increase resolved upon was 100 per cent. But this proved to be a great disappointinent. It was another case of inordinate blind greed devouring the goose which had been giving up golden eggs. Importations fell off to nothing for many months, and have never recovered anything like their former volume. People have learned to do without many articles of import, but no home industry has been developed thereby except the manufacture of intoxicating liquors.

This measure has, therefore, proved to be neither a revenue measure nor one of protection to any valuable home industry, notwithstanding the very liberal "rebates” and “benefits" allowed to merchants. The merchants themselves are not altogether guiltless, for the reason that, in spite of the extremely liberal drawbacks" allowed them at the custom-bouse by the Government, they immediately marked up their goods to "high-water mark" on the passage of the bill increasing tariff duties, and consequently their sales of imported goods have been much lighter than would otherwise have been the case. I have, etc.,


Mr. Baker to Mr. Gresham.

No. 420.]

Managua, Nicaragua, October 24, 1894.

(Received November 13.) SIR: In my No. 412, of October 11, 1894, I gave you an account of some financial changes which this Government proposed, for the benefit of its treasury.

After the lapse of a number of days the Government concluded that the basis for the liquidation of certain custom-house bonds which had been agreed upon at a conference of the merchants and other business inen and the Government could not be carried out; and the latter sent out invitations to the former, inviting them to a second conference to be held at the palace on the evening of the 18th instant, in order to reconsider the matter.

It appears that very few of the bondholders attended this conference; and I think none of the foreign citizens, who happen to be in possession of the larger share of the bonds.

At this meeting the Government announced its conclusion that, in issuing the new bonds in liquidation of the old, it would not recognize the “bonuses” and “benefits” guaranteed by the laws authorizing the original issue, but would include only the principal and accumulated interest. Therefore, the new bond will represent 100 cents principal and 38 cents interest-$1.38 instead of $2.05, on the face value of the original bond, as at first agreed. The merchants are much stirred up over this action and express deep dissatisfaction.

A peculiarity of the action of the Government in this regard is found in their first declining to receive these bonds for 40 per cent of the customs, as provided for in the law authorizing their issue-cash only would be received; and when the merchants protested against this breach of contract and faith, they now declare that after the 1st of next March 30 per cent of all customs must be paid in these bonds, whether the merchant has the bond or not. All cash will not be received. The bonds are held in few hands, I have, etc.,


(Inclosure in No. 420.—Translation.] The President of the Republic decrees:

ART. 1. To name the last day of the present month for the liquidation and con. version of the custom house bonds for obligations against the treasury. In the liquidation, the principal and interest only will be included.

ART. 2. From the 1st of next March, the general treasury will indispensably require the payment of 30 per cent of the total amount of the policies (pólizas) in said obligations.

ART. 3. The bonds which are converted from now until the last of this month will be received as obligations in payment of the policies liquidated since the 20th of September last, at the rate of io per cent, the remaining 90 per cent to be collected in cash.

ART. 4. Orders against the general treasnry, which may be received in 20 per cent cash payment of the policies, will [be] liquidated the last day of next February, and the remainder will be recognized and paid as a debt of state.

Art. 5. Bonds which may not be converted during the present year will be paid in legal money from the 1st of March, 1896, by a drawing of the numbers which may not have been entered in the conversion of the bonds up to the last of December of the present year, and at the rate of $25,000 monthly, to be liquidated according to the manner which the National Assembly may designate.

ART. 6. On the 21st instant, the minister of finance will commence the conversion according to the provisions of this reglamentary law, and he shall take all prudential measures which he may see fit.

ART. 7. From the 1st of next December, 10 per cent or more must be paid in legally coined silver for the value of the policies wbich exceed $200. But this will be rebated to those who pay said customs dues in national treasury notes. Let it be known. Managua, October 19, 1894.

J. SANTOS ZELAYA. The Minister General,

Baca, H.


Mr. Baker to Mr. Gresham. No. 161.


Managua, December 5, 1893. (Received January 3.) SIR: I desire to call your attention to the case of Mrs. Josefa Jacoby, of Granada, widow of an American citizen who spent long years in Nicaragua and acquired considerable property. Mrs. Josefa Jacoby was called upon to pay a forced contribution under decree of August 3. This was levied for the purpose of partly paying the expenses of the war just closed, and the administration has insisted upon the pay. inent of it, calling among others on Mrs. Jacoby for her quota. She remonstrated to the ministry of hacienda and received in reply the communication of which I inclose a copy and translation. As you will see, the claim is made by the piini ter in charge that the fact of her being the widow of an American citizen does not exempt Mrs. Jacoby from the payment of this tax.

Mrs. Jacoby is a native of Nicaragua, but I presume became a citizen of the United States by her marriage to Mr. Jacoby, and has not forfeited her rights as such by marrying again.

The new constitution containing articles subjecting the foreigners resident in the Republic to the same taxes imposed upon the citizens, referred to in my communication No. 132, of November 1, has not been promulgated as yet, but I fear that even under the old constitution the administration may endeavor to secure forced loans from foreigners; and I should like to know in an emergency the position which the Department wishes me to take in cases of this nature, in view of our treaties with this country. Awaiting your instructions, I beg to remain, etc.,


(Inclosure in No. 161.- Translation.)

Mr. Callejas to Mrs. Jacoby.

Managua, November 21, 1893. I have before me your petition of the 17th instant, in which you ask to be exempted from the payment of the contribution which, in accord ance with the decree of the 3d of August last, the authorities of Grauada demand of you. The Government regrets not to agree with you. It thinks that the fact mentioned-of your being the widow of an American citizen-does not exempt you from the payment of the contribution aforesaid, and I beg therefore that you will pay in the shortest time possible the quota assigned to you. I answer thus your courteous communication and remain, etc., The minister in charge of the department,


Mr. Baker to Mr. Gresham.

No. 164.)


Managua, December 6, 1893. (Received January 3.) SIR: Referring to my communication No. 161, of December 5, I beg to say that I received last night the following telegram from Mrs. Jacoby:

GRANADA (11.45 A. M.). LEWIS BAKER, Minister of the United States:

I am being forced to pay contribution, and fine, an escort being placed at my door and forbidding all communication. Mr. Low, consul, told me he had passed at the ministry asking them to suspend until Washington heard from. I beg you will protect me. Answer.

The governor telegraphed to the ministry, and they answered that before all I am a Nicaraguan citizen.

JOSEFA JACOBY. This morning I accompanied Mr. Low, our vice-consul, to the Presi. dential palace to make inquiries in the matter. I saw the President, who, upon hearing of the object of our errand, sent for his minister of foreign relations, Mr. Madriz. Mr. Low explained that Mrs. Jacoby's husband was an American citizen; that upon his death he left her in charge of his estate, equally divided between her and her sons; that she is the curator of her sons' property, and that recently, when a forced contribution of $600, for purposes of paying the expenses of a civil war, was demanded of her, she appealed to him for protection against the demand. Mr. Low had then gone to see the minister of finances and was promised verbally that the matter would be left in abeyance until he could get instructions from Washington. Notwithstanding that promise the authorities had insisted upon the payment of the amount, and had pursued for that purpose the means related in Mrs. Jacoby's letter to me.

Mr. Madriz said that above all things Mrs. Jacoby was a Nicaraguan; that by the death of Mr. Jacoby the legal fiction under which she had acquired the nationality of her husband, and which was recognized by some nations but denied by others, was abrogated, and that she naturally returned to her antenuptial conditions of nationality and citizenship, as far as a woman can be a citizen.

Mr. Low and I called attention to the fact that in the United States a woman is not supposed to lose the privileges acquired by her mar.

riage on account of the death of her husband; on the contrary, that in the case of pensioners, for instance, the widow enjoys the pension of her deceased husband until she renounces the privilege by a new alliance; that the United States do not recognize the tenets that nationality of birth is an unalterable condition, and that the American ideas of naturalization are beginning to be recognized the world over.

Mr. Madriz cited the case of a woman claiming exemption from certain contributions in 1869, which, he said, was ably argued on Nicaragua's side by Mr. Tomas Ayon, then minister of foreign affairs, and which was the occasion of a diplomatic incident between the United States and Nicaragua. In that case the husband was living.

After further conversation the President offered that Mrs. Jacoby deposit the money under protest, but, not satisfied with that, we insisted that the case remain in statu quo until definite instructions could be had from the Department to establish a precedent for our guidance. This we obtained at last, and I now beg to ask your decision in the matter.

I have absolute documentary evidence that Mr. Jacoby was an American citizen by naturalization. I have her certificate of marriage. She has just handed me a letter of a former minister of gobernacion of Nicaragua in reply to a protest made by her against the payment of a similar tax in 1885, a translation of which I send. The argument used then was similar to the one used at present, that she ceased being an American citizen by the death of her husband. But the authority of Carlos Calvo, vol. 2, 1868, was quoted as follows (p. 538): “Modern jurisprudence has accepted in all its parts the logical and undisputable maxim of the Roman code which assigns to the married woman as legal domicile that of her husband, whose name and rank she takes, and which establishes, therefore, that the widow retains it unless she should contract a new marriage, in which case she will acquire that of her new husband," and the demand was withdrawn.

He also hands me a statement signed by Don Alejandro Chamorro, prefect of Granada, to the effect that "the undersigned prefect of the department states that he exempted Dona Josefa Mayorga, widow of Jacoby, from the contribution, because the latter has proved that she is a North American citizen. Granada, May 21, 1893. The Prefect: Alejandro Chamorro."

I have asked Mrs. Jacoby to notify me in case she should be subjected to further vexations, but I hope that the case will remain in statu quo until I may hear from you. But should she be interfered with again, I shall make an energetic protest, as from present lights I can not fail to recognize her right to the protection of our Government. I beg to remain, etc.,


Mr. Baker to Mr. Gresham.

No. 169.)


Managua, December 9, 1893. (Received January 3.) SIR: I wish to add, in connection with my communications No. 161 and 164, that I received yesterday a letter from Mrs. Jacoby, the translation of which is as follows:

Masaya, December 8, 1893. Mr. LEWIS BAKER, Managua :

MY DEAR Sir: I concluded to remain in this city until I should know whether or not they had given orders to suspend the loan. Last night my son telegraphed me that the governor of police had come yesterday to demand the contribution. I beg that, to spare my suffering an outrage. you will send me a statement of the minister to the effect that he has given orders for the suspension, or that you will indicate to me what I should do. With the highest consideration, I remain, etc.,


The day of Mrs. Jacoby's visit, viz, the 6th, I gave her the following note:

MANAGUA, NICARAGUA, December 6, 1893. MY DEAR MADAM: In an interview this morning in relation to the case which you have submitted to this legation, viz, the demand from you, as an American citizen, of a forced loan, His Excellency the President agreed that no further demand shall be made upon you until the matter may be adjusted by instructions to me from Washington.

This you my use and show to whom it may concern; and should you be subjected to further trouble please telegraph me at once. Yours, respectfully,

LEWIS BAKER. I reply thereto to Mrs. Jacoby to-day as follows:

ManagUA, NICARAGUA, December 9, 1893. MY DEAR MADAM: I beg to acknowledge the receipt of your favor of December 8, and in reply thereto I will say that the note which I gave you on the day you were here is the only document I can furnish you, stating that His Excellency the President has agreed to leave the matter of the forced loan exacted from you in abeyance until I may receive definite instructions from Washington. I have entire confidence that the President will give instructions in order that this agreement may be complied with, and that, therefore, no trouble will be caused you until I may get a reply from the State Department. I beg to remain your obedient servant,


This morning I have verbal and extra-official notice that the contri. bution from Mrs. Jacoby will be collected, and that it is claimed the contribution can be levied on every foreigner; I am also informed that the Government does not want to recognize the sons of Mrs. Jacoby as American citizens.

Should this be the case, I shall make a most energetic protest, basing my action on paragraph 146 and 147 of the Consular Regulations of 1888 and on Department dispatch No. 15, of June 16, taken in connection with the treaty of 1867 between the United States and Nicaragua, and the preambles of the decrees of July 24 and August 3, under which said loan is collected, and which read as follows:

Decree of July 24, distributing throughout the Republic a forced loan of $500,000. Whereas the ordinary resources are not sufficient for the maintenance of the forces raised for the purpose of reestablishing the public order subverted in Leon; and whereas it is indispensable to provide for those expenses by means of a forced loan, the President of the Republic decrees

Decree of August 3, by which the forced loan decreed on the 24th of July last is reduced

to $200,000.

Whereas the provisional Government, presided over by General Joaquin Zavala, made with the Bank of Nicaragua a contract for a loan of $100,000, to be paid by the product of a forced loan of $500,000, decreed on July 24;

Whereas the ordinary revenues of the nation are not sutiicient to comply with this engagement in the short period stipulated, nor to finish to pay the extraordinary expenses incurred by the war; and whereas, on the other hand, the forced loan for the total amount of $500,000 is not necessary and should be reduced to what is strictly indispensable, the Junta of Goverment, in use of its faculties decrees I beg to remain, etc.,


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