Government, desirous to own and possess these properties, agreed with the companies that the value of their bonds and properties was $4,500,000, and they submitted to arbitration the question as to the instalments in which this sum should be paid and the security that should be given. The Hon. George Gray, judge of the United States Circuit Court of Appeals, and the Hon. Manuel de J. Galvan, both named by the Dominican Republic, and the Hon. John G. Carlisle, named by the United States, were the arbitrators, and rendered their award on July 14, 1904. By its terms the Dominican Government was to pay the above-mentioned sum of $4,500,000, with 4 per cent interest per annum, in monthly instalments of $37,500 each during two years and of $41,666.66 each month thereafter, beginning with the month of September, 1904, said award to be secured by the customs revenues and port dues of all the ports on the northern coast of Santo Domingo. The award further provides for the appointment of a financial agent of the United States, who was authorized, in case of failure during any month to receive the sum then due, to enter into possession of the custom-house at Puerto Plata in the first instance and assume charge of the collection of customs duties and port dues, and to fix and determine these duties and dues and secure their payment; in case the sums collected at Puerto Plata should at any time be insufficient for the payment of the amounts due under the award, or in case of any other manifest necessity, or in case the Dominican Government should so request, the financial agent of the United States was authorized to have and exercise at any and all of the other ports above described all the rights and powers vested in him by the award in respect of Puerto Plata. Under the award the financial agent could only apply the revenues collected toward its payment after he had first paid the expenses of collection and certain other obligations styled “aparods,” which constituted prior charges on the revenues assigned. These prior charges are specified in the award. The Dominican Government defaulted in their payments; and in virtue of the award and the authority conferred by the Dominican Government, and at its request, possession was delivered of the custom-house of Puerto Plata to the fiscal agent appointed by the United States to collect the revenues assigned by the arbitrators for the payment of the award; and in virtue of the same authority possession of the custom-house of Monte Cristi has also been handed over. I submit herewith a report of Mr. John B. Moore, agent of the United States in this case, and a copy of the award of the arbitrators.
During the past two years the European claimants except the English, whose interests were embraced in those of the American companies, have, with the support of their respective Governments, been growing more and more importunate in pressing their unsatisfied demands. The French and the Belgians, in 1901, had entered into a contract with the Dominican Government, but, after a few payments were made on account, it fell into neglect. Other Governments also obliged the Dominican Government to enter into arrangements of various kinds by which the revenues of the Republic were in large part sequestrated, and under one of the agreements, which was concluded with Italy in 1903, the minister of that Government was empowered directly to collect from the importers and exporters that portion of the customs revenues assigned to him as security. As the result of chronic disorders attended with a constant increase of debt, the state of things in Santo Domingo has become hopeless, unless the United States or some other strong Government shall interpose to bring order out of the chaos. The custom-houses, with the exception of the two in the possession of the financial agent appointed by the United States, have become unproductive for the discharge of indebtedness, except as to persons making emergency loans to the Government or to its enemies for the purpose of carrying on political contests by force. They have, in fact, become the nuclei of the various revolutions. The first effort of revolutionists is to take possession of a custom-house so as to obtain funds, which are then disposed of at the absolute discretion of those who are collecting them. The chronic disorders prevailing in Santo Domingo have, moreover, become exceedingly dangerous to the interests of Americans holding property in that country. Constant complaints have been received of the injuries and inconveniences to which they have been subjected. As an evidence of the increasing aggravation of conditions, the fact may be mentioned that about a year ago the American railway, which had previously been exempt from such attacks, was seized, its tracks torn up, and a station destroyed by revolutionary bands.
The ordinary resources of diplomacy and international arbitration are absolutely impotent to deal wisely and effectively with the situation in the Dominican Republic, which can only be met by organizing its finances on a sound basis and by placing the custom-houses beyond the temptation of insurgent chieftains. Either we must abandon our duty under our traditional policy toward the Dominican people, who aspire to a republican form of government while they are actually drifting into a condition of permanent anarchy, in which case we must permit some other Government to adopt its own measures in order to safeguard its own interests, or else we must ourselves take seasonable and appropriate action.
Again and again has the Dominican Government invoked on its own behalf the aid of the United States. It has repeatedly done so of recent years. In 1899 it sought to enter into treaty relations by which it would be placed under the protection of the United States Government. The request was refused. Again in January, 1904, its minister of foreign affairs visited Washington and besought the help of the United States Government to enable it to escape from its financial and social disorders. Compliance with this request was again declined, for this Government has been most reluctant to interfere in any way, and has finally concluded to take action only because it has become evident that failure to do so may result in a situation fraught with grave danger to the cause of international peace.
In 1903 a representative of a foreign Government proposed to the United States the joint fiscal control of the Dominican Republic by certain creditor nations, and that the latter should take charge of the custom-houses and revenues and give to the Dominican Government a certain percentage and apply the residue to the payment ratably of claims of foreign creditors. The United States Government declined to approve or to enter into such an arrangement. But it has now become evident that decided action of some kind can not be much longer delayed. In view of our past experience and our knowledge of the actual situation of the Dominican Republic, a definite refusal of the United States Government to take any effective action looking to the relief of the Dominican Republic and to the discharge of its own duty under the Monroe Doctrine can only be considered as an acquiescence in some such action by another Government.
That most wise measure of international statesmanship, the Platt amendment, has provided a method for preventing such difficulties from arising in the new Republic of Cuba. In accordance with the terms of this amendment the Republic of Cuba can not issue any bonds which can be collected from Cuba save as a matter of grace, unless with the consent of the United States, which is at liberty at all times to take measures to prevent the violation of the letter and spirit of the Platt amendment. If a similar plan could now be entered upon by the Dominican Republic, it would undoubtedly be of great advantage to them and to all other peoples, for under such an arrangement no larger debt would be incurred than could be honestly paid, and those who took debts not thus authorized would, by the mere fact of taking them, put themselves in the category of speculators or gamblers, who deserved no consideration and who would be permitted to receive none; so that the honest creditor would on the one hand be safe, while on the other hand the Republic would be safeguarded against molestation in the interest of mere speculators.
But no such plan at present exists; and under existing circumstances, when the condition of affairs becomes such as it has become in Santo Domingo, either we must submit to the likelihood of infringement of the Monroe Doctrine or we must ourselves agree to some such arrangement as that herewith submitted to the Senate. In this case, fortunately, the prudent and far-seeing statesmanship of the Dominican Government has relieved us of all trouble. At their request we have entered into the agreement herewith submitted. Under it the custom-houses will be administered peacefully, honestly, and economically, 45 per cent of the proceeds being turned over to the Dominican Government and the remainder being used by the United States to pay what proportion of the debts it is possible to pay on an equitable basis. The Republic will be secured against over-seas aggression. This in reality entails no new obligation upon us, for the Monroe Doctrine means precisely such a guarantee on our part.
It is perhaps unnecessary to state that no step of any kind has been taken by the Administration under the terms of the protocol which is herewith submitted.
The Republic of Santo Domingo has by this protocol wisely and patriotically accepted the responsibilities as well as the privileges of liberty, and is showing with evident good faith its purpose to pay all that its resources will permit of its obligations. More than this it can not do, and when it has done this we should not permit it to be molested. We on our part are simply performing in peaceful manner, not only with the cordial acquiescence, but in accordance with the earnest request of the Government concerned, part of that international duty which is necessarily involved in the assertion of the Monroe Doctrine. We are bound to show that we perform this duty in good faith and without any intention of aggrandizing ourselves at the expense of our weaker neighbors or of conducting ourselves otherwise than so as to benefit both these weaker neighbors and those European Powers which may be brought into contact with them. It is in the highest degree necessary that we should prove by our action that the world may trust in our good faith and may understand that this international duty will be performed by us within our own sphere, in the interest not merely of ourselves, but of all other nations, and with strict justice toward all. If this is done a general acceptance of the Monroe Doctrine will in the end surely follow; and this will mean an increase of the sphere in which peaceful measures for the settlement of international difficulties gradually displace those of a warlike character.
We can point with just pride to what we have done in Cuba as a guaranty of our good faith. We stayed in Cuba only so long as to start her aright on the road to self-government, which she has since trod with such marked and distinguished success; and upon leaving the island we exacted no conditions save such as would prevent her from ever becoming the prey of the stranger. Our purpose in Santo Domingo is as beneficent. The good that this country got from its action in Cuba was indirect rather than direct. So it is as regards Santo Domingo. The chief material advantage that will come from the action proposed to be taken will be to Santo Domingo itself and to Santo Domingo’s creditors. The advantages that will come to the United States will be indirect, but nevertheless great, for it is supremely to our interest that all the communities immediately south of us should be or become prosperous and stable, and therefore not merely in name but in fact independent and self-governing.