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reply to my 586 to you of May 5, 1883, on the subject of the ClaytonBulwer treaty.

You will observe that Lord Granville says:

That Mr. Frelinghuysen still contends that the Clayton-Bulwer treaty is voidable on two grounds--first, because the first seven articles of the treaty related to a particular canal by the Nicaraguan route only; and, secondly, because Great Britain has at the present day a colony instead of a settlement at Belize.

Lord Granville's attention should be called to the fact that this Government not only holds the position to which he has referred, but also holds, as stated to you in my instructions of May 8, 1882, and May 5, 1883, that for the purpose of obtaining the then needed capital to con struct an interoceanic canal by the Nicaraguan route the United States were willing to surrender a part of their exclusive privileges in a canal by that route, and were also willing to agree that, by subsequent treaty stipulation, they would join with Great Britain in the protection of the then proposed Tehuantepec, Panama, or other interoceanic communication, and that the consideration having failed the treaty is voidable as to the Nicaraguan route and as to the other routes.

Lord Granville raises the point that "no time was fixed by the Con vention within which such interoceanic communications were to be made." While this statement is correct, it is also true that it was contemplated that the canal was about to be constructed at the time the treaty was negotiated, and that the survey therefore was then made, and that thirty-three years have elapsed without Great Britain rendering the consideration on which the treaty was based, and this failure, we think, affects the treaty in the same manner that a failure by Great Britain to give the consideration within a definite time, had one been fixed by the convention, would have affected it.

The treaty provides that neither the United States nor Great Britain shall colonize or exercise any dominion over any part of Central America. This was a most important provision. It is one of a cluster restraining one nation from having any advantage over the other in regard to the police of the canal, such as the provision against alliance, against occupation and fortification, and against taking advantage of any intimacy or influence, and yet it is claimed that the treaty does not prohibit the existence of a large regularly organized British colony in Central America, while it does prohibit the United States from having any possession or colony there. The color for this claim is that while the stipulation that neither of the two Governments should colonize any part of Central America is most conspicuous, the declaration of Sir Henry Bulwer, prior to the exchange of ratifications of the treaty, states, "That Her Majesty does not understand the engagements of that convention to apply to Her Majesty's settlement at Honduras or its dependencies." This declaration cannot be held to authorize the subsequent colonization by Her Majesty's Government of a territory as large as three of our smaller States. The declaration was made not to change or vary the treaty, but out of abundant caution that it might not be misunderstood. The meaning of the declaration, we think, is that a mere settlement of British subjects for the purpose of cutting mahogany and logwood in Honduras under Spanish-American sovereignty was not to be considered a British colony and thus be a violation of the treaty, and I fail to see how, since the exchange of the ratifications of the treaty, the organization of a colony, with a full colonial government under the British sovereignty, can be looked upon as authorized or allowed, either by the treaty or by Sir Henry Bulwer's declaration.

The two contracting powers were equally bound not to colonize any part of Central America, and the declaration itself of Sir Henry Bulwer, not being the exception of any territory in Central America from the operation of the treaty, but providing in effect that the settlement should not be considered a British colony, tended to strengthen and not to destroy the mutual obligation not to colonize in Central America.

Lord Granville is correct in saying that I stated in my instruction to you of May 8, 1882, that Her Majesty's Government was not called upon either to admit or deny the views therein expressed as to the Monroe doctrine, and this was so for the reason there given, to wit, because Her Majesty's Government placed its claim to join in the protection of the interoceanic canal on a treaty which, if binding, certainly modified the Monroe doctrine, but the fact that this Government for a promised consideration modified by treaty what is called the Monroe doctrine, 1 think, does not in any manner affect that doctrine after the treaty has fallen, because of its infraction and because of the failure of the consideration contemplated.

You may read this instruction to Lord Granville, and leave a copy of it with him should he desire it.

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