UNITED STATES AND NICARAGUA
Efforts toward Peaceful Settlement. —On the morning of January 27 Rear Admiral Latimer arrived at Corinto, the west coast seaport of Managua, the capital of Nicaragua, and proceeded at once to the capital. It was indicated that, together with Charles C. Eberhardt, the American Minister, he planned to confer with President Diaz, on the basis of a statement in his possession from the Liberal leader Sacasa, in an effort to secure a peaceful solution of the Nicaragua problem. It was expected that representatives of Sacasa would be called in, and it appeared possible that a settlement might be reached which would involve the elimination of both the rival leaders.
Prior to this development, both Diaz and Sacasa had made tentative offers, neither of which had proved satisfactory to the opposition. Diaz on January 15 proposed that he be continued as president until the end of his present term, December 28, 1928, with provision of government jobs and seats in Congress for Liberals, and that at the end of that time a free election should be held under supervision of the United States or other neutral authority. Sacasa, on the other hand, according to despatches of January 23, was willing to step aside at once in favor of a non-partisan executive, chosen through the mediation of the United States or other American nations, and approved by the neutral members of the present Nicaraguan Congress.
Military Activities.—At the close of January, hostilities between Liberal and Conservative forces were still going on, especially in the interior; and in northwestern Nicaragua the Liberals reported considerable success. Despatches from Admiral Latimer on January 10 stated that three additional neutral zones had been established on the eastern coast for the protection of American property and to prevent the entry of munitions for the revolutionary forces. One of these was at Pearl Lagoon, another sixty miles north, and a third at Rama, twenty-five miles up the Escondido River, where there are American mahogany interests. The American forces in Nicaraguan waters included fifteen units, with upwards of 5,000 sailors and marines. This concentration, it was remarked in the press, would serve a double purpose, in the event of serious difficulties with Mexico.
President Defends Nicaragua Policy.—Early in January strong opposition was manifested in Congress and in the press against the policy of the United States in landing forces in Nicaragua and entering into Nicaraguan political broils. In reply to these criticisms President Coolidge on January 19 sent a message to Congress defending the government’s recognition of Diaz and its efforts to end the state of anarchy in Nicaragua.
The message cited the clause in the Nicaraguan Constitution providing that, in the absence of the President and Vice-President, the Congress shall designate one of its members to complete the unexpired term. f It pointed out that, on November 10, when the Congress elected Diaz, both President Solarzano (Conservative Republican elected in 1924) and Vice-President Sacasa (Liberal) were absent from the country, though Sacasa arrived to head his revolutionary forces at the end of that month.
In defense of the recognition of Diaz, the message recited at length the history of recent events in Nicaragua, including Chamorro’s overthrow of Solarzano, the subsequent Liberal uprising, the arrival of American naval vessels last August, and the armistice in October followed by the November election. Concerning the part played by Mexico, President Coolidge said:
I have the most conclusive evidence that arms and munitions in large quantities have been on several occasions since August, 1926, shipped to the revolutionists in Nicaragua. Boats carrying these munitions have been fitted out in Mexican ports, and some of the munitions bear evidence of having belonged to the Mexican Government. It also appears that the ships were fitted out with the full knowledge of and, in some cases, with the encouragement of Mexican officials and were, in one instance at least, commanded by a Mexican Naval Reserve Officer.
After emphasizing the injury to American investments that would result from continued revolution, the President ended as follows:
Manifestly, the relation of this Government to the Nicaraguan situation and its policy in the existing emergency are determined by the facts which I have described. The proprietary rights of the United States in the Nicaraguan Canal route, with the necessary implications growing out of it affecting the Panama Canal, together with the obligations flowing from the investments of all classes of our citizens in Nicaragua, place us in a position of peculiar responsibility.
I am sure it is not the desire of the United States to intervene in the internal affairs of Nicaragua or of any other Central American republic. Nevertheless, it must be said that we have a very definite and special interest in the maintenance of order and good government in Nicaragua at the present time, and that the stability, prosperity and independence of all Central American countries can never be a matter of indifference to us. The United States cannot, therefore, fail to view with deep concern any serious threat to stability and constitutional government in Nicaragua tending toward anarchy and jeopardizing American interests, especially if such state of affairs is contributed to or brought about by outside influences or by any foreign Power. It has always been and remains the policy of the United States in such circumstances to take the steps that may be necessary for the preservation and protection of the lives, the property and the interests of its citizens and of this Government itself. In this respect I propose to follow the path of my predecessors.
In spite of the President’s argument, Senator Borah, on January 13, again came out strongly against American intervention, declaring that Sacasa was the rightful claimant, that the marines should be withdrawn or kept in Nicaragua only to insure a fair election, and that the Monroe Doctrine was in no way involved.
Secretary Kellogg on Bolshevism.—
Before the Senate Foreign Affairs Committee, two days after the President’s message, Secretary of State Kellogg revealed State Department evidence tending to show Mexican activity in Nicaragua, and communistic activity throughout Central America. The documents were concerned chiefly with efforts of the Communist Party in the United States to establish an “All-American Anti-Imperialistic League,” spread propaganda in Latin America, and get in touch with agents in those states. These efforts were approved by the Red International, though probably, as a Russian official said, most of the red leaders had never even heard of Nicaragua. In general, Secretary Kellogg’s efforts to “raise the bogie of Bolshevism” were not taken seriously, though there was some truth in his statement that:
The Bolshevik leaders have had very definite ideas with respect to the role which Mexico and Latin America are to play in their general program of world revolution. They have set up as one of their fundamental tasks the destruction of what they term American imperialism as a necessary prerequisite to the successful development of the international revolutionary movement in the New World.
The propagation of communist ideas and principles in the various countries of Latin America is considered secondary to the carrying on of propaganda against the aims and policies of the United States. Thus Latin America and Mexico are conceived as a base for activity against the United States.
UNITED STATES AND MEXICO
Sentiment for Arbitration.—The possibility of a rupture of relations with Mexico, combined with intervention in Nicaragua, aroused in the United States during January a wave of agitation in favor of arbitration. On January 8, President Calles of Mexico, talking to a group of American clergymen and social workers, committed himself to the extent that he would agree to arbitration of disputes with the United States, “if it were necessary to make such a sacrifice to avert more serious difficulties.”
This statement received wide publicity. On January 25, the U. S. Senate approved unanimously a resolution introduced by Senator Robinson expressing the opinion that it would be sound policy to submit the Mexican controversy “to an arbitration tribunal, which shall apply the principles of international law .... the arbitration agreement to provide for protection of all American property rights pending the final outcome of the arbitration.” This of course was simply an expression of Senate opinion and had no binding effect on government policy.
Secretary Kellogg declared (January 18), when the resolution was brought up, that he had been “giving very serious consideration” to such a course; and the Mexican Foreign Office came out with a statement that it was ready to accept arbitration “in principle.” On the other hand, President Coolidge (January 21) declared himself strongly against arbitration, and said he felt the American people would support this position if they understood clearly that the issue was simply “whether property legally owned by American citizens is to be confiscated.”
The Situation in Mexico.—Such sentiment for arbitration as was expressed in Mexico was doubtless prompted by fear of internal disturbances if relations with the United States were broken, and the embargo lifted on export of arms. Catholic uprisings were under way in several provinces. Bishop Diaz, secretary and leader of the Catholic party in Mexico, was arrested early in the month, and later reported to be under military guard near the Guatamalan frontier. Huerta, at Los Angeles, was said to have received offers from revolutionary leaders with headquarters at Chuhuahua, promising an initial army of 6,000 for a campaign against Calles.
Toward the end of January the Mexican government began cancellation of all permits to drill oil wells on which operations had not been started by December 31, last, this applying only to companies which had not complied with the new petroleum law. No complaints, however, were made to the American embassy, and there was some reassurance in a report on January 29 that the Federal .District Court of Vera Cruz had handed down a decision restraining the enforcement of the oil law until its constitutionality had been passed on by the Supreme Court of Mexico.
UNITED STATES AND EUROPE
Turkish Treaty Rejected.—After discussions in executive session extending over two weeks, the U. S. Senate on January 18 rejected the Lausanne Treaty with Turkey by a vote of 50 to 34, the affirmative vote being six less than the required two-thirds majority. The treaty was opposed on the ground that it failed to provide for the cession of Turkish territory to Armenia as arranged after the war, failed to guarantee protection of Christians, and failed to hold Turkey to recognition of the American nationality of former Turkish citizens naturalized in the United States. Many church organizations opposed the treaty, but the religious and educational institutions most active in Turkey favored its ratification.
The present temporary commercial agreement affording us “most favored nation” treatment has been once extended and expires February 20. The American Commissioner at Angora, Admiral Bristol, entered into negotiations for its further extension.
Fund for Arms Parley.—In a message to Congress on January 7, President Coolidge asked for an appropriation of $75,000 to cover further participation in the work of the Geneva Preparatory Commission for the Disarmament Conference. The Commission meets in plenary session in March, and further meetings will no doubt continue for several months, in preparation for the conference which, it is hoped, will be held next year.
Fists Across the Sea.—In an article by this title in the February Harper's, Mr. Albert Jay Nock analyzes the hostility toward the United States now almost universally manifest in Europe, and the results towards which it is tending. He believes that since the war the great effort of our former Allies has been to shift their burden of American indebtedness from their own shoulders to Germany, and “secure their own economic position in such a way as to make it safe to tell their creditor to dig his pay out of Germany or whistle for it.” And so far as financial independence is concerned, he thinks they are now very near success. France is the only country that would feel any awkwardness about snubbing a demand from us for payment. And he thinks that France, by loans negotiated in other countries—perhaps indirectly from American sources—may be able to finance her economic recovery without dependence on direct loans from this country.
Then how can we ultimately collect these debts? Mr. Nock goes so far as to suggest that, feeling our potential—if far from actual—military strength, we might conceivably resort to strong measures. We might be led “before our diplomatic conversations were over, to ask France for all her colonial possessions, and Great Britain for the maritime provinces and British Columbia, or we might be obliged to make the Chinese market (as seems anyway inevitable) a second Morocco.”
This may sound startling, if not preposterous. But he is on safer ground in pointing out that there is developing an “economic solidarity” of western Europe, including Germany, against the chief economic competitor, America. So long as we continue prosperous, this does not worry us. But when we see our foreign trade cut down in every market of the world, “as this combination will be able to cut it down, will not the pinch be hard enough to start some grumbling, possibly some thinking, and certainly some kind of governmental activity? What kind will it be? Under such conditions,” asks Mr. Nock, “what has it invariably been?”
GREAT BRITAIN
Lloyd George and the Liberal Party. —At a meeting of the Administrative Committee of the Liberal Party, on January 19, it was finally decided to accept Mr. Lloyd George’s offer of support from the £1,000,000 “secret” campaign fund built up during his premiership, and to prepare for a full-line fight in the next election. Although Mr. Lloyd George thus appears to have won control of the Liberal party machine, it is not unlikely that many followers of former Premier Asquith will refuse to support the party under its new leader.
The “New British Empire.”—As Augur points out in the January Fortnightly Review, it is difficult to realize fully the changes recently effected in the organization of what was once called the British Empire. Long tacitly admitted, it is now officially recognized that the Parliament at Westminster cannot legislate beyond the United Kingdom or pass in any way on legislation in the dominions over-seas. The only bond of union is common allegiance to the King, and it should be noted that this raises the British Crown to an increased function and responsibility.
With the new status of the dominions, new diplomatic problems are certain to rise. There will be not only a “British Ambassador” at Washington, but also an envoy from the Irish Free State and Canada, and perhaps soon from Australia. But who will represent the parts of the realm which do not send envoys? And who will take precedence in negotiations concerning the former empire as a whole?
The difficulties over sharing military and naval burdens have long been obvious and have not been solved by the new arrangement. It is interesting to note, in this connection, that the sums which Australia intended to contribute to the Singapore Naval Base were withdrawn when operations were halted by the MacDonald Labor Government, and are now earmarked for the Australian navy.
FRANCE
French Population.—According to the census report, at the close of 1926 the population of France is now about 40,800,000. Of these 2,500,000 are foreigners. One tenth of the population of Paris is foreign.
Approval of Briand Policies.—In a report to the Foreign Affairs Committee of the Chamber, on January 19, Foreign Minister Briand declared that the Poincare cabinet were in complete agreement in support of his present policy toward Germany. In his pursuit of more friendly relations with Germany, and also in his dealing with Italy, M. Briand has received useful assistance from the Vatican, which exerts a powerful influence with the Catholic Center Party in Germany and with Italian Catholics. In this connection it is pointed out that an alignment of Soviet Russia, Nationalist Germany, and Fascist Italy, though it would make strange political bed fellows, is the chief danger threatening the combination of western powers envisaged in the Locarno compact and the chief aim of M. Briand’s foreign policy.
French Finances.—From a statement of Premier Poincare, on January 19, to the effect that the United States Government had no wish to hasten French action on the debt accord, it appears likely that the question of ratification will remain shelved for some time to come. This is partly because of hope for revision of terms, partly because of the unlikelihood that the accord can pass in the Chamber, and partly because of the feeling of increased freedom afforded by the rise and stabilization of the franc. Later in the month Premier Poincare stated his intention to maintain the franc at its present value of about 25 ½ to the dollar for some time in the future. Its fixing at that ratio was accomplished by an offer of the Bank of France to either buy or sell francs in unlimited quantities at that figure. Shipments of gold from France to the United States at the close of January were for the purpose of purchasing American securities, which, it was said, could be used more conveniently than gold as a masse de manoeuvre in preventing fluctuations of the franc. For this purpose M. Poincare has built up available credits to the amount of about $500,000,000.
ITALY
Italy’s Financial Progress.—The monthly treasury balance in Italy, on December 31, indicated that income from taxation and other sources during the last six months of the fiscal year had nearly doubled over the six months preceding.
Fears of Italy in the Balkans.—Reports from Belgrade in January declared that Italy’s recent treaty with Albania was the outcome of the conference last autumn between Premier Mussolini and Foreign Minister Chamberlain of Great Britain, the latter country having decided to scrap her policy of upholding Albania and give Italy a free hand. Whether this report had any foundation or not, the fears of the Jugoslavs were further aroused by the publication at Rome, on January 18, of a manifesto of the so-called “Montenegro Committee of National Defense” demanding Jugoslav evacuation of Montenegro and its union with Herzegovina as an independent state, which presumably would be turned over to the Italian Crown Prince as a grandson of former King Nicholas of Montenegro. In this revival of the Montenegro question, on the heels of the Albanian Treaty, Jugoslav leaders saw clearly the designs of Italy.
GERMANY AND NORTHERN EUROPE
Nationalists in New Cabinet.—The condition set by President von Hindenburg that the next German ministry must have a clear majority in the Reichstag was apparently fulfilled in the cabinet finally organized by former Chancellor Marx and announced January 28. This was based, not as before on a minority group of middle parties, but on a combination of middle parties and Nationalists, commanding an estimated vote of 270 against 222 for the opposition. The new cabinet contained four Nationalists; three Centrists, including the Chancellor; and three of the German and Bavarian People’s parties, including Foreign Minister Stresemann. Dr. Otto Gessler retained his position as Minister of Defense in order to keep the army “on a democratic basis,” although for staying in the cabinet he was ousted from the Democratic party. The Nationalists agreed to swallow the Stresemann foreign policies of Locarno and the League, in return for a voice in internal affairs. Their selection for one cabinet post, Herr Graef as Minister of Justice, was too reactionary even for President von Hindenburg, who forced his withdrawal because Graef had once insulted President. Ebert by staying away from a court reception which custom required him to attend.
Polish-Lithuanian Rapprochement. —Since the establishment of a conservative government in Lithuania, there have been efforts toward a resumption of friendly relations between Poland and her old enemy. Economic conditions are forcing Lithuania to seek friendship with one or another of her frontier neighbors, and Poland appears the most promising, provided some kind of joint control can be established in the Vilna district, long disputed between the two countries.
Russo-Japanese Accord.—According to a despatch from Walter Duranty to the New York Times, January 23, there has been during the last few months a steady smoothing out of relations between Soviet Russia and Japan. The two reasons alleged for this are: (1) the remarkable success of the Cantonese under Soviet guidance, and (2) a growing belief that Russia’s friendship in Siberia and Northern Manchuria will be more profitable to Japan than Chang Tso-lin’s. A fisheries convention on the Siberian coast is up for discussion in March. If, further, Japan secures permission to extend her southern Manchurian Railway northward across the Chinese Easttern to the Amur River, as she has long desired, then Russo-Japanese friendship may be accepted as a fact.
FAR EAST
Anti-Foreign Demonstrations.—At Hankow, 585 miles up the Yang-tse River and just across from Wuchang, the present headquarters of the Cantonese government, the British concession is valued at about $60,000,000. Following a great Chinese mass meeting there, on January 3, a mob of thousands of coolies charged the concession, attacking with clubs and stones the concession police and about forty sailors from a British warship in the river. The police and sailors maintained only a passive resistance, and at nightfall the mob was dispersed by Cantonese soldiers. The following day Admiral Cameron, Consul General Goffe, and the Chinese chief of police agreed that the naval detachment should be withdrawn, and the concession taken over by police under Chinese control. On the fourth British women and children were sent to Shanghai, and about sixty American women and children left on the sixth. The British consul remained in the city, but British banks and business houses were kept closed. The Japanese and French concessions were not attacked, although it was made clear that their ultimate surrender to Chinese authority was expected. At the time of the attack there were about 1,300 Americans in Hankow and Wuchang. Six U. S. naval vessels were on the scene on January 5, and others were sent further up the river.
At Kiu Kiang, 135 miles below Hankow, there were similar demonstrations which led to the landing of British forces for protection of the concession. In the city of Foochow, in Fukien province, a Chinese mob, on January 7, looted the Y.M.C.A. and two mission churches, and attacked the Spanish Dominican orphanage. Some Americans as well as British suffered personal violence. Anti foreign agitation swept through many provinces and threatened foreigners in the interior, but no loss of life was reported.
British Offers to China.—In a speech on January 29, Sir Austen Chamberlain, British Secretary of Foreign Affairs, gave a fairly definite outline of British offers to Chinese leaders. He declared that there offers were most generous and far-reaching, including recognition of modern Chinese law courts and codes for trial of cases brought by British complainants; admission of Chinese tariff autonomy, provided tariffs were not discriminatory against British subjects or goods; and control of British concessions by arrangements which would give a share in their adminstration to both British and Chinese. He pointed out difficulties arising from the anti-British attitude and Soviet leanings of the Cantonese Government, and made it clear that any agreements reached must apply to Northern as well as Southern China.
Counsellor O’Malley of the British legation in China arrived at Hankow, on January 10, and presented the above proposals in subsequent conferences with Foreign Minister Eugene Chen of the Cantonese Government and General Chiang Kai-shek, commander-in-chief of the Cantonese army. These conferences were continuing at the end of the month. As a result of understandings reached, British banks and business houses at Hankow reopened on January 24.
In the meantime the British Government began the despatch of naval vessels and troops to the Far East, providing for a concentration of upwards of 20,000 men at Shanghai, to be known as the “Shanghai Defense Force,” under command of General John Duncan, who sailed for Shanghai on January 26.
United States Policy.—In a statement on January 25, President Coolidge made it clear that the policy of the United States in the present Chinese crisis was to protect American lives and property, but if possible to avoid joining Great Britain or other foreign powers in preparations for actual hostilities against China. The President pointed out that the fact that the United States has no concessions in China differentiates our policy from that of Great Britain.
Information provided by the State Department in January showed that there are about 12,000 Americans in China, of whom perhaps 6,000 are missionaries and their families. There are about 4,000 Americans in Shanghai and this number is increasing owing to the withdrawal of missionaries and others from the interior. There are roughly, 2,000 Americans at Tientsin, 1,300 at Hankow, 1,000 at Nanking, 800 at Canton, and 500 at Hong Kong. American trade represents 20% of China’s imports and 14% of her exports.
Mr. J. V. MacMurray, American Minister to China, who had been recalled to Washington for conference and had traveled as far as Korea, was on January 21 ordered back to Peking. Admiral C. S. Williams, commander of the U. S. Asiatic fleet, arrived at Shanghai, on January 13, and was at the time senior officer among the commanders of the fifty or sixty naval units there assembled. The United States had at that time about fifty-five naval vessels in the Far East with a total of more than 8,000 sailors and marines. On January 29, it was announced that the cruisers Richmond, Cincinnati, and Marblehead had been ordered to Hawaii, under Rear Admiral John R. Y. Blakely, as a reinforcement if needed.
Carrying out the well recognized United States policy of treating China on a basis of full equality, Secretary Kellogg in the latter part of January sent a message, in response to a request from Foreign Minister Koo of Peking, offering to enter into negotiations for new treaty agreements at .any time. Apparently this offer was extended to both the Peking and Cantonese Governments. Mr. Kellogg’s offer was in line also with a resolution introduced by Congressman Porter of the House Foreign Affairs Committee, favorably reported to the House on January 28, which requested the President “forthwith to enter into negotiations with duly accredited agents of the republic of China” for “treaty relations upon an equitable and reciprocal basis.”
Attitude of Japan.—While awaiting the action of Great Britain and the United States, it was evident in January that the Japanese Government foresaw the necessity for de facto recognition of the Cantonese Government and an extensive modification of present treaty agreements. Japanese trade in the Yang-tse valley has suffered severely as a result of recent disturbances, and Japan will not lag behind other powers in adopting a conciliatory policy toward the Nationalist elements now dominant in China.
Japanese Military Expenditures.—The new Japanese budget, the largest in Japanese history, provides for an expenditure of 1,730,000,000 yen. Of this 225,000,000 goes to the navy and 212,000,000 to the army—representing 27 per cent for military purposes, as compared with 50 per cent in the years just after the war. The navy estimates were cut down about 10 per cent.