CHILE: Progressive Socialism

(2 of 5)

Culbertson & National City. Rumors of the Government's intentions broke out like a rash. Diplomats representing all the Great Powers called to protest a decree not yet issued. In the thick of the fog labored large, astute, easy-mannered U. S. Ambassador William Smith Culbertson. After having had to deal with Rumanians as U. S. Minister at Bucharest, Mr. Culbertson rather likes Chileans. His protests last week were firm, not angry. He had done his best when the Davila Government finally handed him their decree, reading significantly in part:

"Article 1. Credits and deposits in foreign currency which the public may have in the national and foreign banks are declared the property of the State.

"Article 2. The commercial, national and foreign banks shall transfer to the order of the State the deposits in foreign currencies which they have for account of the public and shall credit the latter with the sums equivalent to them at the exchange rate of June 3 [day before the Revolution]."

Only U. S. bank in Santiago is the National City. Its officials quietly refused, according to despatches, to turn over any deposits to the State. Mildly Finance Minister La Garrigue said that "conducive measures" would be applied "if necessary," but he did not seem to think them necessary last week. Carabineers, instead of surrounding National City, surrounded Santiago's Stock Exchange and methodically confiscated firearms found on the persons of traders.

Socialist Program. Throughout the week Don Carlos Davila talked of "progressive Socialism," admitted the backwardness of Chilean workers, observed brightly: "However, the Army and Navy are Socialistic." Spokesman for the Army & Navy in the new Cabinet is Irish-blooded Defense Minister Col. Marmaduke Grove (pronounced gro-vay).

"We will use a hand of steel in putting down Communist actions designed to create a substitute for . . . the present Government," declared Col. Grove. "We wish to state as our final word that nothing will be allowed to stand in the way of the program that we have outlined."

What this program was no one really knew except Don Carlos Davila who was suspected of making it up as he went along, feeling his way, testing the Great Powers which have a billion dollars invested in Chile to see what they would let him get away with, testing the Chilean populace to see what they would demand. Finally, however, Don Carlos handed to United Press this definite statement of his aims:

The government of Chile has two immediate objects:

1) An increase in production until we have a surplus for exportation which has previously been lost because of the copper and nitrate crisis.

2) The socialization of all economic processes.

To this end we shall work by organizing all production through cooperation instead of competition. Profits from economic processes will go in small part to individuals, but mostly to the State. We hope to create a collective economy system which will progress paralled with individual enterprise which has dominated until the present. . . .