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government agencies other than the Treasury Department engaged in
borrowing from firms, concessions or even foreign Governments
without the Treasury's prior approval or even knowledge (42).
Moreover, the pre-financed loans had not always been made at
fair prices owing to the lack of international bidding. And,
anxious to proceed quickly, the Government had often failed to
obtain detailed estimates for the construction of certain projects.
This had in many cases resulted in severe difficulties
when final.costs proved to be completely out of line with the
original estimates (43). No corrective measures, however, had
ever been taken.
In attracting these short-term loans, often at high interest
rates, the Government had anticipated the revenues resulting from
the start of production in foreign concessions while expecting
that the rapid growth of revenues of the 1950 's would continue.
But LAMCO failed to come into production prior to 1963 owing to
delays in the financing of the project, followed by delays in the
construction of the railroad and port- No income was forthcoming
from NIOC either. The disease which destroyed the bananaplantation
of the African Fruit Company rendered the Government's
investment in the Port of Greenville negative. On the other hand
numerous construction projects had been financed which were to
boost the country's prestige but which were economically nonproductive.
Among these were the new Capitol building which cost
over $ 2 million, and the President's new Executive Mansion of
about $ 15 million, whereas $ 1 million of public funds was
spent on the construction of a Masonic Temple Building in
Monrovia. This fraternal organization is a powerful institution
in Liberian internal politics. Though officially no relationship
exists with the Government, its influence on public affairs is
in practice substantial if only because every (urban) Liberian of
any importance has joined or aspires to join this organization.
Membership of the Masonry usually coincides with the membership
of the only political party in the country since 1955, the True
Whig Party, though the reverse does not always hold good.
The extravagance in representing Liberia abroad had, among other
things, led to the purchase of Liberian Embassy quarters in
Washington, London, and Paris and the maintenance of a
Presidential Yacht which cost the Treasury millions of dollars
which it could ill afford. With the private constructors of the
prestigious Ducor Hotel in the nation's capital the Government
undertook by agreement, in 1958, to lease a minimum number of
suites and double rooms at a total rental of $ 125,000 per
year during the first ten years of the existence of the hotel.
Unnecessary investments in the National Iron Ore Company in 19 58
cost the Treasury another ft 5 million (see Chapter 7).
The 1963 Financial Crisis
With an annual total revenue of less than | 4.0 million the
Government in the beginning of 1963 faced a public debt amounting
to nearly $135 million in principal, with an additional $ 34
million in interest. Of this total debt of $ 167 million about