CHILE: Greatest Crime

Smiling new President Juan Esteban Montero, elected after his friends upset the Ibanez Dictatorship (TIME, Oct. 12), faced an appalling crisis last week, cheerfully declared, ”Courage is the greatest need!”

The crisis concerned nitrates, needful in peace as fertilizer, in war as the basis of explosives. Because Chile digs nitrates from her natural deposits, because German producers of synthetic nitrogen cut prices, threatened to ruin her, Chile’s whole nitrate industry was rationalized, reorganized and speeded up last year by the creation of “Cosach,” the $375,000,000 nitrate trust, Compania De Salitre De Chile (TIME, July 28, 1930). Last week the most violent political and editorial attacks on Cosach were hurled up & down the length of slender Chile.

In the vortex of Revolution last July a commission was appointed to investigate the dictatorship of ousted President Ibanez on the general principle that everything created under it must be bad. Last week the commission reported that Cosach:

1) Was “the biggest crime of the Dictatorship.”

2) Is “faulty in its legal construction.”

3) Was constructed in a nefarious attempt to “wipe out the debts of the American-owned companies in the merger belonging to the Guggenheim interests.”

4) Must be dissolved.

In Santiago the managing director of Cosach, cool-headed Alfred Houston, read from beginning to end the 16 sizzling newspaper columns occupied by the commission’s report, then said:

“This is not entirely a surprise to us. In preparing their report the commission scarcely called upon the company at all for information regarding itself and called constantly upon sources antagonistic to Cosach.”

In Manhattan the Brothers Guggenheim bided their time in silence, waited for Chile’s seething Cosach pot to clarify. Who was honestly against Cosach, and who wanted money? Were agents of the German synthetic nitrogen trust perhaps at work in Santiago to ruin Cosach? Would smiling President Montero decide to come out for Cosach or against? When the President called courage the greatest need was he only weaseling and watching?

In Santiago last week Senor Montero studiously ignored the Cosach crisis, reorganized his Cabinet, talked of doing something to aid the 15% of Chilean workers who are now unemployed.