justice was recognized by no less a Spanish statesman than Señor Sagasta, the present Premier of Spain, then in the opposition, who said:

"Our treasury is not now sufficiently provided with funds to aid Cuba in the way and to the extent that we would like to do; but I say the Peninsula must give all that it can, and we must do without hesitation all that we can.'

"Was not this a clear acknowledgment of the national character of the debt?

"Perhaps not so clear as that made in the decree of autonomy for Cuba and Porto Rico, signed by the Queen Regent of Spain on the 25th of November, 1897, and countersigned by Señor Sagasta, as President of the Council of Ministers. In Article II. of the Transient Articles' of the decree, we find the following declaration:

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ARTICLE II. The manner of meeting the expenditures occasioned by the debt which now burdens the Cuban and Spanish treasury, and that which shall have been contracted until the termination of the war, shall form the subject of a law wherein shall be determined the part payable by each of the treasuries and the special means of paying the interest thereon, and of the amortization thereof, and, if necessary, of paying the principal.

Until the Cortes of the Kingdom shall decide this point, there shall be no change in the conditions on which the aforesaid debts have been contracted, or in the payment of the interest and amortization, or in the guarantee of said debts, or in the manner in which the payments are now made.

"When the apportionment shall have been made by the Cortes it shall be for each one of the treasuries to make payment of the part assigned to it.

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Engagements contracted with creditors under the pledge of the good faith of the Spanish nation shall in all cases be scrupulously respected.'

"In these declarations we find a clear assertion not only of the power of the Government of Spain to deal with the so-called Cuban debt as a national debt, but also a clear admission that the pledge of the revenues of Cuba was wholly within the control of that Government, and could be modified or withdrawn by it at will without affecting the obligation of the debt.

"As to what is stated in the Spanish memorandum touching the aid given to Cuba in the last century or the early part of the present century by the Vice Royalty of Mexico, the American Commissioners might offer certain pertinent historical observations; but they deem it necessary now to say only that Mexico is not making any claim before this Joint Commission, either directly or indirectly. As to the statement that Cuba has produced during a very few years in the

H. Doc. 551- -24

present century a surplus which was turned over to the treasury of the Peninsula, the American Commissioners will cite the justly celebrated Diccionario Geográfico-Estadistico-Histórico de la Isla de Cuba, by Señor Don Jacobo de la Pezuela, by which (see article on Señor Don Claudio Martinez de Pinillos) it appears that after 1825 not only were all the expenses of the island paid out of its revenues, but surpluses were sent, annually and regularly, to the mother country. These surpluses from 1850 to 1860 amounted to $34,416,836. And it is to be observed that in addition to the regular annual surpluses turned over after 1825, extraordinary subsidies were from time to time granted to the home Government. It was for services rendered in matters such as these that Señor Pinillos received the title of Count of Villanueva.

"As to the recent advances' to Cuba, referred to in the Spanish memorandum, it is to be regretted that details were not given. But, by the very term 'advances,' it is evident that the Spanish memorandum does not refer to gifts, but to expenditures for the reimbursement of which Cuba was expected ultimately to provide; and the American Commissioners do not doubt that these expenditures were made for the carrying on of the war, or the payment of war expenses in Cuba.

"When the American Commissioners, in their memorandum of the 14th instant, referred to the Cuban insurrection of 1868 as the product of just grievances, it was not their intention to offend the sensibilities of the Spanish Commissioners, but to state a fact which they supposed to be generally admitted. They might, if they saw fit to do so, cite the authority of many eminent Spanish statesmen in support of their remark. They will content themselves with mentioning only one. On February 11, 1869, Marshal Serrano, President of the Provisional Government at Madrid, in his speech at the opening of the Constituent Cortes, referred to the revolution in Spain and the insurrection in Cuba in the following terms: The revolution is not responsible for this rising, which is due to the errors of past Governments; and we hope that it will be speedily put down and that tranquillity, based upon liberal reforms, will then be durable.' (Annual Register, 1869, p. 255.)

"The American Commissioners have read without offense the reference in the Spanish memorandum to the Indian rebellions which it has been necessary for the United States to suppress, for they are unable to see any parallel between the uprisings of those barbarous and often savage tribes, which have disappeared before the march of civilization because they were unable to submit to it, and the insurrections against Spanish rule in Cuba, insurrections in which many of the noblest men of Spanish blood in the island have participated.

"Nor are the American Commissioners offended by the reference of

the Spanish memorandum to the attempt of the Southern States to secede. The Spanish Commissioners evidently misconceive the nature and the object of that movement. The war of secession was fought and concluded upon a question of constitutional principle, asserted by one party to the conflict and denied by the other. It was a conflict in no respect to be likened to the uprisings against Spanish rule in Cuba.

"The American Commissioners are unaware of the ground on which it is asserted in the Spanish memorandum that the United States has been compelled to admit that the Cuban people are as yet unfit for the enjoyment of full liberty and sovereignty. It is true that an intimation of such unfitness was made in the note of the Spanish Government on the 22nd of July last. The Government of the United States, in its reply of the 30th of July, declared that it did not share the apprehensions of Spain in this regard, but that it recognized that in the present distracted and prostrate condition of the island, brought about by the wars that had raged there, aid and guidance would be

necessary.

"The reference in the Spanish memorandum to the obligations of Porto Rico is not understood by the American Commissioners, who had been led to believe that there was no Porto Rican debt. On June 30, 1896, Señor Castellano, Colonial Minister of Spain, in submitting to the Cortes the budget of Porto Rico for 1896-97, the last one, as it is understood, ever framed, said:

"The duty to report to the National representation the financial condition of Porto Rico is exceedingly gratifying. It shows the ever growing prosperity of the Lesser Antille, which, through the multiplicity of its production and the activity of its industry, has succeeded in securing markets for its surpluses in the whole world.

"It being without any public debt (sin deuda pública), all its necessities being covered, its treasury being full to repletion, its public services being fulfilled with regularity, with economy in the expenses, and with a constant development of the revenues of the state, the spectacle afforded by Porto Rico is worthy of attention.'

"The Gaceta de Madrid of July 1, 1896, which published this budget, published also a Law, approved June 29, 1896, providing for the disposition to be made of the surplus of $1,750,909 in the treasury of Porto Rico at the expiration of the fiscal year 1895-96.

66 No Porto Rican Loan was ever contracted or floated before 1896. "No Porto Rican bonds are quoted in the markets of Europe or America.

"It is possible that the Governor General of Porto Rico may have borrowed money from a bank or from private persons in order to meet in advance expenses authorized by the budget, and that he may have given promissory notes for the amount borrowed, but these notes, paid

on maturity, do not constitute a Porto Rican debt, in the sense claimed by the Spanish Commission.

"Nor is it to be supposed, in view of the flourishing condition of the colonial finances, as explained by the Spanish Minister of the Colonies, that any note of the kind referred to remains unpaid.

"The American Commisioners are not acquainted with the works of the publicists who maintain that the thirteen original United States paid to Great Britain 15,000,000 pounds sterling, presumably for the extinguishment of colonial debts. The American Commissioners, however, feel no interest in the matter, since the statement is entirely erroneous. The preliminary and definite treaties of peace between the United States and Great Britain of 1782 and 1783 were published soon after their conclusion, and have since been republished in many forms. They are the only treaties made between the two countries as to American independence, and they contain no stipulation of the kind referred to.

"Nor do the American Commissioners perceive the relevancy of the citation in the Spanish memorandum of the sums paid by the United States to France, Spain, Russia, and various Indian nations for territory acquired from them. In none of these cases does it appear that the United States assumed any debts. The money paid by the United States was paid for the territory.

"As to the case of Texas, the American Commissioners have only to observe that Texas was an independent state which yielded up its independence to the United States and became a part of the American Republic. In view of this extinction of the national sovereignty the United States discharged the Texan debt. Indeed, the whole reference made in the Spanish memorandum to the case of Texas is quite inaccurate. The United States did not demand of Mexico the independence of Texas. That independence was established by the inhabitants of Texas themselves, and had long been acknowledged, both by the United States and by other powers, before the voluntary annexation of Texas to the United States.

"The payments of money made by the United States to Mexico for territory obtained by the former from the latter at the close of the Mexican war are referred to in the Spanish memorandum, but these payments established no principle. They were made by the United States as a part of the general settlement with Mexico, and it will hardly be argued that if the treaty of peace had contained no stipulation on the subject, anything would have been due from the United States.

"The Spanish memorandum, however, refers to these transactions as if they constituted precedents for the proposal put forward by the Spanish Commissioners for the arbitration by the United States and Spain of the question whether the whole or any part of the alleged

Cuban and Porto Rican debts should be assumed or guaranteed by the United States. The American Commissioners are compelled to take a different view of the subject. They have no doubt that if during the negotiations with Mexico a proposal had been put forward by either party for the arbitration of the question whether Mexico should cede the territories demanded by the United States, or whether if they were ceded the United States should pay for them, and if so how much, such proposal would have been rejected by the other party as entirely inapplicable to the transaction.

"So it is in the present case. The Commissioners of the United States and of Spain have met for the purpose of concluding a treaty which is to terminate a war. The matters involved in this transaction are matters for mutual adjustment and definitive settlement. They are matters to be determined by the parties themselves, and not by any third party. Arbitration comes before war, to avert its evils-not after war to escape its results.

"As was shown by the American Commissioners in their memorandum of the 14th of October, the burdens imposed by Spain upon Cuba in the form of the so-called Cuban debt have been the fruitful source of Cuban insurrections. In the opinion of the American Commissioners the time has come for the lifting of this burden, and not for the submission to a third party of the question whether it shall be lifted at all.

"Having answered so much of the Spanish memorandum as relates to the vital articles of the Spanish proposals, and expounds the Spanish views regarding them, the American Commissioners do not think it necessary to discuss the remaining articles, which may be, for the purpose of this discussion, regarded as merely subsidiary, and as to which they make all necessary reservations.

"Near the close of their memorandum, the Spanish Commissioners

say:

"It appears by this recapitulation that the only question now pending between the two Commissions and awaiting their decision is a question of money, which, so far as one of the High Contracting parties is concerned, is relatively of secondary importance. That question is the one which relates to the colonial debt.'

"In this conclusion the American Commissioners concur.

"The American Commissioners have maintained that the proposal by the Spanish Commissioners that the United States shall assume the so-called Cuban debt is in reality a proposal to affix a condition to the unconditional promise made by Spain in the Protocol of August 12, 1898, to relinquish all claim of sovereignty over and title to Cuba;' and they have further maintained that the abstention of Spain from proposing such a condition at that time precludes her from proposing it now. The American Commissioners have declared, and now repeat,