$10,000,000 Diplomacy

"You don't seem to realize that I am a personal friend of the President of the United States," was the reputed parting shot of Ambassador Sumner Welles to President Ramon Grau of Cuba before Mr. Welles returned to Washington (TIME, Dec. 25). Last week President Roosevelt recognized the five-day-old Cuban Government of the Island's new President that shrewd old politico Colonel Carlos Mendieta put in by a coup d'etat (TIME, Jan. 29). Straightway the Colonel cabled to Mr. Welles, now Assistant Secretary of State in Washington: "I am particularly grateful to Your Excellency . . . for your noble efforts . . . I am encouraged . . . because . . . I can count on your intelligent and weighty cooperation."

Arriving in Mexico City last week ousted Cuban President Grau, a surgeon of nation-wide repute, said: "The fact that the United States recognized Mendieta after five days while they didn't recognize me during my four months as President is easily explained. The whole trouble was that I didn't pay interest on the Cuban debt to the Chase National Bank of New York City, my reason being that I considered theirs an illegal contract made by the [ousted] Tyrant [of Cuba] Machado" (TIME, Jan. 8).

Into Cuba's new Cabinet beaming President Mendieta drafted as Secretary of the Treasury a onetime lawyer for the National City Bank, Senor Joaquin Martinez Saenz. From Havana the Republican New York Herald Tribune's alert Tom Pettey cabled:

"Every Cuban is confident that there is going to be at least a $15,000,000 loan from United States government sources . . . So far as this correspondent has been able to learn there is not much chance of such a dream coming true, regardless of how freely government money is being spent in America."

Never was an .able newsman more mistaken. By the time Mr. Pettey's dispatch reached the U. S., President Roosevelt had instructed the AAA to pour $10,000,000 worth of foodstuffs and other supplies into Cuba as a loan. Cuba's new Secretary of the Treasury said he would be glad to give every security for repayment in his power--the Cuban Treasury having been notoriously bankrupt for months.

With his cheerful zest for getting things done, President Roosevelt saw $2,000,000 worth of pork, lard, wheat flour and rice dispatched with utmost urgency to Havana. Mr. Welles had evidently told his White House friend that the danger of a Negro uprising and race-war in depression-ridden Cuba is real. If it can be bought off with $10,000,000 worth of dollar diplomacy the price seemed cheap to Washington. Having refused to lend a cent to feed hungry, rebellious Cubans until President Mendieta had been maneuvered in, President Roosevelt was credited throughout Latin America this week with a masterly piece of "invisible intervention."

Not daring to antagonize Cubans too much by returning at once the properties of Electric Bond & Share's Cuban Electric Co. which ex-President Grau seized and by canceling his 45% rate cut, President Mendieta announced that these matters will be arbitrated.

As President Roosevelt's personal representative in Havana, loyal Jefferson Caffery got to work at once on a treaty expected to result in more Cuban sugar entering the U. S., keener competition for U. S. sugar producers. Momentarily Mr. Caffery was expected to be dubbed Ambassador.

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