033.1140/111: Telegram

The Acting Secretary of State to the Commission to Negotiate Peace

112. The President from Glass. I fear there is great danger of confusion in regard to the matter of representatives of the Treasury in Europe. Colonel House has suggested that Norman Davis be appointed Commissioner in connection with the armistice discussions at Spa and I have recommended to you his appointment as [Page 554] such. Davis has also advised me of his appointment as one of the American representatives on Special Board created to deal with relief problems. Crosby has tendered his resignation and I have transmitted it to you for such action as you think proper. Secretary Lansing has cabled me saying that the Peace Commissioners wish to have financial advice from some one other than the Treasury’s representative and suggested Albert Strauss go over for that purpose if I approve. In view of these demands from various sources for financial representation, and the danger of conflicting councils and disorganization among the Treasury representatives I ask your approval of the creation of a Treasury Commission in Europe under the chairmanship of some one who will be my responsible representative. If you approve I plan to send Mr. Strauss over to head the Treasury’s delegation at as early a date as possible.

I have concluded to ask your approval also of sending Thomas W. Lamont of New York. He would be particularly useful in connection with the armistice discussions at Spa. You know he is a member of the firm of J. P. Morgan and Company and the owner of the New York Evening Post. The armistice discussions, it seems to me, are likely to involve the whole economic and financial problem of Germany. The British, the French and the Germans will doubtless be represented by their strongest financial men. Our public opinion is by no means prepared as yet to welcome any effort on behalf of the United States or of the Allies to restore decent conditions in Germany. It is therefore peculiarly important that the financial representation of the United States in these discussions should be such as to inspire confidence in the ability of our representatives to hold their own in a contest with the most expert financiers of Europe and also that the men representing us should be men known to have been thoroughly pro-Ally and anti-German since the outbreak of the European war. Lamont combines these qualifications with a statesmanlike view of the requirements of the situation and recognition of the utter impossibility of preventing the spread of Bolshevism and enabling Germany to meet her indemnities without setting up some plan for the restoration of her economic life. I quite recognize the possibility of objection to Lamont on the ground that he is a member of J. P. Morgan and Company and on the ground that he is the owner of a newspaper. I believe as to the first the advantage of his being a member of that firm for the reasons above indicated far counterbalances any disadvantage in connection with such a negotiation as this. As to the second I understand he has trusteed the ownership of the Post and takes no part in its direction. To summarize, my suggestion would be as follows: That the Treasury be represented in Europe immediately [Page 555] by a commission headed by Strauss and including Davis and Lamont and Crosby, if you do not accept his resignation, and that they should retain the services of Goodhue, Loree20 and Harris and such organization as has been created in Europe under Crosby’s direction. I should expect Strauss to act as the executive head and to be my responsible representative in Europe.

The plan and organization outlined in this cable are predicated upon the policy of excluding from discussion in Europe all questions concerning the making, the readjustment or the conversion of our loans to foreign governments. I may add that I assume you will agree with me that so far as the Peace Commissioners or Mr. Hoover, or others in Europe, are in need of financial advice, they should obtain it from an organization acting under my general direction and responsible to me.

  1. F. A. Goodhue, member of the Inter-Allied Committee for War Purchases and Finance, and R. F. Loree, a Treasury representative in Europe.