New-York tribune., 1902-04-11
CHILTS FINANCIAL PLIGHT.


Chilli has for so long been regarded as a rich
and prosperous country that it is bit startling
though not upon reflection surprising. we
shall see-to find her in something like financial
straits Yet such is indisputaby the case.
few weeks ago she was earnestly trying 10 float
a loan in the London market, where a great
mass of her securities is ALREADY held. She did
not succeed, which is not to be wondered at
For while she has ever been prompt in paying
the interest on her outstanding bonds various
causes have combined to depress the market
value of her securities Thus her 4la per cent
bonds of 1856 fell from 81 In December 1000,
to 30 in December. 1901, and her > per cent
bonds in the same space Of time fell from w 10
81. 1t is easy to say this decline was due TO
transient causes, such as bad wheat harvest
and labor troubles in the nitrate fields. The I'M
portant fact IS that it initiated against the
floating of another loan. So then she turned to
New York, with what result is yet to be seen
1t is interesting to note, however. that news
items of obviously 'nspircd' Chiiian origin
have been stating sometimes that she has Sc
cured the loan, and sometimes, as if to solicit
the loan by ''bluffing," that she has given up
the idea of borrowing because she finds she does
not need to do so.
The financial plight Chilli is actually in may
of record. Thus in January of this year, to
raise funds the Chilian Congress voted TO i'm
pose an additional duty of 10 per cent on all i'm
ports. In February indefinite delay was ordered
in making some official payments. In March
an increase of export duties on ritrates was CON
sidered. and so was further issue of paper
money. True, on March 20 the officially inspired
announcement was made that negotiations for
loan had been abandoned as unnecessary. But
at the same time, in the same utterance. it was
admitted that the money was needed and was
to be raised. in lieu of loan, by sales OF public
property 1t was added that the government
had decided upon retrenchments to the extent
OF So. 800 600, though it not explained that
these were to be effected at the expense OF
primary school instruction and of the army and
navy. How the situation Is regarded in Chill
may be judged from what was recently said by
"El Ferrocarril,'' Of Santiago: "The clear facts
'of the past show that we have made an eco
'nomical error, especially in not stimulating In
"dustry. The actual situation is not political
zone. but one of general poverty, which will
"soon become one of famine If we do not apply
'heroic remedies It is hard to say this but the
truth is sometimes necessary"
One Of the most dsquieting features of the
case is the future outlook 1t is well known
that large proportion of Chili's revenue is and
for wears has been derived from the great
Tarapaca nitrate beds, which she took by con-
quest from Peru. The export duties on nitrates
form more than 60 per cent of Chilis ordinary
revenue. But that is not permanent source
It's failure is now within measurable distance.
When the nitrate beds are exhausted that reve-
nue will cease When will that be? Some say
in ten wears. while the most optimistic do not
venture to postpone the catastrophe more than
thirty-fve years. Three years ago Mr.. Salinas.
the Chilan Minister Of Finance, said frankly TO
Congress: The millions from Tarapaca have
Slipped and are slipping through our fingers.
But what will happen when there are no more
funds to throw away, and when the goose that
LAYS golden eggs no longer figures in our bud
"gets? This may happen in twenty. thirty or
fifty years time. but happen some time IT
must" Meanwhile expenditures 90 on increas-
ing and no new sources of revenue are de-
veloped OF a truth. the rapidly waning nitrate
beds might we'll saw after us the deluge'
The blame for Chiii's financial plight is two
fold Some Of it is to be laid upon government
officials who have s0uandered funds. Thus 'El
Chileno' recently exposed the fact that the Min
istry of Public instruction had since 1880 pur-
chased lands TO the value of Si32, 900, which had
never been used but were still occupied by
private parties. This. il was said, was only one
example of what had been widely done in vari-
Gus departments As result OF the exposure
the President is now conducting an investiga-
tion into the matter Still more blame is to be
laid upon the state of armed peace" for which
Chilli herself is responsible. For years her rest
less and belligerent disposition has entailed
upon herself and her neighbors the necessity OF
maintaining costly armies and navies, and even
now, in her present straits she is considering
the possibility of making further additions TO
her fleet. Unlike her neighbor, Argentina, she
has no vast territories whose resources are to
be developed and into which millions of immi-
grants may be welcomed. She has only mar
row strip between the mountain peaks and the
sea. She has limited wheat belt. some copper