Spring Fever

In the somewhat banal white marble palace of the Pan-American Union in Washington last week gathered diplomats from 21 republics of the Western Hemisphere, to hear a somewhat banal Pan-American Day message from their Good Neighbor, Franklin Delano Roosevelt. Beaming "with faith in the high destiny of the Americas," Good Neighbor Roosevelt spoke a smooth public piece in the style to which all Americans are now accustomed. When he had finished he unexpectedly dismissed the press, asked that the microphones before him be deadened, and in a suspenseful silence gave a confidential extempore talk which every delegate present was soon itching to get onto a cable. Particularly itchy was Cuba's brand-new Ambassador Pedro Martinez Fraga, for the substance of Good Neighbor Roosevelt's remarks was that he would under no circumstances be prevailed upon to intervene in the affairs of Cuba.

Day prior, Good Neighbor Roosevelt's most obstreperous neighbor, Cuba's Army Chief and Strong Man, Colonel Fulgencio Batista, had dramatically tightened his hold on the island which he now rules. Returning from a long week end in Camagueey Province to his gleaming, refurbished Camp Columbia ten miles outside Havana, Boss Batista met his Capitol lieutenants to hear details of how the lower house of Cuba's 16th Congress was staging a legislative "standup" strike in the corridors outside their chamber. For a full week they had refused to take their seats in number sufficient for a quorum. Unread on the lectern was the latest message which Dictator Batista had authorized his hand-picked President Federico Laredo Bru to read.

As soon as the Colonel's lieutenants shuttled back from Camp Columbia to the Capitol, the stand-up was over. Back into the chamber filed 111 of the lower house's 162 members, just enough for a quorum but not enough to let Boss Batista forget that they were aggrieved. What they then heard from President Laredo Bru would have burned the ears of any U. S. Congress.

The Government, thundered Camp Columbia through the mouth of Laredo Bru, was tired of keeping 162 Representatives and 36 Senators at a cost of $4,000,000 a year unless they passed some laws to earn their pay. Since the Senate obeyed the Colonel's orders last December and impeached troublesome President Dr. Miguel Mariano Gomez, both houses had been feeling a new sense of power. They had refrained from legislating to argue over such matters as jobs. Now the Government, reported dutiful Senor Laredo Bru, was going to set things moving again by holding elections for its long-deferred Constituent Assembly which, among other acts, is supposed to write a new Cuban constitution.

Spring. With a Constituent Assembly in the offing this will be an eventful political spring in Cuba, and last week there were many rustling signs of spring among Cuba's politicians. As the buzzards wheeled lazily by day and the business life of Cuba went peacefully on in the sunbright streets and sleepy countryside, at night in the city of Havana the secret conferences of dark-eyed men talking softly and rapidly became longer and subtler and more intense. The Republican Actionist Party of impeached President Gomez, who spent the winter attending exhibition baseball games with ostentatious humility, suddenly spurted with a violent manifesto characterizing Acting-President Laredo Bru as "a decorative figure and a phantom, imprisoned in the palace as a legal fiction," and demanding that the Army stay clear of the elections for the Constituent Assembly. Grizzled, conservative old General Mario Menocal, vice president and smarting under his finessing by Republican Gomez in last year's Batistafied election, finished grinding sugar at his central (mill) in Camagueey and turned up in Havana for "unofficial talks" with Dr. Gomez. That was exciting enough, but not nearly so much a sign of political spring as the news that onetime President Dr. Ramon Grau San Martin, who has been living in Miami since Boss Batista turned him out in January 1934, was proposing to return. Strong though General Menocal is, Dr. Grau, a deep Pink if not a real Red, is even stronger with the Cuban electorate, and Batista might welcome him back as an ally to stave off eclipse by the martial Menocal.

These stirrings gave Havana a high political fever, with rumors of new coalitions circulating hourly. About all that any Cuban politician knew surely was that, let coalitions form where they might, for the moment the undisputed boss of Cuba was husky, brown Fulgencio Batista y Zaldivar.

Bosses. For the first time since he was born in a farmer's hut in Oriente Province 36 years ago, full-blooded Fulgencio Batista was without a boss to chafe him. His first boss was a tailor who apprenticed him at the age of 12. Batista now brags that before he quit a year later he could make a suit of clothes himself. Afterward he worked in a grocery store and bar, as a railroad fireman, engineer, conductor. Once he studied to be a barber. In the sugar boom of 1920, Cuba's Dance of the Millions, he was administrator of an Oriente cane plantation and likes to recall how he spurned his chances then to enrich himself dishonestly. Next year he entered the army as an infantry private. He was smart enough to study shorthand, which enabled him to win a competitive army examination and become a court stenographer with the rank of sergeant. Four years ago Sergeant Batista was scribbling obscurely at courts martial when Franklin Roosevelt sent his friend Benjamin Sumner Welles as Ambassador to see whether the ominous groundswell against ruthless President Gerardo ("The Butcher") Machado could be oiled over without a Revolution.

Sumner Welles gave only one gingerly touch to the corrupt Machado regime when, to his dismay, it crumbled completely, unleashing forces that soon proved too violent to handle. His hand-picked President Carlos Manuel de Cespedes, a polished Cuban nonentity whose father was a Revolutionary hero in 1868, lasted for 23 days of riot and bloodshed. Those days turned Sergeant Fulgencio Batista from a stenographer into a martial dictator. While Mr. Welles was anxiously trying to calm everything down again, Batista met with a five-man junta which handed the presidency over to Dr. Ramon Grau San Martin, surgeon and fiery professor of anatomy at the University of Havana. When the lower officers besieged their Machadista superiors in the Hotel Nacional, Batista led them. Few days later Mr. Welles found that he not only had a new provisional president but an aggressive army with Fulgencio Batista, now Colonel, as its chief.

Sumner Welles is as chilly, precise and high-minded a Brahmin as Groton-&-Harvard ever produced. With a rich wife and an intense devotion to duty, he is a paragon of U. S. career diplomacy. Between him and his absolutely opposite number, the earthy, self-made Cuban farm boy Batista, now began a historic tug of war for Cuba. First round went to Mr. Welles when Dr. Grau began heckling the U. S.-owned Cuban Cane Products Corp. and failed to win U. S. recognition. Second round was Batista's: he eluded Mr. Welles' trap to discredit him through Dr. Grau by turning against Grau in time, forcing his resignation. After two days and two more provisional presidents, quiet, conservative Carlos Mendieta stepped in, won formal U. S. recognition within five days. Back in Washington, Assistant Secretary of State Welles hastened the repeal of the 33-year-old Platt Amendment authorizing the U. S. Government to intervene in Cuban affairs. When, after nearly two years of wrangling with an unruly Congress, Carlos Mendieta stepped out, Secretary Welles won another round by persuading Batista to hold a constitutional election for his successor.

Meantime, Mr. Welles, not without misgivings, had left Cuba in the hands of able Career Diplomat Jefferson Caffery. The election was duly run off in January 1936 and produced President Dr. Miguel Mariano Gomez, the first "legally" elected President of Cuba since Machado's first term (1924). Perhaps because of his faith in Sumner Welles, cocky Dr. Gomez made the mistake last December of talking back to Batista when the Colonel had Congress levy a 9-c- tax on each sack of sugar produced in Cuba to finance an Army-conducted program for rural schools. With Sumner Welles and Franklin Roosevelt busily hymning Democracy at Buenos Aires and friendly Jefferson Caffery on needles, Boss Batista won his first big round by having Dr. Gomez impeached for "interfering" with the Congress, replaced him with tractable Secretary of State Federico Laredo Bru.

Latest round was doubtful. Last month the State Department abruptly dispatched Jefferson Caffery on a "vacation," a move behind which many a Cuban could discern the long, disillusioned face of Sumner Welles, who all winter has quietly been trying, with indifferent success, to encourage formation of a liberal anti-Batista bloc in the Cuban Congress.

Father. Perched for the moment on the top of his long, potentially rich island with not a U. S. Marine in sight, Boss Batista commands the biggest army in Cuba's history (12,000 regulars, 20,000 reserves and a national police force of 4,000). He spends $19,000,000 a year on them, has replaced the tumbledown shacks of the stingy Machado regime with spruce modern barracks. Leaves are frequent: potatoes are peeled and floors swept not by soldiers but by civilians.

In a country where blood has been spilled as freely as in Cuba, where the highest criterion of patriotism is actually having risked one's life, and where revolution preoccupies college students as normally as football does in the U. S., the use of armed force as an instrument of political progress seems perfectly natural and not at all barbaric. And it is not as a killer but as a father that Boss Batista sees himself using his martial power. He thinks of Cuba's three million guajiros (landless peons), from whose midst he has risen, much as he thinks of his two children, Mirta, 10, and Ruben Fulgencio ("Papito"), 3, to whom the Boss has given a Colonel's uniform and with whom he loves to romp when he arises at noon. Boss Batista explains that it was not fascism but such boys as Papito he had in mind in setting up, under the direction of his Secretary of State and closest civilian henchman, Dr. Juan J. Remos, 1,000 civic-military schools, staffed by Army sergeants, in Cuba's remote rural districts. There are about 70,000 children and adults in the schools now, learning to read, write, delouse themselves, ply trades. Army sergeants were chosen as teachers, says Batista, because they were the handiest group who knew how to read and write. Fatherly Batista has also secured a firm Army grip on orphan asylums, tuberculosis sanatoriums and charitable institutions, administered by a group of seven Army-controlled corporations, to whose income he wants to add the estimated $1,400,000 annual profits of Cuba's weekly lotteries. The U. S., says Batista, has always been very kind and fatherly toward Cuba, and a profitable thing that attitude has been for the U. S. Now, says he, let paternalism begin at home, and let the profits stay there, too. Batista, and not the U. S. State Department, will be the father of his country.

Money. However fatherly Boss Batista becomes, he knows that he and Cuba must remain at least economic nephews of Uncle Sam, who buys 65% of Cuba's chief cash crop and controls a good share of the land that grows it. Cuba also needs capital, which so far the U. S. has supplied. Last week Secretary Hull greeted with diplomatic enthusiasm the news that President Laredo Bru had appointed a five-man commission to tackle the $80,000,000 defaulted public works debt inherited from Boss Machado. This comprises $40,000,000 in public works bonds (some $34,000,000 of which are held in the U. S.), $20,000,000 in short-term credits held by Chase National and two other Manhattan banks, and $20,000,000 in contractors' certificates about half of which are held by Boston's Warren Bros.

The public works taxes originally levied to meet the interest charges have for three years been absorbed in the general budget, and last week, with Boss Batista's approval, this absorption was extended for two years more. This was a blow to the assembling creditors, and Chase Bank's Vice President Shepard Morgan sped to Washington, then to Cuba to protest about it. The Cuban Treasury politely explained that not to absorb the public works taxes would mean further unbalancing Cuba's proposed budget of $68,000,000 revenues and $74,000,000 expenses. Shaving expenses would mean throwing many deserving Cubans out of Government jobs and stirring up discontent--a problem precisely comparable to President Roosevelt's Relief-swollen budget equation.

Upon this financial scene, meanwhile, has appeared an enterprising, colorful group named Cuban American Banking Corp., which stole a march last fortnight by getting introduced into Congress by Dr. Marcelino Garriga, the extremely adroit Negro-blooded president of the financial committee of the lower House, a bill authorizing it as agent to convert all Cuba's existing foreign debt into a new 3 3/4% issue. Cuban American proposed taxing Cuba's foreign-owned businesses and foreign labor some $3,000,000 per annum to meet the interest load and amortization.

Moving spirit of Cuban American Banking Corp. is Eduardo Grenas, 37, industrious, ambitious son of Colombia's late Liberal Leader Alfredo Grenas. His silent backers include the Bank of Mexico and Manhattan's potent old Ladenburg Thalmann & Co.

Plan. Cuban American's plan was privately attacked by U. S. Treasury officials, who echoed the Chase Bank in describing the 5% commission asked by Promoter Grenas as exorbitant for a "purely mechanistic function." Unpractical, visionary, grandiose were their words for a larger plan that Cuban American had in the back of its head.

If Cuban American were allowed to handle the conversion, they promised to set up a Cuban national currency of 100,000,000 silver pesos. These Promoter Grenas and his bankers said they were ready to furnish at the rate of 5,000,000 a month. Cuba would have 2,500,000 each month as a seigniorage, would pay for the rest by turning over the U. S. and foreign currency captured through Cuba's sizable export balance. With its own currency Cuba could then set up a national bank to furnish Cubans with foreign credit in exchange for their new pesos, pegged to the U. S. dollar. In addition the Bank could furnish Cubans with credit to buy back their land from foreigners, run their businesses, put Cuba on its own financial feet. As a counter-move to Cuban American, the Chase Bank's Morgan took to Havana the draft of a speedily contrived plan whereby the Chase would do for Cuba what Cuban American proposed to do as a bank of issue, thus retaining for the Chase its dominant position. Further to checkmate the Chase, Promoter Grenas had the support of the Asociacion National de Acreedores del Estado, organized and fostered by him, composed of some 75,000 native creditors of the Cuban state--chiefly veterans, civil servants, teachers, small bondholders. The Asociacion could be counted on to oppose any Chase payoff before their claims were met. At the week's end, the Chase faced a further barrage from North Dakota's Senator Gerald Nye, who was angry because his SEC-authorized committee of Cuban bondholders in the U. S. had not been invited to appear before the new Commission.

Good Neighbor. Looming behind and above this flurry of fiscal planning last week, however, was still the three-year-old man-to-man fight for Cuba, Fulgencio Batista v. Sumner Welles. In Cuba, Mr. Welles had hoped to make a record which would crown his achievements in the Dominican Republic and Honduras and bring about his dream of becoming Under Secretary of State. Last week Fulgencio Batista was still a hard brown obstacle to that dream. To boss Boss Batista, Sumner Welles would apparently have to do just what Franklin Roosevelt promised not to do on Pan American Day: actively intervene in Cuba and thus blot his great Good Neighbor policy.

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