The Montgomery advertiser., 1902-08-08
CREAM of the SPECIALS
CAN CUBA PAY INTEREST.
House Has Passed Bill Authorizing
 Bond Issue.

From Washington Brooklyn Edsie'
 Shall the United States permit the Re public of Cuba to issue bonds 10 thS amount of $35,0o000o?
 This is a question that may soon pc presented to the administration Tor oe cision under the terms 9f the Iidt' @ amendment If 1t is decided atnrmallEe ly 1t raises the further question of Wheth- by permitting the bonds to pe issued the United States does not bee )me moral ly responsible for their payment Tn the event of default by the Cuban IoVerH- ment.
 The first official information received in Washington in regard to the lroposed loan was in cablegram received lroih Minister Squires saying:
 The House has passed the bill au- of issue 90 per cent; maximum interest pe- cent redeemable in forty years
 The provision of the Platt amendment that gives the United States supervision of the debt of Cuba is as follows:
 That said government shall not assume or contract any public debt to pay the interest upon which. or to make reasoiia- ble sinking fund provision for the ultl- revenue of the Island of Cuba, after de fraying the current expenses ot the gov ernment shall be inadequate.
 Though the Cuban Senate has not yel acted on this loan bill it Is dnderstooa here that it is certain to do so and that there is no doubt of President Palma glV, ing it his approval. What course snail then be pursued by the United states IS a question which will give the adminlstra- ton much concern If it is found, upon investigation that there is danger that the Cuban Government may not De aole to pay the interest on the bonds ana prCviIo for sinking fund inc onlteu States may make representalonS; .o Cuba through Minister Squires advising against the making of the loan. It IS not believed that any further acton would be necessary, for 1T It snoulo pe, come known that the United states nao disaprroved the loan it is not propapie that Cuba would be able to find bankers in thls country or elsewhere wiling to buy the bonds.
 on the other hand if this government eithe' by direct statement or by rethaiI. .Lo ing silent permits the issuance or the bonds it will do much to estapnsn tne credit of the new republic and to enable the bonds to be sold to advantage; ouch approval would doubtless be taken au- vantage of by the Cubans in negotiating the!r bonds, as it would be argued that tho approval of the United States amounted to a practicaol guarantee.
 The practical question for the onlteo States to decide, and for bankers to de- eide. when the bonds are offered, IS whether the Cuban revenues are sufficient to take care of a loan of this magnitude and at the same time to defray the ruiI- ming expenses of the insHar government.
 
 for ar official decision in some way, the officials of the administration will not eX- press any opinion for quotatlon upot u now, but it can be said that there IS disposition in official circles nere ,,, to to doub. the ability of the Cubans, with their present revenue, to take care or a debt of this magnitude. The annual revenues of Cuba. under the American military government, amounted to apous ..Is ; SIG GOO GOO most of it made up of customs receipts Thus far there seems 10 pc a fallirg off in the receipts under the independent government. me eAPshsess . of the government under the American receipts due to the fact that II was the policy of the intervening government to make improvements and develop tne school system as rapidly as possible. IL is unotrstood that the Cubans are cuttlhS down the expenditures for scnoots .his hhu for p,tbltc works, but, in spite or this' 1t is expected that the expen 1itures uhder the independent government Will De greater than they were under Iehei al Wood The reason of this IS tnat tne @ Cubans are now paying many salaries TOT officials of all grades, from Preslueha tha down, which were not paid under tne military government-the duties Of the plaCrs being discharged by men in the military service of the United states "ho were paid by this government. 4.
 The only safe way for the CuDahs 10 issue the proposed bonds, according 10 officials of the administration, IS Tor thel'i to provide special taxes to iieet t is terest and sinking fund charges It IS believed that a scheme of internal reNe- n,,r toxes similar to the war taxes which wsre in!po sed in this country. at the be. De. ~inning of the war with Spain might, be divised to meet the emergency. Even then some question might be raised as o,oo oo Tnder wnssr' the definition of ordinary reye, nues'' within the meaning of the fiatt amendn ent. It is not probable that this government would raise thls ds polndL, however. and the purchasers of the bonds would probably see that provision was mad, in the law devoting these special oad avenues exclusively to the principal ana interest of these bonds; .,,,. r,orov
 The purpose of Cuba to use this money ,, u,at,ne loans to agriculturalists "; vi ,E,e business, is not looked upon with much favor by officials in Washington, If is believed that it will estapilsh