1940: Cuba

Havana Conference.

The Havana Conference, formally known as the Second Consultative Meeting of Ministers of Foreign Affairs of the American Republics, took place July 21-30. Following logically, as it did, the Lima and Panama Conferences of 1938 and 1939, as an expression of inter-American unity it exceeded any previous Pan American gathering and represented a real advance in the operation of consultative machinery. The common threat from Europe gave poignant significance to questions of continental solidarity and hemisphere defense, economic and political. The problem of European possessions in the Western Hemisphere, the major objective of the Conference, shadowed consideration of a program of economic defense, since it most immediately concerns the security of the Americas and especially since the confused situation at Martinique focussed attention on it. The original United States proposal for a Pan American mandate system was opposed by the Argentine delegation, which favored postponing a decision until an emergency presented itself. Brazil, possibly with an eye on the Guianas, favored such a system. The Act of Havana finally went beyond the original proposal, shifting in terminology from 'mandate' or 'joint protectorate' (Cuba's proposal) to 'provisional administration,' which might be established 'when American islands or areas at present held by non-American nations are in danger of becoming the subject matter of exchange of territories or sovereignties.'

After the crisis is passed, the possessions would either be independent or returned to their former sovereigns, providing that it 'would not be prejudicial to the safety of the American republics.' In addition, any American republic may act alone if the emergency should be so urgent that action of the 'emergency committee' created to implement the agreement could not be awaited. This committee, composed of one representative for each of the twenty-one republics, should be considered constituted on the date of the appointment of two-thirds of its members. Ecuador's selection of its representative in October, the fourteenth appointee, brought the emergency committee into existence, and it will function until the Convention of Havana is ratified by two-thirds of the American republics and a permanent Inter-American Commission on Territorial Administration is set up. Sumner Welles, Under-Secretary of State, has been designated United States representative. With the adoption of this resolution the Monroe Doctrine passes from a unilateral declaration to an inter-American instrument of common policy.

Secretary Hull, who headed the United States delegation, recommended a four-point program of co-operative action, providing for (1) the strengthening and expansion of the activities of the Inter-American Financial and Economic Advisory Committee as 'an instrument for continued consultation with respect to trade matters'; (2) the creation of facilities for orderly marketing of accumulated surpluses of the key commodities of the American republics; (3) the development of commodity agreements to assure equitable trade terms for producers and consumers; and (4) consideration of methods for improving the standard of living throughout the Americas. The economic resolutions adopted amplified these points and laid down the broad lines of economic policy for the Western Hemisphere but left the details to be worked out by the Inter-American Financial and Economic Advisory Committee, working in cooperation with the Inter-American Bank and Inter-American Development Commission. It was recognized that the shifting world situation made it desirable to leave the program for economic cooperation flexible, so, although the surplus commodities problem received primary attention, no cartel or marketing board plan, such as was earlier under discussion in the United States, was proposed. Instead, the Conference merely recommended the creation of 'instruments of inter-American cooperation for warehousing, financing and transitory disposition of the surpluses, as well as for their orderly and systematic distribution and sale,' a program presumably linked to the increase in the capital of the Export-Import Bank (see ARGENTINA).

The third section of the agenda pertained to neutrality. Such questions were referred to the Inter-American Neutrality Committee, sitting in Rio de Janeiro, which functions now with greatly enlarged powers. It is entrusted with the drafting of a convention on general principles of neutrality and another to implement the 300-mile wide 'safety zone' established during the Panama Conference, in this latter case to define what might be considered acts of war and the nature of the sanctions, short of force, to be applied. Patent violations of the zone, such as the cases of the Graf Spee and the Wakama, show the necessity for such a convention.

Finally, a resolution was passed providing for the suppression of foreign subversive activities, including provision for the exchange of information and immediate consultation 'in the event that the peace of any of the American republics should be menaced by such activities.'

The United States Senate, on Sept. 27, ratified the Havana Pact without reservation. The work of implementing the Conference's resolutions goes on slowly. The agreement regarding European possessions has been criticized as 'legalizing United States intervention,' but such misuse of the Act of Havana would destroy the continental solidarity to which Secretary Hull aspires. Whether the program of economic and financial cooperation outlined will defend the Americas against German economic penetration depends, in part, upon the ways in which it is given concrete application. Germany has manifested eagerness for the surpluses accumulated because of the loss of European markets, and has already solicited orders from various South American countries in exchange (see BRAZIL), promising deliveries of manufactured goods at prices far below those quoted by North American exporters. In the years just preceding the European War, Latin America sold about 60 per cent of its exports outside the Western Hemisphere, and most of this went to Europe: thus the importance of either the cartel plan for joint marketing of important staple exports or an intensive program to increase United States consumption of existing Latin American products and to develop new commodities for the United States market.

The Inter-American Financial and Economic Advisory Committee, to which specific economic problems were assigned, is an outgrowth of the Panama Conference. Its principal work has been the drafting of plans for an Inter-American Bank, the convention for which was signed by nine nations, including the United States, in May, whose subscription of more than the minimum number of shares of stock (145 shares worth $100,000 each) makes it possible for the Bank to start operations; the appointment of a committee to put into effect the 'Davila plan' for promoting non-competitive economic activities with joint United States and Latin American capital; the elaboration of a coffee quota agreement (see EL SALVADOR); and the instigation of studies by its subcommittees of the raw materials situation, the balance of international payments and the problem of complementary production.

Elections.

Presidential elections, twice postponed and finally held July 14, resulted in a 3-to-2 victory for Col. Fulgencio Batista over Dr. Ramón Grau San Martín. Batista was supported by a coalition of seven groups, including the Communist Party, which he had legalized two years ago, at the one extreme and the very conservative Democratic Republican Party of ex-President Menocal at the other. (The Batista bloc is known as the Socialistic Democratic coalition.) Dr. Grau's supporters ranged from his own party, the Autéticos, the largest political group in the country at large, and the ABC, to the Acción Republicana, the party of Miguel Mariano Gómez. Such widely varied support on both sides, and the agreement of both candidates on such important questions as close collaboration with the United States and maximum guarantees to foreign capital, made it clearly a campaign fought on personalities alone. In spite of the usual charges of intimidation and electoral abuses, the election was reasonably calm and decisive, and was characterized by a large turn-out of voters, including many women. The opposition was subsequently divided on obstructing Batista's inauguration — bickering over the election results did delay the installation of the new Congress — but the new government took office on Oct. 10. The Cabinet selections were clearly in the nature of rewards for support in the campaign, although the Communists received no appointment, and acceptance of their support seems to have been merely a matter of political expediency.

New Constitution.

The political difficulties of the new administration are numerous, since its support was drawn from so many mutually antagonistic groups. It operates under a new Constitution, moreover, which was finally approved June 8. The Constituent Assembly, which formally opened its sessions Feb. 9, was dominated by the opposition until the Menocal group lent Batista its support in March, thus providing the Batista forces with fifty votes to the opposition's twenty-five. The Communists had six delegates in the Constituent Assembly. The new Constitution, an unwieldy document of hundreds of items, provides for a semi-parliamentary system, with a prime minister responsible to the Chamber, a reduction in the size of the Lower House and an increase in the Senate, compulsory balloting, and a mortgage moratorium. This last was the center of very bitter debate and denunciation by the conservatives, who call its provisions, drastically cutting interest rates and providing amortization periods of from twenty to thirty years in some instances, as unfair to business interests as the law vetoed last year by President Laredo Bru. The Constitution provides, too, for the exclusive use on government buildings of the traditional Cuban flag, ruling out the Fourth of September flag, which commemorates the sergeants' revolt of 1933 that brought Batista into power. This item reflects a feeling that the army should be subordinated to the state and the dualism between the government and army abolished. A maximum working week of 44 hours, with a month's paid vacation each year, is provided. The government is empowered to fix minimum wages; the immigration of common laborers is prohibited; the land area that may be owned by any individual or corporation is limited in accordance with use, and restrictions are imposed on alien land ownership. Similar specific items have given point to the criticism that the new Constitution is a code of laws designed for specific cases rather than an organic charter. On the whole, it reveals a tendency towards a controlled economy, with economic enterprises submitted to the 'economic-social interest of the nation.'

The Falange.

'Subversive activities' in Cuba have centered in the Falange Españols, an offshoot of the Consefo de Hispamcismo, which is the propagandist organ of the Franco government in Latin America, designed to restore Spain's prestige in the Western Hemisphere. The Falange, legalized in July as a 'social aid' society, has an estimated membership of 50,000. A motion demanding its dissolution and the recall of Genario Riestra, newly appointed Spanish Consul-General, has been presented to the Senate.

Financial Matters.

Negotiations for a $50,000,000 loan from the United States were temporarily discontinued when, in October, an Economic and Technical Commission, which had been in Washington for two months, disbanded. The bill authorizing the loan was signed by the President Sept. 18. Decrease in revenue, caused by the low price of sugar and the general economic crisis, accounts for the budgetary deficits and makes a loan necessary to meet government expenses. The 1940 budget, totalling 76,000,000 pesos, was extended for the first three months of 1941. President Batista, in November, recommended a budget of 83,986,959 pesos, but Congress failed to approve the increase.

Sugar Industry.

As a result of close economic ties with the United States, Cuban foreign trade is not so seriously affected by the European War as that of most American republics, although European markets normally account for over 30 per cent of Cuba's sugar shipments. The government has taken no action to fix this year's crop, although most mill owners favor limiting it to 2,000,000 tons. Last year's crop was restricted to 2,700,000 long tons. Cuba now has a million tons on hand. The 1941 sugar import quota for Cuba, established by the United States Department of Agriculture, has been fixed at 1,869.060 short tons. (The Sugar Act of 1937 has been extended for one year, until Dec. 31, 1941.) A recent decree excluded sugar mills from compliance with the 44-hour week.

Education.

President Batista has signed a decree transferring control of the army-directed rural schools, a favorite project, to the Minister of Education, indicative, possibly, of his desire to put his presidency on a thoroughly civilian basis. One-half of the 8,000,000 pesos increase in the proposed budget represented the increased appropriation to the Department of Education needed to place the military schools under its jurisdiction.