The New York herald., 1922-03-05

General for long time to come.
A banking law was needed. Govern
ment expenses needed pairing down to
income size. Then there was the des-
perate situation Of the cane grower.
Legislation was necessary to assure
the cane grower payment for cane de-
livercd at the mill. The existing state
of affairs permitted the mill owner to
dispose OF sugar as he wished, per-
mitting the grower no voice in the
matter and utterly ignoring the claims
banks or merchants may have had on
the raw cane crop for loans made
uDon it before it's maturity.
Treasury Was Empty.
Cuba's treasury was as empty as
Central American treasury can be-. A
loan was imperative. 1t would require
an American to negotiate It. Ameri-
can bankers would listen to one of
their own countrymen. They had come
to distrust Cuban promises and Cuban
reports. And all this set the most diff
ficult problem that Gen. Crowder has
had to solve.
for the expenditure of s136,000,0O 1t
might just as well have called for
s136 900 100000. During the preceding
twelve months about $160,000,o00 had
been spent. The budget had been pre-
pared for the politically starved fol-
lowers of zayas. They had been long
out Of office. Their day had arrived.
Imagine the shock when Gen. Crowder
said that that budget would have to be
whitfield down to $50, 100000. The
Zayas Congress had already shown it's
inability TO understand the situation
by promptly passing some 300 bills,
all but twenty of which carried more
or less absurd appropriations.
One OF the last things Menocal did
before leaving office was to issue a
the effect that he left a surplus of
s36. 100000. When Gen. Crowder went
to inspect this surplus he found in
stead deficit of $4,000. 900. which is
now called Cuba's floating debt. To
wipe this out an international bond
issue Is proposed.
One reason for this condition of the
Treasury is seen in the lack of sound
economic liaison between the Treas
ury and the Banco Nacional, which,
as Government repository, paid all
Government checks. For years this
favored bank handled millions of Gov
ernment dollars, paying no interest for
the use thereof. When this bank
closed its doors after failing to meet
the payments prescribed by the scaled
.t.x,,f q, 4 a..
ury s22,50O,000. 1t still owes it.
Collapse 70 Sugar.
The collapse of the sugar market
carried everything with it, of course.
In the summer Of 1914 Cuban pro-
ducers of sugar were getting q little
less than two cents pound for sugar.
In the spring of 1920 they were getting
twenty-five cents, only to fall back TO
eighteen and half cents when the
holders of sugar formed the well
known Sole Sales Commission with the
view of taking all Cuban sugar off the
market. They insisted that they would
hold the sugar for the peak price of
twenty-five cents. There were those
who said they would force the price
to thirty.
Cuba was rich beyond her widest
dreams. The newspapers named the
ensuing orgy of spending La Danza
de los Milliones" (the dance of the
millions). Men and women who had
never ridden on anything wilder than
an electric street car (and that but
once IN q while) appeared in magnIfi-
cent motor cars. Small planters who
had never known what il was not TO
be in debt to the storekeepers awarded
contracts to builders for palaces. The
Government went quite mad, boosted
salaries. created thousands OF new
jobs. Contractors received commits
sions for public work without having
to bid for ii.
The lid was or, and, with every
thing rising and no roof to retard said
rise, Cuba kept going up and up and
up, until the whole dream vanished in
the thinnest sort OF air. IL was an OK
plosion rather than a collapse. A run
started on the Banco Internacionale.
Another started on the Banco Ma
cionale. Another began on the Banco
Espano.
Thus far the Crowder commission
has been able 10 revive four OF the
sixteen Cuban banks and banking in
stitutions that collapsed. The general
impression IS that Gen. Crowder will
leave Cuba in better financial condi-
ton than she ever has been.
Statement by Mitchell.
Charles T.. Mitchell issued state
ment here last week to the business
men of Cuba and probably what he
had to say comes very close to what
Gen. Crowder himself would were he
in position to make public speeches.
In part Mr.. Mitchell said:
Cuba. as was the case with the
United States. went through an eco
nomic debauch and IS now paying the
price. and that price Is being cxacted
by the economic law. The faults. IL
there have been faults, have been the
faults of all. They have not been the
faults Of a few, nor have they been
the faults existent in other countries
reacting in turn upon Cuba.
But J truly believe that tho worst
is over and that Cuba In on the mend.
though tho mcnding process will be
no more rnpid here than pleevboro