The Savannah morning news., 1902-02-02

basis of the actual cost of construction.
The rate of subsidy was so high on
the one hand, and was so eagerly COW
eted by the Germans on the other, that
they made every possible effort to Sc
cure the concession.
Now, a subsidy of per cent, clear,
on an actual investment would have
seemed a Golconda to the modern
Spaniard or Frenchman; a trust Of
magnificent proportions to an English
investor; and a ISlondike to- an Ameri-
can. AS for the Germans, they made
the astute reflection that Z per cent. on
real investment of seven million doll
lars was not half as good as per cent.
on fifteen million dollars. So they is
sued capital stock to the amount Of If
teen millions.
The Republic, for its part made the
extortionate subsidy a national debt.
Crespo was in power when the Krupp
Company, in 1892, Immediately upon the
completion of the road, made the stag
gering demand for a payment OF s1,050.-
000 in quarterly installments. He de-
clared 1t was plain robbery and at
that time, there was some little talk on
the part of the Germans about Venez-
uela's reluctance to pay her debts. The
apprehension of what a refusal to COM
ply with the terms of the agreement
might mean to Venezuela in internal
tional finance, induced Crespo to go ON
with the payments. But, embodied in
the national debt as they were, the sur
plus in the treasury frequently fell
short All the government had, it gave
until the arrearages amounted to the
$2,000,000 Germany now seeks to collect.
The demand for full payment of all ar
rears was made eight months ago,
when the country was in the throes
of several revolutions. and President
Castro found his resources fully taxed
to repress them. There was absolute
ly no money adequate for the pay
ment of two million dollars. But Gen.
Castro, like Gen. Crespo, abhorred the
idea of any charge Of Reputation of
debts. He endeavored TO convince the
Krupp Company that Venezuela would
discharge its obligations. And, when
government troops had to be trans
ported in the course of the disturb
ances, he used the Caracas Railway.
and paid the transportation charges in
cash. When the revolutionists tore
up the tracks, he paid the damages IN
cash. And he, like Crespo. undertook
to pay as much of the guarantee sub
sidy as was possible at the first OPP
portunity the finances of Venezuela
could afford.
1t has happened that case anal
gous to that of the Krupp Company
uement between Venezuela and
France. The Orinoco River Company,
holding contract with Venezuela for
the navigation of the OFinoco and the
exploitation of the rubber belt, claimed
damages to the amount of $400, 900 by
reason of the political disturbances.
The River Company put its claim into
the hands of the French minister of
foreign affairs for collection He in
VoHfiVHfR6 20
conclusion the claim was a Just one.
On the part of the government of
France, therefore, he addressed re-
quest to the government of Venezuela
for court of arbitration. The deter
mination of the character of the court
Is In course of adjustment. France
desires that the Judges of the court
be neither Venezuelan nor French
in nationality. Venezuela, because OF
the essentially South American con-
ditions surrounding the claim desires
the court to be composed exclusively
or Venezueleans. The two govern
ments are now engaged amicabIy in
discussing the Formation of the court:
ard the claim will ultimately be heard,
ana satisfied. according to interna-
tional law.
Venezuela does not refuse to pay the
German claim. But the republic
does refuse to be bullied into paw
ment by the German empire. The
disput will be settled in either of two
ways. One way is for the German
government to accept Gen. Castros en-
gagement to pay part of the s.. 900. 600
within the next few months and TO
pay the rest as speedily as treasury will
allow. The other is to insist on paw
ment at once, and to endeavor to col
lect by force. II is true, Germany could
seize and hold any Venezuelan port
preferably that of La Guayra. But the
seizure OF La Guayra would mean that
German troops must keep the peace OF
the territory they occupy and that the
Venezuelan government is under no re-
sponsibility for their protection. The
mountains are only 900 feet from the
seashore. The mountaineers have a
nasty habit Of coming down with rifles.
in groups of a dozen, at night. Ger
many would find herself involved In
a guerilla warfare which would place
the city practically in a state OF seige.
As a nation. Germany would feel little
apprehension of a war with Venezuela,
although 1t might be well to remem-
Der that Spain needed 200, 900 men TO
hold Cuba and England has already
used 100000 men to secure a grip on
South Africa.
But what Germany has already
shown evidence of remembering is that
the 100000 bags OF Maracaibo and La
Guayra coffee are handled by the Ger
man commercial houses. She cannot
AFFORD to peril her entire trade with
Venezuela for a claim that can, by no
possibility, remain more than half just.
The most serious outcome for, at any
time, is a naval demonstration or the
coast