The Waterbury Democrat., 1937-06-16
received preferential treatment were poorly fed.

Fleeing Westward
 Now tens of thousands of these people were fleeing westward to- ward Santander and airplanes were bombing and machine gunning the road, which runs through one of the most beautiful and picturesque countryside in Europe. But the conquest means much to the Ma tionalists. By capture of the Bil- bao region they will come into pos session of an immensely rich iron ore region. Bilbao is one of Spain's great commercial ports. Also it gives the Nationalists a new navy base on the Bay of Biscay.
 Marketing of the iron ore will en- able the Nationalists to obtain bad dly needed foreign currency.
 Million Tons A Year
 Normally this region produces about 100000 tons year but pro- duction has reached 5,000,000 tons. Some of it is used for armaments, and the Nationalists may be ex- pected to divert it from Great Brit ain and France to Germany and Italy.
 For all these reasons the Nation alist troops are not concentrating their attention on Bilbao city but are driving hard to push the Loyal ists out of the region before they have an opportunity to blow up mine machinery which would delay production.
 It remains for them to decide whether they will pursue the Basque Loyalist army westward or consoli- date their position here and then withdraw tens of thousands of men and hundreds of guns for a great push elsewhere. The decision may rest on the reports received on the morale of the Basque army after its defeat. If the Loyalists proved badly demoralized, immediate pur- suit might be decided upon in an effort to clean up the entire coast.
 Germany, Italy Back
 Berlin, June 16-CUP)-Germany and Italy have decided to return to the international non-intervention agreement on Spain and to active participation in naval patrol service in Spanish waters, it was announc- ed today by DNB, official German news agency.
 DNB announced that the German and Italian ambassadors in London had notified the chairman of the non intervention committee of their povernmentS' decision,
 The return was based on the June 12 agreement among Britain, France Germany and Italy, the four patrol nations, providing for safeguards in case of attack on their vessels.
 Germany and Italy withdrew from the agreement on May 31 after Germany had bombarded the Spanish port of Almeria in retalia- ton for the bombing of the Ger man battleship Deutschland by a Loyalist plane Previously, an Ital- ian ship had been attacked. The two powers demanded effec- tive guarantees that their vessels ] would be protected if they rejoined the naval patrol.
 Train Guns On Destroyer La Pallice, France, June 16-(UP) The French dispatch vessel Auda- cieuse and the British destroyer Bulldog trained their guns on the Spanish Loyalist destroyer Ciscai today because of mutiny in the crew.
 The Ciscar arrived here Monday with refugees and it was reported then that the crew was mutinous for what reason was not known Two officers escaped and asked pro- lection of French police. When the Audacieuse gave the customary naval salute, the Mutt. neers" replied by pointing the Cis- cars guns at it, police said.
 The police prefect of La Rochelle asked the Spanish Loyalist consu to board the ship and quiet the men.