Papers Relating to the Foreign Relations of the United States, 1917, Supplement 2, The World War, Volume I

File No. 763.72/13416

Report of the Special Representative of the United States Government ( House)¹

The mission was composed of the following:

• Edward M. House, Special Representative of the United States Government;²
• Admiral W. S. Benson, Chief of Operations, United States Navy;
• Gen. Tasker H. Bliss, Chief of Staff, United States Army;
• Oscar T. Crosby, Assistant Secretary of the Treasury;
• Vance C. McCormick, Chairman of the War Trade Board;
• Bainbridge Colby, Member of the United States Shipping Board;
• Dr. Alonzo E. Taylor, Representative of the United States Food Administration;
• Thomas Nelson Perkins, Representative of the War Industries Board;
• Gordon Auchincloss, Assistant to the Counselor for the Department of State, Secretary of the Mission.

In addition to the foregoing the following accompanied the mission:

• With Edward M. House, Mrs. Edward M. House, Miss Frances B. Denton, confidential secretary to Mr. House, Mr. Clarke A. Cross, stenographer and secretary to Mr. Auchincloss.
• Navy Department. Lieut. Commander A. F. Carter, aide to Admiral Benson, T. H. Lathe, Chief Yeoman, U.S.N., stenographer to Admiral Benson, and Mr. C. D. Alviar, attendant to Admiral Benson.
• War Department. Maj. W. B. Wallace, aide to General Bliss, and Sergt. Charles J. Steele, orderly to General Bliss.
• Treasury Department. Paul D. Cravath, legal adviser to Mr. Crosby, and Louis D. Neumann, clerk and stenographer to Mr. Crosby.
• War Trade Board. Milton L. Young, secretary to Mr. McCormick.
• United States Shipping Board. Mr. Charles Day, expert engineer, attached to Mr. Colby, and Mr. Everett W. Hawkins, secretary to Mr. Colby.
• United States War Industries Board. Mr. W. Randolph Burgess, statistician, and Mr. William Burns, secretary to Mr. Perkins.
• Disbursing officer of mission, Mr. Harry R. Young, employed by the Department of State.

In London and Paris representatives of the War and Navy Departments were temporarily attached to the mission as expert advisers and the following were detailed to assist me: Mr. A. H. Frazier, First Secretary of the American Embassy at Paris, detailed by the Department of State during the entire stay of the mission in London and Paris; Ensign Hugh A. Millard, Ensign Samuel S. Walker, detailed by the Navy Department to act as my aides in London and Paris in connection with code work, etc.; and Lieut. LeRoy King, detailed by the War Department to act as my aide in Paris in connection with code work, etc.

Commander L. B. McBride was detailed in London by the Navy Department to assist Mr. Colby of the Shipping Board during the stay of the mission in Europe and to return with the mission to the United States.

A special train leaving Washington at 9.15 p.m., Sunday, October 28, in charge of Mr. J. M. Nye, of the Department of State, brought the mission to Halifax, N.S., arriving there at 9.30 a.m. on Tuesday, October 30.

The following members of the party were immediately taken on board the U.S. cruiser Huntington: Col. and Mrs. E. M. House, Miss Frances B. Denton, Mr. Gordon Auchincloss, Mr. Clarke A. Cross, Admiral W. S. Benson, Lieut. Commander A. F. Carter, T. H. Lathe, C. D. Alviar, Gen. Tasker H. Bliss, Maj. W. B. Wallace, Sergt. Charles J. Steele, Mr. Vance C. McCormick, Mr. Milton L. Young, and Mr. Harry R. Young, and the rest of the party were taken on board the U.S. cruiser St. Louis.

The Huntington and the St. Louis, accompanied by the torpedo boat destroyer Balch, steamed out of Halifax harbor at 11.30 a.m. Tuesday, October 30.

The trip across was uneventful and very comfortable. On November 4 the torpedo destroyer Dowries joined us and on November 6 four additional torpedo boat destroyers, namely, the Cushing, Sampson, Wilkes and Davis joined us.

At 4 o’clock in the afternoon of November 7, an English torpedo boat destroyer and an English aeroplane picked us up and piloted us into Plymouth Harbor. We landed at about 6.30 p.m. and were met by the following: Admiral Sir John Jellicoe, First Sea Lord of the British Admiralty, General Colwell of the British General Staff, Mr. Ian Malcolm, representing Mr. Balfour personally and the British Foreign Office, Sir William Wiseman (who during our stay in England was attached to the mission by the British Foreign Office), and Mr. Irwin Laughlin, Counselor of the American Embassy at London. We proceeded at once to London by a special train arriving there at 12 o’clock midnight. At Paddington Station we were met by Mr. Balfour, Ambassador Page and Mr. A. H. Frazier, of the American Embassy at Paris.

With my immediate party I was taken at once to Chesterfield House, the London residence of the Duke and Duchess of Roxburghe, which was placed at my disposal by the British Government during my visit. The rest of the party were the guests of the British Government at Claridge’s.

A few days before our arrival the British Prime Minister, Mr. Lloyd George, and Gen. Sir William Robertson, the Chief of the British Staff, left for Italy on account of the violent reverses in that theatre of the war, culminating in the disastrous retreat of the Italian armies to the river Piave. The absence of these two men delayed considerably my work and the work of General Bliss, and it at once became apparent that the Inter-Allied Conference, arranged to be held in Paris on November 15, would have to be postponed.

The day after we landed in England the news from Russia became very definitely worse and reports were received of the counterrevolution which eventually resulted in the control of the Government of Russia being shifted from Kerensky to the Bolsheviks and the followers of Lenin.

On Tuesday, November 13, the French Ministry, headed by M. Painlevé, which had been in power exactly two months, was retired by an adverse vote in the Chamber of Deputies. On November 15 M. Clemenceau was asked by Poincaré to form a ministry. He accepted the task, becoming Premier himself and Minister of War.

The Italian disaster, the Russian counter-revolution, and the retirement of the French Ministry all taking place within a few days after our arrival in England indicate in some degree the exceedingly critical situation with which we were met. The fall of the French Ministry necessitated a further postponement of the Paris conference to November 29.

During our visit in London, which lasted until the morning of November 22, I conferred with all of the important members of the British Government, including the principal naval and military experts, and also with a number of influential individuals not in the Government, such as newspaper men, labor leaders and former governmental officials.

In order that it might be possible for the mission to do its work in the shortest possible time, I asked you to telegraph our Ambassadors at London and Paris to discourage all public entertainments that might be suggested in honor of the mission, and upon my arrival in England I requested Mr. Balfour to arrange it so that the minimum number of entertainments should be arranged for. Consequently, during the stay of the mission in England it attended only three entertainments and these were all so small that they could hardly be described as public.

On Thursday, November 15, Mr. Balfour entertained informally all the members of the mission except myself at dinner at the Harcourt Room of the House of Commons. The only speeches made were a very short speech of welcome by Mr. Balfour and an equally short speech of thanks by Admiral Benson.

On November 16 the King and Queen entertained the member’s of the mission at luncheon in Buckingham Palace. The lunch was a very small and unostentatious affair. In addition to the members of the mission and Prince Albert and Princess Mary and the immediate household officials of the Palace, the only guests at this luncheon were Mr. Lloyd George, Mr. Balfour, Ambassador Page, and Sir William Wiseman.

On November 21 the members of the mission, except myself, lunched with the Prime Minister, and the principal members of the British Government, at 10 Downing Street. This lunch was entirely informal and no speeches were made.

In the evening of November 8 I received the newspaper men and issued the following statement:

Our visit at this time is the President’s response to an invitation to the United States from the Allied Governments to attend the War Council which is presently to be held. It was thought that a still better coordination could be brought about if the United States were represented in these deliberations.

We need not tell you of our resources for they are known to you as well as they are to us, but we would like you to know that there is an indomitable spirit back of these resources to use them in every way possible in order to make the world a better place in which to live.

Our people see the issue clearly. Notwithstanding the many races that make up our entity, there is an undivided purpose to fight until it becomes certain that no group of selfish men can again bring about such a disaster.

One hundred and forty-one years ago the makers of our nation laid down the doctrine that governments derive their just powers from the consent of the governed and are instituted among men to give security to life, liberty and the pursuit of happiness. We intend to live and develop under this doctrine which is now at stake, and we feel that our being would not be justified if at this critical hour we failed the other democracies who share with us in this lofty and just conception of the dignity of man.

I attach herewith as indicating the importance attached to the mission’s visit by the English press the leading editorial of the London Times of November 9.¹

Previous to Lloyd George’s return from Italy on November 13 I had conferred fully with the following individuals: Mr. Balfour and Sir Eric Drummond, of the Foreign Office, Admiral Hall, of the Intelligence Department, M. Klotz, the French Minister of Finance, Sir George Macdonogh, Director of Military Intelligence, Lord Milner, Lord Robert Cecil, Mr. Bonar Law, A. G. Gardiner, of the Daily News, Sir Edward Carson, Admiral Jellicoe, Mr. Asquith, Massingham of the Nation, Geoffrey Dawson, editor of the London Times, Gen. Sir William Robertson, the French Ambassador, M. Paul Cambon, Lord Curzon, Viscount Grey and a host of others, including the members of the mission with whom I was in daily touch. On Sunday, November 11, at 11 o’clock, I conferred with the King at Buckingham Palace and on Monday, November 12, Mrs. House and I lunched at Buckingham Palace with the King and Queen. The only others present were Prince Albert and Princess Mary.

On November 12 Lloyd George at a luncheon given in his honor by the French Minister of War and President of the Council, M. Painlevé, delivered the following address [printed as annex 1 to this document]. This speech caused a sensation in England and certain of the followers of Mr. Asquith believed that the time had come for a concerted attack against Lloyd George, and there was considerable talk heard of a ministerial crisis. Lloyd George himself was much upset, and if it had not been for the attitude of President Wilson in support of the principle of unity of control the Lloyd George Ministry would almost surely have fallen. It seemed to me better that the United States should give support to Lloyd George at that critical time and so permit him to maintain his power, even though his plan for a Supreme War Council seemed to me impractical and bound to result in failure. The prospect of an upheaval in the English Government following the Italian defeat, the Russian defalcation, and the French Ministry turnover was not a pleasant one, and I concluded that the best advice I could give the President was to lend Lloyd George such support as would enable him successfully to weather the storm of criticism hanging over him.

The Prime Minister returned to England November 13, and during that day I received from him an autograph letter inviting me to dine with him alone that evening at 10 Downing Street. The subject of our discussion at dinner was of course the Supreme War Council set up by the agreement signed by France, England and Italy at Rapallo. Lloyd George’s idea is that the council should be composed of a military and a civil representative from each Government, and he asked for the approval of the United States Government to this plan. I told him that the matter would have to be referred to the President and that I would advise the President to appoint a military representative but not a civil representative. As it turned out later in Paris the “unity,” need of which Lloyd George emphasized so strongly in his Paris speech, was to be made impossible by Lloyd George’s own attitude.

At dinner the Prime Minister asked me to consent to his making a statement in the House of Commons the next afternoon declaring that the United States approved of the idea of the Supreme War Council and would be represented thereon. I refused most emphatically to permit this until I had ascertained the President’s wishes by cable. My purpose, of course, was that any announcement that was to be made with reference to the position of the United States in this matter should be made by myself and not by Lloyd George.

On Sunday, November 18, I received a cable from the President outlining his views with reference to the Supreme War Council,¹ and that evening I issued the following statement to the press:

Colonel House, head of the American mission and special representative of President Wilson in Europe, has received a cable from the President stating emphatically that the Government of the United States considers that unity of plan and control between all the Allies and the United States is essential in order to achieve a just and permanent peace. The President emphasizes the fact that this unity must be accomplished if the great resources of the United States are to be used to the best advantage, and he requests Colonel House to confer with the heads of the Allied Governments with a view of achieving the closest possible cooperation.

President Wilson has asked Colonel House to attend the first meeting of the Supreme War Council with General Bliss, Chief of Staff of the United States Army, as the military advisor. It is hoped that the meeting will take place in Paris before the end of this month.

It is clear from this statement that the Prime Minister’s plan is not specifically approved. The general idea of unity of action and unity of control of resources is approved.

I took care to have the true scope of my statement explained to Geoffrey Dawson, the editor of the Times. I quote the first few sentences of the leading editorial of the Times for Monday, November 19:

The latest, and incomparably the most important, development of the Allied Council scheme is the statement issued last night by Colonel House on behalf of President Wilson. It is as guarded in tone as it is comprehensive in scope. Manifestly it is not intended to serve any controversy over detail in this country. But it does emphasize unmistakably the central principle for which Mr. Lloyd George is standing at this moment—that “unity of plan and control” which received partial recognition at Rapallo. We say partial recognition because it is clear enough from the President’s message, no less than from American press comments, that the work begun at Rapallo is still very far from seeming complete to competent observers. Unity of war aims is first in order of achievement. Unity of strategy depends in turn upon unity of resources and supply. All three call for urgent attention. But the practical point for the moment is that all the specious arguments for “particularism” in strategy, which the Prime Minister denounced in Paris, are scattered to the winds by the detached common sense of our partners in the war.

On Monday afternoon, November 19, Lloyd George in a speech in the House of Commons defended himself with the assistance above referred to, silencing his critics for the time being.

An unpleasant incident in connection with my statement above mentioned occurred on Tuesday, November 20.

The Daily Mail published the following, Tuesday morning, November 20:

Washington, Monday. President Wilson denies that he sent a cablegram to Colonel House stating that the United States considers that a united plan and control between the Allies and the United States is essential to a lasting peace. This denial was issued through Mr. Joseph Tumulty, the President’s private secretary.—Wireless Press.

I refused to make any statement in answer to inquiries so as not to be drawn into a controversy. Mr. Bonar Law’s secretary called on me at lunch time to ask what the Chancellor of the Exchequer might say in the House of Commons that afternoon with reference to this news item. He stated that notice had been served on Mr. Bonar Law of a question to be asked concerning the representation of the United States on the Supreme War Council. I explained what the situation was; that there was a misunderstanding and that the President’s secretary apparently did not know of the cable sent me by the President. I attach herewith the report of the proceedings in the House of Commons on the afternoon of November 20. This statement by Mr. Bonar Law effectively disposed of this rather unpleasant incident.

President Wilson and the Supreme War Council

Mr. Pringle (Lanarkshire, N.W., L.) asked the Leader of the House whether the Government had received any intimation from the Government of the United States to the effect that President Wilson had asked Colonel House and General Bliss to attend the first meeting of the Supreme War Council which was to take place before the end of the month, and that President Wilson had cabled to Colonel House that the Government of the United States considered that unity of plan and control between all the Allies was essential; whether the official statement to this effect in the press on Monday was issued by the authority of the Government; whether the right honorable gentleman’s attention had been called to the message published that morning, in which it was stated that President Wilson denied that he had sent a cable in the terms quoted; and whether in these circumstances the Government could make an authoritative statement on the matter.

The Chancellor of the Exchequer. President Wilson has directed Colonel House to take part not only in the Inter-Allied Conference, but also in the Supreme War Council, and General Bliss is to be his special military adviser.

Mr. Hogge (Edinburgh, E., L.) asked the right honorable gentleman whether President Wilson sent the cable or whether this was another case of a “Kerensky telegram.” (Cries of “Oh”!)

The Chancellor of the Exchequer. I hardly think the House will wish me to answer that. (Cheers.) We had the information quite officially.

I quote herewith a letter received by me from Colonel Hankey of the War Cabinet, and my reply thereto:

Offices of the War Cabinet,
2, Whitehall Gardens, S.W.1.

Dear Colonel House:

I am instructed by the Prime Minister to invite you to meet the War Cabinet and certain other members of His Majesty’s Government, on Tuesday next, November 20, 1917, at 10 Downing Street, at 11.30 a.m., when it is hoped to have a full discussion of the question of the co-operation of the United States of America in this war, and the nature of the assistance that they can render to Great Britain and her allies.

The Prime Minister hopes that you will bring with you such other members of your mission whose presence you consider desirable.

I shall be glad if you will kindly furnish me, at your early convenience, with a list of those who will accompany you.

As regards the secretarial arrangements, neither the War Cabinet nor the inter-Allied conferences usually keep stenographic notes, although I always prepare a précis of the discussion and circulate it to those concerned, first for remarks, and, when final agreement has been reached, for record. If, however, you would prefer to have a stenographic record, I will certainly arrange for it.

Yours very truly,

(Sgd.) M.P.A. Hankey
Secretary

Colonel Edward M. House,
Special Representative of the President of the United States,
American Mission, “Chesterfield House,” Mayfair, W.1.

The following is the reply which was made to the above letter:

Chesterfield House, Mayfair, W. 1.
November 18, 1917.

Dear Sir:

Colonel House has asked me to acknowledge receipt of your letter of the 17th instant, in which the Prime Minister invites him to meet the War Cabinet and certain other members of His Majesty’s Government on Tuesday next, November 20, at 10 Downing Street, at 11.30 a.m.

As you have already been advised, Colonel House himself will not attend this meeting.

The members of the mission who will be present are the following:

• Admiral W. Shepherd Benson
• Gen. T. H. Bliss
• Mr. O. T. Crosby
• Mr. Vance C. McCormick
• Mr. Bainbridge Colby
• Dr. A. E. Taylor
• Mr. T. N. Perkins
• Mr. Paul D. Cravath
  and myself as Secretary

Colonel House feels that there is no need so far as he is concerned, for a stenographic record of the conference. I shall take at longhand such matters as may be of interest to Colonel House.

Yours very truly,

(Sgd.) Gordon Auchincloss
Secretary

Lieut. Col. Sir Maurice P. A. Hankey, K.C.B., C.B.,
Secretary of the War Cabinet,
2, Whitehall Gardens, S.W.

My reason for not attending this meeting was that the matters to be discussed were entirely within the jurisdiction of the other members of the mission and were not questions with which I was specifically charged, except in an advisory capacity.

The meeting of the War Cabinet was held at 11.30 a.m. at 10 Downing Street in the room and around the table at which Lord North took the final steps which resulted in the American War of Independence.

The seating of this meeting was as follows:

[Here follows the list.]

I attach hereto a printed report of the proceedings [annex 2].

Between the time of the Prime Minister’s return from Italy and the day of my departure from London (November 22), besides frequent conferences with Lloyd George, Lord Reading, Lord Northcliffe and Mr. Balfour, I conferred among others with the following: Scott of the Manchester Guardian, Donald of the Daily Chronicle, Maxse, editor of the Fortnightly Review, Asquith, General Smuts, the French Ambassador, M. Paul Cambon, Lord Bryce, the Belgian Minister, Baron Moncheur, Lord French, Sir William Tyrrell, who is engaged in preparing data for the British Government’s case in the peace conference, Sir Maurice Hankey, Secretary of the War Council, Lord Landsdowne, whom I found to be in a peculiarly pacific frame of mind, Strachey, of the Spectator, Thomas and Davis, the labor leaders, Sir Eric Geddes, the First Lord of the Admiralty and who in my opinion is the most forceful man in the Cabinet and who explained to me the progress of the Admiralty in coping with the submarine situation. M. Venizelos, the Greek Prime Minister, called on me and explained the Greek situation, and stated that if the Allies did not hold Saloniki he might as well resign as Prime Minister, send for Constantine and let the Germans take Greece. Venizelos impressed me as an interesting and able man. Other individuals of importance with whom I conferred were the following: Colonial Secretary Walter Long, Spender of the Westminster Gazette, Hirst of the Statesman and Lord Loreburn, Sir Albert Stanley, President of the Board of Trade, Sir Joseph Maclay, the Shipping Controller, and Austin Harrison of the English Review, who wished to talk about the Irish question.

I had a further long conference with Admiral Jellicoe. He explained to me the strategy of the war so far as the Navy was concerned, and he expressed the keenest appreciation of the ability and energy of Admiral Benson.

Before leaving England I had a long conference with the Prime Minister and Mr. Balfour at 10 Downing Street. They had been instructed by the War Cabinet to ask my advice on two questions: First, concerning the recognition of Kaledin, the leader of the Cossacks in southern Russia, by advising the Roumanian Government to co-operate with him. I advised strongly against this and stated that if anything was done they should not go further than to advise Roumania to co-operate with whatever fighting forces of Russia were nearest without mentioning any names. Lloyd George and Balfour finally agreed to this procedure. The other question about which my advice was asked was a contemplated statement by England that East Africa should never again return to German rule. I advised strongly against the issuance of such a statement on the ground that the military importance of such a statement would be greatly outweighed by the political embarrassment such a statement would cause.

At the request of the King I called on him again on November 20, at 7 p.m., and conferred with him for a half hour.

During one of my conferences with Lloyd George and Reading I pinned the Prime Minister down to a statement of the British war aims.

What Great Britain wants are the African colonies, both east and west, an independent Arabia under the suzerainty of Great Britain, Palestine to be given to the Zionists under British, or if desired by us, also under American control, an independent Armenia and an internationalization of the Straits.

Other individuals with whom I had conferences before I left England were Lord Robert Cecil, Sir Eric Drummond, the ex-British Ambassador to Austria, Sir Maurice de Bunsen, who now has charge of Mexican affairs for the British Government and who wished to tell me, by Mr. Balfour’s direction, that the British Government would follow our lead and recognize Carranza; Josiah Wedgwood and Noel Buxton, Members of Parliament, the Italian Ambassador, the French Ambassador, and a number of others.

Each day during the last ten days of our visit in London the mission met at 10 o’clock in the morning for such interchange of information and ideas as seemed important at the time. I attended most of these meetings and kept in daily touch with the activities of the members of the mission, which are more fully stated in the reports submitted herewith.

On November 21 the British began a surprise offensive with tanks at Cambrai and the first reports of the battle encouraged everyone. As it later turned out the gains made were not all maintained and the operation proved to be a costly one for the English.

At 11.40 on November 22 the mission left London by special train for Dover. At the station to see us off were many members of the British Government including Mr. Balfour and Lord Reading. Ambassador Page and members of his staff were also on hand. Upon our arrival at Dover we immediately went on board the eighteen hundred ton torpedo boat destroyer leader Termagant. We crossed the channel to Calais at 30-knot clip. The sea was calm and the channel had been carefully swept for mines. Some had been found not only on the Dover-Calais route but also many on the Folkestone-Boulogne route, which were said probably to have been placed in anticipation of our crossing. At Calais we were met by newspaper correspondents and some representatives of the French Foreign Office. We were taken aboard a special train, and we arrived at the Gare du Nord, Paris, at 8 p.m., having made the trip from London to Paris in the almost record time of eight hours and twenty minutes. At the station in Paris we were met by a special representative of President Poincaré and by the French Minister of Foreign Affairs, M. Pichon, Ambassadors Sharp and Willard, General Pershing, and many others. We drove immediately to the Hotel de Crillon where we were given a beautiful suite of rooms on the first floor as guests of the French Government. Before retiring I had a conference with General Bliss and General Pershing on the military situation.

At 11 o’clock in the morning of November 23 the entire mission called on Ambassador Sharp and his staff in order that the members of the mission might be placed in touch with their opposite members in the French Government and get down to work at once.

Upon leaving London I gave out the following statement:

I have been impressed by the wonderful machinery you have created here at the heart of your Empire to control your part of the war. You have given the world an example of the efficiency of a democracy which will be of lasting value. The glorious victory on the Somme is the beginning of the realization of this efficiency, and will hearten every lover of democracy throughout the world.

We are also creating in Washington vast new machinery of government to bring our resources to bear, and we shall profit by what we have seen here. We all realize that no human organization is perfect, and I am sure you will not be content with yours any more than we shall be content with ours until the tools we are making have accomplished the great work for which they are being forged.

It is inspiring to feel that our two organizations will work closely and frankly together in the cause of liberty.

We appreciate beyond measure the kindly reception your officials, your press, and your citizens have given us, and we will take back to America a delightful sense of your warm hospitality. Our visit has been a memorable one and I hope profitable to the cause in which we are both enlisted.

Upon my arrival in France I issued the following statement:

We bring to the French Republic a message of encouragement. America’s millions are mobilizing in factories, farms, and upon the military fields.

There is a grim determination amongst us to wage war until the world is freed from the shadow and the spectre of the sword. We have in mind no material gain. What we want is an assurance of permanent peace, and the tramp of our soldiers upon the soil of France will be heard ever increasingly until it is achieved.

It is here that brave men come to mingle their blood with yours. It is here that all come to gather inspirations from your heroic deeds.

Our President and our country see the issue clearly, and France may confidently count on every resource which may be at our command.

Between the time of our arrival in Paris and the arrival of the British mission late in the evening of Tuesday, November 27, my time was entirely devoted to frequent conferences with members of the French Government and representative French newspaper men. I also had several conferences with Minister Brand Whitlock and Ambassador Willard, who were in Paris for the special purpose of seeing me.

Ambassador Willard described to me conditions in Spain and told me of conversations he had been having with the Spanish King. He stated that the King is pro-Ally and is convinced that the Germans cannot win. Willard further said that King Alphonso has talked to him from time to time about peace terms. Willard believes that peace proposals will be made by Germany before long. I told Willard to convey to the King of Spain from me the suggestion that peace proposals had better be made to the United States rather than to the British and other Allies, inasmuch as the United States was disinterested as to territorial aims, and that the influence of the United States at the moment was such that it was paramount in any discussion of this sort.

On November 23 I conferred at length with M. Clemenceau and again on the 25th with him and Generals Pétain and Bliss. The principal subject of our conversation was the practicability of the proposed Supreme War Council.

November 23 was principally devoted by me to receiving French newspaper men, American correspondents, and a host of other callers more or less important.

An indication of the favorable treatment accorded the mission by the French press can be had by an examination of the leader of the Temps for Saturday, November 24, which I quote:

[Here follows the article referred to, entitled “The House Mission in Paris.”]

On Saturday, November 24, the entire mission attended a luncheon given in their honor by the President at the Elysée Palace. This was a brilliant affair and the only public entertainment attended by the mission en bloc in France. I give herewith the seating:

[Here follows the list.]

It will be seen from this that the entire French Ministry and a few prominent Frenchmen outside of the Government were present at this luncheon. M. Clemenceau came in after luncheon. He makes it a rule never to attend these functions.

On Sunday, November 25, the entire mission without previous announcement went to Picpus Cemetery in order to lay a wreath upon the grave of Lafayette. The inscription thereon was, “The American War Mission in Grateful Remembrance. November 25, 1917.”

During this time I had conferences with M. Moutet, the prominent socialist deputy, M. Hovelaque, Minister of Education; Henri Bergson, Paul Lewis, of the Temps; Judge Walter Berry, of the American Chamber of Commerce; Hervé, of La Victoire; Gabriel Hanotaux, former Prime Minister; M. Barthou, M. Klotz, Minister of Finance, M. Clémentel, Minister of Commerce, M. Tardieu, M. Chéradame and M. Renaudel; besides frequent conferences with Ambassador Sharp, Generals Pershing and Bliss, Admiral Benson and other members of the mission.

My conference with M. Clemenceau and Generals Pétain and Bliss on Sunday, November 25, considered two subjects; first, the actual military situation, which is dealt with by General Bliss in his report, and second, the organization and functions of the Supreme War Council, proposed at Rapallo. We were in agreement that such a council could do no practical good. I suggested that the civil end of the council should be eliminated and that the council should be military and composed of the commanders in chief of the armies on the western front and the chiefs of staff of these armies, the latter constituting the committee on strategy. General Pétain’s objection to this plan was that it did not provide for an executive officer whose duty it would be to execute the will of the council. General Bliss met this objection by suggesting that an executive official might be chosen president of the council and be charged with the duty of carrying into execution the will of the council. This plan met with the approval of all present. The French Prime Minister and General Pétain approving with the distinct understanding that the civil members of the council would be eliminated.

As soon as Lloyd George arrived on Tuesday, November 27, I took up with him the question of modifying the original plan for the Supreme War Council. It took me only five minutes to persuade him that the civil end of the council should be eliminated, and that there should be a president of the military council who should act as its executive officer.

At the same time I told Lloyd George that I had proposed to the French Prime Minister that he open the Inter-Allied Conference with a speech of only two or three lines and that all set speeches be dispensed with, and that the conference split up at once into committees and get down to work. Lloyd George agreed to this plan, but later both he and Mr. Balfour strongly urged that speeches be permitted. However, the French Prime Minister agreed with me and we carried our point. In passing I may say that when I came to Paris I discovered that no plans whatsoever had been made for the conduct of the proceedings of the Inter-Allied Conference, and that I learned that a number of the delegates had prepared long set speeches which would have precipitated interminable discussion of a dangerous character. I was determined to avoid this and consequently made the suggestions aforementioned to M. Clemenceau and to these suggestions he readily agreed.

A few minutes after I left Lloyd George on Tuesday afternoon he asked me again to come to his apartment, which was directly opposite mine on the same floor of the Hotel de Crillon, and I found him in a very excited state of mind. He had been told, probably by the Secretary of the War Cabinet, Colonel Hankey, that Clemenceau’s plan was to have a generalissimo of all the armies, and that this man was to be a Frenchman, and that Clemenceau intended to have the chiefs of staff act as an advisory council. Lloyd George was very angry at this and his attitude was based entirely on the fact that he does not wish General Robertson, the Chief of Staff of the British Army, or Field Marshal Haig to be a part of the Supreme War Council, but he does wish his friend General Wilson to be the British representative. Lloyd George’s attitude in this matter bodes ill for the success of the Supreme War Council and the general principle of unity of command.

Lloyd George had arranged to see Clemenceau at 10 o’clock on Wednesday morning, November 28. Lloyd George stated to me that if his plan which he said had been agreed to by the French and the Italians was not carried out he would at once return to England. I made an appointment to see M. Clemenceau at 9.30 in order, if possible, to smooth things over before these two men got together.

On the morning of November 28 I learned that Lloyd George had again twisted and was now in favor of the civil end of the War Council being continued. It is difficult to do business with the British Prime Minister on account of his rapid changes of front.

When I saw Clemenceau at 9.30 he agreed to yield to Lloyd George’s wishes in respect to the chiefs of staff, stating however, that Lloyd George’s plan made the War Council thoroughly impractical.

After leaving M. Clemenceau on Wednesday morning, November 28, I went at his request to call on M. Pichon, the Minister of Foreign Affairs, and outlined to him the procedure I had suggested for the conduct of the Inter-Allied Conference, that is, a short introductory speech by the French Prime Minister, to be followed by the appointment of committees dealing with questions of finance, supplies, blockade, shipping and munitions. M. Pichon readily agreed to the procedure suggested.

The rest of the day was spent in conferences with members of the British mission and late in the afternoon I attended a conference at the office of the Minister of Foreign Affairs between the Prime Ministers and Foreign Secretaries of the French, British, and Italian Governments, which conference formally adopted the procedure for the Inter-Allied Conference above referred to.

That afternoon I designated the following individuals to represent the United States on the five committees of the conference: finance, Mr. Crosby and Mr. Cravath; munitions (including aviation), Mr. Perkins, General Williams, Colonel Boiling, Commander Cone, and Mr. Burgess; blockade, Mr. McCormick; supplies, Doctor Taylor; shipping, Mr. Colby, Mr. Day, and Mr. McCormick.

At 10.30 o’clock on the morning of November 29 the Inter-Allied Conference met at the Salon de l’Horloge at the Quai d’Orsay. M. Clemenceau, the French Prime Minister, in opening the conference stated as follows:

Gentlemen: In the name of the French Republic the honor falls to me to bid you welcome. In this greatest of all wars it is the sentiment of a supreme solidarity of people which unites us to conquer on the fields of battle the right to a peace which will really be one of humanity. For this reason we are all here; a magnificent gathering of hope, of duty and of resolution in agreement to make sacrifices demanded by an alliance which no intrigue, no weakness can ever shake. It behooves us to translate into acts the high passions which animate us. Our order of the day is work. Let us set to work.

M. Pichon, Minister for Foreign Affairs, then briefly referred to the questions submitted to the examination of the conference and explained that the work of the conference would be grouped under five main subjects to be dealt with by five committees, over each of which the corresponding French Minister would preside. These committees were: (1) finance; (2) armament, including aviation; (3) maritime transportation; (4) food and supplies; (5) blockade.

He then requested the various delegates to select representatives to serve on each of these five committees. After these had been named the conference adjourned at about 11 o’clock. It may be noted that Liberia and Brazil decided to be represented on all committees by the representatives of the United States.

The conference committees set to work at once and meetings of these committees were held on the 29th and 30th of November, and the 1st, 3d and 4th of December, and on December 5 at 3 o’clock the conference was again called into session to receive the various reports and formally to close. The reports made by these committees are either described in or made a part of the reports made by the individual members of the mission.

At the request of the French Prime Minister I closed the conference with the following statement:

Monsieur Clemenceau, President of the French Council, in welcoming the delegates to this conference declared that we had met to work. His words were prophetic. There has been coordination and unity of purpose which promise great results for the future. It is my deep conviction that by this unity and concentrated effort we shall be able to arrive at the goal which we have set out to reach.

In behalf of my colleagues I want to avail myself of this occasion to thank the officials of the French Government and through them the French people for the warm welcome and great consideration they have shown us. In coming to France we have felt that we were coming to the house of our friends. Ever since our Government was founded there has been a bond of sympathy between us—a sympathy which this war has fanned into a passionate admiration. The history of France is a history of courage and sacrifice, therefore, the great deeds which have illuminated the last three years have come as no surprise to us of America. We knew that when called upon France would rise to splendid achievement and would add lustre to her name.

America salutes France and her heroic sons and feels honored to fight by the side of so gallant a comrade.

The French Prime Minister had not intended to speak himself but, changing his mind at the last minute, spoke extemporaneously as follows:

[Translation]

Since it is my duty to declare this conference closed, allow me to add a few words to those you have just heard. I came here with the formal intention of keeping silence, in order to leave you under the impression of the beautiful words just spoken by my friend, the eminent Colonel House, who so worthily represents the noble American people.

While listening to him, I could not help thinking that there is a lesson to be learned from the historic friendships that to-day unite the French and American peoples in a glorious past; there is as great a lesson in the total elimination of former enmities.

In the past we have been friends of America and enemies of England. French and English have bravely and fairly fought each other on land and sea. The two peoples are acting to-day in complete solidarity and friendship. All peoples are great who struggle for the same ideal of justice and liberty, and they will succeed in attaining it through sacrifices soon to be splendidly rewarded.

If I may believe the newspapers, a harsh voice has been heard from the other side of the trenches making sport of this conference. There is no matter for sport here. Our enemies, who see nothing beyond brute force, can not understand us.

We are all fighting under the orders of humanity’s conscience. We desire the same attainment of right, justice and liberty. And we are assembled to see to it that right, always promised, shall become reality.

Even though, on the other side of the Rhine, they will not grasp the fact, the world awaits our victory. It shall have it. All the peoples represented here are helping each other for the success of the greatest cause. We are striving by force to win the right to peace.

I attach to this report a pamphlet containing the personnel of the conference.¹

Early in the afternoon on Thursday, November 29, the British Prime Minister asked to see me and proposed that he and I insist that Great Britain be permitted to find out what Austria’s peace terms were. I acquiesced and suggested that he bring the matter up at the conference to be held at the Office of the French Minister of Foreign Affairs at 4 o’clock.

Those present at this conference were the French Prime Minister, the French Minister of Foreign Affairs, and his assistant, De Margerie, representing France; the English Prime Minister, the English Minister of Foreign Affairs, and Mr. Addison, representing England; the Italian Premier and the Italian Minister of Foreign Affairs, representing Italy, and myself representing the United States.

Lloyd George started off the discussion with a vehement argument in favor of permitting Great Britain to ascertain Austria’s peace terms. This Sonnino resented. Finally, however, the matter was adjusted and the Italian representatives agreed to Lloyd George’s proposal.

In the morning of November 30 I had conferences with Lloyd George, Mr. Balfour, the Japanese Ambassador at Paris and the Japanese Ambassador at London, General Pershing, several members of the Polish National Committee at Paris, the Liberian Minister, General Bliss, Admiral Benson, and other members of the mission.

In the afternoon at 4 o’clock I attended another meeting of the Prime Ministers and Foreign Secretaries of Great Britain, France, and Italy at the French Foreign Office. A full account of the discussion at this meeting I attach to this report.¹

The principal subject of discussion at this conference referred to what statement should be sent to Russia. I expressed myself in favor of having the Inter-Allied Conference adopt a resolution substantially as follows:

The Allies and the United States declare that they are not waging war for the purpose of aggression or indemnity. The sacrifices they are making are in order that militarism shall not continue to cast its shadow over the world and that nations shall have the right to lead their lives in the way that seems to them best for the development of their general welfare.

Such a resolution as this I thought would have a wholesome effect not only in Russia but all over the world.

Mr. Balfour strongly recommended that the Allies release Russia from her promise to continue the war. Sonnino violently opposed this suggestion. The Russian Ambassador was then brought into the conference, and he was in favor of some such statement as I had drafted. It was decided to request the Russian Ambassador to draw up a memorandum of what action he thought we should take and to consider the same the next day.

The question of a more active participation in the war by the Japanese was left to be handled by M. Pichon without any of us having any hope that he would be successful in stimulating that nation to a more active effort.

At 9.45 a.m., December 1, General Bliss and I started for Versailles (Messrs. Frazier and Auchincloss following in another automobile), to attend the meeting of the Supreme War Council, which was to be held at the Petit Trianon at 11 a.m. Before the council met Lloyd George, Clemenceau, Orlando and I had a conference to outline a program.

I attach herewith as part of this report a record of the proceedings of the Supreme War Council.¹

General Bliss and I agreed not to take any positive position at this meeting but to listen and get information. We felt that it was not good taste to do more at this time since we have no men on the firing line. When we get our Army over here it will be another story.

Questions of general policy, finance, munitions, etc., of course, we felt at liberty to take part in—perhaps the leading part—but as to military plans other than naval it seems best to be modest and listen for the time being.

A perusal of the minutes of the meeting of the Supreme War Council indicates that the council as organized is ineffective so far as securing the desired efficient unity of control.

The council adjourned at 1.15, and I at once motored back to Paris.

The Lansdowne letter which appeared in the Daily Telegraph on Thursday was uppermost to-day in the mind of the British Prime Minister. Before attending a conference of the Prime Ministers and Foreign Secretaries of Great Britain, France and Italy at the French Foreign Office on the afternoon of December 1, I urged upon Lord Reading and the British Prime Minister the importance of having the Inter-Allied Conference adopt a resolution similar to the one set forth above and my efforts were fruitless.

I attach to this report the minutes of the conference of the Prime Ministers and Foreign Secretaries of Great Britain, France, and Italy, which I attended at the French Foreign Office on the afternoon of December 1.¹ The resolution that I had proposed came up for discussion and the alternative draft resolutions prepared by the Russian Ambassador and Baron Sonnino also were discussed. The proposal of the ultra-conservative Baron Sonnino seemed to meet with the approval of the members of the conference except myself, and I emphatically declined to subscribe to it on behalf of the United States. The refusal of the United States to be a party to this resolution, of course, effectively disposed of it.

Many other matters were brought before the conference but none definitely decided upon. The lack of coordination and decision is the predominant characteristic of all of these conferences.

Before bidding Lloyd George goodbye on Saturday night (for he left for England early Sunday morning) I urged on him the necessity for revising the British censorship rules, telling him that it was ridiculous that the American public should be compelled to submit to a British censorship of its news. He promised that he would straighten out this matter.

Sunday, December 2, was filled with conferences with the following: the Russian Ambassador, Lord Reading, Winston Churchill, General Pershing, Mr. Balfour, Lord Milner, Dr. Alexander Lambert, who had just come from Italy, and a number of newspaper men.

I attended the final meeting of the Prime Ministers and Foreign Secretaries of Great Britain, France and Italy (except Lloyd George) held at the Quai d’Orsay at 11 a.m. on December 3. I attach hereto the records of the proceedings at this meeting.¹

The final meeting of the Inter-Allied Conference took place at 3 o’clock. The proceedings I have described above.

After the closing of the conference I had a short talk with M. Clemenceau, and he asked me to do what I could to speed up the instruction of the American troops in France. He told me that he had formed a bureau to deal exclusively with American problems and that he had put M. Jules Cambon at the head of it.

In the evening of December 3 President and Madam Poincaré gave to the members of the Inter-Allied Conference a beautiful dinner at the Elysée Palace. Madam Poincaré made me the guest of honor, which was, of course, a great compliment to the United States, inasmuch as nearly all of diplomatic and military Europe were present. Late that evening I had a final conference with Mr. Balfour with reference to British representation in the United States. It has been decided definitely to send Lord Reading to America within a few months as Ambassador Extraordinary and to bring the present Ambassador home.

December 4 was devoted to a visit by the mission, accompanied by Ambassador, Mrs., and Miss Sharp, Lord Northcliffe, his aide, Colonel Stewart, and Count de Chambrun, to the headquarters of the American Army at Chaumont. The programme for the day was as follows:

• Leave Paris 7.55 a.m., December 4; (Gare de l’Est);
• Arrive Gondrecourt 12.25 p.m.;
• Breakfast and lunch on train;
• At Gondrecourt, to see—

  (a) Bayonet exercise;

  (b) Rifle instruction, employing targets representing landscape;

  (c) Hand grenades;

  (d) Rifle grenades;

  (e) Trench mortars;

  (f) “Mopping-up” exercise;

  (g) Engineer companies;

  (h) Artillery exercise, with aeroplanes;

  (i) Automatic rifles;

  (j) Machine gun barrage;

• Leave Gondrecourt by train at 2.25 p.m.;
• Arrive Chaumont 4 p.m.;
• Visit headquarters A.E.F.;
• Leave for Paris by train at 6 p.m.;
• Arrive Paris 10 p.m.

On the train I had long satisfactory talks with General Pershing. My last two days in Paris were devoted to a succession of conferences. Among my callers were the Russian attaché and Soldatenkoff; Professor Rappard, of the Swiss commission (the agreement between the War Trade Board and the Swiss Government was completed to-day by Mr. McCormick, and this agreement seems to be in every way satisfactory¹); M. Hennessy, the French deputy, who was disturbed at the President’s reference to “northern France” in his address at the opening of Congress; M. Pichon, the Foreign Secretary, was also disturbed at this. I made it clear to both of these gentlemen that the President had no reference either directly or indirectly to Alsace-Lorraine. Lord Milner called to discuss the constitution of the Supreme War Council, and John Bass wished to talk of Russia and Poland. At lunch with the Marquis de Chambrun, I met Messrs. Barrio, Léon Bourgeois, Denys Cochin, Jules Cambon and Colonel Chambrun.

I entertained a number of prominent members of the French Government at lunch on December 6 in honor of M. Pichon, the French Minister of Foreign Affairs.

Long and frank statements made to me by General Pétain, M. Clemenceau, and General Pershing, separately, indicated clearly that there is much work to be done before a complete and sympathetic understanding can be had between General Pershing and the heads of the French Government, civil and military. I have warned General Pershing of the difficulties ahead of him and have suggested to him certain methods of overcoming these difficulties.

Other callers before my departure from Paris were a large delegation from Alsace-Lorraine, the Minister from Porto Rico [sic], the Chinese Minister, and many others.

Upon bidding farewell to me the French Prime Minister expressed deep gratification over the results of the visit of the mission and asked me to tell the President that he was now his very warm admirer and hoped the President would only remember his former criticism of him to make his present attitude more complimentary.

The mission, with the exception of Mr. Crosby and Mr. Cravath, who remained in Paris to participate in the work of the Inter-Allied Council, and Doctor Taylor, who went to England on Tuesday, December 4, in order to continue certain rationing negotiations with the representatives of Norway, Denmark, and Holland, left Paris at 10.30 p.m. on the night of December 6. Our destination at that time was not disclosed to any of us by the Navy Department’s representatives.

On December 7 at noon we arrived at Brest, having taken a circuitous route from Paris. We were at once taken on board the U.S.S. Mount Vernon (formerly the Kronprinzessin Cecilie) and at 4.30 p.m., convoyed by the U.S. cruiser San Diego and torpedo boat destroyers, we steamed out of Brest Harbor; and after an exceedingly comfortable and uneventful trip we arrived at New York City late in the afternoon of Saturday, December 15.

If this war is to be won, better teamwork between the Allies must be effected. As now conducted there is great loss of energy and resources. Duplication is going on in some directions—in others men and money are being wasted.

The Central powers are not overmatched, because their resources are perfectly mobilized and under single control. The individual German soldier is perhaps not so good as the English, but the German military machine is superior to that of either England or France. The difficulties under which the English and Americans have to fight are a great handicap. Not only have they wide distances from which to gather their forces and maintain them, but these difficulties are enormously enhanced by having to create and maintain a huge army in a foreign land amongst a people with different habits, customs and prejudices.

The diplomatic end of such an undertaking is nearly as great as the military end, and General Pershing is beginning to realize this.

Unless a change for the better comes the Allies cannot win, and Germany may. For six months or more the ground has been steadily slipping away from the Allies. Outside of England and France it is questionable whether the rest of the alliance is a liability or an asset. It would certainly have been better if none of the smaller nations in southeastern Europe had entered the war. Greece and Italy would have been more helpful as neutrals than as allies. They are a drag on both the men and resources of the Entente. England would have come out of the war better if she had fought the Central Empires alone. She would have taken the German colonies and driven her commerce from the seas as she has now done. Germany, under such circumstances, would have been compelled to give naval battle, since there would have been no way to use her Army. In all probability her Navy would have been destroyed. Therefore, England by making the fight alone would have gained rather than lost in prestige, and the cost to her would not have been one-tenth of what she has already expended.

Germany is now declaring that the world is up in arms against her and is unable to defeat her. This keeps up the morale of her people and adds to her prestige among the neutrals. It is a sham, and should be exposed.

The English and French are insistent that our troops should be placed amongst theirs as soon as they come over. The argument is that it would give them better and quicker training, and would also help them withstand the great German drive which they believe is imminent. The drive, I think, will be made, and every possible help should be given them to withstand it, for if it is successful the war on land will have finished. On the other hand, they are asking us to do what the Canadians and Australians have refused to do. If once we merge with them we will probably never emerge. The companies and battalions placed with them will soon be mere fragments. Then, too, if they are placed in such a position they will not get along well with either the English or French and will never get credit for the sacrifices they make. It can, I think, be taken for granted that this plan would be the most effective immediate help we could give the French and England, but it would be at great cost to us.

We found the morale of the people high in England. The more fortune goes against them the steadier and more determined they are to win. In France the morale was also good. There were no signs of weakening. In England the people are more sober than on my last visit. London is gloomy. There was a lack of bustle that I had never seen before and indications of depression. Every one seems now to realize what this war means, and the blitheness of former years has given way to grim determination. Food, gasoline and other useful commodities are being conserved. In France it is otherwise. Paris is normal in appearance. The streets are lively, the people cheerful, and food, gasoline, etc., are plentiful to wastefulness. Dinners are given in Paris that would be considered a scandal in America, not to mention England. To rebut this I was told that if restrictions were placed upon the French people they would rebel. That the only way they could be kept going at the top notch was to let them have their way in this direction.

However, what discourages one most in the whole situation is the lack of unity of control and of action. There is but little coordination anywhere between the Allies. Jealousies are everywhere rife. None of them at heart like one another, and I doubt whether any of them like us. It is the thought of “hanging together or separately” that keeps them going. Fortunately, a like condition exists in the Central Alliance.

The Supreme War Council as at present constituted is almost a farce. It could be the efficient instrument to win the war. The United States can make it so, and I hope she will exercise her undisputed power to do it.

In conclusion I wish to record my appreciation of the individual work of the members of this mission. Whatever success it has had as a force for good is due to them. In all my experience of men I have never known better and more intelligent teamwork. There has been no confusion of purpose, no slacking in the pursuit of the objects to be obtained, and there has been absolutely no personal differences or friction to retard their work. They have been amenable to both advice and suggestion and have left the impression in England and France of men of great ability and of equally great modesty. They have had to do with their opposites having the rank of Cabinet Ministers, but no one who conferred with them for a moment doubted they were conferring with their equals.

E. M. House

On Board U.S.S. “Mt. Vernon” ,
December 15, 1917.

[Annex 1]

Speech of the British Prime Minister ( Lloyd George) at Paris, November 12, 1917

I must claim your indulgence for taking up the time of so many men who hold great and responsible positions in the state and the legislature at a moment when they can ill spare from the conduct of important affairs time for listening to speeches. My only apology is that I have important practical considerations to submit to you, which affect not merely the future of your own country and of mine, but the destiny of the world. I have one advantage in speaking of this war, in that I am almost the only Minister in any land, on either side, who has been in it from the beginning to this hour. I therefore ought to know something about the course of events and their hidden causes. Of both I want to say something to you to-day.

My friend and comrade, M. Painlevé, has explained to you the important decision taken by the Governments of France, Italy, and Great Britain in setting up a Supreme Council of the Allies whose forces operate in the west to ensure the united direction of their efforts on that front. As he has already explained, that council will consist of the leading Ministers of the Allied countries, advised by some of their most distinguished soldiers, and the choice which has already been made by these countries of their experts proves that the Governments mean this council to be a real power in the co-ordination of their military effort.

Unfortunately, there was no time to consult America and Russia before setting up this council. The Italian disaster and the need of immediate action to repair it rendered it essential that we should make a start with the powers whose forces could be drawn upon for action on the Italian front. But in order to ensure the complete success of this great experiment—an experiment the success of which I believe to be essential to victory for the Allied cause—it is necessary that all our great Allies should be represented in its deliberations, and I look forward with confidence to securing the agreement of those two great countries and to their cooperation in the work of this council.

There are two questions which may be asked with reference to the step which we have taken. Why are we taking it now? That is easy to answer. The second question is more difficult to find a satisfactory answer for—Why did we not take it before?

I propose to answer both. In regard to the first question, the events of the war have demonstrated, even to the most separatist and suspicious mind, the need for greater unity amongst the Allies in their war control. The Allies have on their side—in spite of all that has happened they still have at their command—all the essential ingredients of victory. They have command of the sea, which has never yet failed to bring victory in the end to the power that can hold out. On land they have the advantage in numbers, in weight of men and material, in economic and financial resources, and beyond and above all in the justice of their cause. In a prolonged war nothing counts as much as a good conscience. This combined superiority ought ere now to have ensured victory for the Allies. At least it ought to have carried them much further along the road to victory than the point which they have yet reached. To the extent that they have failed in achieving their purpose, who and what are responsible?

Let us ruthlessly search out the answer to that question without undue regard to susceptibilities. The fate of the world is at stake and we have no right to think of anything but realities. The fault has not been with the navies or with the armies. We all admire the skill of our naval and military leaders. We are all enthralled with the valour of our sailors and soldiers. The defense of Verdun will be remembered with amazement and with pride until the world grows cold. Yea, and the story of the indomitable tenacity which won the crests of Passchendaele, after months of conflict almost unexampled in its fierce stubborness, will make the mists of my native land ever glow with splendour. And let me say this word for the Italian Army in its hour of discomfiture: No one can look at those frontier mountains without a thrill of respect for the gallantry that once stormed them in face of the entrenched legions of Austria.

Let us also be just to Russia. Russia is suffering from a violent fever, into which she has been driven by conditions of atrocious misgovernment. She is making a great struggle, and through fluctuations she is winning her way to steadier and cleaner health than she has ever yet enjoyed. She now lies stricken through no fault of her own. Let us not forget what she did in the early hours of the war, when her heroic sacrifice helped to save the west, and in France and in Italy, from the cruel dominion of the Prussian. And there are the heroic little nations who have lost their lands. Let us not forget their gallantry, their sacrifice.

No, the fault has not been with the armies. It has been entirely due to the absence of real unity in the war direction of the Allied countries. We have all felt the need for it. We have all talked about it. We have passed endless resolutions resolving it. But it has never yet been achieved. In this important matter we have never passed from rhetoric into reality, from speech into strategy.

In spite of all the resolutions there has been no authority responsible for co-ordinating the conduct of the war on all fronts, and in the absence of that central authority each country was left to its own devices. We have gone on talking of the eastern front and the western front and the Italian front and the Salonika front and the Egyptian front and the Mesopotamia front, forgetting that there is but one front with many flanks; that with these colossal armies the battlefield is continental.

As my colleagues here know very well, there have been many attempts made to achieve strategic unity. Conferences have been annually held to concert united action for the campaign of the coming year. Great generals came from many lands to Paris with carefully and skillfully prepared plans for their own fronts. In the absence of a genuine inter-Allied council of men responsible as much for one part of the battlefield as for another there was a sensitiveness, a delicacy about even tendering advice, letting alone support for any sector other than that for which the generals were themselves directly responsible. But there had to be an appearance of a strategic whole, so they all sat at the same table and, metaphorically, took thread and needle, sewed these plans together, and produced them to a subsequent civilian conference as one great strategic piece; and it was solemnly proclaimed to the world the following morning that the unity of the Allies was complete.

That unity, in so far as strategy went, was pure make-believe; and make-believe may live through a generation of peace—it cannot survive a week of war. It was a collection of completely independent schemes pieced together. Stitching is not strategy. So it came to pass that when these plans were worked out in the terrible realities of war the stitches came out and disintegration was complete.

I know the answer that is given to an appeal for unity of control. It is that Germany and Austria are acting on interior lines, whereas we are on external lines. That is no answer. That fact simply affords an additional argument for unification of effort in order to overcome the natural advantages possessed by the foe.

You have only to summarize events to realize how many of the failures from which we have suffered are attributable to this one fundamental defect in the Allied war organization. We have won great victories. When I look at the appalling casualty lists I sometimes wish it had not been necessary to win so many. Still, on one important part of the land front we have more than held our own. We have driven the enemy back. On the sea front we have beaten him, in spite of the infamy of the submarine warfare. We have achieved a great deal; I believe we should already have achieved all if in time we had achieved unity.

There is one feature of this war which makes it unique among all the innumerable wars of the past. It is a siege of nations. The Allies are blockading two huge Empires. It would have been well for us if at all times we had thoroughly grasped that fact. In a siege not only must every part of the line of circumvallation be strong enough to resist the strongest attack which the besieged can bring to bear upon it; more than that, the besieging army must be ready to strike at the weakest point of the enemy, wherever that may be. Have we done so? Look at the facts.

The enemy was cut off by the Allied navies from all the rich lands beyond the seas, whence he had been drawing enormous stores of food and material. On the east he was blockaded by Russia, on the west by the armies of France, Britain, and Italy. But the south, the important south, with its gateway to the east, was left to be held by the forces of a small country with half the population of Belgium, its armies exhausted by the struggles of three wars and with two treacherous kings behind, lying in wait for an opportunity to knife it when it was engaged in defending itself against a mightier foe.

What was the result of this inconceivable blunder? What would any man whose mind was devoted to the examination of the whole, not merely to one part of the great battlefield, have expected to happen? Exactly what did happen. While we were hammering with the whole of our might at the impenetrable barrier in the west, the Central powers, feeling confident that we could not break through, threw their weight on that little country, crushed her resistance, opened the gate to the east, and unlocked great stores of corn, cattle, and minerals, yea, unlocked the door of hope—all essential to enable Germany to sustain her struggle.

Without these additional stores Germany might have failed to support her armies at full strength. Hundreds of thousands of splendid fighting material were added to the armies which Germany can control—added to her and lost to us. Turkey, which at that time had nearly exhausted its resources for war, cut off from the only possible sources of supply, was re-equipped and resuscitated and became once more a formidable military power, whose activities absorbed hundreds of thousands of our best men in order to enable us at all to retain our prestige in the east. By this fatuity this terrible war was given new life.

Why was this incredible blunder perpetrated? The answer is simple. Because it was no one’s business in particular to guard the gates of the Balkans.

The one front had not become a reality. France and England were absorbed in other spheres. Italy had her mind on the Carso. Russia had a 1,000-mile frontier to guard, and, even if she had not, she could not get through to help Serbia, because Rumania was neutral. It is true we sent forces to Salonika to rescue Serbia, but, as usual, they were sent too late. They were sent when the mischief was complete.

Half of those forces sent in time—nay, half the men who fell in the futile attempt to break through on the western front in September of that year—would have saved Serbia, would have saved the Balkans and completed the blockade of Germany.

You may say that is an old story. I wish it were. It is simply the first chapter of a serial which has been running to this hour. Nineteen fifteen was the year of tragedy for Serbia; 1916 was the year of tragedy for Rumania. The story is too fresh in our memories to make it necessary for me to recapitulate events. What am I to say? I have nothing but to say that it was the Serbian story almost without a variation. It is incredible when you think of the consequences to the Allied cause of the Rumanian defeat.

The rich corn and oil fields of Rumania passed to the foe. Germany was enabled to escape through to the harvest of 1917. The siege of the Central powers was once more raised and this horrible war was once more prolonged. This could not have happened if there had been some central authority whose responsibility was to think out the problem of war for the whole battlefield. But once again France and England had the whole of their strength engaged in the bloody assaults of the Somme, Italy was fighting for her life on the Carso, Russia was engaged in the Carpathians, and there was no authority whose concern it was to prepare measures in advance for averting the doom of Rumania.

If you want to appreciate thoroughly how we were waging four wars and not one, I will give you one fact to reflect upon. In 1916 we had the same conference in Paris and the same appearance of preparing one great strategic plan. But when the military power of Russia collapsed in March, what took place? If Europe had been treated as one battlefield you might have thought that when it was clear that a great army which was operating on one flank and [sic] could not come up in time, or even come into action at all, there would have been a change in strategy. Not in the least.

Their plans proceeded exactly as if nothing had occurred in Russia. Why? Because their plans were essentially independent of each other and not part of a strategic whole. You will forgive me for talking quite plainly because this is no time for concealing or for glossing over facts. War is preeminently a game where realities count. This is 1917. What has happened? I wish there had even been some variety in the character of the tragedy. But there has been the same disaster due to the same cause. Russia collapsed. Italy was menaced. The business of Russia is to look after her own front. It is the concern of Italy to look after her own war. “Am I my brother’s keeper?” Disastrous! Fatal! The Italian front is just as important to France and Britain as it was to Germany. Germany understood that in time. Unfortunately we did not.

It is no use minimizing the extent of the disaster. If you do, then you will never take adequate steps to repair it. When we advance a kilometre into the enemy’s lines, snatch a small shattered village out of his cruel grip, capture a few hundreds of his soldiers, we shout with unfeigned joy. And rightly so, for it is the symbol of our superiority over a boastful foe and a sure guarantee that in the end we can and shall win.

But what if we had advanced 50 kilometres beyond his lines and made 200,000 of his soldiers prisoners and taken 2,500 of his best guns, with enormous quantities of ammunition and stores? What print would we have for our headlines? Have you an idea how long it would take the arsenals of France and Great Britain to manufacture 2,500 guns?

At this moment the extent to which we can prevent this defeat from developing into a catastrophe depends upon the promptitude and completeness with which we break with our past and for the first time realize in action the essential unity of all the Allied fronts. I believe that we have at last learned this great lesson. That is the meaning of this superior council. If I am right in my conjectures then this council will be given real power, the efforts of the Allies will be co-ordinated, and victory will await valour. We shall then live to bless even the Italian disaster, for without it I do not believe it would have been possible to secure real unity. Prejudices and suspicions would have kept us apart. Had we learned this lesson even three months ago what a difference it would have made!

I must read to you a message which appeared in the Times three days ago from its Washington correspondent. It is a message of the first importance, for, in the words of an old English saying, “Outsiders see most of the game.” And these shrewd men in America, calmly observing, the course of events from a distance of thousands of miles, have come to conclusions which we would have done well to make ours years ago:

It is realized here that delicate questions of prestige exist between the great European nations engaged in the war, and that this militates against quick decisions and effective action when these are most needed. It is believed by some of President Wilson’s closest advisers that Germany owes much of her success in this war to her unity of control, which permits the full direction of all Teutonic efforts from Berlin. Indeed, it is felt here that unless the Allies can achieve a degree of co-ordination equal to that which has enabled Germany to score her striking, though perhaps ineffectual successes, she will be able to hold out far longer than otherwise would have been believed possible. American military experts believe that if the Allied help rushed to General Cadorna’s assistance to stem the tide of invasion had been thrown into the balance when Italy’s forces were within 40 miles of Laibach, the Allies would have been able to force the road to Vienna. Victory at Laibach would have spelled a new Austerlitz, and the magnitude of the prize almost within his grasp is believed here to have justified General Cadorna in taking the risk of advancing his centre too far and temporarily weakening his left flank. The lack of cooperation between France, Great Britain, and Italy is blamed here for the disaster which ensued, and which it is believed would not have occurred if one supreme military authority had directed the combined operations of the Allies with the sole aim of victory without regard to any other considerations.

You may say the American estimate of the possibilities of the Italian front for the Allies is too favourable. Why? It is not for me to express an opinion. I am but a civilian; but I am entitled to point out that the Austrian Army is certainly not better than the Italian. On the contrary, whenever there was a straight fight between the Italians and the Austrians the former invariably won. And the Germans are certainly no better than the British and French troops. When there has been a straight fight between them we have invariably defeated their best and most vaunted regiments. And as for the difficulties of getting there, what we have already accomplished in the course of the last few days is the best answer to that.

But now I will answer the other question: Why was not this said before and why was this not done before? I have said it before, and I have tried to do it before, and so have some of my French colleagues that I see here. For weeks, for months, for years, at committees, at conferences, at consultations, until I almost became weary of the attempt, I have written it where it may be read and will be read when the time comes. I should like to be able to read you the statement submitted to the conference in Rome in January about the perils and possibilities of the Italian front this year, so that you might judge it in the light of subsequent events. I feel confident that nothing could more convincingly demonstrate the opportunities which the Allies have lost through lack of combined thought and action.

We have latterly sought strenuously to improve matters by more frequent conferences and consultations, and there is no doubt that substantial improvement has been effected. As the result of that conference in Rome and the subsequent consultations, arrangements were made which shortened considerably the period within which aid could be given to Italy in the event of her being attacked. And if the tragedies of Serbia and Rumania are not to be repeated—and I feel assured that they will not, in spite of the very untoward circumstances—it will be because the preparations made as the result of the Rome conference have materially affected the situation. But if there had been real co-ordination of the military efforts of the Allies we should now have been engaged in Italy not in averting disaster from our Allies, but in inflicting disaster upon our enemies. That is why we have come to the conclusion that for the cumbrous and clumsy machinery of conferences there shall be substituted a permanent council whose duty it will be to survey the whole field of military endeavour with a view to determining where and how the resources of the Allies can be most effectually employed. Personally I have made up my mind that, unless some change were effected, I could no longer remain responsible for a war direction doomed to disaster for lack of unity.

The Italian disaster may yet save the alliance, for without it I do not believe that even now we should have set up a real council. National and professional traditions, prestige, and susceptibilities all conspired to render nugatory our best resolutions. There was no one in particular to blame. It was an inherent difficulty in getting so many independent nations, so many independent organizations, to merge all their individual idiosyncrasies and to act together as if they were one people. Now that we have set up this council our business is to see that the unity which it represents is a fact and not a fraud.

It is for this reason that I have spoken to-day with perhaps brutal frankness, at the risk of much misconception here and elsewhere, and perhaps at some risk of giving temporary encouragement to the foe. This council has been set up. It has started its work. But particularism will again reassert itself, because it represents permanent forces deeply entrenched in every political and military organization. And it is only by means of public opinion awakened to real danger that you can keep these narrow instincts and interests, with the narrow vision and outlook which they involve, from reasserting their dominance and once more plunging us into the course of action which produced the tragedies of Serbia and Rumania and has very nearly produced an even deeper tragedy for Italy. The war has been prolonged by sectionalism; it will be shortened by solidarity.

If this effort at achieving solidarity is made a reality, I have no doubt of the issue of the war. The weight of men, material, and moral, with all its meaning, is on our side. I say so, whatever may happen to, or in, Russia. I am not one of those who despair of Russia. A revolutionary Russia can never be anything but a menace to Hohenzollernism. But even if I were in despair of Russia, my faith in the ultimate triumph of the Allied cause would remain unshaken. The tried democracies of France, Great Britain, and Italy, with the aid of the mighty democracy of the West, must win in the end. Autocracy may be better for swift striking, but Freedom is the best stayer. We shall win, but I want to win as soon as possible. I want to win with as little sacrifice as possible. I want as many as possible of that splendid young manhood which has helped to win victory to live through to enjoy its fruits.

Unity—not sham unity, but real unity—is the only sure pathway to victory. The magnitude of the sacrifices made by the people of all the Allied countries ought to impel us to suppress all minor appeals in order to attain the common purpose of all this sacrifice. All personal, all sectional, considerations should be relentlessly suppressed. This is one of the greatest hours in the history of mankind. Let us not dishonor greatness with pettiness.

I have just returned from Italy, where I saw your fine troops marching cheerily to face their ancient foes, marching past battlefields where men of their race once upon a time wrought deeds which now constitute part of the romance of this old world—Arcole, Lodi, Marengo. We met the King of Italy on the battlefield of Solferino, and we there again saw French soldiers pass on to defend the freedom which their fathers helped to win with their blood. When I saw them in such environment I thought that France has a greater gift for sacrificing herself for human liberty than any nation in the world. And as I reflected on the sacrifices she had made in this war for the freedom of mankind I had a sob in my heart. You assembled here to-day must be proud that you have been called to be leaders of so great a people at so great an hour. And as one who sincerely loves France, you will forgive me for saying that I know that, in the discharge of your trust, you will in all things seek to be worthy of so glorious a land.

[Annex 2]

Procès-verbal of a Conference of the British War Cabinet and Heads of Government Departments with Certain Members of the Mission from the United States of America, Held at 10 Downing Street, SW., on Tuesday, November 20, 1917, at 11.30 a.m.

• Present:
  • Great Britain
    • The Prime Minister
    • The Rt. Hon. the Earl Curzon of Kedleston, K.G., G.C.S.I., G.C.I.E.
    • The Rt. Hon. the Viscount Milner, G.C.B., G.C.M.G.
    • The Rt. Hon. Sir E. Carson, K.C., M.P.
    • The Rt. Hon. A. Bonar Law, M.P.
    • The Rt. Hon. G. N. Barnes, M.P.
    • Lieut.-Gen. the Et. Hon. J. C. Smuts. K.C.
    • The Rt. Hon. A. J. Balfour, O.M., M.P., Secretary of State for Foreign Affairs
    • The Rt. Hon. Lord Robert Cecil, K.C., M.P., Minister of Blockade
    • The Rt. Hon. Sir E. Geddes, G.B.E., K.C.B., M.P., First Lord of the Admiralty
    • Admiral Sir J. R. Jellicoe, G.C.B., O.M., G.C.V.O., First Sea Lord and Chief of the Naval Staff
    • The Rt. Hon. the Earl of Derby, K.G., G.C.V.O., C.B., Secretary of State for War
    • Gen. Sir W. E. Robertson, G.C.B., K.C.V.O., D.S.O., Chief of the Imperial General Staff
    • The Rt. Hon. W. Long, M.P., Secretary of State for the Colonies
    • The Rt. Hon. Sir J. P. Maclay, Bart., Shipping Controller
    • The Rt. Hon. Sir A. Stanley, M.P., President of the Board of Trade
    • The Rt. Hon. Lord Rhondda
    • The Rt. Hon. A. Chamberlain, M.P.
    • Maj. J. L. Baird, C.M.G., D.S.O., M.P., Parliamentary Secretary to the Air Board
    • Sir L. Worthington Evans, Bart., M.P., Parliamentary Secretary to the Ministry of Munitions
    • Mr. P. Kerr
    • The Rt. Hon. the Viscount Reading, G.C.B., K.C.V.O.
    • The Lord Northcliffe
    • Sir Charles Gordon, Vice-Chairman to Lord Northcliffe’s Mission
    • Lieut.-Col. Campbell Stuart, Military Secretary to Lord Northcliffe’s Mission
  • United States of America
    • Admiral W. Shepherd Benson, U.S.N., Chief of Operations
    • Gen. Tasker Howard Bliss, U.S.N. [U. S. A.], Chief of Staff
    • Mr. Oscar Terry Crosby, Assistant Secretary of the Treasury
    • Mr. Vance C. McCormick, Chairman of the War Trade Board
    • Mr. Bainbridge Colby, Representative of the United States Shipping board
    • Dr. Alonzo E. Taylor, Representing United States Food Controller
    • Mr. Thomas Nelson Perkins, Representative of the United States War Industries and Priority Board
    • Mr. Paul D. Cravath, Legal Adviser to United States Treasury
    • Mr. Gordon Auchincloss, Assistant Counselor of the State Department and Secretary to the American Mission
    • Brig. Gen. W. Lassiter

• Lieut.-Col. Sir M.P.A. Hankey, K.C.B., Secretary
• Col. E. D. Swinton, C.B., D.S.O., Assistant Secretary
• Maj. L. Storr, Assistant Secretary

The Prime Minister. Gentlemen, perhaps you will allow me, on behalf of my colleagues, to welcome you, the representatives of an important American mission, to a meeting with the British War Cabinet. It is a very significant occasion were it not only for the place where the meeting takes place. I do not want to rake up the unpleasant past, a past especially unpleasant for us though not for you. It was in this room, I believe, that Lord North engineered some trouble for America, but a great deal more trouble for himself. It is a great source of delight and satisfaction that, in this very room where we committed a cardinal error, which has ever since been a lesson to us, a lesson which has borne fruit in the British Empire such as it is, that we should have representatives of your great country here to concert common action with us for the liberties of the world. This is purely a business gathering. You have come over to this country to do business, and I have heard from enquiries I have made from various departments how hard you have been working during the few days you have been here to transact your business with the various departments with which you are concerned.

You will permit me just to give a general sketch of where I think your great country could render most effective service, especially in the immediate future, to the cause to which it has committed itself. We have been three and a half years in this war; we had a great navy; we had a small army; and we were treading unaccustomed paths. We have made mistakes, as we were bound to make, because it was an unexplored country. That gives us an advantage in any conversation we may have with you who are just beginning now, as we were three and a half years ago. In fact, the conditions under which you are beginning are more like our own than those of any other Allied country. Others of our Allies had great armies. We had a small army, and we had to create out of nothing the very great army we have got at the present moment. Had we known as much then as we know now, it would have saved a great deal of time. Therefore, you have got the benefit of our experience, because you have witnessed the mistakes we have made.

I am sure you will forgive me if, from the point of view of one of the Ministers of this country who has been in office for three and a half years, I were to give you my views as to the best help which America can render, and give it more or less in the order of urgency. It is rather difficult to do this. All the things which are wanted for the efficient conduct of the campaign are urgent, because, naturally, the sooner you are ready, the sooner it will be over. But there are one or two things which are more urgent than others. After a good deal of consultation with my colleagues and our military and naval advisers, I should put man-power and shipping as the two first demands on your consideration. I am not quite sure which I will put first. I am not sure that you can put either of them before the other, because they are both of the most urgent importance; but if you will permit me, I should like to say a few words upon each.

Take first of all the question of sending men over into the battle line as soon as you can possibly train them and equip them. I will give you the reason why that is extremely urgent, and I do so after consultation with the Chief of the Imperial General Staff (Sir William Robertson), who supplied me with the necessary information. I need hardly tell you that this is a very confidential gathering, and, therefore, I am able to speak more freely than I would if I were present at a public gathering. The collapse of Russia and of Italy has changed the situation. There is in addition to that the failure in the man-power of France, which I will come to later. That is second. The two dominant factors are the collapse of these two great countries. I have not got the exact figures at the moment by me, but I have no doubt the Chief of the Imperial General Staff will supply them—the figures of the number of divisions held by Russia on the eastern front. I understand from the Chief of the Imperial General Staff that there are over 80 German divisions alone, equal to 1,800,000 men, on the eastern front. In addition the Russians are holding a very considerable number of Austrians as well. But you have chaos in Russia. The Russian military power has disappeared, and I do not know whether there is now anything to prevent the Germans going right through, except the fact that Russia is a difficult country to march into, and it is a bad time of the year. The Russians are much more concerned with their own troubles than with facing the foe, and with regard to one section of them, at all events, I am not at all sure that they are not better disposed to the Germans than they are to the Allies. In fact, there is much ground for suspicion that some of the leaders are more or less in the pay of Germans. That means that, at the moment, if Germany were either pressed on the west, or if Germany chose to exercise pressure on the west, either in Italy or in France, she could take certainly 30 or 40 of her best divisions and hurl them on the west without any detriment to her position in the east. That is the position in Russia.

The position in Italy is not as bad. The nation is fairly united there, but the Italian Army has lost pretty nearly half its equipment, certainly in guns. It has lost between 200,000 and 300,000 men, and it cannot stand up to the foe without very substantial assistance from France and England, and both these countries at the present moment are engaged in pouring into Italy as rapidly as the railways will carry them, some of the very best divisions from France and from Flanders. They have to do that, otherwise the whole of the Italian power will collapse and Italy might be ruled out of the war. The bearing of that you will see for yourselves. Then France herself is very largely exhausted. There will be a considerably fewer number of divisions next year than there are this year, and if you were to work the sum out it might work out something like this: that the Germans may be able to put 600,000 more men on to the French and Flanders front next year and we might have 600,000 fewer men. There is a superiority at the present moment on the western front. Should that change take place, you might not merely wipe out that superiority, but you might have a distinct inferiority in the number of Allied troops confronting the Germans in the west. That shows that it is a matter of the most urgent and immediate importance that you should send to Europe next year, and as early next year as possible, as many men as you can spare, to enable us to withstand any possible German attack, apart altogether from the’ possibility of inflicting any defeat upon them. It is better that I should put the facts quite frankly to you, because there is a danger that you might think you can work up your army at leisure, and that it does not matter whether your troops are there in 1918 or 1919. But I want you to understand that it might make the most vital difference. So much for the question of man-power. You can see why I am putting that almost in the forefront.

The next point is shipping. It is obvious that it is no use having men and guns and equipment unless there are ships to carry these men and their supplies across the ocean. Our position next year will be that certainly we cannot spare a single ton to assist you in transport, and I will tell you the reason why. Not only shall we be unable to assist you in transport, but Italy and France will be crying out for more help, and you and ourselves, somehow or other, will have to do our best to try and help them. I tried to get the figures this morning. The Shipping Controller is here, and he will tell me if this figure is correct. Sixty per cent of our shipping is engaged on war service, on purely war service, for ourselves and our Allies. In order to show the extent to which we are helping the Allies, 2,600,000 tons of our shipping is devoted exclusively to helping the Allies—France, Russia, and Italy—more especially France, and half the time of 2,300,000 tons of shipping as well. Now, we are a country more dependent on imports than probably any other great country in the world. It is a very small country—as you have probably observed in crossing—a very small country, and a very thickly populated country. We only grow about one-fifth of the wheat we consume. We are dependent on what we get from overseas for the rest. I am not sure if we cultivated every yard here that we could be self-supporting. We might. The climate is an uncertain one, and if you had a very good harvest you might; on the other hand, you might not get a good harvest. Taking the barest essentials not merely of life, but of war, we have also to import a good deal of our ore and other essential’ commodities. Further, our exports have almost vanished, except war exports. I should like our American friends to realise this, that the trade of this country is largely an international trade. We manufactured for the world, and we carried especially for the world, and we did a good deal of financing for the world; that is practically gone. We have stripped to the waist for war. Such exports as there are we have only kept alive, because they are essential in order to enable us to finance certain essential imports in certain parts of the world. Our trade, you might almost say, has completely gone except in so far as it is essential to war. We were very dependent upon our shipping, not for bringing goods here, but because it was part of our business. The business of the big shipowners was part of the business of this country, and we carried for ourselves and we carried for other lands. There were ships of ours which never came home to this country. We were a people who lent ships and traded in ships. Now the Shipping Controller has brought them home from every part of the world. Why? We have been getting rid of our business, because we want it for war and to help not merely ourselves, but to help our Allies. I am not sure it is sufficiently realised outside—the extent to which we have put our trade, as it were, into the war. We have risked it all on this great venture.

As for imports, our imports the year before the war were 54,000,000 tons. This year they will be 34,000,000 tons. Next year we must bring them down to 26,000,000 tons; that is, our imports will be about half what they were the year before the war. But what will these imports be? They will only be imports essential for food, for clothing, and for the munitions of war. We are cutting down everything else. Luxury has gone, as far as imports are concerned, and next year we shall probably find it necessary to cut down even our food imports by 2,500,000 tons, and I am afraid we shall probably have to cut down our munition imports by 1,500,000 tons, because, though we are getting the submarine under and are doing our best to build as hard as we can, still the losses up to the present have greatly exceeded the gains. The losses of our Allies have been very heavy also, and neutral shipping, upon which we were dependent to a considerable extent, has suffered severely—has suffered more severely in proportion to the number of ships put to sea, because they are not in our system of defence, and therefore they are just like sheep for the slaughter. They are there without any protection at all. The result is we shall have to cut down what this year we thought was a minimum, by several millions, and we are prepared to do it. We shall have to ration, not so much for ourselves, but because the French production of food is down to 40 per cent of what it was before the war, for the simple reason that the peasants who cultivated the soil are now shouldering the rifle instead of following the plough. They are defending their land, and the land is meanwhile getting weedy because the men are not there. The women are doing their best in France, the old women and the children are working, but the soil is getting impoverished, and therefore we have got to pool our luck. We could have got through with stricter rationing ourselves, but we cannot do it, because we have to divert our wheat in order to save the French and save the Italians—to save the Italians from actual privation.

I met the correspondent of the Times in Paris the other day, and he said to me: “I have just been through parts of France. I went to a village where they had had no bread for days.” If that had happened here, Lord Rhondda’s head would have been put on a charger, and probably mine with it too. The only remark that this correspondent had heard was: “Well, we are very patient people.” As M. Clemenceau remarked to me, that is the reason why we have revolutions in France, which is a very shrewd observation. They are very patient people really, in spite of their occasional outbursts. They are holding on with great fortitude, and there is not a single thought of giving in. The government that proposed to give in would not last twenty-four hours. In spite of the gigantic losses they have sustained, and of the privations they are facing, France is as resolute and determined as she ever was. We feel it an honour to pool our luck with her, and we have agreed to do it.

Now what does all this involve in the way of shipping? It means that we should do as much as we can in the way of shipbuilding, and it means that you have to do more. You are an infinitely bigger industrial country than we are, and what the United States can do when she really takes anything in hand, is something which will, I think, astonish the world, and we should very much like it if your great country can add next year 6,000,000 tons to the shipping of the world. And taking your resources into account, the readiness with which you adapt yourselves to new conditions, your great gift of organisation, and your unlimited production of steel, I should have thought that that was something which you could achieve.

Under this head the other thing we would press you for is that you should supply us, if you can, with 2,000 tons a month of steel plates, and if you could also help Canada with steel plates and also help to finance her shipbuilding. Then she could contribute very materially to the output of shipping.

To summarise what I have said as to the most important spheres in which the United States can help in the war. The first is that you should help France and her Allies in the battle line with as many men as you can possibly train and equip at the earliest possible moment, so as to be able to sustain the brunt of any German attack in the course of the next year; and the next point is that you should assist to make up the deficit in the shipbuilding tonnage of the year by extending your yards and increasing shipbuilding at an unexampled rate.

Just one word about the Navy. May I here say how much we are indebted to the United States Navy for the prompt assistance which it rendered earlier this year in helping to combat the submarine menace, and the success which has been achieved in dealing with that menace is attributable in no small measure to the most effective assistance which the Navy of the United States rendered at a critical juncture. I want to tell you how invaluable your torpedo-boat destroyers and other craft have been, not merely in protecting ships, but in helping to keep this menace under. I understand that you are building on a very great scale. I have no doubt at all that Admiral Jellicoe has already given to Admiral Benson his views as to the priority, and as to the relative urgency of the various craft which he is very anxious the United States of America should bring to the common stock—destroyers or craft for submarine work, mines and minelayers, and so on, down to light cruisers.

There are only one or two other points which I should like to mention. One is on the subject of aeroplanes. Anybody who has watched the war from the commencement of this campaign must realise how vital the command of the air is to us. In the battle line it is as essential as the command of the sea. If we lose the command of the air our artillery becomes ineffective, and although I do not mean to say that we should not hold our own—we should hold our own to a very considerable extent—anything in the nature of progress, of beating the enemy and driving him back, would be absolutely impossible, and therefore the command of the air is essential to victory. We have managed to more than hold our own, but with great difficulty. The manufacturing resources of France, and of England, and of Italy have been strained to the very utmost. Germany is undoubtedly, according to our information, making the most prodigious effort. Their airmen are becoming more enterprising, and it looks as if they were making a real effort to wrest the command of the air out of the hands of the Allies, because they understand how very important it is in this struggle. You have undoubted advantages in the creation of a great air fleet. One is your great manufacturing resources. I understand that you have invented a very efficient machine. Not merely have you got very great advantages in your manufacturing resources, but I think you have very great qualifications in the equipping of your machines. Your people have got more, I think, than the usual share of enterprise and of daring, which are essential qualities in a successful airman. I should have thought that an American naturally would make a first-class fighter in the air, because of those qualities of enterprise and dash and daring which are associated with your race, and which you have displayed on so many battlefields both in peace and in war. The other point is that your climate lends itself more to an air service than ours. There are not so many days in the year that we can go up here. Ours is a much more uncertain climate. You have all sorts and varieties of climates: where the climate is bad in the North, it may be good in the South and the East and the West. You have a greater choice in that respect for your training grounds. We are depending very largely upon what you are going to do with regard to aviation. In this respect very great hopes have been aroused, in all the Allied countries, and I would very respectfully urge that you should turn out the maximum output of aeroplanes which your ships can carry, consistent with transporting the largest possible number of men for the Army, which is first in urgency because with the aviators of France, and of England, and of Italy, and of America we shall then gain the command of the air. I do not believe Germany can ever recover if once she loses the command of the air. There is nothing which will more assuredly seal her fate than that.

The next point is guns. I need hardly dwell upon the importance of equipping your Army with guns. Those of you who have been watching the campaign, notably in Flanders, will realise that guns are essential to any progress. We require an overwhelming mass of artillery, which is the only means by which your men can advance without the most hopeless slaughter. The more guns the fewer casualties, because they destroy the protection which the Germans have set up for their machine-gun men.

May I just say one word about food for the Allies? We are depending very largely on your great country for keeping the populations of these Allied countries in Europe alive. Our grain fields one by one have disappeared. Russia, as a grain field, does not exist, because you cannot get the grain away. Most of her grain has to leave through the Black Sea, but that is now closed. We were very dependent on Russia, especially in the summer season. Australia, although she has plenty of grain, it is not available, because of the enormous distance which we have got to send our ships, and we cannot afford to do that. Therefore, we are very dependent upon the United States of America and Canada, both in France and in this country. India is available, to a certain extent, for the feeding of Italy, but not altogether.

We owe you very considerable gratitude already for the help you have given us in financing the war, and for the very effective assistance you have rendered with regard to the blockade—a most important part. But I have no doubt you can render us very much more assistance in the future. Anything in the nature of economic war against Germany is impossible without the active cooperation of the United States of America. With the help of the United States of America, I think we can make it an effective instrument for the destruction of the power of this combination which has organised its resources against the liberties of the world.

I thank you very much for listening to what I have to say. I thank you still more for the effective assistance which you are rendering; for the eagerness and the earnestness with which you are throwing yourself into this great task; and I have no doubt that the United States of America, France, Italy, and ourselves, and I hope eventually, Russia—the great democracies—marching shoulder to shoulder will be able to achieve their goal—the liberty of the world. I thank you very much.

Admiral Benson. I wish to thank you for the warm reception that we have received, and for the very generous attention which has been paid to us since we have been here. We appreciate fully the opportunity given us to meet this powerful body in this historic room. Whatever may be the historical deeds to which you have referred, I am sure that we are all agreed that their execution was bread cast upon the waters, as we are now come, with all the strength and vigour of the young and matured manhood, and with the experience reaped from the development of our own great country, we come to you with a strong feeling and desire to do all that is possible for the freedom of the world so that everyone may exercise the right of life, liberty, and the pursuit of happiness. We particularly appreciate the necessity for the freedom of the seas. In order that the various countries of the world may carry on their trade and may be of real assistance to each other, there must be free communication, and that communication can only be carried on through the freedom of the seas.

Our mission represents various departments of our Government, and during our stay here we have each taken up, with representatives of your Government, the subject that he has in hand, and we have all received the most careful consideration and attention. Everything has been thrown open to us to give us a true and correct idea of the situation as it exists, and as far as possible you have given us the result of your experiences gained during the past three and one-half years. We have also, at home, followed as closely as possible the events as they have occurred during the progress of the war, and I believe a great many of us have felt that, sooner or later, we would come into it, and we have tried, as far as circumstances would permit, to anticipate and be prepared for it. Of course, we are unprepared in many forms of equipment. But the time has come when we feel that we must get closer together, and we must follow a definite line.

I think that most members of the mission have possibly as much as they can get in the way of information, and now we feel that if we can get a definite plan for the future, and the methods in which these plans will be executed, I can assure you that our country is heart and soul in this war. None of our resources will be spared, our men, or our ships. Our country is absolutely united behind the President in this cause. I think I am justified in saying there is no exception anywhere. All sections of our country are absolutely united, not only united, but willing and glad to throw all of our resources into the struggle, and all that they want to know is: What is to be done? and feel assured that the plans that are being adopted are the best for the object to be attained. With that idea in view we are utilising our resources as far as we can. We are building ships as fast as our resources will permit. We are, of course, giving priority in our shipbuilding to the construction of destroyers, and we hope, within the next eighteen months, to have at least 267 of these vessels to add to the fleet. We are building 103 submarines, and hope to increase that number when the facilities will permit. Next in importance to the building of destroyers we are giving everything up to the construction of ships for the purpose of carrying cargo. We have practically given up the construction of capital ships, except those which are already under construction.

We are making now in our country what we believe to be the necessary sacrifices or restrictions in regard to food in order that we may have a larger quantity to be shipped abroad to the various Allies. I think it would be hard for you to realise, bearing in mind the great distance from the real scene of action, and without the actual experience, the willingness, and the completeness of the sacrifices that the American people are making for the common cause.

In regard to aircraft, the promise of results in that line is very great, and we hope in January to be turning them out by hundreds per month, and by May or June by the thousand. We have developed an aircraft motor which experiments show to be even better than we anticipated. The reports received since we have been in London from the other side indicate that not only the shop experiments, but the trials with the motor in the air, surpass anything we anticipated. It is the “Liberty” motor. We are, of course, utilising all the suitable mechanical plants and industries of our country for this purpose, and we hope that by May or June we will be turning out several thousand aircraft per month.

With regard to guns and other equipment, we are, of course, building them in large quantities, especially the small type of guns, 4-inch and 5-inch for mounting on ships, in particular the large-size destroyers, which are good, seaworthy vessels, and have a speed of 35 knots. I have received a message this morning that one of these vessels will be dispatched within a few days to this side. The trials have been most satisfactory in every way.

We are handicapped to a great extent by the lack of forgings, but that situation will be greatly improved later on. In order to increase our output in all the various requirements for this war, the United States Government has expended immense sums of money in duplicating or increasing very largely all the various kinds of plants. Millions of dollars have been spent in building up shops and foundries, and where the private companies were not able to meet the situation the Government has come to the rescue in order that all our material and all our mechanics might be utilised to the utmost in producing what was required. Nothing has been left undone to put into proper shape all our resources, and I think there can be no question in regard to that. I would like you to feel, and I would like to impress upon you as earnestly as I can, the sincere and earnest feeling there is in our country, and the unanimity and the firm resolution, to hold on until the very last. I appreciate the great honour I have of addressing this body, and of meeting in this room. I thank you for the cordiality of our reception.

Lord Derby, in reference to Admiral Benson’s statement, in which he referred to the fact that 4,300 aeroplanes per month would be produced by June, 1918, enquired if pilots would also be trained for that number of machines.

Admiral Benson stated that this was so, and explained that several training camps were under construction, which would enable the output of trained airmen to be still further increased. He instanced that upwards of 2,000 aviators were being trained in France, where 10 stations were being established, while 5 were being installed in the United Kingdom.

Lord Curzon enquired if the figure of 4,300 implied complete machines with engines and all fittings.

Admiral Benson stated that this was so.

Mr. Barnes asked Admiral Benson if the figures in regard to carrying ships were promising.

Admiral Benson said that it was quite recognised that the principal factor in the whole of American cooperation was that of shipping, and that without ships it was impossible for men or material to be transported from the United States. For details he referred to Mr. Colby, who had full information on the subject.

Mr. Colby asked if information was required as to tonnage actually under construction.

Mr. Barnes explained that, what he wanted to know was, what amount of tonnage would be available for the common pool, say, in two months’, three months’, and four months’ time.

Mr. Colby stated that according to the most recent estimate he had received, by May, 1918, the output of ships per month would be 300,000 tons gross, while by the 31st December, 1918, the total amount of shipping completed would amount to 4,600,000 tons deadweight. By May, 1919, this total would rise to 6,104,000 tons dead-weight.

Mr. Barnes said that, as regards the more immediate problem to be faced, he would like to know the figures for the month of May, 1918.

Mr. Colby, in reply, stated that by the 1st March, 1918, there would be launched 754,000 tons dead-weight (equivalent approximately to 500,000 tons gross). To express the future in terms of vessels, the following was the estimate of output:

		Vessels
November	1917	14
December	“	27
January	1918	33
February	“	36
March	“	39
April	“	55
May	“	69
June	“	99
July	“	116

He agreed with Admiral Benson that the main problem was how to cope with the shortage of tonnage, both for individual, national and joint needs, and it was a mere truism to say that every need or necessity finally could be reduced to the question of tonnage. It was impossible to send over steel for construction, men to fight, or grain to feed the men, without shipping. He pointed out that the tonnage at the disposal of the United States Army at the moment amounted to 850,000 tons, whilst that at the disposal of the United States Navy was 150,000.

Mr. Balfour asked how many men the United States Government would be able to put in the field of operations in France.

Mr. Colby replied that by the 15th January, 1918, there would have been conveyed to France one Army corps, in addition to the United States troops already in that country, but that this Army corps would not be completely equipped and would not have all its transport animals. According to his estimate, the tonnage available would enable the United States to maintain 220,000 men in France.

Mr. Bonar Law enquired to what extent shipping had been taken away from the ordinary trade of the United States.

Mr. Colby replied that as much tonnage had been diverted from the trade of the country as had been the case in Great Britain, in fact, as much as it had been possible to divert. Of course, some trades were essentially war trades, which could not well be cut down, such as the import of nitrate, which was used for explosives, and the export of certain commodities for the maintenance of credit essential to the purchase of war necessities; but with the exception of maintaining such war trades the United States Government was making absolutely no effort to keep up the general trade of the country. Mr. Colby instanced the fact that the United States had relinquished a great portion of their Pacific trade to the Japanese, and had indeed transferred a steamship line, which ran to Hawaii, to the Atlantic. There were only two sources from which tonnage could be drawn at the present timer—

(a) That belonging to neutrals;

(b) Enemy tonnage interned in South America.

The only other method of obtaining ships was to build them. From the information he had received from the departments in this country, he gathered that the British were constructing from 125,000 to 150,000 gross tons per month, whilst in the United States they expected to attain a total of 300,000 gross tons per month. Combined, the two countries would eventually produce 475,000 gross tons per month. This did not seem to be in excess of the destruction being effected by submarines, and he felt that for some time at least, the action of enemy submarines must reduce the amount of tonnage available.

Lord Milner drew attention to the fact that the estimate of future losses by submarines was excessive, and in calculations recently made by a committee, of which he was chairman, the average of the figures for September and October had been taken as holding good for the future, giving an average for British losses of 225,000 gross tons per month.

Mr. Colby said that, in regard to the subject of the employment of neutral tonnage, there seemed to be some lack of perception between the authorities at Washington and the Ministry of Shipping in London. In mentioning this he did not wish it to be thought that there was on his part any suggestion of disapproval or criticism of the action of the Minister of Shipping, from whom he had received the greatest friendliness and the maximum of information on all points, but he considered that there was a lack of mutual understanding as to the proper handling of the problem, which might be remedied with great advantage. In the United States they were holding a number of neutral ships belonging to Norway, Holland, and Denmark, and the High Commissioners for those countries in the United States were busy negotiating in reference to the release of these ships and the relaxation of the Allies’ embargo. At the same time the British Government had concluded separate arrangements with the Governments of Norway, Holland, and Denmark. The result was that there was some misunderstanding between the United States and British Governments, which was the cause of great delay in obtaining the use of this neutral shipping, which, at the present juncture, was a vital matter. Mr. Colby instanced that there were 400,000 tons of Dutch shipping alone, which had been lying idle in New York Harbour since July. He suggested, as a practical measure whereby the Allies might at once make use of this tonnage, that a pool for all neutral ships should be formed, from which the British and United States Governments should each take 50 per cent. Having agreed upon this decision, the two Governments could afterwards discuss the actual employment of the tonnage so placed at their disposal.

Lord Reading enquired what amount of neutral tonnage was being employed by the United States Government, apart from the ships which were lying idle in American ports.

Mr. Colby explained that there was a certain amount, but the charters of these vessels would shortly expire.

Mr. Balfour reminded the conference that the subject of imports touched upon that of blockade, and suggested that Lord Robert Cecil should give his opinion on the subject.

Lord Robert Cecil said that he was in agreement generally with the views set forth by Mr. Colby, but he went further, and thought that a partial solution of the shipping problem was that the whole of the tonnage available to the Allies should be employed in common. As regards Norway, Mr. Colby’s statement was correct. As to the agreement with Holland and Denmark, that touched upon a very small part of the whole subject. In regard to the greater part, he hoped that the United States Government would assist the British Government by requisitioning the Dutch tonnage in United States harbours. He considered that the tonnage situation at present was vital, and the question of the provision of ships to carry on during the next two or three months governed everything. He much regretted that there should have been any misunderstanding, but agreed that there was some suspicion on both sides that each country was inclined to look to its own future instead of the future of the alliance. He submitted that there was only one way in which the matter could be dealt with satisfactorily, and that was the whole tonnage of the world should be pooled and all devoted to the essential purposes of the war.

The Prime Minister asked if Lord Robert Cecil meant all shipping.

Lord Robert Cecil replied that he did, and that there should be international cooperation of the nature alluded to by the Prime Minister in his speech of the previous day in regard to the military sphere of operations. He considered that whole-hearted cooperation was even more important economically than it was militarily.

Mr. Balfour asked if there was not some slight contradiction in terms between what were known as the blockade and tonnage policies.

Lord Robert Cecil agreed that there was. He said that the question was one of vital importance from the blockade point of view, since it was necessary to put pressure upon neutrals to prevent them sending supplies to Germany. If the power in the possession of the United States was employed to get tonnage from neutrals and nothing else, the chance of using that weapon to make the blockade more effective would disappear. He did not regard the importation of food into Germany as being so serious as the import of minerals, which, from Norway and Sweden, was of great assistance to the Central powers. He did not think that the power to reduce these imports should be sacrificed to obtain tonnage merely without further trade restrictions.

Sir Joseph Maclay gave his opinion that there was really no serious disagreement in regard to tonnage between the views of the British and United States Governments, and that there would be no difficulty in adjusting whatever misunderstandings existed. He agreed that there had been some mutual suspicion, but he thought that he had satisfied Mr. Colby as to the bona fides of the British, giving as an example the case of the employment of ships going East to carry goods. In regard to the pooling of all shipping, there was a distinct difference of opinion, and he had gathered that Mr. Colby was against the formation of an inter-Allied pool, and in favour of close cooperation in working. It was not to be forgotten that it was not merely a matter between Great Britain and the United States, but that France and Italy were also concerned.

Mr. Colby said that he agreed in the desirability of establishing a pool, but did not think that it was a practical proposition. He thought that the only practical step was to establish a shipping board in New York and a shipping board in London, which would be connected by a cable commandeered for their use alone. These boards would work in intimate touch with each other, and, by their mutual action, unity of direction in all problems of the employment of ships would be established. He considered that otherwise, if a pool were established, the surrender of ships by one nation to another would be both unpalatable and difficult. In regard to neutral tonnage, he was quite sympathetic to Sir Joseph Maclay’s point of view, having experienced similar difficulties on the other side of the Atlantic. He thought that it would be reassuring to the United States if a termination could be put to a discussion which had continued for months by sweeping away the whole question of neutral tonnage by a mutual declaration that Great Britain should take one half of what was available and the United States keep the other half. He considered that the arrangement in regard to Danish and Dutch tonnage was weak. The main thing, in his opinion, was to avoid delay in employing the vessels.

Mr. Barnes asked how much neutral tonnage there was in the United States ports.

Mr. Colby informed the conference that there were approximately 750,000 gross tons of neutral shipping in the United States ports, as much as was at the disposal of the United States military authorities, or would be constructed in the United States by April, 1918.

Mr. McCormick, as an instance of the efforts being made by the United States Government to obtain tonnage, quoted the case of the negotiations which had been proceeding between the United States and Japan in regard to an exchange of steel plates, which were badly required by Japan for Japanese shipping to be employed in the Atlantic trade. In regard to the suspicions which had existed in the matter of the employment of British ships, he quoted the case of the Blue Funnel Line, which had been employed in the Pacific. As to policy, he agreed with the views of Lord Robert Cecil, and thought that it was essential for both sides to put all the cards on the table and treat the shipping problem as a whole. If it were to devolve upon the United States to transport and maintain their army in Europe, he could quite understand the desire of the United States Shipping Board to retain one-half the Norwegian shipping. For them the alternative to obtaining tonnage from outside was to maintain a small army alone. In regard to the maintenance of 1,000,000 men, however, neutral tonnage played a very small part.

Sir Joseph Maclay explained that the reason why the vessels of the Blue Funnel Line, which originally ran to Vancouver, had been employed in the Eastern seas, was that they had been sent out to convey coolies from China to France, which was a war purpose, and not a trade operation.

Mr. McCormick instanced this explanation, which he at once accepted, as an example of how easily such questions would be settled if a joint organisation to handle the subject of shipping existed.

The Prime Minister gathered that there was still some difference of opinion, and considered, if that were the case, that the matter should be cleared up once and for all before the United States mission left the country, and proposed that a small committee should meet that afternoon to consider the matter.

It was decided that—

A committee should meet at 4 o’clock that afternoon to consider and settle the question of the best use to be made of the neutral shipping available to the Allies, this committee to be composed as follows:

Lord Curzon	Mr. McCormick
Lord Milner	Mr. Colby
Lord Robert Cecil	Dr. Taylor
Sir Joseph Maclay	Mr. Perkins
Capt. Clement Jones (Secretary)

Lord Northcliffe pointed out to the conference that he had been in the United States for five months, and quite agreed that there had been considerable suspicion as to our motives. He considered that it was natural that such suspicions should exist, if it were borne in mind how far removed from the war the inhabitants of the United States were and how ignorant of the war they were—very largely owing to the fact that they were not supplied with information and facts from this side. He was therefore not surprised that there was not full appreciation of the great extent to which the trades of the British Empire had been sacrificed for war purposes. He suggested, as a practical and partial measure, that Sir Albert Stanley should meet the members of the United States mission before they left London and explain to them categorically how many British trades had been absolutely killed owing to the necessity of conducting the war.

Mr. Crosby agreed that possibly the public in the United States did not understand the situation, but those responsible did. He added that for many reasons the United States Government, especially the Treasury, would have preferred that these trades, for economic reasons, had not been killed.

Mr. Balfour pointed out that within the reference to the small committee just appointed to consider the best use to be made of neutral shipping would come the question of exchanging for other advantages the present power of the United States to enforce an embargo.

Mr. Colby alluded to the fact that the Danish agreement had been subscribed to by Great Britain, France, and the United States, and that it amounted to a 50-50 proposition. The matter had been settled, but the settlement was now held up—not owing to any difficulties between Norway and the United States, but owing to difficulties between Great Britain and the United States.

Lord Robert Cecil was of opinion that the United States Government were so anxious about neutral tonnage that they were desirous of getting it at all costs.

2, Whitehall Gardens, S. W.,
November 20, 1917.

Report of the Representative of the Navy Department ( Benson)

1. The following is a brief summary of what I believe to have been accomplished from a strictly naval point of view during the visit of the mission to Europe:

(a) Decision to send division of battleships to join British Grand Fleet immediately.

(b) Tentative agreement to send entire Atlantic Fleet to European waters in the spring provided conditions warrant such action.

(c) A joint decision to undertake with the British the closing of the North Sea by establishing and maintaining a mine barrage.

(d) An assurance by the British Government that the Straits of Dover will be efficiently closed, and that steps will be taken immediately with this object in view.

(e) Decision upon a definite plan of offensive operations in which our forces will participate in the near future.

(f) The practical abandonment of the office of naval attaché in London during the war and the ordering of the commander of the U.S. Naval Forces Operating in European Waters as naval attaché in addition to present duties. Decision to follow a similar course in France.

(g) Agreement entered into with British Admiralty which permits the officer commanding the U.S. Naval Forces Operating in European Waters to attend the morning conference in Admiralty.

(h) An agreement to have three of our officers detailed for duty in the planning section of the British Admiralty in order to secure closer cooperation and in order that we may have full information at all times as to just what plan of operations the British Admiralty may be considering.

(i) The formation of the Inter-Allied Naval Council.

(j) Discovery of the necessity for and the decision to reorganize our naval forces in France so as to properly administer the several fields of naval activity and so coordinate their work that the maximum efficiency may be obtained. The ports of Brest, St. Nazaire, and Bordeaux will be separately administered, so far as the Navy is concerned, and will be coordinated under the command of the senior naval officer in France.

(k) Decision to organize an efficient secret service along the French coast in order to reduce the activity of enemy spies to a minimum and thereby provide for the safety of our ships and the security of the lives of our nationals.

2. As the result of my intimate contact with the general situation abroad, and particularly with the naval phase of it, I recommend the following:

• First: That steps be taken to increase our patrol and escort forces in France. In order to accomplish this and in order to supply destroyers for operations in which we should participate in the North Sea our destroyer building program should be hastened in every possible way.
• Second: That every effort be made to push to completion the necessary material for naval aviation and the training of the necessary personnel for aggressive operations with the British against the enemy in accordance with plans agreed upon. Offensive operations in the air I consider a necessary preliminary to other forms of naval offensive against enemy bases.
• Third: That steps be taken to establish an efficient naval advance base in the Azores.
• Fourth: That steps be taken immediately to increase the port facilities for handling ships and for discharging cargoes and troops at all of the French ports which we propose using.
• Fifth: That a coordinate plan satisfactory to the War Department, the Navy Department, and other interested departments of the Government be drawn up which will provide for the efficient administration of the French ports which we propose using, and further, that once this plan is decided upon it be issued in the form of an Executive order for the guidance of all concerned.

3. My investigations and studies of the situation in England and France, and the opinion which I have reached as the result of conferences with the naval representatives of Italy in Paris, convince me that we can expect no additional naval assistance whatever from the continental European Allies. I have been unable to escape the conviction that all countries opposed to Germany in this war, except ourselves, are jealous and suspicious of one another. They believe, however, in the sincerity and unselfishness of the United States; and feeling thus, they are not only willing for the United States to take the lead in matters which affect our common cause; but they are really anxious that we should dominate the entire Allied situation, both as regards active belligerent operations against the enemy, and economically. From intimate contact with the actual war operations and from a knowledge of the European situation which is based upon secret and what I consider reliable information, I am convinced of the possibility of the burden of the entire war sooner or later devolving upon the United States and Great Britain—and this practically means the United States. With these facts before me I feel that every form of assistance which the United States can give to any or all of the Allies to sustain them in such a manner that they can continue the war means a continuation of the war (so far as we are concerned) on foreign soil; and geographically advantageous to ourselves. In addition it means that every day that we can keep any of the European Allies in the war, just so much of the burden is being borne by that ally which otherwise would have to be borne by ourselves.

4. For this reason I believe that no time should be lost nor should any effort be spared to assist all the Allies at the earliest possible date and to the utmost extent by any means which will help towards the prosecution of the war.

5. In order for us to efficiently render assistance to the Allied cause in keeping with our resources and expressed determination a logical administration of tonnage having in view the defeat of Germany is imperative. It matters not what flag any ship or ships may sail under provided they are engaged in carrying out well-defined plans for the accomplishment of the above purpose which meet with the approval of the several Governments concerned.

W. S. Benson
Admiral, U. S. Navy Chief of Naval Operations

On Board U.S.S. “Mt. Vernon”,
December 14, 1917.

Report of the Representative of the War Department ( Bliss)

After conferences extending over approximately thirty days with the Chiefs of Staff, members of the General Staffs and Commanders in Chief of the Allied armies on the western front, as well as with the highest civil officials of their respective Governments, the following are my conclusions and recommendations as to the military situation and as to the military demands upon the resources of the United States with which the latter must make every effort to comply.

Conclusions

1. A military crisis is to be apprehended culminating not later than the end of the next spring, in which, without great assistance from the United States, the advantage will probably lie with the Central powers.

2. This crisis is largely due to the collapse of Russia as a military factor and to the recent disaster in Italy. But it is also largely due to lack of military coordination, lack of unity of control on the part of the Allied forces in the field.

3. This lack of unity of control results from military jealousy and suspicion as to ultimate national aims.

4. Our allies urge us to profit by their experience in three and a half years of war; to adopt the organization, the types of artillery, tanks, etc., that the test of war has proved to be satisfactory. We should go further. In making the great military effort now demanded of us we should also demand as a prior condition that our allies also profit by the experience of three and a half years of war in the matter of absolute unity of military control. National jealousies and suspicions and susceptibilities of national temperament must be put aside in favor of this unified control, even going if necessary (as I believe it is) to the limit of unified command. Otherwise, our dead and theirs may have died in vain.

5. The securing of this unified control, even unified command in the last resort, is within the power of the President if it is in anyone’s power. The military men of the Allies admit its necessity and are ready for it. They object to Mr. Lloyd George’s plan of Rapallo (which, however, I would accept if nothing better can be done) for the reason that, on last analysis, it gives political and not military control. I asked Sir Douglas Haig and General Robertson what would happen if the military advisers of the Supreme War Council recommended and the Prime Ministers accepted a military plan which the British Commanders in Chief in the field and the Chief of Staff did not approve. They said that it would be impossible to carry it into execution without their approval; that they would have to be relieved and the advisers to the Supreme War Council put in control. In the present temper of the English people such an issue could not be forced without the probable defeat of the Government. In general, they hold that the problem now is a military one and that in some way unity of control must be obtained through an unhampered military council.

The difficulty will come with the political men. They have a feeling that military men, uncontrolled, may direct military movements counter to ultimate political interests. They do not fully realize that now the only problem is to beat the Central powers. They are thinking too much of what they want to do after the Central powers are beaten. They do not realize, as the Central powers do, that national troops as a body can only be efficiently employed in the direction in which national interests lie, with, in this war, the sole exception of our troops which will fight best where they get the best military results. There need be no political fear that great bodies of English or French troops will be “switched off” to help the territorial aspirations of the Italians, nor vice versa. It is not merely a political necessity, it is also a military one which any commander in chief must recognize, that the English Army must fight with its back to the Channel, the French Army must fight with its back to Paris, the Italian Army must continue to fight Austria in the only direction by which it can reach her. This does not prevent troops of any of the four—English, French, Americans, Italians—being detached in accord with some coordinated plan from their main army where they are less needed to operate on another part of the front where they are more needed. The English failure to accomplish results at Cambrai in the last days of November was likely due to lack of reserves which might have been thus furnished.

But, even as to the political men, I think they may now be ready to yield to intelligent pressure. Probably no English or French Premier could, of his own motion, propose what would look to the man on the street (the man who overturns governments) like a deliberate surrender of control of some national interest. But it is not unlikely that those same Premiers are looking to the President of the United States to help them do, with the acquiescence of their peoples, that which they know ought to be done.

And it would seem that the Allies would take in good part the exercise of this pressure by the United States now when it is making this great demand upon our resources.

6. To meet a probable military crisis we must meet the unanimous demand of our allies to send to France the maximum number of troops that we can send as early in the year 1918 as possible. There may be no campaign of 1919 unless we do our best to make the campaign of 1918 the last.

7. To properly equip these troops, so that we may face the enemy with soldiers and not merely men, we should accept every proffer of assistance from our allies, continuing our own progress of construction for later needs, but accepting everything from them which most quickly meets the immediate purposes of the war and which will most quickly enable us to play a decisive part in it. This should be the only test.

8. To transport these troops before it is too late we should take every ton of shipping that can possibly be taken from trade. Especially should every ton be utilized that is now lying idle, engaged neither in trade nor in war. The Allies and the neutrals must tighten their belts and go without luxuries and many things which they think of as necessities must be cut to the limit. Every branch of construction which can be devoted to an extension of our shipbuilding program, and which is not vitally necessary for other purposes, should be so devoted in order to meet the rapidly growing demands for ships during 1918. The one all-absorbing necessity now is soldiers with which to beat the enemy in the field, and ships to carry them.

Recommendations

1. That our military program for the first half of 1918 be the dispatch to France of 24 divisions, the last to arrive not later than the month of June; these to be accompanied or preceded by the proportionate number of service-of-the-rear troops.

2. That the artillery troops precede the other troops of the corps, to receive instruction with such artillery as may be available in France.

3. That every effort be made to secure the additional tonnage indicated in paragraph 1 of my despatch No. 10¹ from Paris to the War Department.

4. That the Government of the United States concur in the resolution adopted by the Inter-Allied Conference in Paris by which an inter-Allied organization is created to handle the question of shipping “with a view to liberating the greatest amount of tonnage possible for the transportation of American troops,” as quoted in paragraph 7 of my despatch No. 10 from Paris to the War Department.

That the very best man obtainable in the United States should represent us on that commission.

5. That an exact inventory be taken of the capacity of all vessels now in use by the War Department and that before sailing a certificate be required that she is loaded to full capacity.

6. That every effort be made to speed up completion of facilities at ports of debarkation in France. This, together with using fullest capacity of vessels, will, in the opinion of shipping men who have inspected these ports, increase in effect our present tonnage as now operating by from 30 to 50 per cent.

7. That the Leviathan (the former Vaterland) be used as a station ship at Brest, if we continue to use that port for our deep-draft transport fleet. All troops from the other vessels can be berthed on her pending evacuation from the port. This will greatly hasten the turn-around of the rest of the fleet. It will avoid the danger of a terrible disaster resulting from the torpedoing of a vessel carrying 10,000 men.

8. That a careful study be made of the relative advantages of Southampton as the port of debarkation of the deep-draft transport fleet. This fleet can not carry cargo to Brest. To Southampton it could carry steel billets to meet our obligations to England for steel used by her in filling our orders. Our other transports can do the same for France.

9. That a more satisfactory and efficient plan for port administration in France be devised. It would seem that General Atterbury, assisted by a high-grade terminal expert at each port, could have entire control of discharge of transports, troop and cargo, until men and supplies are delivered at their destination.

10. That the resolution of the Ministries of Munitions,¹ as quoted in paragraph 2 of my despatch No. 10, in respect to our supply of artillery and ammunition for all of our troops arriving in France during 1918, be at once accepted with reference to every item with which we can be supplied more quickly in this way than by following our own program. Everything should be subordinated to the quickest possible equipment of our troops with its artillery.

11. That, if tonnage requirements make it necessary, approval be given to the plan worked out by a board of officers under General Pershing for a reduction in the strength of a division from 27,000 men to about 22,500; the elimination of the cavalry; the reduction of the reserve supply from 90 days to 45 days, and increasing the number of troops sent via England to 30,000 per month.

12. That, unless the division be materially reduced or its complement of artillery be materially increased, our General Staff study out a new combat scheme by which the four combatant divisions of a corps fight together on the line, with reduced front and extended depth. The front occupied by a division in combat is determined by its power in artillery. An American division from 50 to 100 per cent stronger in personnel than an English or French division, but no stronger than they in artillery, cannot cover its full division front.

13. That the aviation program worked out in Paris, and which I understand is now on its way to the United States, be approved.

14. That the tank program communicated in my despatch No. 12² from Paris be approved and every effort made to hasten it. In this war of machines this weapon has become all-important. The prolonged artillery bombardment to destroy wire entanglements before an attack makes a surprise impossible. It becomes possible through the use of the tanks and saves costly expenditure of ammunition. In the attack on Cambrai late in November (which would have been successful with a few more light tanks and reserves to follow the attack) it is estimated that the use of tanks to destroy obstacles saved 2,000,000 rounds of artillery ammunition, or more than the value of all the tanks engaged.

15. That, having in view conclusion No. 5, above, the Government of the United States represent to the other Governments concerned the great interest which it has in securing absolute unity of military control even if this should demand unity of command; and that for this purpose the Supreme War Council be made a military council with the representation on it of the Commanders in Chief of the respective armies in the field, and their Chiefs of Staff or representatives.

16. Finally, that consideration be given to the question of changing our military line of action so as to bring us into closer touch with the British. This is a very delicate matter and if taken up must be handled with great care. But it is also a very serious matter.

We must take note of the deep, growing and already very strong conviction on the part of Englishmen, both military and the civil, that the war must finally be fought out by an Anglo-Saxon combination. If this is true, it may become evident by the driving in of a wedge into the French line that will cause that people to quit—not to make a separate peace, but to be reduced to a state of inaction leaving the others to fight it out.

But the driving in of that wedge, as our troops are now and apparently are to be situated, will separate us still further from the English forces. If it is likely that we may have to fight with them every purely military consideration points to our joining them now. It would cause a contraction of the French line which would greatly add to its strength. If the French could be brought to look upon this Anglo-Saxon union as having no ulterior object other than a more certain defeat of the enemy, it would be greatly to be desired. The situation as it is, is fraught with possible great danger.

So earnest are General Robertson and Sir Douglas Haig in this matter that, in my interviews with them they have urged our amalgamating bodies of our troops with theirs. Sir Douglas Haig even said that he would give command of these mixed organizations to American officers and that as rapidly as our units become sufficient in number to form complete American divisions they would be separated for this purpose.

Tasker H. Bliss
General, Chief of Staff

On Board U.S.S. “Mt. Vernon”,
December 14, 1917.

Report of the Representative of the Treasury Department ( Crosby)

London

In London conferences were held chiefly with the following gentlemen: Mr. Bonar Law, Chancellor of the Exchequer; and Sir Robert Chalmers and Mr. Keynes, two of the most prominent officials of the British Treasury; Lord Cunliffe and Sir Brien Cokayne, Governor and Deputy-Governor of the Bank of England; Lord Robert Cecil and Sir Adam Block, of the Blockade Division of the British Government; Mr. Austen Chamberlain, Lord Buckmaster and General Smuts, delegates of the British Government to the Inter-Ally Council which we are about to organize, and to which I have been delegated by the President and the Secretary of the Treasury to represent our Government. In addition to these British officials, conferences were had with the Italian Ambassador, and the three delegates of the Italian Government to the same council, namely: Baron Mayor des Planches, Prof. B. Attolico, and Col. A. Mola.

Two representatives of the French Ministry of Finance, M. Fleurieu and M. Avenol, joined in a number of conferences. M. Klotz, French Minister of Finance, was in London one day during our stay, and it was possible to confer with him and Mr. Bonar Law together rather hastily concerning the Argentine wheat purchases.

Interviews were also had in your office with M. Venizelos and some of his aides, this being followed by further discussions in Paris which will be noted below.

The Roumanian Minister in London was also seen and some light upon the difficult subject of his country gained from him.

I shall not mention the various official dinners and lunches attended, although they offered at times excellent opportunity for extending knowledge of both the general and special subjects which interested the mission.

Loans for Great Britain and France in neutral countries

The matter to which chief attention was directed in London in discussions with Bonar Law and officials of the Bank of England was that of the obtainment of loans for Great Britain and France in neutral countries and the corresponding treatment which those countries should receive in the matter of finance and commodity embargo. I found that the Chancellor of the Exchequer, either because of his very heavy parliamentary burdens or because of his rather strained physical and mental condition, had really directed but slight effort to this phase of war finance. As far as I could make out, he felt secure in resting upon the United States Treasury. He had not fully grasped the idea that the limitation of gold exports by our Government would seriously limit the efficacy of our loans in dollars as a liquidation of British debts in neutral countries. It was still more obscure to him that in the end even gold shipments might not fully answer the purpose. Before leaving London, however, I believe he had come to join more or less heartily in an appreciation of this question. At least in my presence he gave instructions that agents should be at once sent to the various neutral countries where heavy purchases were being made, with a view to the obtainment of loans. He did not assent to a written suggestion that this effort on his part should be made in conjunction with similar efforts by the French Government, but preferred that they should be made independently. After considerable discussion of the financial embargo, which had been proposed by the Blockade Division of the British Government, Mr. Bonar Law in a last note written to me before my departure from London took the position, which seemed to me a reasonable one, that until his financial agents had at least felt out the situation in their various fields of effort, it would be unwise to proceed against the neutral banking systems with rigorous measures. I had already telegraphed to Secretary McAdoo that, in my judgment, the matter should be held more or less in suspense, as it seems quite inadmissible that we should assume the neutrals should be wholly driven, rather than led, in the matter both of commodities and finance. It is difficult for those who have not gone into the question, perhaps, to understand the vital importance in this war of the obtainment by Great Britain, France and Italy of material and financial aid from neutral countries.

In this connection, a transaction was begun by cable while we were in London, looking to the obtainment of a loan for the British and French Governments in the Argentine Republic in order to cover heavy purchases of wheat desired to be made there. The first idea which I found in the British Treasury was that our own Government should become a purchaser of one-third of the wheat, which should then be turned over to the European belligerents. I could see no reason whatever for the United States becoming a borrower, when as a matter of fact, it is just now a lender to all the countries of the world, either through direct loans to governments or through balances of trade running in its favor. Nor did it seem reasonable to record a purchase of wheat in the Argentine when we are exporting wheat to belligerents on this side of the water. Consequently, my recommendation to Secretary McAdoo proposed only that our diplomatic representative in Buenos Aires should be instructed to support the propositions which would be made by the British and French representatives looking to the loan in question. A telegram was framed which was submitted to Secretary McAdoo with the suggestion that he might have it sent to our Minister at Buenos Aires through the State Department. This was done, and cable negotiations have been going on constantly since that time. It is impossible to record in detail in this report all that has taken place, but I should not fail to indicate that the attitude of the British representative, Mr. Keynes, when the subject came up again in Paris was that of one who desired in any case to bring the United States Treasury directly into the matter. I could not discover that he went whole-heartedly into the transaction as an independent loan to his Government and to that of France. It was with great difficulty that the arguments presented by us, and let me say also supported by the French, resulted in further telegrams restricting the negotiation to a transaction between the directly interested parties. I am not confident now that the cabling that may be done from London will continue to hold the tone which is necessary for success as an independent effort. This doubtless will be known in the next few days.

In the course of this transaction, much appeared which caused both Mr. Cravath and myself to feel that the proposition of having a financial council more or less centered in Paris would be of value. This matter will be referred to later, but is mentioned here because of the practical lessons learned in a very practical and important special transaction.

In relation to the whole question of loans in neutral countries and in British provinces such as Canada, I found the attitude of the Bank of England officials quite different from that of the Treasury. They were wholly convinced that the efforts which we have urged so strongly should long ago have been made, and they were confident that if properly made they would succeed. The differences upon this and other questions between Mr. Bonar Law and the Bank of England officials have led to a certain strain there which made it difficult for Lord Cunliffe to present his views as strongly as would have been desirable. It is my duty, however, to record the fact that the highest financial authorities in London took the same view, both of the importance and of the probable success of the negotiations proposed by us when this subject was first attacked in Washington two or three months ago.

Inter-Ally Council

While no official work was undertaken with the three gentlemen named as delegates to our Inter-Ally Council, as that council could not yet be organized, I found them interested in the work ahead of them. I was told, moreover, that they were already acting on, as it was called in London, the American committee, and were busily engaged in obtaining from proper sources all of the demands which are likely to be made upon our Government for some months to come. It is understood these demands will be available for study upon our return to London for the organization of the council.

I discussed generally the subject of the council’s work with the three Italian delegates, and they seemed to be alive also to the situation, but had obtained no information as yet from Italy. While in Paris, this matter was urged upon Signor Nitti, Minister of Finance, who promised he would place in their hands immediately a list of the Italian requirements.

Paris

On arriving in Paris, and as soon as the conference had been organized and the finance committee appointed, work was begun, M. Klotz, French Minister of Finance, giving general direction to the meetings. This was the rule followed in all the other sections, namely, that the French Minister should arrange meetings, and indeed act as the chairman of the respective sections. It is a pleasure to record the prompt and efficient manner in which the meetings were thus directed. M. Klotz is surrounded by an extremely efficient staff, and this I state with much confidence, although some of our English friends as well as some of the Americans were at times a little impatient with a certain fullness and prolixity of discussion on the part of the French representatives. In the main, however, their analysis of every situation was more complete than that offered by other interested parties, and their work in formulating precisely what was under discussion or finally decided upon was of the utmost value in rounding up the work of the committee.

As in the case of the other sections of the conference, representatives of all countries were brought together in the first meeting, but the smaller powers understood the situation, and thereafter only the representative of each such smaller power came into the conferences with the English, French, Italian and American representatives in order to discuss his particular case. At a final meeting of the section, the representatives of all countries were again gathered together, but more or less as a ceremony, rather than as a business gathering.

Greece and Roumania

The smaller powers whose cases were very particularly and somewhat lengthily discussed were Greece and Roumania. A report was made by telegraph to Secretary McAdoo concerning both of these countries, with recommendations bearing upon them. At this hour it will be impossible to repeat in any considerable detail what was said in that telegram, but a copy of it has heretofore been transmitted to you for your information.

In respect to Roumania, while dictating this hasty report, I see statements in the morning paper indicating that possibly the whole action there will fail by reason of an armistice said to be now being considered, which is reported as probably including Roumanian troops. Fortunately, provision was made in the proposition which was recommended to Secretary McAdoo that the diplomatic representatives of the lending powers should draw upon the credits to be established in favor of Roumania. We may therefore be protected against the misuse of funds, first, by the fact that the action of the United States was, of course, only recommendatory, and I have not yet received from Secretary McAdoo an answer to my cable permitting final assurances to be given to the Roumanian Government; and, second, even if this had been given, the check above mentioned would serve to prevent money being turned over to the Roumanians at a date too late for benefit or when it might be turned against us.

The Greek situation I consider very difficult indeed, and it may be that the participation of our Government which has been recommended to Secretary McAdoo will never be called for by reason of changes in military situation in that territory. I desire to record my judgment that the whole Greek situation has been handled by the Allies in an extremely foolish fashion. To-day we are dedicating nearly 400,000 men and probably 1,000,000 tons of shipping to the mere protection of Greek territory. It is true that a number of Bulgarian soldiers are presumed to be occupied in watching the force in Greece, and this is the maximum military benefit now obtained from all this vast effort. It is, of course, wholly inadequate. Greece was probably more of an asset when a neutral than she is now as a belligerent. However, we must take the situation as we find it, the good and the bad; and it was in recognition of the fact that if some action were probably not taken Greece would all the sooner be overwhelmed and an extremely bad situation created, that led me, as I suppose it led you and General Bliss, to the conclusion that we could not criticize the situation too narrowly but if we are to move at all it should be promptly.

In the last meeting of the committee with M. Venizelos it appeared that the whole transaction had been carried along in a very ragged fashion, nobody having clearly understood whether 600,000,000 francs worth of military supplies was to be given or lent by France and England to Greece. M. Venizelos stated that his transactions had been on the basis that he would leave this matter to the big Allies at the end of the war, with the understanding that they would take into account such territorial advantages as Greece might have obtained in the general scramble. As soon as this element was plainly introduced, it seemed to me important that we should get out of that particular situation entirely. While Lord Reading, who then represented the British Treasury, and M. Klotz were both naturally anxious to have us share the burden, they saw, I think, the strength of the argument advanced in this respect, and eventually it was determined that their Governments would go ahead on the lines indicated by M. Venizelos, namely, that at the end of the war the whole situation in Greece would be borne in mind by France and England, and that determinations would then be made of munition and other costs which should be assessed against Greece. Great Britain and France may turn to us in the matter, asking for our participation, but I see no reason for hasty action in this respect.

Portugal

The President of the Council of Portugal expressed his desire to meet the representatives of the United States later, and indicated in his appearance before the finance committee that his country might have to arm itself against Spain, and he seemed to think that if this were done it should be financed by other powers. However, as no specific request was made, the matter was remitted to a later date. It would certainly require a great deal of study to justify the United States in helping to arm Portugal against Spain.

Russia

The Russian representatives also appeared, but merely to voice the utter helplessness in which they find themselves. It is my opinion that it is now time to seriously consider whether all the funds and materials subject to control by the Russian Ambassador in the United States should not be taken over by our Government. I know there are technical difficulties in the way and those at this late hour I shall not undertake to solve, but take this opportunity of urging that the question be at once considered. I have already wired Secretary McAdoo a suggestion about the steps which might save our manufacturers from ruin. Those steps we had already considered before my departure from the United States, and they were of course doubtless well in the minds of Secretary McAdoo and Mr. Leffingwell. I hope within the next few days both in London and Paris that action will be somewhat more matured, and that the heads of the Governments there will determine whether or not they shall continue to give a status to the representatives of the Kerensky regime which will carry with it the right to control large amounts of money and material. It seems to me the gentlemen in question, as they can no longer communicate with any governmental organization in Russia, would not feel hurt if, even as trustees, the Governments of Great Britain, France and the United States, respectively, should take in hand all the funds and material resulting from earlier loans. Indeed, I am informed by M. Klotz that he is already doing substantially this, as the Russian Ambassador here must submit all of his checks against previous credits to M. Klotz before they are honored.

Japan

The Japanese representatives in the finance section indicated in a few well chosen words the willingness of their Government to act as creditor in cases of need of other belligerents. The move was admirably done, and was a part of a justifiable procedure which leads to the recognition of Japan in all respects as a first-class power. We did not turn to Japan for aid in the Greek situation, however, because there was no time to consider the political aspects of such a move.

Financial council

M. Klotz proposed that the work of the Inter-Ally Council, based upon Secretary McAdoo’s letter of July 18, 1917,¹ should be extended and at the same time divided. The extension consists in having central bodies in Europe to consider not only Allied needs in the United States, but also Allied needs in neutral countries. The importance of this to us has been made manifest by the development of the exchange situation in New York. We now know that for months we have been lending money to Great Britain and France for the settlement of their balances in all these countries, and the whole attempt to obtain loans for the Allies in these countries has been an effort to relieve ourselves of a burden which is objectionable, both from the point of view of the amount of money involved, and from the atmosphere surrounding the statutes under which loans are made. There is a third aspect in the matter which is also of importance, namely, the effect upon the value of the dollar in various neutral countries. I shall not have time to fully develop this subject, but as a matter of fact, I think it can be concretely stated that as we have married the dollar to the pound sterling, they go for “better or for worse” together in certain conditions, and we cannot make a decent divorce except by the obtainment of loans for Great Britain and France in these countries, thus measurably re-establishing independent international commercial relationships. As soon after I return to London as possible, now that the feverish work of the council is past, I hope to be able to set the subject carefully on paper, and probably shall have wired something more definite to Secretary McAdoo before this reaches him through you.

Another direct interest of the United States was suddenly presented here, namely, that our Army in France is desirous of making very considerable purchases in neutral nearby countries, that is, Spain and Switzerland. The matter of priorities in these countries between our purchases and those of France and England is thus immediately brought on the carpet, and, incidentally, all the more importance is given to the exchange question. If at this moment we buy, as is desired by our Army people here, large quantities of material in Spain, exchange being against us as it is, it will cost something like approximately 15 per cent more to pay for these goods than would be the case if we had not undertaken to bear the burdens we now bear in respect to the British and French trade in Spain.

Taking all these reasons into account, it seemed to me eminently desirable that a continuous study of these problems should be effected by men not directly charged with the seeking after and listing of commodities. I am also convinced that it is desirable that this work should be done in Paris. There is, as a matter of fact, to-day a more intelligent appreciation of the financial situation in Paris than in London. In the latter capital, there was a feeling that one was always running against a current; here one runs with it. I am quite satisfied these conditions will change, because of the attitude taken by Lord Reading, who is suddenly thrown into the mill here as the representative of Bonar Law. He discovered how complex the situation is, and seemed to have gone away convinced that a continuous study of finance in neutral countries was of the highest importance. I believe also, though this is less certain, that he will see the importance of cooperation of the English and French efforts in these respects. The insularity of Great Britain, its splendid position in the world for so long—all these subtle forces render the talk of coordination much more froth than beer. Our work must be continuous in order to give any substance to the resolutions of the conference.

I have just received the following telegram on this subject from Secretary McAdoo:

My own judgment is against two councils. Concentration instead of diffusion is the need of the hour, it seems to me, but am willing to accept your and House’s judgment whatever it may be.

I believe your own personal explanations of the importance of having contact with Paris, as well as with London, together with such explanation as this hasty dictation, will relieve Secretary McAdoo’s mind. It is quite possible that we may eventually work the thing out to this effect, that the Inter-Ally Economic Council shall have a finance subcommittee. That indeed was my first thought when M. Klotz proposed his plan. M. Klotz urges, however, that it is always desirable that those who consider getting things together should be checked by others who consider how to pay for those things. This, of course, is fundamental, and is of some value. Nevertheless, I do not consider that as the main reason for assenting to his proposition, since the Inter-Ally Council could be made up of such elements as would in themselves offer the necessary checks and balances as between a commodity man and a finance man. Giving some weight to that consideration, I gave more weight perhaps to the importance of having official work which should regularly call the American representative from London to Paris. I feel entirely sure that any representative of our country staying entirely in one capital or the other would lose part of his usefulness. I do not mean by that, at least so far as I am personally concerned, that I would, chameleon-like, take on the complexion of the people among whom I dwell, since I believe I have lived long enough and independently enough among the peoples of many countries of the world to be immune from that danger. But even if this is true of me or any other representative of the United States, it also remains true that the bodies of information and the points of view in London are different from the bodies of information and points of view in Paris. We need both. This reasoning would extend as well to Rome, and, indeed, I hope to be able to get to Rome for a short time at least, and at an early date. I shall also hope to get to Madrid, particularly if in the meantime we cannot work out some relief to the exchange situation in that country. It is just now perhaps the most vexatious one from our national point of view, and I shall expect to be reporting upon it by cable to Secretary McAdoo before you reach America.

In the haste of this dictation, I have doubtless omitted some important considerations, but these perhaps have been more or less covered by personal conversations, and will later be made a matter of record.

Oscar T. Crosby

Paris , December 6, 1917.

Report of the Representative of the War Trade Board ( McCormick)

Upon my arrival in London, in accordance with my instructions, I at once communicated with the foreign office of the American Embassy, to make an appointment with Lord Robert Cecil, Minister of Blockade, to arrange for conferences to discuss the negotiations with Norway, Denmark, Holland, Sweden, and Switzerland.

Lord Robert Cecil, Doctor Taylor, and I met at once and arranged for a series of conferences. These conferences were held in the Blockade Minister’s office in the Foreign Office, and those present at these conferences were as follows:

• For Great Britain:
  • Lord Robert Cecil
  • Lieut. Commander Leverton Harris
  • Sir Eyre A. Crowe
  • Mr. Kidston
  • Mr. Harwood
  • Mr. Forbes Adams
    and other blockade experts
• For France:
  • M. de Fleurieu
  • M. Charpentier
• For Italy:
  • Prince Borghese
• United States Representatives:
  • Dr. A. E. Taylor
  • Mr. Gunther
  • Mr. Pennoyer
    and myself

A complete record of the minutes of these conferences are attached hereto as a part of this report,¹ and the result of the negotiations has already been filed with the State Department in cablegrams which were interchanged between the War Trade Board and Doctor Taylor and myself.

We were impressed with the desire of the British representatives to close as soon as possible these negotiations, and they were particularly anxious to have them carried on in London, owing to its proximity to the neutral countries, as well as to our other allies, and the possibility of freer and more expeditious interchange of communications between the respective Governments and their representatives, as it was possible for the commissioners to return to their own countries for additional instructions. Their anxiety to hasten the closing of these negotiations was primarily to enable them to reopen their commerce with the neutrals in order to improve the exchange situation in these countries, which was becoming serious. Also the effect of the embargo was beginning to create a bitter feeling against the Allies which was encouraged by the German propagandists.

We encountered no serious difficulties with the Allied representatives as to the terms of our negotiations, and discovered we were in accord upon most points, and found that Lord Robert Cecil took a most liberal view in regard to the disposition of the northern neutral tonnage, now or hereafter in the Allied service.

We regretted that the Norwegian negotiations could not have been transferred to our respective Ministers in Norway, because from reliable information at hand we believed the negotiations could have been concluded by our Ministers with much greater dispatch than through Doctor Nansen, who, according to our advice, has not full power, and must refer all proposals to the Foreign Minister of Norway, who is reported to us to be out of sympathy with the aims of the Norwegian Government, and people. I was sorry that Washington did not approve of our proposal, because I believe it would have been entirely satisfactory to the people of Norway, and the agreement would have been executed by this time.

All of our negotiations were carried on in the most open and frank manner, with all the information in the hands of the British at our disposal, with the apparent desire to co-operate in every possible way and defer to our views upon all important matters.

The conference considered the final proposals to Norway and Denmark, as submitted to them by the War Trade Board, and by cable have expressed their approval, with the addition of certain recommendations.

Doctor Taylor and I reported to the conference the difficulties we have encountered in connection with our negotiations with the Dutch commissioners, particularly dwelling upon the tonnage question. In this connection Lord Robert Cecil informed the conference that he had submitted to the War Cabinet the question of the requisitioning of the entire Dutch Fleet, and the War Cabinet had approved this recommendation, including those Dutch ships in British ports, estimated to be 38 in all, and suggested that we urge upon our Government the requisitioning of all Dutch ships in our ports.

The British laid great stress upon the gravel and stone trade in its trans-Holland aspect, and urged us to join with them in stopping this traffic, insisting that it is necessary to stop the export of these materials from Holland. The French delegates raised the point of similarity of coal to Italy, via Switzerland, stating that the Swiss Government did not object to this traffic.

Figures were submitted to the conference showing that the original figure of 500,000 head of cattle which the Dutch claimed they must slaughter was now shown by a member of the Dutch Agricultural Board to be reduced to 50,000 head. In conference Doctor Taylor and Mr. Harwood and the Food representative have agreed upon the Holland ration. The British delegates pointed out the urgency of completing the negotiations with Holland, as the Germans were trying to tie up the Dutch by various agreements dealing with the products about which England had already approached Holland and had obtained agreements thereon.

An effort was made to have Sweden send representatives to London to negotiate with us while we were there. It seemed to be the opinion of all the delegates that since the Russian disaster the Swedish negotiations were not as pressing as the others, and that aside from the iron ore question there were no difficult problems confronting us. It was the unanimous opinion of the delegates present that it would be impossible to effect a complete cessation of ore exports from Sweden to Germany, and that an effort should be made to reduce the tonnage to the least possible amount.

The discussion of the Swiss agreement was deferred until the meeting of the Inter-Allied Conference in Paris, with the exception of a conference by Doctor Taylor with Mr. Waterlow on certain details in our proposal to Doctor Sulzer.

In view of the War Trade Board’s close association with tonnage questions I discussed the tonnage phases of this subject with Lord Robert Cecil, and suggested to him that the time had come for the elimination of competitive commerce among the Allies, and for perfect frankness and co-ordination of action in regard to the tonnage question, and that unity of our economic effort in this direction was just as important and necessary as in our military and naval efforts. He was in perfect accord with this suggestion, and to further this plan arranged a conference of the representatives of Great Britain, France, Italy, and the United States, at which Lord Milner of the War Cabinet presided. Mr. Colby and I represented the United States. A sub-committee was appointed to draft and submit a plan for the consideration of the general committee. Lord Robert Cecil drafted a memorandum on the tonnage situation. This was discussed, but not acted upon, and formed the basis of discussion by a committee subsequently appointed by the Anglo-American conference on November 20, 1917.

Lord Robert Cecil and I urged a broader treatment of the subject by a pooling arrangement without actual control; the only improvement suggested over the present system being the appointment of an American representative of the United States Shipping Board in London to act in an advisory capacity—the British now having Sir Thomas Roydon in America acting in a similar manner. The formation of two such committees, three thousand miles apart, would not be as effective as one joint organization, as proposed by us, and the result would be that the committee in London, with Great Britain controlling 70 per cent of the Allied tonnage, and the United States only 10 per cent, would make the committee in London the dominating and important committee, and there was sure to be lack of unity in such an arrangement.

The impracticability of this plan is further evidenced by the first paragraph of the resolution offered by Sir Joseph Maclay, which was as follows:

America, France, Italy, and Great Britain should all tabulate and make available to each other a statement showing tonnage in detail.

Emphasizing again the need of a central inter-Allied organization which would properly manage and supervise the entire tonnage situation.

To further illustrate: under the proposed plan of Sir Joseph Maclay when the military Inter-Allied Council desired to ascertain the available tonnage for a particular purpose it would be compelled to consult individually each separate country, instead of being able to call upon a central committee for such data. A central inter-Allied committee, with the needs of each neutral nation before it, as well as the available tonnage could operate effectively, and would make possible through a single agency a closer co-ordination of the various war committees, and thereby tend to greater efficiency in the prosecution of the war.

At one of the conferences in the Foreign Office, Mr. Crosby and Mr. Cravath were present to discuss the question of a financial blockade of the northern neutrals. No definite conclusions were reached except that due to the great importance of the Allies making loans in the neutral countries it was thought advisable to postpone any action in this direction until after such loans had been arranged. It seemed to be the opinion of all the delegates to the conference that such a blockade could be made effective if joined in by all the Allies, and seriously affect the financial operations of the enemy.

Mr. Crosby is familiar with the situation, and he is going to open up the subject again at a propitious time.

On November 22 the mission proceeded to Paris, and at once, through the Embassy, Doctor Taylor, Mr. Sheldon, who accompanied us from London, and myself were put in touch with the Blockade Ministry, and on the same afternoon began a series of conferences to discuss the Swiss situation, but more particularly the proposal made by the War Trade Board, through Doctor Sulzer, to the Swiss Government, and also to take up the embargo matters with Spain, to make, if possible, a more satisfactory financial arrangement for the Allies for the improvement of the exchange, and also secure from that country much needed supplies for the needs of the Allied armies. Those present at the conferences in addition to the American delegates, were the representatives of the French, English, and Italian Governments, the members of the International Rationing Committee of France, Italy, and Russia. Conferences were presided over by the Minister of Blockade, assisted by the officials of his department and technical delegates. The War Trade Board proposal to the Swiss Government was referred to the rationing committee, on which Doctor Taylor sat, in order that the figures might be examined in detail, so as to obtain a perfect concordant with the contingents at present in force. The rationing commission made some slight modifications in the original proposal. The proposal was subsequently unanimously approved by the delegates to the conference, and the suggestion that the American delegates at once request the Swiss Government to send representatives to conclude the negotiations was approved by the conference, and the Swiss Government was at once communicated with through its Minister, to carry out this suggestion.

The matters discussed at these conferences will be found in more detail in the memoranda attached hereto.¹

The following delegates, A. Cailler, Grobet-Roussy, and Heer, accompanied by Professor Rappard, arrived in Paris, and met with Doctor Taylor, Mr. Dresel and Mr. Sheldon and myself, to agree upon the final terms of the agreement before submitting it for final consideration at the Inter-Allied Conference. No serious difficulties were encountered, and finally at a meeting of the conference, at which all the nations were represented, the agreement was approved on December 4, and signatures were affixed on December 5. The memorandum was signed by the Swiss delegates and by myself for the War Trade Board. A copy of this agreement is attached hereto.²

We considered it a most propitious time for the execution of the agreement on account of the disturbing reports we had received from Switzerland of the growing distrust of the Allies by the Swiss, largely brought about by the German propagandists, and the commission from Switzerland were unanimous in their belief that the conclusion of this agreement, which assured Switzerland of its food, would go a long way to counteract the evil influences of the German propaganda.

The Allied delegates were particularly urgent upon the necessity of the United States having a permanent representative on the International Commission on Contingents, sitting in Paris, as well as on the Inter-Allied Commission at Berne, which two commissions pass upon the rations. This, after receiving authority from Washington, the American delegates agreed to.

A special conference of the blockade delegates was arranged with Mr. Crosby, Mr. Cravath, and Colonel Dawes, representing General Pershing, to discuss the ways and means of assisting the Allies in making loans in Spain and purchases for their army needs; it having been reported that Spain had placed an embargo on certain very necessary materials which both the French and the American Armies badly needed. The result of this meeting was the creation of a Joint Purchasing Committee for the Allies, so that competitive bidding would be eliminated, and it was determined through this committee to test the Spanish embargo at the earliest possible moment, and if the Allied Governments were being discriminated against to recommend a system of retaliation by refusing licenses for cotton and fuel exports from America. In this connection Doctor Taylor and I called on Ambassador Willard, who was fortunately in Paris, and found him alive to the situation, and with very practical suggestions as to the method of handling this situation, which have since been embodied in cablegrams now on file in the State Department. In considering these commercial questions with Spain the lack of commercial attachés resident in that country was particularly noticeable; the attaché in Paris is now attempting to cover Spain in addition to France and Switzerland, which is an impossible undertaking if efficiently done.

At the conclusion of the conferences of the blockade section, the Inter-Allied Conference at the final session adopted the following report covering the work of this section:

The blockade section first devoted its attention to the Allied conventions with Switzerland concerning the blockade questions. As the outcome of the councils held in Paris between November 23 and 30, 1917, the following results were arrived at:

(a) The project for an arrangement between the United States and Switzerland was submitted to the conference and approved unanimously.

(b) The United States will appoint delegates to participate in the deliberations of the Permanent International Commission on Contingents, as well as in those of the Inter-Allied Commission of Berne.

(c) The section then proceeded to study the measures to be taken to ensure the revictualling of the invaded countries. It decided that the necessary measures should be taken to facilitate the work of the Relief Commission in Belgium and the north of France in its programme of supplies and transportation.

(d) The section deems it advisable to submit the following general declaration to the conference:

The prolongation of the war having led to a consumption of products of all kinds which is out of proportion to production, it is obvious that the available resources, either in the Allied countries, or in the various neutral lands, are insufficient for the actual requirements. It is, therefore, necessary to make a general extension of the principles laid down at the end of last July by the American Government.

Doctor Taylor and I were fortunate in having with us in practically all of our conferences Mr. L. P. Sheldon, the Food Administrator’s representative in London. Through his connection with the Embassy in London he was familiar with the work of the War Trade Board, as well as that of the Food Administrator, and was of inestimable value to us. It was the opinion of Doctor Taylor and myself that as he is a man of great ability and has a thorough knowledge of the affairs of the War Trade Board we would recommend his appointment as our representative in London, provided that satisfactory arrangements can be made with Mr. Hoover. We believe he can ably represent us in that capacity, and his business experience and knowledge of our work should particularly fit him to build up an efficient organization.

We would also recommend the appointment of Mr. Ellis Loring Dresel as the representative of our board to sit upon the Inter-Allied Commission in Berne. Mr. Dresel met us in Paris, and was present at most of the conferences on the Swiss agreement, and his thorough knowledge of conditions in Switzerland as well as in Germany would make him a most valuable man for us in that capacity.

We had hoped while we were in England to have the advantage of personal reports from our representatives in the northern neutral countries to assist us in our negotiations, but unfortunately Mr. Gale, from our Legation at Copenhagen, and Mr. Edwards and Mr. Hayward from Holland did not join us until our last week in Paris. We particularly regretted that representatives from Norway and Sweden were not available, Captain Breckenridge being the only American representative from whom we were able to get direct information concerning those countries.

Doctor Taylor and I discussed the Danish proposal with Mr. Gale and Mr. Conger in Paris, and they both considered it a very fair proposition, and their only criticism was that it might be somewhat too liberal.

Doctor Taylor returned from Paris to London and spent a week in conferences, with the British, French, and Italian blockade authorities, dealing with the subjects of Holland and Sweden.

The industries, imports, exports and economic situation of these two countries were thoroughly gone into and a technical basis of blockade and exchange agreed upon by the representatives of the four countries. These two furnished the basis for the later negotiations to be held in London with special representatives of the Dutch and Swedish Governments.

Doctor Taylor participated in London in two conferences in the office of Lord Robert Cecil, attended by members of his staff, M. Charpentier and M. Serruys, of the French Blockade Ministry, the Italian representative, and Mr. L. P. Sheldon. The Dutch representative was Snouck, who came from Holland with powers to conclude an arrangement ad referendum within certain limits. These negotiations extended over two days, and led to the clarification of the situation and to a formulation of certain arrangements that have since found their expression in the modus vivendi between the Dutch Government and the Allied Governments.

The scope of the conference with Sweden was outlined but could not be entered into on account of the delay in the arrival of Ballenberg, the Swedish delegate.

Doctor Taylor left London with the conviction that all of the technical features of the blockade of these two countries were settled in these conferences, leaving only broad questions of policy to be determined by cable, and the later conduct of these negotiations has proved the correctness of this view.

It was arranged in London that the negotiations with Denmark and Norway should be conducted in Washington by the War Trade Board under a clear understanding of the limiting factors involved. On the other hand, the negotiations with Sweden and Holland were to be conducted in London under a similar definition of the limiting factors involved.

Mr. L. P. Sheldon, representative of the War Trade Board in London, attended every meeting devoted to the blockade, held in London prior to the departure of the mission for Paris, in Paris, and in London following the return of Doctor Taylor.

This laid the foundation for a familiarity with the subject that will be of great importance to the War Trade Board in the later work of Mr. Sheldon, who is a man of broad experience in the diplomatic life of Europe, and of unusual and versatile powers.

In general it may be said that the conferences in London and in Paris cleared the ground of all technical misunderstandings.

The blockade authorities of the four countries understand each other from the point of view of commodities, industry, trade and exchange. Any question that may arise in these directions will from now on be trivial and easily settled by cable. There remain only questions of policy, which change with the progress of the war, and under these circumstances, future negotiations ought to be greatly simplified as compared to those of the past.

The hearty co-operation afforded us in London by Lord Robert Cecil, Minister of Blockade, and in Paris by Minister Lebrun, and their respective staffs, make possible a much closer co-ordination of our work, and a better understanding with our allies upon all blockade matters. And with the privilege of thus laying the foundation for future branch organizations of the War Trade Board in London, Paris, and the European neutral countries, much has been accomplished, and the future operations of the War Trade Board will be greatly facilitated.

Respectfully submitted,

Vance C. McCormick

Report of the Representative of the Shipping Board ( Colby)

As the representative of the Shipping Board upon your mission my immediate objectives were as follows:

1. To ascertain the true extent of the destruction of Allied and neutral shipping by submarine operations; the extent to which the effective tonnage of the world is diminished as the result of such operations; and the extent to which new construction was reducing the net effect of submarine sinkings.

2. To gain such information as was accessible concerning the extent of new ship construction in Europe, and particularly in Great Britain, and also such information from the plans and methods pursued in British shipyards as might be instructive or helpful in carrying forward our own shipbuilding program, particularly with reference to so-called “standardized” ships.

3. To discuss with the shipping authorities of England, France and Italy methods for the coordinated employment of the joint tonnage of those countries in connection with that of the United States, so that the utmost efficiency of service might be obtained from the reduced aggregate of the world’s tonnage, pending relief of the present shortage by new construction.

4. The discussion of some program of joint action on the part of the four chief belligerent powers regarding unemployed neutral tonnage.

5. To bring about some agreement on a common plan of action, looking to the acquisition of the interned and refugee German shipping in South American countries, or, in case acquisition should prove impossible, some other method by which this idle tonnage could be impressed into service in the present emergency.

I have been accompanied on the mission and greatly assisted by Mr. Charles Day, a consulting engineer of Philadelphia, whose services have been voluntarily given to the Government in connection with the work of several of the departments, since the outbreak of the war.

Upon my arrival in London, I was fortunate in obtaining the assistance, through Vice Admiral Sims, of Naval Constructor L. B. McBride, whose expert knowledge of ship construction and familiarity with the shipbuilding program of the British Admiralty, gained through his residence in London of several months, have been of very great value.

Upon the day of our arrival, Ambassador Page placed me at once in personal contact with Sir Joseph Maclay, who is at the head of the Ministry of Shipping, Sir Alan Anderson, Controller of the Admiralty and charged particularly with all construction work of both naval and merchant ships, and Maj. Gen. A. S. Collard, in direct charge of merchant shipbuilding. There ensued a series of daily conferences with the officials above mentioned, which were attended by the heads of the various related departments. All pertinent facts were disclosed with complete unreserve, and I have been enabled to gather voluminous and, I believe, very complete data upon all the subjects of inquiry above indicated. This data is in the form of statements, tables and reports prepared by the departments most familiar with the various subjects, and will be filed with the Shipping Board, where it will be accessible. A tabulated statement of the data referred to, is annexed hereto.¹

I will take up briefly the objectives to which I have directed my inquiries, in the order above outlined.

1. The Extent of Ship Destruction by Submarines

The losses of British, Allied and neutral shipping due to war risks from August 1, 1914, to September 30, 1917, total	3,788	ships
	9,224,555	gross	tons
Losses due to marine risks for same period	1,552,290	“	“
Total	10,776,845	“	“
The losses of British, Allied and neutral shipping due to war risks from January 1, 1917, to September 30, 1917, total	5,157,000	“	“
Losses due to marine risks for same period	369,000	“	“
Total	5,526,000	“	“

Consideration of the losses by weeks from January 1, 1917, indicates that if the several weeks during which the losses were extraordinarily heavy (in April, May and June) be eliminated, the reduction in losses during recent months has not been sufficient to warrant the conclusion that there has been any distinct change affecting the efficiency of enemy submarine operations. On this account it must be assumed that the losses for the year 1918 will correspond with the rate in 1917.

On this assumption, the combined losses of Great Britain, the Allies and neutrals for 1918 will be	7,368,000	gross	tons
The estimated output of new ships in the United Kingdom for 1918 is	1,841,250	“	“
(If the United States could furnish ship plates to the extent of 5,000 tons per week, the production can be increased to 2,366,000 gross tons.)
The United States merchant shipbuilding program for 1918, according to the latest advices received by me from the Shipping Board provides for	3,070,000	“	“
Consequently the combined production of the United Kingdom and the United States will aggregate	4,911,250	“	“
It is therefore apparent that the combined tonnage of Great Britain, the Allies and neutrals will be reduced during the year 1918 by	2,456,750	“	“
The foregoing statement makes no allowance for possible production of tonnage by countries other than the United Kingdom and the United States which is not likely to exceed	500,000	“	“
The total of the projected shipbuilding for the year 1918 by Great Britain and the United States will only slightly exceed mated British losses for 1918.
Great Britain has lost from January 1 to September 30, 1917 (war risks only)	811	ships
	3,173,197	gross	tons
On this basis Great Britain’s losses for 1918 will be	4,230,929	“	“

It may be thought that an estimate of sinkings by submarine for the year 1918, based upon the average rate of loss from January 1 to October 1, is excessive because that period includes three months during which the losses were at a very heavy rate, not later maintained. If, however, the months of July, August and September, 1917, which more nearly approach a normal experience, are taken as a criterion of the present effectiveness of the submarine, and an estimate for the year 1918 is deduced from the average of these months, the result is only a little less startling. According to figures furnished me in confidence by Sir Eric Geddes, First Lord of the Admiralty, the loss of tonnage for the three months of July, August and September, amounted to 1,521,000 gross tons, made up as follows:

Sinkings by submarine	1,341,000	gross	tons
One-fifth of damaged shipping (a percentage which should be reckoned as a loss)	57,000	“	“
Losses from marine risks	123,000	“	“
Total	1,521,000	“	“

This is at the rate of 6,084,000 gross tons, or 9,734,000 dead-weight tons, per annum.

While it is true that we are embarked on a shipbuilding effort, of a magnitude beyond all precedent, the foregoing figures of submarine destruction, which are derived from the most authentic sources, constitute a striking challenge to the adequacy of our program. A glance at the foregoing figures can leave no doubt that the sinkings by submarine are not only in excess of present shipbuilding, but in excess of projected building by Great Britain and the United States for the year 1918.

We must do more or leave the submarine in possession of the field.

2. New Construction

The present output of new tonnage in Great Britain is limited by the amount of ship steel available. The estimated output for 1918 is 1,841,250 gross tons. This output could be increased to about 2,366,000 gross tons if 5,000 tons of steel plates per week can be supplied by the United States. No ships now under construction in Great Britain can properly be termed “standardized” or “fabricated” ships as these terms are understood in the United States. There are nine different types of cargo vessels now under construction on Government order. Structurally, these ships do not differ from the ordinary tramp type, but are standardized to the extent of using a common type of deck and engine auxiliaries. They also incorporate certain features in connection with the arrangement of the upper works to increase the difficulty of a submarine calculating their course or speed.

There are now in course of erection in the United Kingdom, four national yards, at which it is the intention to employ unskilled labor, consisting in part of German prisoners. Designs of a standard or fabricated ship to be built at these yards, are being prepared, involving the use of more modern methods and equipment than have heretofore been employed, such as multiple punches, pneumatic tools, etc. To make possible this advance in methods it will be necessary for the United States to supply a considerable amount of pneumatic tools and a limited amount of crane equipment.

There is practically no merchant shipbuilding under way in Italy and France, where the shortage of men, materials and fuel practically restricts such shipbuilding facilities as these countries, respectively, possess, to the mere repair and maintenance of naval vessels.

3. Employment of Existing Shipping

In view of the fact, of most grave significance, that the present inadequate total of world tonnage is destined to still further reduction, due to the fact that it will be many months until the accretion of new tonnage equals the monthly destruction resulting from submarine operations, the efficient employment of existing tonnage becomes a matter of the first importance.

Not only is it the duty of the belligerent nations to withdraw all ships from purely commercial service and to employ them in the maintenance of their armed forces and for purposes strictly cognate to the prosecution of the war, but it is highly desirable that there should be the utmost measure of coordination in the employment of all tonnage within this restricted field.

These facts are clearly recognized and promptly conceded by the English, French and Italian officials. Notwithstanding this, however, there is a strong disinclination on the part of each of the powers named to concede any measure of actual control of the shipping which each possesses. The problem presents a twofold aspect. There is, first, the obvious wisdom of coordination and unity of direction for the sake of efficient common action. At the same time each nation apparently feels that the duty of defending itself, involving the maintenance of its own forces and the sustenance of its own nationals, is one that it cannot confide in any degree to another nation nor to any inter-Allied body of control. Inasmuch as the tonnage at the service of France and Italy, respectively, is clearly insufficient for their needs, and in view of the fact that both France and Italy are not utilizing tonnage which has been voluntarily placed at their disposal by Great Britain and the United States, it seemed obvious that whatever relief to the situation can be expected from the more efficient employment of existing tonnage must come from joint action of Great Britain and the United States. I therefore discussed this subject very fully with the shipping authorities in England, and we reached certain agreements as to the employment of the tonnage that Great Britain and the United States, respectively, controls, and such neutral tonnage as may be obtained by either.

Our discussion proceeded upon a frank recognition at the outset that neither country could relinquish the power of control of its own shipping, although fully recognizing the importance of coordinated direction and mutual agreement to the fullest possible extent. I therefore proposed that the United States should maintain in London a representative, some one who understood its needs, the scope of its military operations, and its shipping resources, to be in constant contact with the British Ministry of Shipping; and that Great Britain should do likewise, sending a man of similar qualifications to the United States. With contact thus established, it was further suggested that the two nations should effect some arrangement, by commandeered cable or priority of cable communication, whereby the utmost rapidity and ease of communication could be brought about, and thus the two viewpoints, British and American, could be brought into play upon the employment of every vessel subject to our joint direction and control, and the designation of every overseas voyage.

These suggestions were thoughtfully received by the British and very carefully examined. They were discussed briefly at a fully attended conference of the War Cabinet and the heads of departments, held at No. 10 Downing Street on November 20, 1917, and on the same day were very searchingly examined and discussed by a sub-committee appointed for that purpose by the conference, among whose members were Earl Curzon, Viscount Milner, Lord Robert Cecil and Sir Joseph P. Maclay, the Shipping Controller. It was the consensus of opinion that the suggestions embodied the fullest measure of coordination in the control of existing tonnage that was practicable.

Throughout the discussion I had in mind the strong disinclination, heretofore manifested by the United States, to yield the actual control of its own shipping, even to the extent of sending a representative to sit upon the Allied Chartering Committee. I proceeded upon the assumption that the British must feel a similar disinclination to relinquish, in the final analysis, the control and disposition of their own tonnage, in view of their greater dependence upon overseas cargoes for the maintenance of their industries and the feeding of their civil population. The proposed arrangement seemed to me, therefore, to be the best that was possible under all the circumstances and to be worthy of a trial. If we could not agree upon some formula of absolute unity of direction, we could, at least, assemble the elements of harmonious action and rely upon the intelligence of our representatives to perceive the identity of our interests and aims, and to supply by conduct and practice a coordination that would be difficult to bring about by authority.

A quite complete accord having been reached with the British authorities on this subject, it was recognized as proper that France and Italy should be consulted and their assent obtained. The results of our discussions in London were embodied in a memorandum, which was later agreed to in principle by the section of importations and maritime transports of the Inter-Allied Conference. This latter section or sub-committee of the Inter-Allied Conference was recognized as one of the very important committees of the conference, and its membership was in every sense representative. Messrs. Clémentel, Loucheur, Lémerey and Boret, of the French Cabinet, Mr. Tardieu, the French High Commissioner to the United States, and others representing France, Lord Reading and Sir Joseph P. Maclay, representing Great Britain, Messrs. Bianchi and Nitti, representing the Italian Cabinet, and representatives of Belgium, Brazil, Japan, Roumania and Serbia, constituted the section or subcommittee, together with Mr. McCormick, Mr. Day and myself as the representatives of the United States.

The memorandum of the conference in London, above outlined, as to the control of existing tonnage, was submitted to this section or sub-committee of the Inter-Allied Conference and agreed to in principle. At the suggestion of the French members of the committee, it was voted to establish a standing committee, consisting primarily of representatives of the United States, Great Britain, Italy and France, which should remain in session in Paris, collecting information as to the requirements of the respective belligerent nations and the movements of shipping, for the purpose of maintaining at all times a broad survey of the general needs and available shipping facilities.

This committee is to have no power of actual control or direction of the tonnage belonging to any nation, but is to be a source of information and of recommendations. This action of the sub-committee was regarded with approval by the British and American representatives, as it gives both France and Italy a voice to make known their respective needs and does not interfere with the action of Great Britain and the United States in employing, according to their own judgment, their joint tonnage in the service of the belligerent nations as a whole. The memorandum of the London conference on this subject contains the following express disavowal of any intention by America or Great Britain to delegate the ultimate control of their tonnage, to wit:

It would be difficult for any country, and particularly for America and Great Britain, to delegate absolute power to dispose of its tonnage (which is the basis of all its civilian and military requirements) to a representative on an international board on which he might be outvoted. Such a board, moreover, would not lead to administrative efficiency, partly because the complete control of all tonnage can scarcely be well concentrated in one place, and partly because representatives upon it would tend to be at once out of touch with actual administrative and executive machinery, and at the same time scarcely invested with sufficient authority to make reductions in various supply programs, munitions, food, etc.

The committee on maritime transports, recognizing that coordination was only practicable with such qualifications as are above outlined, adopted the following resolution as expressing its judgment:

The Allies, considering that the means of maritime transport at their disposal, as well as the provisions which they dispose of, should be utilized in common for the pursuit of the war, have decided to create an inter-Allied organization for the purpose of coordinating their action to this effect and of establishing a common programme, constantly kept up to date, enabling them by the maximum utilization of their resources to restrict their importations with a view of liberating the greatest amount of tonnage possible for the transportation of American troops.

4. Neutral Tonnage

The importance of neutral tonnage arises from the possibility of its immediate employment as an offset to the continued diminution of existing tonnage through submarine operations. I found on reaching London that England claimed to have reached definite understandings with Norway, Holland and Denmark, whereby England was to exercise a control over all tonnage belonging to these three nations which was not actually required for their own needs. This control was to be exercised either by direct charter, as in the case of Norway, or by the conceded power of veto of any voyages or cargoes, which England did not approve of. In the case of Holland, it was stipulated that tonnage thus submitted to England’s control should not be employed in the war zone.

Notwithstanding such agreements, which the English regarded as closed and operative, negotiations had been in progress for some months between representatives of the three neutral nations mentioned above and our War Trade Board looking to some concessions of tonnage in return for a relaxation by the United States of its embargo on certain exportations. The situation was confused and has been the occasion of many time-consuming exchanges of communications. Meanwhile much of the neutral tonnage is lying idle and is not serving, as it might, the acute needs of the world, pending the relief which is awaited from new construction.

I think I should state at this point, my belief that England does not, at present, regard the maintenance of her trade as an objective in the dispositions of her shipping, except as it is strictly cognate to the war and the maintenance of the military efficiency of her Allies. Her own need of raw materials for her industries and food for her population is very acute and this she is not losing sight of, but it is the sincere intention and resolve, in my opinion, of the English authorities to utilize all British shipping and all neutral shipping which can be obtained, in war service and not in trade. England’s importations have dropped from 54,000,000 tons, prior to the war, to 26,000,000 tons, which she estimates as the maximum possibility of her importations during the year 1918. This proposal to make all trade subordinate to the efficient prosecution of the war seems sound from every point of view and one which should appeal to and be promptly adopted by the United States. The release of many hundreds of thousands of German soldiers now held as prisoners in Russia and the cessation of operations on the eastern front, constitute a definite shift in the balance of man power between the two groups of belligerent nations, and indicate in the very near future a very grave increase in the pressure on the Allies’ western front. In other words, the military situation is of such gravity as to transcend in importance every other consideration affecting ship-ping, and it is my opinion that we should not hesitate to adopt the English point of view that all considerations of mere trade and commerce in the employment of our shipping should give way to the paramount requirements of the situation on the western front and to the urgent need of throwing all our strength into the reinforcement of the perilous Allied position at this point.

The discussions in London with regard to neutral tonnage in general turned upon the disposition of the Norwegian tonnage. No concrete progress was made until toward the close of our stay in London. We were unable to fully appreciate the British contention that they had concluded an agreement with the Norwegians, in view of the fact that the Norwegians were still negotiating in Washington for an exchange of tonnage for imports. On November 20, two days before our departure from London, I had an opportunity to bring the matter up at the meeting of the War Cabinet, above referred to, and suggested that to save further discussion, loss of time, and incidentally the deprivation which both nations were suffering from the non-employment of Norwegian tonnage, that all neutral tonnage acquired by Great Britain or the United States should hereafter be utilized only in war service and should be allocated equally between England and the United States. This proposal was referred to a sub-committee, as appears in the printed memorandum of the proceedings of the conference, which is filed with the Shipping Board, and before the day was over had received the assent of the British authorities. In my opinion it should operate to our immediate advantage, as we shall receive not less than 500,000 tons dead-weight of Norwegian shipping as the immediate result of the agreement.

5. German Tonnage in South America

It was the consensus of the committee on maritime transport at the Paris conference that the negotiations for the charter or acquisition of the interned and refugee tonnage belonging to Germany and Austria and now situated in South American ports be conducted by one nation, the others to refrain from independent negotiations, which might delay results.

It was further deemed advisable that the United States should conduct these negotiations, sending special representatives for the purpose to the South American countries where this interned and refugee shipping is situated in order to avoid the confusion of conducting these difficult negotiations through the roundabout channels of diplomacy, and the delays of cable or mail communication.

6. Port and Terminal Arrangements in France

The large number of American transports and cargo vessels now arriving in France has seriously taxed the port and terminal facilities at the three ports now in use, to wit, Bordeaux, Brest and St. Nazaire. The importance of an expeditious discharge of cargoes and the quick turn-around of vessels in their relation to the efficient employment of our tonnage needs no demonstration. While this subject is within the immediate province of the Army and Navy, I nevertheless requested Mr. Day and Mr. McBride, while the Inter-Allied Conference was in session in Paris, to visit Bordeaux, in company with General Bliss and Admiral Benson, and later they visited St. Nazaire and Brest. I deemed it desirable that the Shipping Board should have its own impressions of the nature of the difficulties at these ports and the character of the problems to be solved, in order that such cooperation as it can give to the Army and Navy may be effective. Interviews were had with the general commanding at Bordeaux, and at both Bordeaux and St. Nazaire with the quartermasters in charge and the engineer officers in charge of construction at each port, and the engineer officers in charge of operations. I had the opportunity of an extended conference also with Brig. Gen. Wallace W. Atterbury in Paris, the problem being one which is receiving his special study. Colonel Wilgus was present at this conference.

Detailed reports on this subject are filed with the Shipping Board.

7. Coordination of Effort

The subject most emphasized at the Inter-Allied Conference was the necessity of a greater degree of coordination of Allied efforts. No concealment was made of the belief that the reverses and disappointments of the Allies have been due to the failure of such coordination, with the consequent waste of men and materials. In all discussions of the shipping situation no subject received greater emphasis than this of coordination, and yet I am of the opinion that the problem was merely stated and restated with sundry variations of phrase, and that no thorough-going or satisfactory formula of coordination was evolved from the conference. In fact I question whether coordination by agreement between the Allied nations is a genuine possibility. Inveterate jealousy, traditional mistrust, acute self-interest, domestic politics, irreconcilable slants of racial and national bias—all conspire to baffle attempts at coordination.

And yet some progress in this general direction may come from the various committees of information and recommendation that were suggested, and doubtless some degree of unity of direction and effort may result from the conference. The coordination, however, which is needed is something which has authority and can exact compliance. This type of coordination, I fear, cannot be evolved by agreement among the present Allies. It must come, if it comes at all, as the resultant of compelling circumstances or of conditions which have in them certain potential and coercive elements, not yet present in the situation.

It may come in connection with the appearance of a commanding military figure. No such figure has yet arisen. The generals who have thus far appeared are of the conventional type. They have had brief successes, which have aroused high expectations, but like sparks they have faded out in the very instant of their appearance. For reasons that could be readily stated, I think it is not to be expected that either England, France or Italy can assume the role of director-in-chief of the war or of its related operations. Can America play this role? Not yet. Our efforts have not yet touched the popular imagination in the Allied countries. Our loans, while unprecedented in amount and appreciated by the financiers and Ministries of England, France and Italy, do not spell actual participation in the war from the popular standpoint. Our soldiers in the field are relatively few, and they have not yet had the opportunity to give proof of their metal. Our shipbuilding program is of unparalleled magnitude, but it is still only a program in course of realization, and not yet felt as anything more than a sentimental factor in the situation. Our great resources in materials and foodstuffs depend upon transportation in order to be effective as aids to the general Allied position. Nevertheless it is only from America that this authoritative direction can proceed, which is the solitary clue to the “coordination” all are seeking. I incline to the opinion that the next five or six months will be critical in the extreme and will witness an attack in force on the western front by the Central powers. It is highly probable that the French and British line will have to yield in places, and that the general situation on the Belgian-French line will be less favorable at the close of the winter or in the early spring than it is at present. If the losses due to the submarine continue at their present rate, the intervening five or six months will witness a further and serious diminution of the already depleted world tonnage with a resultant accentuation of the present shortage of essential supplies among the Allies. In the meantime, however, we shall have succeeded in transporting additional troops and augmenting our slender forces in France. Our shipbuilding program will have made appreciable progress. In short, our power will have developed as the strength of the Allies will have declined. There will be a clearer perception of the indispensable part of America in the defence of the Allied nations against the German menace, and an increased sense of dependence upon America for the necessities of life and resistance. America may find herself not only tempted to assume the direction of operations which are now proceeding upon the unregulated initiative of individual nations, but the Allied nations may be insistent that America assume and exercise such direction and control.

In either one of these two ways—the advent of the Corsican figure, or the emergence of the solitary and ultimate strong nation—and only so, will the coordination that amounts to authority plus obedience come about.

I file herewith a translated memorandum of the discussion in the committee on importations and maritime transports of the Inter-Allied Conference. This memorandum was prepared by the Secretary of the French Minister of Commerce. It is a résumé not of the committee’s action, but of its deliberations. Action was confined to the adoption of the resolution set forth on page 18 (supra).¹

Bainbridge Colby

December 14, 1917.

[Annex]

Resolution of the Committee on Importations and Maritime Transport of the Inter-Allied Conference

The special committee for maritime transport and general imports of the Inter-Allied Conference of Paris has decided by unanimous resolution of the delegates of the United States of America, Great Britain, Italy and France, that it is necessary to arrange a form of cooperation between the Allies which will secure the following objects:

(a) To make the most economical use of tonnage under the control of all the Allies;

(b) To allot that tonnage as between the different needs of the Allies in such a way as to add most to the general war effort; and

(c) To adjust the programmes of requirements of the different Allies in such a way as to bring them within the scope of the possible carrying power of the tonnage available.

To secure these objects an international board with complete executive power over a common pool of tonnage had been proposed, but has been rejected for the following reasons:

It would be difficult for any country and particularly for America and Great Britain to delegate absolute power to dispose of its tonnage (which is the basis of all its civilian and military requirements) to a representative or an international’ board on which he might be outvoted. Such a board moreover would not lead to administrative efficiency partly because the complete control of all tonnage can scarcely be well concentrated in one place and partly because representatives upon it would tend to be at once out of touch with the actual administrative executive machinery and at the same time scarcely invested with sufficient authority to make reductions in the various supply programmes, munitions, food, etc.

The problem of the allocation of tonnage is largely a problem of securing that the different requirements which make demands upon tonnage should be adjusted in the fairest and best way, and these requirements can only be so restricted by the experts in each class of commodities. It is for instance impossible for any except the munitions experts of the different Allied countries to deal with the restriction of the Allied munitions programmes within specified limits.

The Allies are accordingly agreed:

(a) That America, France, Italy and Great Britain will all tabulate and make available to each other a statement showing in detail and as nearly as possible in the same form each class of requirements for which tonnage is needed and, secondly, the tonnage now available and likely to be available in the future through new building, etc. These requirements having been classified (showing the source of supply, etc.) and having been adjusted (1) to secure a reasonably uniform standard of adequacy both as between classes of commodities and as between countries, and (2) to bring the total within the carrying capacity of the Allies as a whole, will form the basis on which the general allocation of tonnage will be determined. The calculation will be revised at convenient intervals in the light of losses, new building, war requirements and other factors in the problem; but it will be an essential feature of the scheme that subject to such periodical reallocation each nation shall manage and supervise the tonnage under its control.

(b) That the neutral and interned tonnage obtained through any channel and by whatever country shall be used in such a way as to increase by an equal extent the tonnage in direct war services, the extra tonnage being allotted so far as practicable to the most urgent war need of any of the Allies. The method of allocation will be worked out later, but the principle is recognized that it is urgency of war needs and not the method by which the tonnage has been obtained that is to be the criterion.

(c) That steps shall be taken to bring into war services all possible further tonnage, such as that in South America, etc.

(d) That control over cargoes carried shall be such as to ensure that they satisfy the most urgent war needs in respect of which the tonnage has been allotted.

To carry out (a) and (b) above Allied bodies for the different main requirements for food, for munitions and for raw materials will be formed on the model of the Wheat Executive, America being associated with these bodies.

It being necessary in order to obtain decisions by the respective Governments that each country shall designate one or two Ministers—the United States one or two special delegates—who will be responsible towards their respective Governments for the execution of the agreements arrived at and who will meet in conference as Allied representatives as may be necessary from time to time, whether in Paris or in London, according to the circumstances of the case, either on their own motion or at the request of the executive departments, it was resolved that—

For the purpose of carrying out the common policy above indicated the appropriate Ministers in France, Italy and Great Britain together with representatives of America shall take steps to secure the necessary exchange of information, and coordination of policy and effort, establishing a permanent office and staff for the purpose.

After the review of the present tonnage position and of the efforts being made by the European Allies, it was agreed unanimously by the representatives of America, Great Britain, Italy and France, that the annexed statement should in the name of the Inter-Allied Conference be presented to the American Government as representing the claim which the situation makes upon America so far as regards her participation in the solution of the tonnage problem.

Annexed Statement

1. It is important that America should aim at building at the rate of six million tons gross (that is nine million tons dead-weight) in place of the present programme of six million tons dead-weight per annum.

2. It is important that she should supplement the assistance given to France and Italy by Great Britain by providing at least one-half million tons dead-weight in the immediate future and by raising this figure to an average of at least one and one-fourth million tons.

3. Having regard to the projected military effort of America the foregoing assistance can only be provided if America—

(a) Takes every possible step to bring into war service neutral and interned vessels now idle or out of war service;

(b) Obtains the maximum assistance from Japan;

(c) Reduces her own requirements of imports (e. g., by restricting civilian consumption) and requisitions drastically from her own trade.

4. Great Britain in promising further assistance to the Allies to meet their increased cereal demands, has done so in the hope that America will help with additional tank tonnage to the extent of rendering unnecessary the further uneconomical use of double bottoms in British cargo vessels for oil fuel for the Navy (100,000 tons a month). It is hoped that America will take steps to provide sufficient tank tonnage for this purpose and to meet the deficit in stocks by requisitioning tankers from their present commercial employment, 100,000 tons dead-weight being immediately required and a further 200,000 as soon as possible.

Report of the Representative of the Food Administration ( Taylor)

On my arrival in London, I immediately placed myself in touch with Lord Rhondda and the different organizations of the British Government endowed with the responsibility of importation and distribution of foodstuffs.

The organization of food control in Great Britain is different from that in the United States, in that control of consumption came last. The necessity of importation of foodstuffs to as large an extent as three-fourths of the total food supply led early in the war to the formation of import executives, whose function it was to bring in the needed foodstuffs.

The United Kingdom did not at the same time approach the separate problems of securing food supplies and controlling the use of food supplies. The first efforts were devoted entirely to importation. Later on, under the Department of Agriculture, intensive efforts were put forth upon an ambitious production program. Last of all, the office of Food Controller was created a year ago. It was first filled by an entirely incompetent man, Baron Devonport, who was later replaced by the present incumbent, a very competent man, Lord Rhondda.

In the first years of the war, the importation of foodstuffs, especially of cereals, was carried on with no particular reference to France or Italy, since scarcity of tonnage had not yet enforced a unification of efforts of importation. A little over a year ago, the present executives were organized. There are four executives: the Inter-Allied Wheat Executive, the Inter-Allied Sugar Executive, the Inter-Allied Meat Executive, and the Inter-Allied Executive for Fats and Vegetable Oils. These executives sit permanently in London, France and Italy being represented by members who give their entire time to the work. The positions occupied by these executives are at once very responsible, onerous and also unfortunate. It is their duty on the one hand, having received the estimates of the Food Controllers of the three countries, to search through the world for the purchase of the named food supplies at the lowest prices and under such regulations as the Treasuries of the countries may impose. It is their function, on the other hand, to secure from the chartering executives, the tonnage necessary to carry these foodstuffs to the Allied nations, and to force that priority against the industrial and military needs for tonnage. These obligations to and from both sides have become more and more difficult with each month; and greater restriction in conditions of purchase are imposed by the respective Treasuries upon the several countries, ever since our entrance into the war. With increasing scarcity of tonnage, the priority for shipment of foodstuffs has become more and more difficult, greatly accentuated by the failure of the cereal crops of France and Italy in 1917.

To a certain degree the British Food Controller is subordinate to the executives, to a certain extent, he can command them. There is a certain minimum amount of money and a certain figure for importation which the Food Controller has the pledge of the Prime Minister that he can command. Beyond this point, he is under restraint by the Treasury and by the Chartering Executive, with the Wheat Executive standing as buffer between. It can not be stated that this system is from any point of view logical. It arose as a result of accumulation of circumstances, and, apparently, must be continued, because it is easier to go on with the present procedure than to attempt any radical reconstruction at this time.

It is obvious from this general survey that the representative of the United States Food Administration not only had dealings with Lord Rhondda but also with the Wheat Executive, the Sugar Executive, the Meat Executive and the Fat and Vegetable Oil Executive, since each of these are desirious not merely of importing certain amounts of the respective commodities into their countries, but wish to import the maximum amounts possible from the United States, on account of scarcity of tonnage and to take advantage of loans made by the United States Treasury.

Numerous conferences were held, but the cereal program represented the greatest difficulties. The head of the Wheat Executive, is Sir John Beale, a man of unusual ability. The leading French and Italian representatives are Monnet and Attolico, who also represent their various countries upon the several executives. The program of the Wheat Executive for the years 1917–18 is based upon desires of the respective peoples, for a normal cereal ration. They did not wish any restriction in consumption or repression in any direction, despite their low crops. It was their hope and desire to continue the normal consumption, as had been the case since the beginning of the war. This was regarded as impossible by the American representative on account of the low yield of wheat in North America in 1917. Numerous conferences held in London were devoted to attempts at solution that should represent a certain degree of control upon consumption by the food authorities of the Allied nations on the one hand, and a certain exportation above the normal exportable surplus by the Food Administration of the United States. Unfortunately, these meetings were held so late as to render the problem very difficult, because practically one-third of the crop year 1917–18 had already elapsed before the necessity of repression had made itself evident to the Food Controllers of the Allied nations. Had the Allied nations continued to receive cereals, especially wheat, from North America to the extent stated in the original shipping program, this would have imposed upon the United States repression in consumption of wheat whose fulfillment could scarcely have been believed possible, and which in any event would have necessitated grave public control. The Allies had also allocated to themselves shipments of cereals from Argentine and India in amounts that it was quite certain they would be unable to lift.

The results of the conferences in London were two weeks later reaffirmed in the general conference in Paris. The Allied nations undertook to introduce such extensions of their rationing systems, upon a compulsory basis, as would materially reduce the consumption of cereals in their respective countries. The United States undertook, on the other hand, such extension in exportation of other cereals than wheat, as would enable the peoples of the Allied nations to submit to their respective peoples a cereal ration that could not be regarded as drastic.

It is with no sense of criticism but merely as record of actual fact that the writer feels constrained to point out that the consideration of the program of cereals required by the Allied nations has from the beginning been dominated by the point of view of importation and distribution, leaving the matter of consumption largely, indeed almost entirely, to the unguided voluntary regime of the people. The British Controller could ration over four-fifths of his people, the French and Italian Controllers about two-fifths, these fractions representing the portions of the respective populations that depended directly for cereals upon imported grains, since it was contended and indeed conceded that the rural populations could not be deprived of their home-grown grains. The several food authorities had not undertaken rationing in bread on account of fear of their working classes. In Great Britain the labor unions were feared, in France and Italy the munition workers. The psychology of the working classes in these countries had been so distorted by the food blockade propaganda of the press that the natural foundation upon which a reasonable rationing system might have been erected was destroyed. Each month the peoples had been assured that the collapse of Germany through famine was imminent. Now at the end of two years’ drastic food blockade of the enemy, the Food Controllers of the Allies were face to face with the necessity of reversing their positions, admitting that the enemy had not been starved out and placing their own peoples on rations, with assurance that such rationing was not in the least deleterious. It was indeed a difficult situation.

In connection with sugar, meats and fats, the problems were much less acute. The present prospects for sugar within the carrying domain of the Allies is apparently equal to, or in excess of, the tonnage. With moderate restriction in the United States, it is clear that the Allies can obtain from Cuba as much sugar as they can possibly haul. Indeed, figures to date indicate definitely that the Allies will not lift the allotments. The Allies’ sugar rations are low. They are, however, low largely as an expression of tonnage. In the case of meats and fats, the result of the conservation measures of the United States Food Administration and of the stimulation of production, directed from the White House, the United States Food Administration and the Department of Agriculture at the producing classes, give promise to result in material increase in the supplies of meats and fats, both of animal and vegetable origin. Under the circumstances, it seems clear that the desire of the Allies to ship as large a portion of their meats and fats from America as against the Argentine, the Orient and Australia may be gratified, with consequent saving of tonnage that runs into large figures. This is of particular importance to the agriculture of the United States, because it is especially in the direction of production of meats and fats that stimulation results in increased production, since the processes of production are continuous, and not seasonable as in the case of cereals.

In the numerous negotiations held with executives devoted to sugar, fats and oils, the same point of view was evident that was noted in the conferences with the Wheat Executive. Everywhere the point of view was that of the importer, shipper and distributor. The point of food administration from the standpoint of the consumer in the direction of conservation was always far in the background.

A study was made in London of the results of the voluntary rationing system. This has led in the United Kingdom to very light results in conservation. What was saved by certain classes was more than consumed in the increased visualization of other classes; the result of the unusual prosperity due to high wages. There had been reduced consumption of imported meats with increased consumption of domestic meats; this not unwelcome, since it was necessary to reduce the count of domestic animals in order to economize upon the importation of feeding stuffs. There was marked reduction in the consumption of the sugar, and only a moderate consumption of fats, both the expression of stringency in tonnage, since all of the sugar flows through the hands of the Food Controller, and most of the fat is likewise so distributed. In the case of cereals, the total consumption, as applied to the United Kingdom, had risen 5 per cent. England itself had a large potato crop. Attempts were under way to utilize the excess of these by control and through conservation. A campaign for the increased consumption of potatoes had been undertaken, but had not led to satisfactory results.

The hotels and public eating houses were under legally defined restrictions. The serving of bread, butter, bacon, ham and beef were distinctly limited, and wherever one went these regulations were, apparently, observed. There was no limitation in the serving of fruits, such as were available, vegetables, fish or seafood. There was definite limitation in the serving of desserts made of flour, sugar and butter. All in all, one could not fail to be impressed with the fact that the hotels were attempting to follow in a faithful manner the regulations imposed upon them. It was at the same time clear that the regulations were not sufficiently definite to result in notable conservation.

Elimination of waste, recovery of garbage and utilization of garbage through reduction processes have all been greatly perfected in England during the past year. When the writer contrasts the situation observed in November, 1917, with that of 1916, the great progress that had been made was clearly evident, in every direction.

The impending step of the food authorities lies in the direction of repression, like that imposed upon the people of Germany by the food blockade, although it need not approach it in rigor. In the opinion of the writer, if the mean food consumption of the United Kingdom and the mean food consumption of Germany be compared, and the situation contrasted with the visible supplies for the United Kingdom until the on-coming of the new harvest, it ought to be possible to allow a ration that shall represent about half the distance between the normal British ration and the ration of the industrial classes of Germany during the past year and a half.

The stocks in England have run somewhat low, and with the continuation of depleted tonnage it is possible that the stocks may become so low prior to the entrance of the new crop as to cause serious suffering in certain classes. This suffering will not be of such nature as to cause sub-nutrition, but it is possible that it may be of such danger as to cause official unrest, serious outbreaks and uprisings. The great congestion of population in the cities makes equitable distribution very difficult. It is easily possible that added severity in the sinking by submarines, or added efficiency in the warfare against submarines might prove the decisive factor in the maintenance of national victualment in England, France and Italy during the coming months of summer prior to the harvesting of the new crop.

It is the conviction of the writer that the morale of the British people has distinctly improved in its relation to the Food Administration as compared with that of a year ago. It is the opinion of competent judges in the United Kingdom that the British working classes will tolerate to-day regulations and restrictions of food supplies that they would have resented, or indeed rebelled at, one year ago. This is true, partly to a deepened realization of the necessities of the situation, partly to increased confidence in leadership, and partly to a strengthened conviction as to the meaning of the war and the necessity of ultimate victory.

In Paris, two sessions of the Inter-Allied Conference devoted to problems of re victualment. These were devoted largely to the cereal program for the present year. Lord Rhondda, Sir John Beale, the French Food Administrator, M. Boret, the Sub-Director of Food Control, M. Vilgrain, the French delegates upon the permanent executives in London, the Italian Food Controller, Crespi, and the Italian members of the permanent executives were all present at this Paris conference. The discussions, therefore, involved the same problems, with the added viewpoint of the officials of France and Italy. The appended statement represents the substance of the address made before the revictualment section of the Inter-Allied Conference by the American representative.¹

In this conference the particular needs of the French and Italian people were analyzed and evaluated. Not only were the crops of these countries a failure, they were also unfortunately spotted. Certain areas scarcely recovered their seeds, other areas had eaten during the first three months the entire crop in excess of the seed. It is very difficult in France and Italy to move home-grown corn from one section to another.

In every direction the difficulties of agriculture had become more and more pronounced. The fact was emphasized that the French and Italian people were more dependent upon cereals than is the case in the United Kingdom and the United States, and that a material reduction of the bread ration in these countries would constitute a more serious infraction than would be the case in England and the United States. On the other hand, it was freely conceded that no serious attempts had been made at food control or conservation. They had relied upon the natural instinct and thrift of the people to maintain consumption at a low level. It was, however, granted that this was not sufficient under the evil of the day and that rationing would become necessary. Rationing of sugar was already in existence in France and Italy, and the rations were low.

The morale of France is known to be much improved. That of Italy had reached a low plane, but due to their adversities and misfortunes, it had been improved. The total situation in Italy gave a morale of desperation if not one of hope. There was indeed great clarity of the political atmosphere, which resulted in increased confidence in the leadership in these countries, both from the standpoint of military policy, political control and industrial organization. Crop prospects are very much superior to those of last year, and with the development of the season will tend to maintain the morale that would scarcely otherwise be justified by actual condition of resources and stocks of food in Italy and France.

One point stood out very clear in the discussions in Paris, of which some mention must be made, the lack of co-ordination between the authorities of the three nations. Apparently, they do not trust each other. At least, they do not desire to assume before their own peoples repression in consumption, because they have not the conviction that the administrations of the other two countries are undertaking the same measures. From every side it was clear that the co-ordination and leadership are lacking, could not arise in any one of the three countries and had to proceed from the United States. Anomalous and paradoxical as it may appear, the Food Administrations of the three countries look upon the Food Administration of the United States in an entirely different manner than they regard each other. Under these circumstances, the motion by the American delegate at the conference in Paris for the creation of the Inter-Allied Commission on Alimentation was promptly passed as an expression of the desires of all concerned.

This commission is to consist of eight authorities on nutrition; two from the United Kingdom, two from France, two from Italy and two from the United States. They will sit more or less continuously in Paris, although devoting time to the different countries for investigation of conditions. It is the purpose of the commission to make recommendations to their respective Governments as to operations of revictualment that shall apply to feeding the Allies as a unit. This commission will have not only a definite function in correlation of efforts of food control in the three countries; it will have the additional advantage of a scientific point of view. The Food Administrations of England, France and Italy have been practically devoid of scientific point of view. They have developed out of the administration of importations, and have not had the impress nor received the advantage of a clear-cut scientific formulation of the problem. Strange as it may seem, scientists in the United Kingdom, France and Italy will in this Inter-Allied Commission on Alimentation possess for the first time proper opportunity of impressing their viewpoint upon the food authorities of their own countries. The American members upon this commission will be Prof. Russell H. Chittenden of Yale University and Prof. Graham Lusk of Cornell. With the entrance of this commission upon its labors, one of the accomplishments of the Paris conference will have reached fruition.

One additional result of the visit of the representative of the United States Food Administration at this time lies in the greater influence that now exists for the European representative of the Food Administration. Mr. L. P. Sheldon, who was at that time representing Mr. Hoover, a man of wide business experience, long European residence, force, intelligence and integrity in the American point of view, had prior to his attending the conferences on food in London and Paris extending nearly two months, not possessed the grasp on the situation that was necessary for the proper representation of the United States Food Administration in London. This knowledge and experience, Mr. Sheldon now possesses. He has been entrusted also with representation of the War Trade Board, whose affairs are in so many ways interlocked with the Food Administration. We now possess a representative whose knowledge, dignity and influence is worthy of the Food Administration and will result in accomplishments of very material denominations. The absence of a representative of the Food Administration in Paris was felt to be a serious omission.

It is a very great pleasure to testify to the esteem enjoyed by Mr. Herbert C. Hoover in the mind of everyone in the United Kingdom, France and Italy. Expressions from every class of society in every direction and of public officials everywhere testify not only to confidence in the integrity of the administrator, but also to confidence in his ability and humanitarian sympathy. Europe remembers the Hoover of Belgium and sees in the United States Food Administration merely an enlarged edition of the same masterpiece.

The writer takes great pleasure in acknowledging the broad consideration displayed by Ambassador House to the members of his mission. In conferring upon his associates authority and responsibility in the conduct of their special negotiations with their Allied conferees, he at once placed them upon the correct plane of high dignity in the estimation of the authorities of the Allied countries, and secured from them the highest manifestation of their capacities.

It is also incumbent upon the writer to testify also to the faith and confidence felt in the Allied nations that the people of the United States are not only willing, but will be found capable of such sacrifice as may be necessary in order to maintain the revictualment of the Allies. The Allies realize that for the men on the street or on the farm to visualize the war from a distance of three to six thousand miles from No Man’s Land is difficult. They believe in the idealism of the American people; in their strength of determination, and in their love of liberty; and upon this they ground their faith in the ultimate capacity of the American people to carry whatsoever burdens war may impose upon them, and none the least of these, the burden of extensive modification of the dietary of the people of the United States in order that the subsistence of the Allies at the front may be maintained.

Alonzo Englebert Taylor

Report of the Representative of the War Industries Board ( Perkins)

My instructions were to learn what I could of and from the British and French Munition organizations, and to insist that demands made on the United States by the Allies should be properly coordinated in Europe.

[England]

We arrived in London late at night, Wednesday, November 7. Acting upon instructions from you, I asked the American Ambassador to put me in touch with Mr. Churchill, the British Minister of Munitions. My appointment with Mr. Churchill was at 12.45 p.m. on November 8. I met Mr. Churchill, Sir L. Worthington Evans, Sir Arthur Duckham and Sir James Stevenson. Mr. Churchill told me that he would place at my disposal all the information in the Ministry of Munitions, and that after I had had a few days’ study of the situation he should like to confer with me at some length. He cordially agreed with the view that the demands of the Allies on America must be co-ordinated in Europe; that America must be the arbiter of what must be supplied from America, and hoped that America’s requirements and the requirements of the Allies could be co-ordinated so that the most effective results possible might be obtained.

Mr. Churchill fully lived up to his promise to place at my disposal all the information at the Ministry of Munitions. Mr. Burgess, who came with me representing Doctor Ayres’ statistical department, was introduced at once to Mr. Layton, the head of the statistical department of the Ministry, and he found, as I found, everyone willing to give every possible assistance in getting all the facts and figures, even the most confidential, in the possession of the Ministry.

We also were able to make some study of the organization of the Admiralty and the War Office.

The situation as it now exists in England is the result of development from the system as it existed before the war.

Before the war the Army and Navy each had supply departments whose function it was to supply the needs of their respective services, the Admiralty having a supply organization whose duty it was to meet the requirements of the Navy, and the War Office having a department whose duty it was to fill the requirements of the Army. The Navy had been much the larger service, and in spite of the great increase which has taken place in the British Navy since the outbreak of the war, the proportionate increase has been nothing like as large as the increase in the Army, and the supply department of the Navy has been able to a large extent to supply the requirements of the Navy, and to a large extent it still attends to this work.

The organization of the War Office, however, proved entirely inadequate to deal with the enormous problems which resulted from the great and rapid expansion of the Army, and the Ministry of Munitions was formed initially to supply certain specific articles for the Army. From a comparatively small beginning it has grown until now it supplies the requirements of the Army for munitions of all sorts and aircraft construction and supplies. The supply department of the War Office deals with all clothing, leather goods and food supplies. Theoretically the Admiralty continues to supply the Navy.

The situation then is that the duty of supplying the Army is dealt with by the Ministry of Munitions and the War Office, the Ministry of Munitions supplying what roughly may be called hard materials, and the War Office supplying soft materials. The Admiralty itself supplies the Navy. The Admiralty also has complete charge over the building of ships of every kind, whether naval ships or commercial ships. The situation as thus outlined is modified to some extent by the fact that the development of the work has resulted in one or the other of the supply departments getting control of certain raw materials or manufacturing capacity. For instance, the War Office controls wool, the Ministry of Munitions steel and copper and a large part of the gun and shell manufacturing capacity, consequently the Admiralty has to get wool for its clothing from the War Office, and steel and some guns and shells from the Ministry.

The function of the Ministry of Munitions, the supply department of the War Office, and the supply department of the Admiralty, is a supply function purely and simply, neither the Ministry of Munitions nor the supply department of the Admiralty or of the War Office have anything to do with the creating of requirements, or, to put it in another way, the formulating of demand. It is important that this line of distinction should be borne in mind.

The formulating of demand is done ultimately by the War Cabinet. That is to say, the heads of the respective services determine upon the program which they wish to carry out. This program is passed upon by the War Cabinet and approved, thus in effect establishing a budget. The Priorities Committee of the War Cabinet, at the head of which is General Smuts, then determines the relative urgency of the several items of the program, so that after the program has been approved by the War Cabinet and passed upon by the Priorities Committee of the War Cabinet, the demand for the services is formulated and the order in which that demand is to be filled is determined.

The duty of the Ministry of Munitions is to fill those requirements of the Army thus formulated, which fall within its sphere of activity.

The organization of the Ministry of Munitions I shall not attempt to go into in detail in this report. The general outline is as follows: The Minister of Munitions is the head of the organization. He is president of the Munitions Council. He has two vice presidents and a secretary of the council. There are in addition to the two vice presidents, eleven members of the council for the following named departments: design; steel and iron; materials; explosives; projectiles; guns; engines; allies; labor; and secretariat, the head of the secretariat department being also secretary of the council. This council settles the general policy of the Ministry, and each member of the council has under him a group of sub-departments, each of which in turn has a man at the head of it.

The method of operation is as follows: All requisitions enter the Ministry through the department of requirements and statistics, which is a sub-department of the secretariat, and at this point are subjected to a careful statistical supervision to see whether they can be filled with existing facilities, and how they should be filled, and what the effect will be upon the available sources of supply and manufacturing capacity. If the requirement is one which can be filled with existing supplies and manufacturing capacity, without throwing the schedule out of equilibrium, the requirement is passed on from the department of requirements and statistics to the appropriate supply department, where the order is filled in due course.

If the requirement is one which cannot be filled with the available sources of supply and manufacturing capacity, it is sent back by the department of requirements and statistics to the department of the Army which issued the requisition, where it is reconsidered in the light of the criticism made by the department of requirements and statistics. There the importance of the requirement is reconsidered, the possibility of a substitute is considered, and the requirement after such consideration is sent back again to the department of requirements and statistics, either as amended or in its original form as is determined by the appropriate branch of the service. The question, if a serious one, is taken to the War Cabinet for final determination.

If the requirement, when it comes back to the department of requirements and statistics, has been amended so that it is one which can be filled in the normal course, it is sent to the appropriate supply department to be filled as described above.

If, on the other hand, the requirement as it finally comes in calls for the creation of new or additional facilities, a careful study of the best means of creating such facilities is made by the supply departments. The existing plants capable of manufacturing the article in question are considered in the light of other demands upon their facilities, of their transportation facilities, of their danger from aircraft attack, and of their accessibility to existing supplies of raw material and to available supplies of labor and the possibilities of housing labor. The question whether the addition shall be made to an existing private concern or to a nationally owned concern, or whether new construction shall be made by an existing private concern or a new national factory installed, is also considered. These questions being determined by committees of the departments interested, or, if they are unable to decide, by the Munitions Council, or by the Minister, or in extreme cases even by the War Cabinet, work is put in process.

After each requirement has been received by the appropriate supply department, whether such requirement be a routine requirement or an extraordinary requirement, the supply department makes an estimate of the amount of material and manufacturing capacity which will be needed to fill the requirement. This estimate is sent back to the department of requirements and statistics, where it is checked against the available supplies of raw material and capacity, and criticized. If the department of requirements and statistics approves the estimate, the work is put in process; if it disapproves the estimate the same course is followed as in the case of an original objection by the department of requirements and statistics.

Before any work is finally allotted to any private concern, whether it be an ordinary routine requirement or an exceptional requirement such as I have just described, the question is submitted to the contracts department, which examines the proposed arrangement, sees that the contract is in proper form, and that the price at which the work is to be contracted for is reasonable. The contracts department does not actually trade out the price, but subjects the contract to a financial examination to see whether it is reasonable or not.

The Ministry has adopted a plan of limiting the percentage of profit of all private concerns engaged upon work for it, the scale being 4 per cent on the first £1,000,000, 3 per cent on the second £1,000,000, and 2½ per cent on all above. This plan is said to work well.

All work when completed in the factory passes into what is known as inspection bond, from which it is not released until it has been inspected by the inspection department. The inspection department is a sub-department under the main department of design, and is independent of any of the supply departments. When passed by the inspection department the articles may be delivered at once to the Army, by which they may be stored either in England or in France, or may go into storage controlled by the Ministry. This matter is largely decided by the urgency of the necessity for the article, transportation facilities, and available storage facilities.

The order in which requirements shall be filled is determined primarily by the Priorities Committee of the War Council, which as stated above determines the relative urgency of the several programs. Bulk orders when placed are given their respective priority by interdepartmental agreement, allocating raw materials or manufacturing capacity; the inter-departmental agreements being based on the rulings of the Priorities Committee of the War Cabinet.

After disposing of the large or bulk orders, however, there are left a large number of priority questions to be determined. These questions are determined by the priority department, which consists of (1) an executive branch, and (2) a priority committee. The executive branch is presided over by Mr. Edgar Jones, Controller of Priority. He has his staff divided into sections, each of which has charge of questions involving separate subject-matters. The questions which come in are turned over to the head of the appropriate sub-section, who makes a study of the questions and a report. These reports are considered by Mr. Jones, or his deputy, and the appropriate priority determined upon. These determinations are then embodied in the form of agenda for consideration by the priority committee, and are in several classes. Routine questions, the answer to which is practically determined by rulings that have been made before, are all put in one class, and these, while theoretically subject to revision by the priority committee, in effect are passed without examination by the committee, and go through as a matter of course. Questions about which Mr. Jones or his deputy feel doubt are in the second class, and may be brought up for discussion at the meeting by any member. Questions of this class are passed as a matter of course unless a question is raised by some member of the committee at the meeting. The other class of questions are those which Mr. Jones thinks should be considered by the committee, and these are discussed at the meeting and decided by the committee. Agenda for each day’s meeting are sent to the members of the committee the night before.

All decisions of the committee are unanimous, no orders being passed except by unanimous consent, and the committee is composed of representatives of the several departments of the Ministry, a representative of the Admiralty, and a representative of the Board of Trade, who undertakes to speak for the commercial needs of the country.

The contractor to whom a Government contract is let may issue certificates bearing his contract reference and number, or a contractor who has received a priority certificate may issue a certificate based on the one he receives to any sub-contractor or material man with whom he may deal. This has resulted, in some cases, in the issue by unscrupulous persons of duplicate sub-certificates and sub-certificates which were not warranted by any orders placed by the Ministry. There have been, however, a number of prosecutions for this, and although the idea of issuing certificates to sub-contractors direct from the priority division has been considered, the Ministry of Munitions have always been afraid that the effect would be to seriously handicap the progress of all industry, and that it is better not to try the independent sub-certificate.

One defect with their system that has bothered the priority people up to this time, has been that no adequate provision has been made for enabling a contractor to keep on hand a supply of the materials which it is necessary that he should have to enable him to do promptly any work that he may be called upon to do. The system which enables him to issue a certificate for his materials of the same class as the certificate issued to him for his main contract, leaves him without any means to procure supplies until the contract is actually placed with him. Mr. Jones was, when we were in London, just putting into effect a plan by which recognized contractors would be enabled to procure supplies under certain safeguards as to the use of those supplies, which he hoped would solve this problem.

area organization

In dealing with the organization of industries in England, the Ministry of Munitions divided the country into separate districts or areas, and organized each of these areas as a unit, all being coordinated through the central organization. This area organization has proved to be one of the most valuable points in accomplishing a complete and effective mobilization of industrial resources.

The result of the war and the development of the Ministry of Munitions has been to turn Great Britain very completely into a large manufacturing establishment which is engaged in war work, direct and indirect. The process has been one of growth, and the result has been brought about by the gradual occupation of all manufacturing facilities with war work, and the taking control by the Government of certain essential raw materials in which a shortage has developed. I did not get, while in London, a list of the industries which have proved to be essential. I have been promised such a list, which I hope to receive on my arrival in Washington.

I have a number of forms in use by the Ministry of Munitions, and detail descriptions of certain branches of the organization, which will I think prove of value to the War Industries Board, but would be too much in detail to be in place in this report.

I was very much struck by the excellent spirit of co-ordination which exists in the Ministry of Munitions, and by the quality of the men in the several departments. Every man was clearly actuated by the one motive of doing everything possible to accomplish the common end. I was met in the same spirit, and every bit of information was open to me, the only limitation being my capacity to absorb what was put before me in the time at my disposal.

Perhaps the most striking thing next to the quality of the men and the way in which everyone was doing his best to pull his share of the load, was the completeness of the statistical organization and the fact that the whole work of the country is based upon intelligent statistical knowledge.

war office

My study of the organization of the War Office was limited by the time at my disposal.

After ascertaining from General Bliss that it would be entirely agreeable to him to have me go to the War Office through the Ministry of Munitions, I asked Mr. George M. Booth, to whom I am deeply indebted for many courtesies, to arrange an appointment for me with the officials at the War Office.

Mr. Booth introduced me to Sir Reginald Brade, the Secretary of the War Office. He in turn took me to Mr. Andrew Weir, the Surveyor-General of Supplies, and his assistant, Mr. J. T. Currie. They explained to me the organization of their department, which is not essentially different from that of the Ministry. I went with them to their contract department and met the heads of the several sub-departments, and had a long talk with Capt. Claud Levita, who has been put in charge of the newly organized American section.

Captain Levita and Mr. Weir impressed upon me their entire readiness to place at the disposal of the American Army all the facilities which they had, at the cost to them, so that our Army could get what it needs from them so far as they had supplies available, at the same price that they got the articles themselves. When in France I took occasion to call this fact to the attention of our Army purchasing department.

The next day Mr. Weir took me to see the Army clothing factory and storehouse at Pimlico.

There is no matter connected with the study I was able to make of the War Office organization which requires comment, except the fact that having two supply departments for the Army results in a certain amount of overlapping that is obviously not an advantage. The disadvantage is reduced to a minimum by the excellent spirit of cooperation between the men in charge, but it is a disadvantage just the same.

admiralty

The time at my disposal was so short as to make impossible any study of the Admiralty that could properly be called a study. I had a short conference with Sir Eric Geddes, First Lord of the Admiralty, and was shown by him his system of statistical reports, and discussed with him the whole question of organization. He is very familiar with the Ministry of Munitions, having worked in the Ministry. He also had been in charge of railway transportation in France. He was of opinion that the best results could be obtained through one big supply department for both services.

The organization of the Admiralty supply department does not differ essentially from that of the Ministry of Munitions.

In addition to making a study of the several supply departments as above outlined, I attended expressly without any authority to act, an inter-Allied conference at which the question of the world’s supply of wolfram was discussed. At this conference, and at a later conference in Paris, the desirability of joint action in the purchase of wolfram and in distribution of the world’s supplies in such a way as to economize ocean tonnage, was made manifest.

I also took up with Sir Alfred Herbert, the head of the machine tools department of the Ministry of Munitions, several questions in regard to the machine tools which must be purchased in America to enable the British program to be carried out.

France

We arrived in Paris, Thursday, November 22, in the evening.

In France my time was quite completely occupied in conferences in regard to munitions questions with the representatives of the several Allied nations, and in working with our own Army officers over general’ questions of organization and certain concrete questions of supply and program. As a result, my opportunity to study the French Ministry of Munitions was comparatively slight.

M. Loucheur, the French Minister of Munitions, showed real ability throughout all the proceedings in Paris, and was most courteous and helpful in every way. I owe a special debt of gratitude to M. Ganne, who was with M. Tardieu in the United States. M. Ganne placed himself at my disposal, and by his knowledge of conditions in France and in America made my work much easier than it would have been but for his kindness.

It developed early in our conferences that the French and British were in a position and were willing to equip completely all American divisions as they arrived in France during the year 1918 with the best marks of British and French guns and howitzers. That the British and French ammunition supplies and reserves are sufficient to provide the requirements of the American Army thus equipped, at least up to June, 1918, provided that the existing 6-inch shell plants in the United States and Canada are maintained in full activity, and provided that the manufacture of 6-inch howitzer carriages in the United States is to some extent developed.

On the other hand the French, and to a lesser extent the British, require as soon as possible large supplies of propellant and high explosive, and the British require the largest possible production of 6-inch shells from now onward, and 8-inch and 9.2-inch shells from June onward. In both these matters they ask the assistance of the United States.

This situation in regard to guns and gun ammunition was worked out in detail by General Williams of our Ordnance Department and myself, in co-operation with the representatives of the British and French Ministries of Munitions and the British Master-General of Ordnance, and our conclusions were embodied in a draft of a telegram which was submitted to General Bliss and General Pershing and embodied in a telegram sent by General Bliss to the Secretary of War. The portion of the telegram dealing with this matter is annexed hereto.¹

I attended a conference at which there were present the British Minister of Munitions; Sir William Weir, the head of the aircraft department of the British Ministry of Munitions; and other British aviation experts; M. Dumesnil, the French Minister of Aviation, such Ministry being a sub-department of the French Ministry of Munitions; and a number of French aviation experts; the Italian aviation experts; and Colonel Boiling and several other representatives of our aviation department. At this conference it developed that for a certain period during 1918 the actually completed airplanes for use upon the fronts will have to be manufactured in Great Britain, France and Italy, and our contribution for this period must of necessity be the supplying of raw materials and semimanufactured materials. The French advocated the organization of a technical conference to sit in Paris to deal with the entire aviation program. The American representatives took the position that the time for a technical conference had passed. Colonel Boiling pointed out that five months ago he had advocated such a conference, but that now the time for action had arrived and certain practical questions must be decided at once and a definite program decided upon, and the American representatives took the further position that in contributing raw materials to the aviation program America had got to assume the position of arbiter as to the use to which those raw materials should be put; that certain types of machines should be selected and that the raw materials should all be used for those types; and that no materials should be wasted upon experimentation. In this position the British representatives supported us completely, and before I left Paris I was informed that it had been determined that Colonel Boiling should sit as chairman of an inter-Allied council upon airplane supplies. Colonel Boiling informed me that he hoped to have sent to America a telegram which would reach America before I did, giving in detail the aviation program. For this program it was agreed that effective priority should be granted.

I also attended a conference of the British, French and American representatives in regard to a tank program, at which it was decided that the French should limit their construction of tanks to the small six-ton Renault type of tank, and the British and Americans should consolidate upon the manufacture of the larger size tanks. A plan was worked out between Major Drain of the Ordnance Department of our Army, and Colonel Stern, the British Tank Commissioner, for the establishment of an assembling plant at Bordeaux, or some other satisfactory site in France. The plan as worked out was considered by the French Ministry of Munitions and approved. Major Drain and I worked out a draft of a telegram which was submitted to General Bliss and General Pershing, approved by them, and sent by General Bliss to the Secretary of War. A copy of this telegram is annexed hereto.¹

A set of resolutions were adopted by the munitions representatives at the Inter-Allied Conference of Great Britain, France, Italy and the United States, which resolutions were expressly subject to approval by the several Governments. A copy of these resolutions is to be annexed hereto.

I was deeply impressed with the size and difficulty of the problem of supplying our Army with its many needs. Some of these needs can be filled from European sources. As many of these needs as possible should be filled from European sources so that the demands upon ocean tonnage may be reduced to a minimum. Serious efforts are being made to solve this problem by the staff that General Pershing now has. The solution is as yet far from complete, and every possible effort should be made to lend General Pershing all possible assistance in this matter.

My conclusions, briefly stated, are as follows:

The situation of the war is extremely critical. Not only for the purpose of defeating the enemy, but to avoid disaster to ourselves and the Allies it is necessary that the United States should make a supreme and immediate effort.

There is no time for the United States to prepare what seems to it an ideal program for its Army, which program will materialize at some more or less distant date. Our efforts must be immediate and effective. To accomplish this it is necessary that there be intelligent co-ordination with the efforts of the Allies so that the greatest possible supplies of men and materials shall be available early in the spring of 1918. The materials and manufacturing capacity of the several countries must be used in a united effort to a common end.

To accomplish the necessary co-ordination there must be first, a body (a council or an individual) whose function it is to determine the program, or, to put it in another way, to formulate the common demand.

There are now in France and Great Britain bodies whose duties are to fill the several demands of their respective services. The demands are not now fully co-ordinated, and the work of supplying the demands is to a large extent unco-ordinated. Both countries, and Italy as well, have been using the United States as a reservoir to make up the shortages in their own resources.

The United States should at once organize a supply department, preferably a munitions department or ministry, with complete statutory powers; or, failing that, a board acting with delegated powers from the heads of the several services.

This supply department should be charged with the duty of filling the requirements of the several services of our own Government, and the requirements of the Allies.

This supply department should have the best possible man at its head, and the best organizing and executive ability in the country on its staff. It should organize the industrial resources of the country.

This supply department should have a man of first-rate ability in Europe, who should act in a sense as a member of Mr. Crosby’s staff to keep Mr. Crosby, as chairman of the Inter-Allied Council, thoroughly in touch with munitions questions, and who should also sit on the Inter-Allied Munitions Council referred to in the resolutions adopted by the munitions committee of the Inter-Allied Conference, if such Munitions Council is approved by our Government, as I recommend it should be. This European representative of the supply department should have an adequate staff of assistants.

In this way, and only in this way, can the efforts of the several countries be co-ordinated, their resources used effectively, and demands on tonnage reduced to a minimum.

In everything that we do in America we must bear in mind that there is a certain irreducible minimum of supplies which must be received by Great Britain, France and Italy to enable them to hold the enemy until the time when our own efforts can culminate. Our entire effort and program must be made in view of this fact, and these supplies must be given sufficient priority to ensure their being received by the several countries in question.

Respectfully submitted,

Thomas N. Perkins

December 11, 1917.

[Annex]

Conclusions of the Conferences of December 1

(armament)

I

The representatives of Great Britain and France declare that their output of field artillery, heavy ordnance and medium calibre guns is now mounted so that they are now able fully to equip as fast as they arrive in France all the American divisions during the year 1918 and to supply them with the best types of French and English guns and howitzers. The output and available stocks of French and English ammunition are sufficient to supply the American Army with all that it will need until the month of June if not later, provided that the plants in the United States and Canada for 6-inch shells are kept running to their full capacity and that some progress is made in the United States in manufacturing carriages for 6-inch howitzers.

On the other hand France, Italy and in a lesser degree England, must get as soon as possible large quantities of powder and explosives, and Great Britain must get the largest possible number of 6-inch shells beginning to-day and of 8-inch and 9.2-inch shells beginning in June, 1918.

On these two points they call for American assistance. Therefore, with a view to—

1. Establishing and facilitating the equipment of the American Armies in France;

2. Obtaining, in the end, the maximum development in munition supplies together with a minimum need of tonnage, the representatives of France and Great Britain propose that the field artillery, heavy ordnance and medium calibre guns be furnished during the year 1918 and as long thereafter as may be found expedient, to the Americans by the French and English gun factories.

They ask:

(a) That the American effort be immediately bent on producing the largest possible quantity of powder and explosives;

(b) That the plants already set up for the manufacture in the United States of 6.8-mch and 9.2-inch shells intended for Great Britain keep on working to their full capacity: Great Britain even asks that new and large plants for that kind of manufacture be set up without delay.

By this means only will it be possible to bring to a minimum the difficulties of ocean transportation and to carry to its maximum in 1918 and even more so in 1919 the possible output of shells and artillery supplies for the French, English and American Armies.

With respect to very heavy ordnance and certain special types of long-range guns, the representatives of Italy, France and Great Britain recommend that their manufacture be provided for in full accordance with their arrangements. They further think that the present output of material and 8-inch and 9.2-inch shells now being done in America must be kept up.

Finally, if the general principles hereinabove outlined meet with the approval of the Governments the measures to be taken as to manufacture and supply in accordance with the programs and schedules of stores on exact dates must be looked into jointly by the technical commission consisting of representatives of the great powers as hereinbefore set forth.

II

The representatives of Great Britain, Italy and France declare that the Commanders in Chief of the Armies of those nations have most earnestly laid stress the development of the manufactures for air navigation should be given [sic].

Therefore, the Governments of the three countries have decided that all manufactures of airships should be given preference in regard to supplies of raw material as well as labor and transportation. They deem it advisable to call the attention of the representative of the American Government to this suggestion of the Commanders in Chief in order that he may make the same recommendation to General Pershing and have no doubt that this opinion will be concurred in.

In that event, the four nations must agree that effective preference be given for a certain period to the manufactures for air navigation.

With respect to the United States the three Governments ask that during the period immediately following the conference the said preference be given to the orders placed in that country for raw material (steel, lumber, etc.) necessary for the working out of the present programs in Great Britain, Italy and France.

A technical conference which will meet immediately after the adjournment of the official conference will communicate to the American representatives the programs of the three nations and will at the same time state with greater precision what shipments must be rushed in order to carry on the air navigation program.

III

The representatives of the four nations have recognized the necessity of apportioning the manufactures in accordance with the facilities of production peculiar to each.

It is imperative that all the nations should not exert their efforts at the same time on one product, but that the guide in selecting the production to be effected in any one country should always be the consideration of lesser tonnage and of availability of more or less skilled labor.

IV

In accordance with this suggestion the representatives of the nations have given their attention to the two following specific instances:

1. Manufacture of aviation motors in Italy

It was found very desirable to let Italy give its greatest possible development to the manufacture of aviation motors which requires a comparatively unimportant quantity of raw material and justifies a judicious employment of its plants and other energies.

They note that if provided regularly with the needed raw material and also with the coal it must have Italy will be able to increase its manufacture of motors from 800 to 3,000 a month by June, 1918, and eventually to 5,000 by the end of 1918.

A large part of these motors would be set apart for the Allies.

2. Tanks

An organization in which all the Allies would join could be effected in the manufacture of tanks.

England has set up a new type. It can supply a part of the machined material. Assistance could be had from America and also from France and Italy eventually.

The mounting could be done in France at a plant in St. Nazaire or Bordeaux.

This plan would at once permit of a larger output and a national employment of the facilities of each nation.

The tanks so made would be distributed according to the share taken by each nation in the work of all.

It is likewise agreed that a technical conference on this point will meet immediately after the official conference adjourns.

To meet the situation in Italy an effort will be made to fix a special allowance.

V

It is noted that Great Britain and France already communicate to each other all their manufacture programs and statements of output and stocks in hand (armament and aviation).

All that information is centered in a bureau of statistics at the Ministry of Armament in Paris.

The three Governments ask the American Government kindly to communicate the same kind of information to the bureau of statistics.

Finally the representatives of the four nations suggest the creating of a Permanent Committee on Munitions and Aviation that will sit in Paris and be, as far as possible, composed of a representative from the Ministry of every nation as to armament and ammunition and a representative from the Ministry if possible, as to the manufacture of aviation material.

Each representative may be assisted by technical delegates.

The Permanent Committee will meet at least once a month.

A permanent section may even be created within the committee.

VI

The applications of Italy and Great Britain and France in the matter of ordnance, guns, machine guns, and all artillery raw material and manufactures are confirmed by it.

1. This and the following reports, which were submitted to Colonel House, pp. 334–445, comprise the report of the American War Mission to England and France, November, 1917.
2. In the list sent to the Ambassador in Great Britain in telegram No. 5731, Nov. 5, the words are added: “with honorary rank of Special Ambassador.” (File No. 763.72/13326a.)
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