Paris Peace Conf. 184.02302/3
Brigadier General C. H. McKinstry to the Commission to Negotiate Peace
Subject: War Damages, France and Belgium.
1. In an interview with Colonel House on December 28th, Colonel House informed me that my work, which had been started under him, before the appointment of the American Peace Commission, would hereafter be done, not under him alone, but under the Commission, and that accordingly, certain questions which I brought up at that interview, and in general all questions relating to the extent and character of the work and the means of accomplishing it, should be addressed in writing to the Commission.
2. My general instructions are contained in the following extract from letter from Colonel House:
“The President having requested me to set in motion some machinery to obtain for the use of the American Delegation to the Peace [Page 612] Conference some valuation of damages done by the Germans in the invaded parts of France and Belgium …12 I trust that you will now proceed with this work, consulting with French and Belgian officials as occasions require.”
3. In the beginning there was an expectation that an independent appraisal of damages might be made by the Americans. In my report of November 24th to Colonel House (copy herewith),13 I pointed out that our means of obtaining detailed information as to damages were in every way inferior to those available to the French and Belgian Governments and that any independent valuation would necessarily be entitled to less weight than would theirs.
4. For these reasons, Colonel House approved my recommendation that the estimate to be made by my organization should take the shape of a verification of the French estimate; that is, an examination of their methods, coupled with a check estimate of as great a number of individual properties as time would permit.
5. As this method could not be employed without the consent and co-operation of the French, request was made by Colonel House on the French Government for the necessary consent and assistance. A favorable reply was received in letter from the Ministere des Affaires Etrangeres to Colonel House, dated December 5th, 1918 (copy herewith),14 in which it is stated that I may apply direct to the Ministre de la Reconstitution Nationale and the Ministre des Regions Liberees who will furnish me all possible information.
6. About December 5th, Representatives of Great Britain, France, and Belgium, at a meeting in London, agreed to the following resolution (among others):
“That each allied or associated government should formulate its claims for reparation due from enemy states and that these claims should subsequently be referred for examination by an Inter-Allied Commission which will be nominated when claims are ready.”
7. As the acceptance by the United States of this resolution might have affected my work, Colonel House instructed me not to apply to Ministers Le Brun and Loucheur for methods or figures until further notice. On the 28th instant this prohibition was removed, and I at once took the necessary steps to get in touch with these Ministers.
8. The Belgian Government has not yet been formally approached on the subject of a verification by us of the Belgian estimate of damage. It is suggested that the necessary request be made.
9. The damage done by the Germans in France and Belgium affects an extremely wide range of objects—railways, roads, waterways; [Page 613] forests, farm lands, crops, live stock; iron and steel plants; chemical plants, non-ferrous metal plants, textile plants, breweries, beet sugar mills and many other classes of factories; public improvements, public utilities, water works, power plants; all classes of buildings; coal, iron and zinc mines, etc.; household and other personal property, works of art, etc.; requisitions of money, bank and industrial stocks and bonds, etc. The cost of rehabilitating plants, etc., will of course greatly exceed the damage done, valued as of 1914. There is also to be considered the damage caused by lost profits, losses incident to time necessary to reestablish business, lost good will, lost rents, crops and outputs of all classes, losses to dependents from the death of, or injuries to, soldiers. (See categories of damage in Mr. Cravath’s “Preliminary Suggestions Regarding Indemnities.”)15 Even well within the limit at which claims against the enemy states take on a punitive character, it will be difficult to discriminate between various classes of indirect damages. Many of the indirect losses are as real as are direct damages. It is presumed that the Commission will wish to have data for use in deciding which of these claims to admit and which reject. Unless advised to the contrary my organization will make an examination of the subject of indirect damages.
10. It is plain that a comprehensive study and valuation of the damages in France and Belgium will involve major questions of law, finance and economics, as well as of engineering proper. For this work I must have the best available talent in these departments, not only that our methods and results may satisfy ourselves, but may exercise due weight in any contested valuations, as against the results offered by the able men of other countries now or later engaged on the same work. While the greater part of the necessary personnel can be obtained from the A. E. F., it is obvious that the officers whom I need for the more important positions are men who by the very nature of their qualifications are needed elsewhere. It would undoubtedly help me to secure such officers promptly were the American Peace Commission to make suitable representations, by wire, to the Commander-in-Chief, American E. F. Such action is requested.
11. Certain members of the War Industries Board, now in France, have given me valuable information and advice and so long and to the extent that their assistance is available, I shall count on it. We have established relations with the technical advisers to the Commission. In general, we have made use of every opportunity offered to obtain light on this complicated problem. But in spite of this there still exists in my organization a lack of highly trained and experienced men. There is now in France, at the invitation of the French, a commission of eminent American engineers of international reputation [Page 614] appointed by and representing the principal engineering societies of the United States. Any or all of these men would be of great value to my work, and I am confident that the services of some of them could be secured, I refer particularly to Mr. A. M. Hunt, Consulting Engineer, and member of the Naval Consulting Board; Mr. Lewis B. Stilwell, President of the American Institute of Consulting Engineers and Past President of the Institute of Electrical Engineers; Mr. Charles P. Main, President of the American Society of Mechanical Engineers, and a leading designer and builder of textile mills in New England; and possibly Mr. George Fuller, an expert on city building work and water supply and sanitary construction. The services of these men could be secured at the rate of one-thousand dollars per month in each case. If the necessary funds are not available to the Peace Commission, I would recommend that authorization for their employment be obtained by wire from the Commander-in-Chief. I recommend the employment of these men, not only to insure that consideration of the subject which its importance and difficulty demand, but also to inspire confidence in other countries in the results obtained.
12. A large part of the field work of my organization will be in regions where neither rail nor other transportation is available. For the expeditious and economical performance of this field work I must have definitely placed at my disposal adequate motor transportation. I need at once ten motor cars and estimate that I shall soon need twenty more motor cars and twelve three-quarter ton trucks or ambulances, and six motor-cycles with side cars, all with “drivers. As efforts to secure this transportation have failed, it is requested that the following wire be sent to the Commander in Chief:
___________Ten Cadillac open cars with drivers required at once for field work in connection with estimating war damages period It is requested that these report to General McKinstry Paris period It is further requested that twenty additional cars comma twelve three quarter ton trucks or ambulances and six motorcycles with side cars comma all with drivers comma be provided upon later telegraphic request direct from General McKinstry period Please advise action taken period
House, for American Commission to Negotiate Peace
13. Referring to my general instructions (Paragraph 2 above) you will note that there is specific mention of “damages done by Germans in the invaded parts of France and Belgium.” In view, however, of the note of the Secretary of State, dated November 5th,16 stating the [Page 615] President’s agreement with the interpretation “that compensation will be made for all damage to the civilian population of the Allies and their property by the aggression of Germany by land, by sea and from the air,” I assume that I am to make a valuation of damages, both within and without the invaded areas, except damage to ships and cargoes. I shall proceed upon this basis unless advised to the contrary. Early notice is requested in case it is desired to extend the work to other countries, such as England, Italy, and the Balkans. No preparations have as yet been made for such extension and timely advice will be necessary to avoid delays.
14. (a) I am directed to proceed with an evaluation of French and Belgian war damages, reporting hereafter direct to the American Commission to Negotiate Peace.
(b) The work is to be performed in conjunction with the French and Belgians, and shall consist of a verification of the French and Belgian estimates. Credentials have been received from the French Minister of Foreign Affairs which will permit me to deal direct with the French Ministers concerned.
(c) Similar diplomatic arrangements should be made with the Belgian Government.
(d) Unless advised to the contrary, I will secure and check information on indirect and consequential damages, as well as on direct material damages.
(e) It is requested that a telegram be sent to the Commander-in-Chief, Chaumont, requesting him to honor requests for suitable officers for this work and setting forth the urgency of the work.
(f) It is requested that I be authorized to retain three or four civilian engineers to be paid from funds of the Peace Commission, or, if such funds are not available, that a telegram be sent to the Commander-in-Chief requesting him to authorize me to employ four civilian consulting engineers, for four months, at one-thousand dollars per month, each.
(g) Unless advised to the contrary, I will consider war damages anywhere in France and Belgium, but not damages to ships and cargoes.
(h) Timely advice is requested if my organization is to be called upon to consider damages in countries other than France and Belgium.
(i) It is requested that the telegram suggested in Paragraph 10, above, be sent in order that I may obtain motor transportation for field work.