Papers Relating to the Foreign Relations of the United States, The Paris Peace Conference, 1919, Volume X

Paris Peace Conf. 180.0501/24

Supreme Economic Council: Twenty-fourth Meeting Held at the Ministry of Commerce [on 23d June, 1919, at 10 a.m.]

June 23, 1919, 10 a.m.

The Supreme Economic Council held its Twenty-fourth Meeting on Monday, 23rd June, 1919 at 10 a.m. under the Chairmanship of Monsieur Clémentel.

The Associated Governments were represented as follows:—

United Kingdom.	Sir Wm. Mitchell Thomson.
	Mr. Wise.
	Mr. Waley.
United States.	Mr. Hoover.
	Mr. McCormick.
	Mr. Baruch.
	Mr. Davis.
	Mr. Gordon.
France.	M. Boret.
	M. Claveille.
	M. Seydoux.
Italy.	Signor Crespi.
	Commendatore Attolico.
Belgium.	M. Jaspar.
	M. de Cartier de Marchienne.
	Lt. Colonel Theunis.

224.

The Minutes of the Twenty-third Meeting were approved.

225. Recommendations Made to the Council of Heads of States.

A letter from Sir Maurice Hankey dated 17th June (199) embodying decisions reached by the Council of Heads of States regarding:—

(a) The Blockade of Hungary and Bolshevist Russia (See Minutes 195 [196] and 203);

(b) the proposed agreement by Austria as regards trade with Hungary and Germany (See Minute 195);

was submitted.

As regards (b) it was reported that the Council of Heads of States had now accepted the proposals put forward by the Council and had instructed the Drafting Committee to take the action necessary in accordance with their decision.

The above information was noted and it was agreed that the Blockade Section should be notified thereof, and should be authorised to take such action in connection with both the above matters as they considered necessary.

226. Trade Between German Austria and Hungary.

A note from the American Delegates (200) was considered regarding the desirability of permitting such concessions in connection with the present prohibition of trade between German-Austria and Hungary as might be considered essential to the economic life and political stability of German Austria.

The French Delegates stated that no instructions had been sent by the French Government with a view to enforcing a complete prohibition of trade between German-Austria and Hungary.

It was agreed that the Vienna Commission should be informed that they have power to sanction the continuance of the ordinary small frontier traffic in goods between Austria and Hungary, but that any proposals for large exchange of commodities or for transfer of gold or securities should be referred to the Supreme Economic Council for instructions.

227. Seizure of Austrian Gold and Securities.

A Note from the French Delegates dated 21st June (201) covering a telegram from the Austrian Minister for Foreign Affairs to the French Diplomatic Mission at Vienna dated 7th June (202) reporting the seizure by Hungarians from Austro-Hungarian Banks in Budapest of 15 million kronen in gold and 10 million kronen in bank notes was submitted.

The Italian Delegates made the following statement:—

1. In May last, when it was anticipated that a stable Government would be established in Hungary almost immediately, preliminary negotiations took place, with the lull knowledge of the Food Section, for the delivery of foodstuffs from Italy to Hungary as soon as economic and political stability were restored.

2. Sums to the value of three million gold crowns and 15 million of paper money were subsequently deposited at Vienna by a Hungarian Syndicate as security solely for the foodstuffs to be supplied to Hungary by an Italian Syndicate.

3. In view of the fact that a stable Government has not yet been established in Hungary and the blockade is not, therefore, removed, no transactions have yet been completed and no shipments of foodstuffs have been made.

4. Since the contracts have not been completed the gold still in the possession of the Italian Representatives at Vienna can be disposed of in accordance with instructions to be agreed upon by the Allied and Associated Governments.

It was agreed:—

(a) that the information given above should be reported to the Finance Section who should be instructed to determine what action should be taken in the matter;

(b) that the German-Austrian Government should be informed of the position as outlined above and of the action taken by the council.

228. Removal of Gold and Securities in German-Austrian Banks.

The British Delegate on the Finance Section reported that a telegram had been received from the British representative in Vienna recommending that the money and securities needed to pay for food supplied by the Allies to Austria should be removed from Vienna in case of eventualities and stating that this could readily be arranged.

It was agreed:—

(a) that a telegram should be sent to the Financial Mission in Vienna in the following sense:—

1. that with the assent of the Austrian Government, arrangements should be made with the Italian Armistice Commission for the removal to Italian territory of gold coin (but not paper money) and foreign securities available for this purpose within the limits of the amount required to pay for food supplied to Austria by the Allies.

2. that if the Austrian Government ask for the removal to Italy of other gold and securities also, to be held at the disposal of the Austrian Government or the Austro-Hungarian Bank at Vienna, the necessary steps should be taken to comply with this request.

(b) that similar instructions should be given to the Italian Armistice Commission.

(c) that of the gold and securities removed to Italy for the payment of foodstuffs, one-third should be held at the disposal of each of the three Governments concerned, viz. France, Italy and the United Kingdom.

(d) that the Blockade Commission in Vienna should be informed of the above decisions.

229. Reported Violation of Blockade of Hungary.

With reference to Minutes 205 and 214 the Italian Delegates stated that in accordance with instructions given by Baron Sonnino a most rigorous enquiry had been made regarding the reported passage of war materials from the Adriatic to Bolshevik Hungary and that the Italian Supreme Military Command and dependent Commands had stated that no shipments had taken place with their authority or knowledge.

It was possible, however, that some war materials might have been introduced through private Austrian interests and further enquiries regarding this were being made. It was hoped, therefore, that it would be possible to make a further report at the next Meeting of the Council.

The American Delegates reported, in this connection, that according to information they had received, a number of trucks containing nitrates had been despatched from Trieste as part of Relief Trains for Vienna and had subsequently been passed through into Hungary. Further, it appeared that for some weeks past the Italian Railway Officials had refused to allow the American officials of the Relief Mission at Trieste access to the railroad yards with the result that the American officials had been unable to check the contents of relief trains despatched to Vienna.

The Italian Delegates undertook to arrange that a careful military enquiry regarding this report should be conducted immediately.

230. Export of Coal, Petrol and Oil From Poland to Austria.

The British Delegates reported receipt of information to the effect that the Polish Government had refused to export to Austria coal, petrol and oil under the Agreement recently signed and that if this decision were adhered to the lighting in Vienna must be shut down.

The American Delegates reported that the Czecho-Slovak Government expressed their intention of discontinuing the execution of their agreement to send gas coal to Vienna if the Austrian Government refused to supply war materials for which the Czecho-Slovaks were urgently in need.

It was agreed:—

(a) that the Governments of Poland and Czecho-Slovakia should be notified that in the view of the Allied and Associated Governments it is undesirable that any of the Services for the supply of essential commodities to German-Austria from those countries should be suspended during the negotiations in connection with the Austrian Peace Treaty.

(b) that the German-Austrian Government should be requested to do all in their power to ensure that the war materials required by the Czecho-Slovak and Polish Governments should be forthcoming.

231. Control of Traffic on the Danube.

A Note from the Director-General of Relief dated 20th June (203) was submitted, embodying resolutions adopted by the Inter-Allied Danube River Commission at a Meeting on 1st June recommending that all floating craft and equipment other than naval craft and boats and equipment belonging to the European Commission of the Danube should remain under the control of the Inter-Allied Danube River-Commission until its final disposition in conformity with the provisions of the Treaties of Peace.

It was agreed that the resolutions should be deferred for further consideration at the next Meeting of the Council if necessary, and that, in the meanwhile, the Communications Section should examine the points raised therein.

232. Locomotives and Cars for Lithuania.

A letter was submitted by the American Delegation dated 16th June (204) regarding the supply through the American Liquidation Board of locomotives and cars for Lithuania.

It was agreed to refer the letter to the Communications Section with instructions to consider in consultation with the Finance Section, what steps should be taken to arrange that sufficient locomotives and cars and other railway material will be available in the Baltic Provinces, generally to ensure that the adequate and prompt distribution of foodstuffs for relief purposes will be maintained.

233. Use of Enemy Tonnage.

(a) A Report from the Freight Committee of the Food Section dated 6th June (205) regarding the position and employment of enemy tonnage as on 31st May was submitted for the information of the Council.

The Chairman drew the attention of the Council to Annex V. of the report regarding freight rates on food supplied to Germany in German bottoms.

The Director-General of Relief stated that as regards foodstuffs supplied by the American Relief Administration to Germany the point alluded to in Annex V does not arise. He explained that in the account kept for the supply of German food any saving because of the difference between the Shipping Board rates, upon which prices are based, and the rates charged by the Allied Maritime Transport Executive for deliveries in German bottoms is credited to the Germans and increases to that extent funds available for purchases of food by the Germans.

The French and British Delegates stated that in quoting c. i. f. prices for the sale of foodstuffs to Germany Blue Book rates of freight were always used.

It was agreed that the matter should be referred to the Food Section who should notify the Allied Maritime Transport Executive of the action taken by the Section.

(b) the Italian Delegates referred to the probability of a surplus of enemy tonnage being available for purposes other than relief in the near future and requested that the Supreme Economic Council should recommend to the Allied Maritime Transport Executive that the possibility of using some of these boats for the transport of coal to Italy should be considered.

The French Delegates requested that if such a recommendation were being made the French coal situation should receive consideration at the same time.

The following resolution was adopted, the French Delegates making a reservation on behalf of M. Loucheur:—

“The Council requests the Allied Maritime Transport Executive to consider as a question of urgency the employment of the possible surplus of ex-enemy tonnage above food needs having due regard to the coal situation in Italy”.

234. Communication Operations in Central and South Eastern Europe.

(a) The Director General of Relief submitted for the information of the Council a report from Col. Atwood dated 19th June (206) regarding the work of the Mission appointed by the Supreme Economic Council to organise and supervise the transport arrangements, particularly as regards relief supplies, within the limits of the former Austro-Hungarian Empire.

(b) A Report of the Communications Section dated 19th June (207) was submitted for the information of the Council.

235. Finance of German Coal.

With reference to Minute 219 a Note from the Sub-Committee on Germany (208) regarding the quantities to be delivered and prices to be paid in respect of commodities delivered under the Luxemburg Protocol was considered.

The American Delegates stated that in their view it was unnecessary to submit to arbitration the out-standing questions arising out of the Luxemburg Protocol as the points raised had been adequately covered in previous arbitrations. If, however, the Council decided that arbitration was necessary, the American Delegates would act as arbitrators only on the express agreement that the decision of the arbitrator should be considered as final.

It was agreed that the Chairman and Mr. Wise should discuss the matter with Monsieur Loucheur, and, if an agreement were not reached earlier, the matter should be brought before the Council again at the next Meeting.

236. Allied Economic Policy in Russia.

With reference to Minutes 212 and 223 a memorandum from the Communications Section dated 19th June (209) regarding Allied assistance necessary for re-establishing communications in Russia was submitted and deferred for consideration at the next Meeting.

It was agreed that the Finance and Raw Materials Sections and the Allied Maritime Transport Executive should be requested to present their reports at the next Meeting of the Council.

237. Health Conditions in Europe.

With reference to Minutes 173 and 190 a letter from the League of Red Cross Societies dated 14th June (210) and a memorandum from the Minister of Public Health in Poland dated 13th [15th] June (211) reporting on certain difficulties which had ocurred in connection with the negotiations with the League of Red Cross Societies for the prevention of the spread of disease in Western Europe were submitted.

The following resolution submitted by the Director General of Relief was adopted:—

“The view of the Council is that the Polish Government should be supported in its campaign against typhus and the Supreme Economic Council urgently recommends that the various Boards disposing of Army supplies should furnish the Polish Government on credit with the supplies necessary to combat typhus.”

238. Allied Economic Co-Operation After Peace.

With reference to Minute 216 the following documents were submitted:—

(a) Memorandum from the British Delegates dated 20th June (212);

(b) Memorandum from the French Delegates (213);

(c) Letter from the Belgian Delegates dated 20th June (214);

(d) Letter from the Italian Delegates dated 16th June (215).

The American Delegates stated that they were unable at present to put forward any agreed recommendations regarding allied economic co-operation after Peace pending a conference with President Wilson which they anticipated would take place in the course of the day.

The British Delegates urged the necessity for a speedy decision regarding the proposals, if any, to be put before the Council of Heads of States and it was agreed that the Committee on Policy should hold a special Meeting later in the day, if possible.

239. Relief Operations.

A letter from the Director General of Relief dated 22nd June (216) reporting on the progress of relief operations during May was submitted for the information of the Council.

The Chairman on behalf of the Council as a whole expressed warm appreciation of the successful way in which the relief operations had been carried out and particularly expressed to Mr. Hoover the gratitude of all his colleagues on the Council for the invaluable assistance and hearty co-operation which he had at all times afforded them in the work.

Appendix 199

British Delegation,
Paris, 17 June, 1919.

[Letter From Sir Maurice Hankey to Mr. Vance McCormick, Embodying] Decisions of Council of Heads of States [Regarding] Blockade of Hungary and Bolshevik Russia

Sir: I am directed to inform you that the Council of the Principal Allied and Associated Powers this afternoon considered the note from the Supreme Economic Council on the subject of the blockade of Hungary and Bolshevik Russia forwarded in your letter of June 7.¹

It was decided that, after the acceptance of the Conditions of Peace by Germany, measures are not still to be taken to prevent commodities from reaching Bolshevik Russia or Hungary. In addition, the recommendation of the Supreme Economic Council was approved that there should be an abstinence from any positive measures or public announcement indicating the resumption of such trade.

It was further decided that the Supreme Economic Council should be asked to examine as to whether, consistently with the above decisions, means could be found for preventing war material from being carried by sea from Germany to Bolshevik Russia.

The Council also considered the second note forwarded in your letter of June 7, proposing an agreement by Austria regarding trade with Hungary and Germany.²

In regard to this, the Council felt that they could take no decision without fuller explanations.

I am [etc.]

M. P. A. Hankey

Secretary

Appendix 200

Memorandum From American Delegates [Regarding] Trade Between German-Austria and Hungary

The question is presented by recent developments at Vienna as to whether absolutely all trade between Austria and Hungary should be prohibited or whether the Inter-Allied Commission at Vienna should be authorised, in its discretion, to permit such trade across the Austro-Hungarian frontier as may be considered essential to the economic life and political stability of German Austria.

The American Delegation is advised by its representative on the Inter-Allied Commission at Vienna that on instructions from the French Foreign Office the Commission, without the concurrence of the American Delegate, had notified the Austrian Government that all trade between Austria and Hungary was absolutely prohibited, including the export of indigenous as well as imported commodities. In response to this notification a representative of the Austrian Foreign Office appeared before the Commission and stated that if the Commission’s prohibition was carried into effect it would be most disastrous to Austria. He stated in particular that Vienna was dependent upon certain coal mines in Hungary for operating the electric power and light stations of the city, and that no coal could be got from this source unless Austria exported a small amount of coke to be used in operating the mines. He further stated that Austria must continue certain exports to Hungary in order to obtain agricultural products and provisions.

Appendix 201

Note by the French Delegates [Regarding] Reported Seizure of Austrian Gold and Securities by Hungarians

The Austrian Ministry for Foreign Affairs have informed the French Mission at Vienna³ that the Budapest Government have seized from the safes of the Austro-Hungarian Bank of that town 15 million kronen in gold and 10 million kronen in bank-notes.

These sums have been sent to the frontier between Hungary and German Austria, where they were consigned to Italian soldiers and conveyed to Vienna, where they were handed to an Italian Delegate as payment or security for supplies of foodstuffs ordered by the Hungarian Government in Italy.

The attention of the Supreme Economic Council is drawn to this proceeding from the following standpoints:—

(1) The decrease in the reserves of Austria and Hungary resulting therefrom.

(2) The permissibility of such operations in connection with the revictualling of Hungary.

21 June, 1919.

Appendix 202

Vienna, 7 June, 1919.

[Telegram From the Austrian Minister for Foreign Affairs to the French Diplomatic Mission at Vienna]

The Budapest Government have lately seized from the Austro-Hungarian Bank of the said town the sum of 15 million crowns in gold and another 10 million crowns in bank-notes; these sums were sent to Bruck, a frontier station between Hungary and German Austria, where they were consigned to Italian soldiers arriving in automobiles and transported to Vienna to be handed to an Italian Delegate as payment or security for supplies of foodstuffs ordered by the above-mentioned Government in Italy.

The Austro-Hungarian Bank has not failed to announce to the Italian Military Mission at Vienna the illegal nature of the seizure of these monies and to point out her right of ownership to these sums.

Considering the harm that it is causing to the liquidation of the Austro-Hungarian Bank as well as to the financial and economic interests of German Austria, which are intimately connected, the Foreign Office takes the liberty of drawing the attention of the French Diplomatic Mission to this fact, and hopes that the Mission will do all in their power to safeguard the legitimate rights of the Austro-Hungarian Bank.

For the Secretary of the Foreign Office.

French Diplomatic Mission,
Vienna.

Appendix 203

Resolution Adopted at the Meeting of the Inter-Allied Danube River Commission on June 1, 1919 [Regarding] Danube River Traffic

A resolution adopted at the meeting of the Inter-Allied Danube River Commission on June 1, 1919, has been forwarded to the Director-General of Relief by the American representative on the Inter-Allied Danube River Commission. The resolution is endorsed and its immediate passage urged by the Director-General of Relief as being a measure of special importance to the economic life of the territories adjacent to the Danube River. The resolution is as follows:—

“The Commission considers it essential to the development of commerce on the Danube, and to the avoidance of vexatious manipulations of traffic by different Danubian communities pending the coming into force of the Peace Treaties, that the Supreme War Council should now pass a resolution substantially as follows:—

1. In the navigable waters of the Danube River System all floating craft, and all equipment needed for their use and navigation, whether captured, requisitioned, or taken under the Armistice agreements, are to remain under the control of the Inter-Allied Danube River Commission (constituted by vote of the Supreme Economic Council, 20th May, 1919)^3a until finally disposed of conformably to the provisions of the Treaties of Peace. It shall be the duty of the Commission to cause such craft and equipment to be employed in the furtherance of free commerce on the Danube in whatever manner it shall consider expedient.

2. Commercial or passenger services conducted by the instrumentality of any Danubian State, or by any subsidised or unsubsidised company or individual, are to be operated in accordance with such rules and regulations as the Inter-Allied Danube River Commission may approve or prescribe.

3. This resolution shall not affect the control of naval craft, or the boats or equipment of the European Commission of the Danube, or be construed to abridge that Commission’s jurisdiction.

4. The foregoing resolutions are to be communicated to the High Command and to the Governments of all the Associated Powers.”

Appendix 204

U. S. Locomotives for Lithuania

The American Delegation submit to the Supreme Economic Council the following letter:—

Paris, June 16, 1919.

1. I recommend that the attached request from the Lithuanian Delegation, for authorisation from the Economic Council to procure locomotives from the American Liquidation Commission, be honoured.

2. The rolling-stock now in Lithuania is in the hands of the Germans, who probably have a good claim to a legal title to it. For this reason it is doubtful whether the Allied and Associated Powers can prevent the Germans from carrying off most of the rolling-stock and locomotives in the country when they evacuate, as they are expected to do shortly. Lithuania would then be left without means of transport for the distribution of food or for the defence of the country against the Bolsheviks.

3. The recent exchange of notes between the Allied and Associated Powers and Admiral Kolchak leaves it understood that Lithuania will be a de facto independent country until a Russian Government is recognised by the Allies, when it will be turned over to Russia.⁴ Admiral Kolchak has agreed to respect all contracts, &c., made by border countries like Lithuania with the Allied and Associated Governments.

4. Lithuania is a country with a population of about 3,000,000, and it has ample forests and other national resources to guarantee the payment of its debts.

5. Attached is an extract from the report on Lithuania by Lieutenant-Colonel Dawley, U. S. A., of the American Mission to the Baltic countries, on the immediate needs of the Lithuanian railways. It will be noted that Lieutenant-Colonel Dawley’s estimates are higher than the demands of the Lithuanian Delegation. His estimates of the railway mileage at present in order is now too low, as trackage is rapidly being captured from the Bolsheviks by the Lithuanian army.

6. Lieutenant-Colonel Warwick Greene, U. S. A., who has just returned from the Baltic countries and Lithuania as head of the American Mission to these countries, also supports this request.

7. The Council of Four voted on June 12 [13] “that the local national forces in the Baltic provinces should be supported with equipment, arms, ammunition, clothing, and supplies generally.”⁵

R. H. Lord

[Enclosure 1]

Memoire of Lithuanian Delegation to the Supreme Council Requesting Permission To Procure Locomotives From the American Liquidation Commission

Paris, June 13, 1919.

Translation and Digest

The Lithuanian Delegation has asked the American Liquidation Commission for 100 locomotives with a proportional amount of cars. The Liquidation Commission informed us that this material could only be sold upon the advice of the Supreme Economic Council.

Lithuania, with about 5,000 kilom. of railways, has no rolling stock of its own, the Russians or Germans having carried off or destroyed all of it during the war. The Germans have altered the gauge on the Lithuanian railways from Russian to Western European. If the Allies permit the Germans when they evacuate Lithuania to carry off the rolling stock they have brought in for their military uses, the country will be left absolutely devoid of rolling stock.

Railway transportation is now in the hands of the German military authorities, who refuse to let any of it be used for communication or export to Entente countries; and what rolling stock there is in the country is badly worn and insufficient not only for civil purposes but for the defence of the country against the Bolsheviks.

The Lithuanian Delegation therefore requests the Supreme Inter-Allied Economic Council to authorise the American Liquidation Commission to deliver to the Lithuanian Government 100 locomotives with a proportional amount of rolling stock.

A. Voldemar

President of the Lithuanian Delegation at the Peace Conference.

[Enclosure 2]

Annexe No. 4–A

From Lt. Col. Dawley’s Report on Lithuania, May 15, 1919

Origin: Lithuanian Ministry of Communication

Data Regarding the Immediate Needs of the Lithuanian Railways

For the Whole System

	Under Normal Conditions	Minimum	Lt. Col. Dawley’s Estimate
Locomotives	500	135	300
Passenger cars	800	150	150
Freight cars	3,000	1,500	1,500

Necessary Supplies (for one month)

1. Anthracite coal		4,000	tons
2. Forge coal		100	”
3. Axle grease for cars		50	”
4. Machine oil		10	”
5. Wool for greasewicks		150	Kgs.
6. Wire for greasewicks		300	”
7. Metal for bearings (four kinds), about		500	”
8. Crude iron		1,500	”
9. Petroleum		10	tons
10. Coloured cotton waste		1,500	Kgs.
11. White cotton waste		500	”
12. Box filling (“Buxem Exfillung”)		500	”
13. Asbestos		150	”
14. Different kinds of iron, steel, and copper screws for special construction.
	Tools and equipment for 50 repair crews (the average distance covered by a repair crew being 24 kilom.).
	Equipment for 150 railroad stations.
	Equipment for 70 trains.
	Different building materials for special construction.

These lines are at present in order:—

	Kilom.
Virballon–Jewie	148
Knowno–Gaizung	23
Koszodary–Prekulm	274.3
Prekulm–Bajoren	74
Murawjewe Ringen	31
Lansarien–Meiten	187.7
Radziwiliski–Ponowiez	54.3
Raczki–Kamiema–Nora	76.3
Suwalki–Orany	141
Total	1,009.6

Appendix 205

6 June, 1919.

Freight Committee: Enemy Tonnage Sub-Committee, Report No. 2

Position on May 31, 1919

1. Appendix I sets out the position and employment of all German tonnage nominated by the Allied Maritime Transport Executive for Food Service.

2. Appendix II gives similar tables regarding Austrian tonnage.

3. The totals are as follows:—

	German Tonnage	Austrian Tonnage
U. S. A.—
March shipment		10,700
April “		66,000
May “	32,000	58,000
June loading	350,350	112,400
July “	40,450	52,000
August “		29,700
Canada—
April shipment		5,000
May “	16,000	10,600
June loading	43,750	9,600
July “		6,500
River Plate—
June loading	105,500	14,600
July “	175,725	64,450
August “	9,500	33,150
Australia—
April shipment		8,300
May “		7,500
July loading	109,550
August “	57,750
French West Africa—
June loading	29,975	15,175
July “	13,800	3,850
French Bay Ports—
June loading	21,750
July “

4. Owing to shortage of cereals available in the United States and the congestion of the ports both in the United States and Canada, it has been decided to send no further enemy tonnage to North America for June loading. Tonnage becoming available in early June is therefore being despatched primarily to the River Plate, and where vessels are too deep to load there, to Australia. The smaller vessels are being put in to lift American supplies from French Atlantic ports to the Baltic. Later tonnage will be available to make July loading to North America.

5. Austrian tonnage under Italian management is being utilised for (a) provisioning German Austria, and (b) replacing to Italy supplies forwarded to German Austria carried in tonnage on Italian service, and vessels diverted to Roumania.

Appendix III sets out the proposed utilisation of tonnage assuming that 15,000,000 dollars will be available from the French German-Austrian loan and approximately a further 3,000,000 dollars unspent balance of the British German-Austrian loan for the purchase of the necessary ration for German Austria from the United States.

Arrivals in Austrian tonnage would then be as follows:—

(1) To German Austria―

U. S. A.—
May	14,000
June	78,800
July	33,000
Total	125,80

(2) To Italy—

From United States of America-
April	16,500
May	40,400
June	34,700
From Australia,June	15,700
“ United States of America,
“ July	37,600
“ Canada, July	9,500
“ Plate, July	11,100
Total	165,500

(3) To Roumania—

From United States of America, May

27,000

Replacing—

(1)	Diverted to Roumania from Australia	22,000
(2)	Diverted to Austria from Australia	19,500
(3)	Italian supplies delivered to German	126,000
	Total	167,500

There will be left unallocated to arrive from:—

	U. S. A.	Canada	Plate
July			4,000
August	29,200	6,450
September	34,750		51,500
	63,950	6,450	55,500
	}
Total	125,900

6. French-managed Austrian tonnage is being used to replace to Germany 20,000 tons of German tonnage diverted to the United Kingdom in replacement of an equivalent amount of cereals diverted from the United Kingdom to Poland in May. There remains unallocated 33,000 tons August loading in the Argentine.

7. The only German purchases in the Argentine so far notified are 135,000 tons of wheat and 20,000 tons of linseed. Sellers are the Compañía Mercantil and arrangements have been completed with Messrs. W. H. Muller and Co., The Hague, the agents of the latter, to put the contract on a c. i. f. instead of a f. o. b. basis. Messrs. Muller and Co. have accordingly agreed to sign the charter parties and pay freights in London on German vessels allocated to load the wheat sold to Germany by the Compañía Mercantil. Linseed is not at present allowed to be imported into Germany.

8. Standard Charter Parties have now been agreed for the following voyages:—

	Charterers
1. U. S. A./Germany	United States Food Administration.
2. Canada/Germany	Royal Commission on Wheat Supplies.
3. Plate/Germany	Compañía Mercantil.
4. French West Africa/Germany	French Commission.
5. French Atlantic Ports/Baltic	United States Food Administration.

The rates are set out in Appendix IV a and IV b. As these have been calculated on the average voyage it has been found necessary to make provision for demurrage at loading and discharging ports, the rate being fixed on a parity with the freight rates. For the same reason the usual strike clause has been deleted.

9. The rates quoted in Appendix IV a are applicable both to vessels carrying supplies to Germany and to Relief areas, but in our view such rates should be granted only where the whole benefit of the cheap rate goes to the buyers.

We desire to express our concurrence with the resolution (see Appendix V) of the Allied Maritime Transport Executive on this point.

10. A summary of the shipping lists set out in Appendices I, II, and III yields the following results (subject to finance in the case of Germany and Austria being available):—

estimated arrivals (tons)

				Total	Of which arrivals by French-managed Austrian steamers
(a) For Germany—
	May	Arrival	U. S. A.	28,046
			Canada
	June	“	United States of America	133,000
			Canada	8,338
	July	“	United States of America	226,800	6,200
			Canada	23,000
			Plate	105,500
			French West Africa	45,150	15,175
	August	“	United States of America	40,450
			Plate	188,175	12,450
			French West Africa	17,650	3,850
(b) For German-Austria—
	April	Arrival	Canada	4,285
	May	“	United States of America	9,362
	June	“	United States of America	31,029
(c) Unallocated—
	July	Arrival	United States of America	106,200
			Canada	9,600
			Plate	14,600
	August	“	United States of America	52,000
			Canada	6,500
			Plate	52,000
	September	“	United States of America	29,700
			Plate	33,150

August and September arrivals for North America and September arrivals for Plate can be considerably increased.

F. B. Elliot

Appendix I.—German Tonnage

31 May, 1919.

U[nited] S[tates of] A[merica]

Allocated to United States Food Administration

						Metric Tons
Arrived—
Falkenfels	Baltimore	8/5	Rotterdam	25/5	Rye	10,809
Santa Cruz	“	10/5	“	27/5	“	6,493
Kronenfels	Philadelphia	12/5	Hamburg	30/5	“	10,744
Total arrived						28,046
On passage–
Weissenfels	New York	17/5			Flour.	2,302
Solfels	Philadelphia	29/5			“	1,736
Total						4,038

To Load

June—	D. W. Tons
Kybels	7,700
Altenfels	11,350
Artemisia	9,025
Bermuda	10,300
Gertrud	8,600
Gallipoli	6,650
Franziska	8,050
Hornfels	6,350
Greiffenfels	9,050
Gundomar	6,000
Wolfsburg	10,200
Augsburg	11,200
Waldenburg	9,600
Erfurt	10,000
Isis	12,800
Rudelsburg	10,200
Lippe	11,000
Wolfran	9,900
Nalmes	8,750
Ehrenfels	6,800
Dessau	11,000
Gerfried	9,800
Elbing	7,850
Hanau	7,125
Sonnenfels	9,050
Schwarzenfels	12,500
Kandelfels	9,000
Schildtum	8,700
Huberfels	8,500
Meiningen	10,900
Remscheid	11,200
Waldeck	10,900
Kagera	9,100
Therese Horn	7,400
Slavonia	6,700
Belgravia	10,350
Crostafels	7,600
Aschenburg	9,150
Total (June)	350,350
July—
Belgravia	10,650
Mannheim	9,800
Wachtfels	9,050
Altenbur	10,950
Total (July)	40,450

Canada

Allocated to Royal Commission on Wheat Supplies

On passage—					Tons
Burgomeister Schröder	Montreal	12/5	Rotterdam	Flour.	8,338
*Atta	“	30/5	Newcastle	Wheat	6,933
					746
[Total]					16,017

To Load

June—	D. W. Tons
*Tasmania	8,000
Totnes	8,000
*Masuna	6,200
Arabia	7,200
*Kribi	6,550
Clare Hugo Stinnes	7,800
[Total]	43,750

*Allocated to the United Kingdom to replace May loading vessels 6,619 tons diverted to Germany and 19,726 tons to Poland. The latter will be made good to Germany by the allocation of Austrian tonnage from United States of America and the Plate.

Argentine

Allocated to Compafila Mercantil (up to total of 135,000 tons)

To Load

June—	D. W. Tons
Itajahy	7,400
Louise Horn	6,200
Wotan	6,100
Elbe	6,100
Bosporus	6,900
Oehrengen	5,600
Derindje	5,600
Plauen	7,100
Irmgard	6,600
Erika	4,150
Pionler	4,850
Sofia	5,600
Pera	6,600
Alster	6,100
Homcap	6,200
Arensburg	6,500
Secundus	7,900
Total (June)	105,500

July—	D. W. Tons
Karl Leonhardt	5,100
Rherania	6,500
Olympus	5,700
Eichfelde	6,600
Malaga	4,950
Schwaben	7,300
Ganelon	6,200
Spezia	6,300
Germanicus	6,600
Almeria	7,000
Gudron	6,500
Santa Fe	8,000
Weissenfelde	6,100
Normania	5,500
Solingen	6,900
Wartburg	6,400
Lepsos	6,050
Claus Horn	6,000
Franz Wilke	6,900
Warrega	6,000
Warrundi	6,050
Hollandia	5,100
Nordmark	9,050
Arangonia	7,750
Renasburg	8,000
Liberia	5,675
Santa Cruz	7,600
Total (July)	175,725
August—
Burgomelster von Melle	9,500

Australia

Proposed To Be Allocated to Commonwealth Government

To Load

July—	D. W. Tons
Gera	10,000
Furst Billow	12,400
Heilbrunn	11,200
Treuenfels	11,200
Helouan	11,200
Roda	8,600
Geissen	7,300
Cordoba	6,500
Total (July)	78,400

Unallocated

To Load

July—	D. W. Tons
Altmark	8,200
Java	12,100
Raimund	10,850
[Total (July)]	31,150

August—	D. W. Tons
Falkenfels	12,500
Kronenfels	12,325
Weissenfels	12,500
Burgomeister Schroder	9,500
Itauri	10,925
Total (August)	57,750

West Africa

Allocated to French Commission

To Load

June—	D. W. Tons
Frieda Horn	4,400
Borussia	4,400
Hamburg	4,050
Hornsee	4,400
Alma	4,325
Regina	4,400
Uhlenhorst	4,000
Total (June)	29,975

July—	D. W. Tons
Christian Horn	4,300
Genua	4,800
Procida	4,700
Total (July)	13,800

French Bay Ports for Baltic Ports

Allocated to U. S. Food Administration

To Load

June—	D. W. Tons
Antwerpen	4,050
Karpathos	4,800
Schwince	4,300
Roma	4,400
Atta	4,200
[Total (June)]	21,750

Appendix II. Austrian Tonnage

(a) under french management

Northern Range

Allocated to Food Administration

To Load

June—	D. W. Tons
Plitvice	6,200

Argentine

(Unallocated)

July—	D. W. Tons
Atlántica	7,200
Graf Serenyl Bela	5,250
Total	12,450

August—	D. W. Tons
Kobe	7,200
Mediterraneo	7,550
Buda	6,350
Immaculata	5,600
Vega	6,450
[Total]	33,150

West Africa

Allocated to French Commission

June—	D. W. Tons
Onda	4,750
Indeficienter	3,400
Nagylagos	3,500
Stephanie	3,525
[Total]	15,175

July—	D. W. Tons
Eros	3,850

(b) under italian management

Northern Range

(1) Allocated to Italy

Arrived						Tons
Sirena	Philadelphia	8/5	Bari	8/4	Wheat	3,045
					Commeal	918
Fiume	“	25/3	Siracuse	19/4	Wheat	3,896
President Wilson	New York	5/4	Genoa	22/4	Cornmeal	1,310
Dalmatia	“	31/3	Trapani	28/4	Wheat	2,801
Total April arrival—
					Wheat	9,742
					Cornmeal	2,228
Argentina	New York	10/4	Genoa	6/5	Flour.	551
					Cornmeal	73
					Beans	632
Francesca	“	17/4	“	7/5	Wheat	1,335
					Flour.	510
Corsinia	Philadelphia	6/4	Trieste	7/5	Wheat	6,548
Iris	Baltimore	10/4	“	12/5	“	8,433
Magyarorczag	Philadelphia	26/4	Cagliari	21/5	“	4,696
Carolina	New York	7/5	Genoa	30/5	“	1,623
Belvedere	“	10/5	“	30/5	“	4,565
					Flour.	963
					Cornmeal	106
Laguna	Philadelphia	27/4	Venice	26/5	Wheat	6,770
					Cornmeal	31
					Rye flour	38
Szent Istvan	Baltimore	10/5	Oneglia	28/5	Wheat	3,533
			Total May arrival—
					Wheat	37,503
					Flour	2,024
					Rye flour	38
					Cornmeal	210
					Beans	632
Total arrived—
					Wheat	47,245
					Flour	2,024
					Rye flour	38
					Cornmeal	2,438
					Beans	632
On Passage to arrive June.
	Columbia	New York	24/5	Genoa	Wheat	2,964
					Flour	952
	Baltico	Baltimore	20/5		Wheat	4,901
	Bosanka	Philadelphia	25/5		Wheat	1,166
	Contessa Adelma	Baltimore	28/5		Wheat	5,125
	Sofia	New York	22/5		Flour	1,779
	Graf Tisza Istvan	Philadelphia	30/5		Wheat	3,474
Total on Passage—
					Wheat	17,630
					Flour	2,731

2. Allocated to German Austria

Arrived						Tons
Perseveranza	Jacksonville	14/4	Trieste	12/5	Flour	4,673
Africana	Galveston	18/4	Trieste	30/5	Wheat	4,689
On Passage
June arrival
	Cat. Gerolomich	New York	15/5	Trieste	Wheat	4,672
					Flour.	980
					Cornmeal.	136
					Rolled oats.	841
	Adriatico	Baltimore	16/5	Trieste	Flour.	3,201
					Bean flour.	89
					Cornflour	543
					Cornmeal.	1,209
Maria Immacolata	Philadelphia	19/5	Trieste		Flour	4,244
					Bean flour	346
					Oatmeal.	207
					Rye flour.	38
					Cornflour.	80
	Kossuth Ferenez	Baltimore	24/5	Trieste	Flour.	4,586
					Cornmeal.	89
					Cornflour.	212
					Corngrits.	1,316
	Szeterenyi	Baltimore	13/5	Trieste	Flour.	2,512
					Cornflour.	1,662
	Dubac	New Orleans	26/4	Trieste	Wheat.	2,538
					Flour.	514
					Cornmeal.	311
					Beans.	703
Total on passage—
					Wheat.	7,210
					Flour.	16,037
					Cornmeal.	1,745
					Oatmeal.	207
					Corngrits.	1,316
					Beans.	703
					Rolled oats.	841
					Bean flour.	435
					Cornflour.	2,497
					Rye flour.	38

3. Unallocated

To Load

June—	D. W. Tons
Erderly	7,000
Aug. Foherezegno	6,700
Lapad	3,500
Kossuth	6,500
Dardania	4,700
Atlantico	4,500
Emilia	5,000
Marianne	5,400
Radium	4,500
Izvor	6,600
Arcadia	7,000
Maria Valera	4,400
Boheme	6,400
Clumecki	6,200
Istina	5,500
Graf Hedervary	6,000
Georgia	8,000
Ellenia	7,300
Fiume	3,900
[Total]	106,100

July—	D. W. Tons
Leopoldina	6,000
Iskra	6,500
Gerty	6,300
Proteo	5,900
Szent Istvan	4,000
Arcadia	4,700
Laconia	8,300
Perse veranza	5,000
Laconia	8,300
Francesca	5,300
[Total]	60,300
August—
Jadera	5,600
Persia	5,400
Giulia	3,900
Zora	5,100
Gardenia	4,500
Java	5,200
[Total]	29,700

Canada

(1) Allocated to Italy

Arrived						Tons
Vindobona	Portland	¾	Cagliari	28/4	Wheat	4,567
On Passage
June arrival—
Mrav	Portland	6/5	Ancona		Wheat	5,619
Trieste	“	17/5			”	5,025
[Total]						10,644

(2) Allocated to German Austria

Arrived						Tons
Hungaria	Portland	7/4	Trieste	30/4	Wheat	4,285

(3) Allocated to Roumania

On Passage
June arrival—					Tons
Gerania	Portland	23/4	Constance	Wheat	6,717
				Flour	1,233
Baron Edmonde Vay	“	24/4		Wheat	3,688
				Flour	335
Absirtea	“	30/4		Wheat	4,360
				Flour	1,938
Burma	“	8/5		Wheat	6,569
Pssa. Christiania	“	15/6		Flour	3,364
[Total]
				Wheat	20,334
				Flour	6,870

(4) Unallocated

To Load

June—	D. W. Tons
Vindobona	4,600
Baron Fejervary	5,000
[Total]	9,600

July—	D. W. Tons
Olimpo	6,500

Argentine

Unallocated

To Load

June—	D. W. Tons
Barona Kemeny	3,200
Sirena	3,900
Jokai	4,000
Orjen	3,500
[Total]	14,600

July—	D. W. Tons
Sud	5,000
Alga	4,000
Epidauro	6,000
Iris	8,100
Balaton	2,900
Srgz	4,300
Corsinia	6,000
Magyarorczag	4,700
Stella	4,000
Laguna	7,000
[Total]	52,000

Australia

Allocated to Italy

On Passage					Tons
Filippo Artelli	Walleroo	21/4		Wheat.	8,315
Tirreno	Geelong	7/5		”	7,464
Total					15,779

Appendix III.—Exchanges of Tonnage Between Italy, Austria, and Roumania

Italy			Austria			Romania
April Arrival—
North America.			February-Mid-May. 126,000 tons
Sirena	3,045	W. 918 C. M.
Fiume	3,896	W.
President Wilson	1,310	C. M.	Australia
Dalmatia	2,801	W.	Porsanger	6,360	F.	Pengreep	7,466	W.
Vindobona	4,567	W.	War Earl	6,018	F.	Ferngarth	7,393	W.
						Tregarthen	7,083	F.
	16,537			12,378			21,942	W. & F.
May Arrival—
North America.
Argentine	632	P. 551 F. 73 C. M.
Francesca	1,335	W. 510 F.
Iris	8,433	W.
Magyarorczag	4,696	W.
Corsinia	6,548	W.
Szent Istvan	3,533	W.
Carolina	1,623	W.
Belvedere	4,565	W. 963 F. 106 C. M.
Laguna	6,770	W. 31 C. M. 38 R. F.
	40,407
June Arrival—
North America.			Australia.
Mrav	3,614	W.	War Cowslip	7,220	F.
Trieste	5,021	W.
Columbia	2,964	W. 952 F.
Baltico		4,896	W.
Bosanka	1,167	W. 2,689 F.
Sofia	1,777	F.
Contessa Adelma	5,121	W.
Graf Tisza Istvan	3,474	W.
	31,675
Australia.
Filippo Artelli	8,316	W.
Tirreno	7,457	W.
	15,773
Total June	47,448
July Arrival—
North America.
Aug. Foherezgno	6,700
Marianne	5,400
Leopoldine	4,850
Iskra	6,500
Perseveranza	5,000
Francesca	5,300
Fiume	3,900
	37,600
Cananda
Vindobonda	4,500
Baron Fejervary	5,000
	9,500
Plate.
Baron Fejervary	3,200
Sirena	3,900
Jokai	4,000
	11,100			145,598			21,942
Grand Total	162,592					167,540

Shipments to Trieste for German Austria (amounting approximately to 62,000 tons) financed by the French Government, and further proposed shipments, assuming finance to total value of 18,000,000 dollars is available.

				Approximate f. o. b. Cost/£
May Arrival—
From United States of America.
Hungaria	4,290	F.		64,900
Africana	4,689	W.		92,300
Perseveranza	4,673	F.		126,100
	13,652	283,300
From Australia.
Porsanger	6,360	F.		171,700
War Earl	6,018	F.		162,500
	12,378			34,200
Total May Arrival	26,030			617,500
June Arrival—
On passage from Australia.
War Cowslip	7,220	F.		194,900
On passage from United States of America.
Dubac	2,538	W.		91,200
	514	F.
	311	C. M.
	703	Beans.
Szenterenyi	2,508	F.	}	112,500
	884	C. F.
	777	C. G.
Maria Immacolata	4,240	F.	}	132,500
	80	C. F.
	346	B. F
	207	C. M.
	38	R. F.
Adriatico	3,198	F.	}	136,000
	1,751	C. M.
	90	C. M.
Cat. Gerolomich	4,668	W.	}	144,700
	979	F.
	136	C. M.
	840	R. O.
Kossuth Ferenez	4,581	F.	}	158,00
	70	C. M.
	211	C. F.
	989	C. G.
[Total May and June arrival]	63,879			1,587,300 (7,500,00 dollars)
June arrival—
Loading—
Emilia	5,000	Flour and groceries		135,000
Bohême	6,500	“ “		175,500
Dardania	4,700	“ “		126,900
Radium	4,500	“ “		121,500
Georgia	8,000	“ “		216,000
Lapad	3,500	“ “		94,500
Atlantico	4,500	“ “		121,500
Kossuth	5,500	“ “		148,500
Izvor	5,600	“ “		151,200
Total	47,800
July arrival—
North America—
Graf Hedervary	6,000	Flour and groceries		162,000
Istina	5,500	“ “		148,500
Ellenia	7,300	“ “		197,100
Clumecki	5,200	“ “		140,400
Erdely	7,000	“ “		189,000
Plate—
Orjen	2,500			67,500
[Total]	33,500
Total arrival—
May,June,and July	145,179			£3,782,400 (18,000,000 dollars.)

Austrian Steamers

(Additional to Proposed Arrivals in Italy and Austria Detailed in Foregoing Passages)

Northern Range

August arrivals—
Szent Istvan	4,000
Gerty	6,300
Protec	5,900
Arcadia	4,700
Laconia	8,300
Total	29,200
September arrivals—
Jadera	5,600
Persia	5,400
Giulia	3,900
Maria Valerie	5,100
Zora	5,100
Gardenia	4,450
Java	5,200
Total	34,750

Canada

August arrival—
Olimpo	6,450

South America

July arrival—
Alga	4,000
August arrival—
Sud	3,600
Balaton	2,900
Srgz	4,300
Corsinia	6,000
Epidauro	6,000
Ins	8,100
Stella	4,050
Laguna	7,000
Magyarorczag	4,700
Leopoldina	4,850
Total	55,500
Grand total	125,900

Appendix IV (a).—Freight Rates on the Basis of Blue Book Rates of Hire

United States and Canada

Per Ton of 1,015 kilogs. Weight or 40 cubic feet measurement at Shipowners’ option. Pork Products, Peas, Beans, Condensed Milk Rice, and Cocoa		Per quarter of 480 lb. of Heavy Grain or 320 lb. of Oats.		Flour per Ton of 1,015 kilogs.		Port of Discharge
s.	d.	s.	d.	s.	d.
52	6	11	6	60	0	Antwerp or Rotterdam.
58	6	12	6	65	0	Hamburg, Bremenhaven, or Emden.
63	6	13	6	71	0	Stettin.
66	0	14	3	73	6	Danzing.
71	0	15	3	78	6	Finnish ports, Kronstadt or Reval.

Gulf, 2s. per quarter over above rates.

River Plate

Per ton of 1,015 kilogs.		Port of Discharge.
s.	d.
80	6	Antwerp or Rotterdam.
86	6	Hamburg, Bremenhaven, or Emden.
92	0	Stettin.
95	0	Danzig.

The above rate includes Bahia Blanca, but whole cargoes loaded at Buenos Ayres and Montevideo 2s. 6d. per ton less.

Australia

Per Ton of 1,015 kilogs.		Port of Discharge.
s.	d.
135	0	Antwerp or Rotterdam.
141	0	Hamburg, Bremenhaven, or Emden.
147	0	Stettin.
151	0	Danzig.

West Africa

Per ton of 1,015 kilogs., Pine Kernels and Ground Nuts (shelled).		Port of Discharge
s.	d.
76	0	Antwerp or Rotterdam.
83	6	Hamburg, Bremenhaven, or Emden.
90	0	Stettin.
94	0	Danzig.

Appendix IV (b).—Blue Book Rates of Freight Fixed by A. M. T. E. for Shipments of Relief Cargoes From West French Ports to the Baltic

		Per Ton weight or measurement.
Bordeaux or Saint-Nazaire to—		s.	d.
Danzig	}
Memel		40	0
Libau
Reval	}
Helsingfors
Cronstadt		45	0
Viborg

Appendix V.—Freight Rates on Food to Germany

With reference to the discussion which took place at the meeting of the Finance Committee Section of the Council on the 15th May and Minute 65, “it was ascertained that the whole of the food sales to Germany by the representatives of the Associated Powers were made on the basis of c. i. f., and that, as far as the representatives were able to say, the question of hire of the steamers was not considered in any way by them when quoting prices of food,” the A. M. T. C. wish to point out that in framing the freight rates for the transport of foodstuffs to Germany they had assumed, in view of Section C 6 of the note of discussion of details at Brussels,^* held on the 17th January, that the element to be included in the c. i. f. price by the seller of the goods would be based on the rates which they supplied.

The rates supplied are based on Blue Book gross rates of hire, and the Committee desire to call attention to the fact that if any c. i. f. price has been based on any other current freights, a large profit will accrue to the country selling the goods, arising solely from the freight charged, and in such a case it does not seem to them right that such a profit should be kept by the country selling the goods, but that it should either go to the country managing the ships or be set aside for an Allied fund, the proceeds of which should be disposed of as may be agreed later.

Appendix 206

[Report by Colonel Atwood, Submitted by the Director General of Relief, Regarding Communications in Central and South Eastern Europe]

The Director General of Relief submits to the Supreme Economic Council the following report from Colonel Atwood:

June 19, 1919.

Mr. Herbert Hoover,
51 Avenue Montaigne, Paris.

Dear Mr. Hoover: In response to your request for a report from me as representing yourself as Director-General of Relief under the authority for Railway control conferred upon you by the Supreme War Council on the 7th March, acting through the Communications Sections, I beg to submit the following:—

The preliminary reports made by both American and Allied investigators for the Director-General of Relief indicated that the transportation capacity of the railroads would limit the amount of relief which could be given to the liberated countries. It appeared from these reports that, while the road-bed and bridges were generally in operating conditions, except in old Serbia where the destruction was complete, the motive power and rolling stock were in bad condition, and the operating forces were generally disorganised. The more serious difficulties were due to the political situation, on account of the breaking up of the former Austro-Hungarian Empire, and the existing national and racial animosities. Practically all boundary lines of the new States were closed to traffic.

As a result of the conditions shown by these reports the Communications Section of the Supreme Economic Council was formed, and on your recommendation the Supreme War Council, on the 7th March, authorised the organisation of a special mission with broad powers to control the movement of relief traffic within the limits of the former Austro-Hungarian Empire. This Mission is an Inter-Allied organisation, under the executive presidency of an American, and reports to you through the Communications Section. The Communications Section designated me as the member through whom these reports and instructions were to be received and issued.

At the meeting of the Communications Section of the 8th March, Lieutenant-Colonel William B. Eyan, T. C, United States of America, was designated as president of the Mission, and instructions covering the operations of the Mission were adopted. Shortly after this it was necessary to relieve Colonel Ryan, and Lieutenant-Colonel William B. Causey, Engineers, United States of America, was designated to replace him. Each of the other Powers represented on the Communications Section at that time appointed one or more liaison officers.

The general duty of this Mission is to secure and furnish such transportation as is requested by the Mission of the Director-General of Relief in this territory, and also to aid in the re-establishment of normal economic and transportation conditions within the territories which formerly made up the Austrian Empire.

The first work initiated was the opening of through freight service for supplies moving from Trieste to German Austria and Czechoslovakia. When this Mission commenced its operations, about the 23rd March there were about 41,000 tons of supplies in storage in Trieste, 12,000 tons at Fiume, and the average daily movement was about 700 tons out of Trieste and nothing out of Fiume. From the 23rd March to the 15th June, inclusive, there has been moved from Trieste a total of 178,200 tons, or a daily average, including holidays, of 2,121 tons. On several days during this period the daily movement has exceeded 4,000 tons. Of these supplies 125,100 tons have been delivered to German Austria and 52,100 tons to Czecho-Slovakia. Since the 30th April, when the change in the route for supplying Czechoslovakia became effective, it has only been necessary to ship 8,000 tons to that country from Trieste.

A study of the transportation situation showed that supplies for Czecho-Slovakia could be handled with greater economy and expedition through the German ports and waterways than by rail over the Alps from Trieste. As soon as necessary transportation and political arrangements could be made, supplies for Czecho-Slovakia were delivered by ocean carriers at Hamburg and transported by the Elbe to Czecho-Slovakia.

The first barges were loaded in Hamburg on the 1st April, and arrived at Schandau, on the frontier between Germany and Czechoslovakia, on the 9th April. From that time until the 13th June about 142,000 tons have been shipped from Hamburg, of which 100,000 tons have arrived in Schandau, the remainder being in transit.

Since the beginning of the work of the Mission, 18,200 tons of supplies have been evacuated from Fiume and delivered at various points in Greater Serbia. Assistance has also been given to the British Serbian Relief Organisation in the transportation of their supplies to Belgrade and other points.

In addition to its work in connection with through transportation, this Mission has exercised a general supervision of the distribution transportation within the various countries, and had aided in the organisation of transportation in connection with the redistribution of various necessities which were in existence in the different countries.

They have also exercised a general supervision over the distribution of the available coal supply, and have done whatever was possible to increase the production of coal within their territory. On finding that the supply of lubricating and lighting oils for railroad purposes was nearly exhausted, arrangements were made for the shipment of a small amount from the United States, and the Mission has convoyed trains and secured considerable supplies of oil from the Ukraine. These trains were considerably obstructed by the military operations and were frequently fired upon, but the officers in charge succeeded in delivering the greater part of the oil to its destination.

Lieutenant-Colonel Causey has also exercised a general supervision over the work of the Communications Section Missions in Serbia and Czecho-Slovakia, these Missions being charged with aiding in the reconstruction and rehabilitation of the railroads and their equipment.

The Serbian Mission, under Major McKennett, Engineers, has been of material asistance to the Serbs in the matter of technical advice, selection of proper construction plant, and the securing of this plant and plant equipment and necessary supplies from the American army stocks, credit having been granted to Serbia to the amount of about 11,000,000 dollars for this purpose.

The operating Mission, under the presidency of Lieutenant-Colonel Causey consists of Majors Burke, Wilson, Berry, and McKennett together with fifteen other officers and fifteen enlisted men of the American army. Lieutenant-Colonel Brown, of the British army, has been an extremely valuable member of the Mission, as were also liaison officers furnished by the other Powers.

Yours very truly,

Wm. G. Atwood

Appendix 207

Report of Communications Section of Supreme Economic Council of Date June 19, 1919

1. Object—The work of the Communications Section consists in

(a) The organisation and co-ordination of the necessary urgent assistance for the maintenance and improvement of the existing port, railway, inland waterway, and telegraphic facilities in Eastern Europe, with a view to the earliest possible return to normal conditions.

(b) The apportioning of the necessary action between the Allies, with a view to the most effective solution of the above problem.

(c) The organization of the immediate despatch of the necessary technical missions.

(d) The expediting of supply of essential materials.

(e) Arranging through the naval and military authorities of the organisation of additional lines of communication required for economic purposes.

(f) Reporting on any technical communication question referred to the Communications Section by the Supreme Economic Council.

(g) Endeavouring to increase the output from coal mines in the assisted countries.

Note.—The Communications Section is not responsible for the forwarding, custody, or handling of any consignments.

2. The Communications Section was formed as a result of the report, of date the 22nd February, 1919, of a special Sub-Committee,⁷ appointed by the Supreme Economic Council, which met on the 20th and 22nd February.

In this report, which outlines the proposed functions of the Communications Section, an Inter-Allied credit of £20,000,000 was recommended to enable the minimum assistance necessary to be rendered until essential requirements could be met through the ordinary trade channels, which it would be the object of the Communications Section to encourage.

Although the functions of the Communications Section are economic rather than military, it was agreed that the existing military organisation alone possessed the facilities for prompt and effective action.

3. The Communications Section has held twenty-three meetings to date. It consisted at first of representatives of America, Great Britain, France, and Italy, with a representative of Marshal Foch attached. Since that date a Belgian representative has been nominated, and also a representative of the British Naval Section has been attached. Further, a financial representative from the French Foreign Office has attended for the four last meetings.

The Supreme Economic Council adopted the report of the Special Sub-Committee of the 25th [22nd?] February, 1919, and authorised the Communications Section to proceed as far as possible prior to the allotment of funds. In this connection the British Treasury representatives on the Supreme Economic Council arranged that the Treasury should favourably consider proposals for British missions submitted by the War Office.

4. The relations between any separate mission sent out by the Supreme Economic Council and an existing military mission under the High Command have been defined as follows:—

“When the military mission exists under the High Command its relations with the technical mission of the Supreme Economic Council will be the same as its relations with the civil organisation so concerned, to assist which is the duty of the proposed mission.”

The technical missions report to and receive instructions from the Communications Section of the Supreme Economic Council through the channel laid down by the Power responsible for executive action.

5. The principle followed has been for Inter-Allied Missions to be sent to every country assisted, but that in each case one Ally should be charged with the necessary local executive action.

6. The following Inter-Allied Technical Transportation Missions at present in existence are as follows:—

(i) Adriatic Mission.—The first Inter-Allied Mission to be authorised was the Mission to control the through railway service from the South for the relief of the States of the old Austro-Hungarian Empire. The responsibility for executive action of this work was allotted to the Americans, and the Head of the Mission is Lieutenant-Colonel Causey, U. S. A., with headquarters at Vienna, the instructions to whom were adopted in the 11th March. The powers of this Mission were defined by a special decision of the Supreme War Council.

The attached charts show the tonnage of relief despatched from Trieste and Fiume since the Mission started working on the 7th March until the week ending the 23rd May. The decrease in tonnage during the last month is due to the opening of the Elbe for relief to Czechoslovakia, which has obviated the necessity for the long railway haul from the South.

The British representative with this Mission, stationed at Trieste, is also in charge of the transshipment of British supplies from the Serbian Belief Fund destined for Jugo-Slavia.

(ii) Austria-Hungary.—An Inter-Allied Mission has lately been formed here. The executive action of this Mission has been allotted to the Italians, and the Head of the Mission is Colonel Alberti, of the Italian Army, with headquarters at Vienna. In connection with the Communications Section this Mission is at present studying, in concert with the Italian authorities, the technical measures necessary for reopening a commercial train service from the Italian ports to Austria.

(iii) Don and Caucasus.—A British railway expert has been attached since March to the British Military Mission with General Denikin, and detailed lists of urgent railway requirements for the railways from these districts are available. The situation in the Don and Caucasus needs immediate action. The railways have only 20 per cent, of their pre-war capacity; they have only stores for another two and a-half months. The lines now under General Denikin’s control serve areas which are rich in products. In addition to material and tools for locomotive repair, there are certain more general requirements, including clothing and boots for railway employees. The issue of 20,000 suits of prisoners of war uniforms from British military stocks has been arranged towards meeting this. The cost of the railway material of immediate urgency is roughly estimated at £500,000., and the equipment, clothing, and medical stores for the railway staff and certain mechanical transport for railway deliveries are estimated to cost a further £800,000. No further action can be taken without credits, and an immediate grant from British Relief Funds has been insistently asked for since the beginning of April. £1,000,000 should be allotted at once.

(iv) Jugoslavia.—The executive action on transportation questions in this country has been undertaken by America, which is represented by Major McKennett, with headquarters at Belgrade. Detailed lists for immediate urgent requirements as well as prospective total requirements are available for the railways of Jugo-Slavia.

About 78 per cent of the 1,080 kilometres of standard gauge track have up to the present been restored to operation. It is hoped that the bridge over the Save and the joining of the line from Salonika through Nish to Belgrade will both be completed at about the same time, viz., the beginning of August. No heavy repairs can be done to locomotives and rolling-stock until the shops at Nish are reopened. The necessary plant for doing this is being despatched from American army stocks in France.

(v) Poland and Baltic Provinces.—These territories are combined under the executive control of Brigadier-General Hammond, of the British Army. A full report has been received, with lists of material of primary urgency, consisting chiefly of material and tools for repairs to locomotives, of which about 50 per cent, are under or awaiting repair. In spite of great difficulties, the Poles are showing a disposition to organise their railways. A British allotment of £500,000, out of the Kinds available for relief has been granted for the supply of material, and orders have been placed for considerable quantities, and the first shipments should leave very shortly. The despatch of 100 “Armistice” locomotives and 2,000 “Armistice” wagons from France has been authorised, and has now commenced. The transfer of these wagons should be completed by about the end of this month, and the locomotives by about half-way through July.

Besides the work on the railways of Poland, the Inter-Allied Mission has been asked to undertake in assisting in the reorganisation of the waterways of Poland, and to this end a technical expert is being despatched to join the Mission.

(vi) Roumania.—Up to date no Inter-Allied Mission has been formed. There is, however, a British Railway Mission under Lieutenant-Colonel Billinton. A credit of £500,000, for the furnishing of urgent railway material for Roumania has been allocated, and some of this material has already been supplied. In order to tide over the time while this material arrives and while the existing locomotives are being repaired (of which only 275 out of a total of 1,181 were in working order on the 1st March), it has been found necessary to despatch 100 locomotives from France. Of these, 14 locomotives have arrived in Roumania, having been despatched cold through Italy, and the despatch of other locomotives has now commenced at the rate of two per day in steam through Switzerland. The Roumanian railway authorities have also ordered considerable quantities of railway repair material from a private firm in Austria, and several train loads have already been despatched.

(vii) Czecho-Slovakia.—There is an Inter-Allied Mission established at Prague with Major Wilson, of the American army, as Chief of the Mission. The greatest need of this country at present in transportation requirements is coal cars, of which 3,000 are urgently required; 200 heavy type freight engines are also urgently needed, chiefly for hauling coal from the Silesian mines. Further 100 “Armistice” locomotives are shortly to be despatched from France. The Czecho-Slovaks are at present negotiating with the Americans for another 100 locomotives and 3,000 wagons. Major Goodyear, of the American army, is working in the Silesian mines district with a view to increasing the production of coal.

(viii) Trans-Caucasia.—The railways in the Trans-Caucasus and Armenia are at present being controlled by a British Technical Mission under General Brough. He is endeavouring to organise an efficient service between the Black Sea and the Caspian Sea, in spite of differences between the various local Governments concerned and the corruption and inefficiency of the local managements.

The Food Section of the Supreme Economic Council are trying to increase the imports of relief into Armenia from 5,000 to 15,000 tons per month. An American transportation officer had been sent out to work in liaison between the American Food Administration and General Brough, but until further rolling stock is available, and until the mutual distrust of the local Governments can be broken down, great difficulty will be experienced in effecting a substantial improvement.

7. River Navigation.

(i) Elbe.—In order to relieve the congestion on the railways caused by the relief traffic from Trieste to the States of the old Austro-Hungarian Empire, it was decided to open the Elbe at the beginning of April for shipments of relief to Czecho-Slovakia. The attached chart shows the despatches of relief from Hamburg destined for Czecho-Slovakia from the time of the inception of the route up to the week ending the 24th May. Further, during May the Elbe was again reopened for ordinary commercial traffic to Czecho-Slovakia.

(ii) Danube.—The question of facilitating the transportation of relief and commercial consignments on the Danube was raised on the 23rd April by Colonel Logan, of the U. S. Army, and as a result the Supreme Economic Council have authorised the formation of an Inter-Allied Commission, working under the orders of the High Command. Briefly the functions of this Commission are (a) to facilitate the circulation of relief and commercial barges, (b) to collaborate with the Communications Missions established in the riparian States in taking any necessary action to assure the upkeep of the boats and the supply of fuel and lubricants, (c) to improve as quickly as possible the means of communication and liaison between the commandants of the three sectors into which the river is at present split up for executive working purposes.

This Commission is at present in the course of formation. It will be under the presidency of Admiral Troubridge, R. N.

The importation of 3,000 tons of coal per month was authorised for the Danube navigation. A request has since been received that this should be increased to 10,000 tons per month, and the question of the supply of this quantity is now being taken up. There are already in existence several regular services tot heavy freight and passengers running in to a kilometrage of 10,000 per week, but no traffic can proceed through to Vienna until the political situation at Budapest becomes clearer.

(iii) Rhine.—In order to further the economic interest of the countries concerned in the navigation on the Rhine, it is proposed to confirm the arrangement that the existing “Commission interalliee de Navigation de campagne” should temporarily continue to control these economic transports, and that requests and suggestions of an economic nature which the Supreme Economic Council may make should be communicated to the High Command for transmission to the Commission interalliee de Navigation de campagne by Marshal Foch’s representative on the Communications Section.

8 (a). In order to help the Communications Section to make a comprehensive up-to-date review of the transportation situation in Eastern Europe, the Chiefs of all Railway Missions have been requested to furnish weekly a uniform statement giving for railways—

(i) Repair situation for locomotives, wagons, and passenger vehicles.

(ii) Kilometrage of track in operation.

(iii) Average number of trains per day of various classes, and

(iv) Train kilometrage of various classes.

(v) Any other factors which are likely to assist the Communications Section in arriving at a proper estimate of the transportation and coal situation.

(b) Statistics have also been requested from the authorities controlling the river navigation on the Rhine, Danube and Elbe, to give the following points:—

(i) Indication of development of tonnage moved or of cargo capacity of vessels moving on the river.

(ii) Indication of the percentage of the river fleet laid up awaiting or under repair.

(iii) Limiting factors against increase of traffic.

(iv) Directions in which the demands for transportation have not been complied with.

(v) (Applying only to Danube and Elbe.) Action required or being taken to remove these limitations.

9. The Communications Section has instructed its Missions to foster as far as possible the interchange of commercial traffic between the various countries of Eastern Europe by using its officers where necessary as liaison between the railway administrations and between the Governments of the various countries concerned. By this means it is hoped to break down the reluctance at present shown by several of the countries in allowing their rolling-stock to cross their frontiers, and to re-establish as soon as possible the normal conditions of international transport.

10. In connection with paragraph 9, the Communications Section is also organising the opening up of further through train services from France for the transport of goods to the various countries, and to this end, besides the above-mentioned service from Italian ports to Austria, it is under consideration to run regular through commercial trains from France to Jugo-Slavia and Roumania.

11. Arrangements have been made for the re-establishment of postal communication with Poland, Czecho-Slovakia, Austria, Jugo-Slavia and Roumania.

12. In order to assist the Relief Administrations, the American member of the Communications Section has arranged for the installation or connecting up of existing telephonic and telegraphic circuits between the principal towns of Europe, giving also direct communication with Paris.

13. The Communications Section arranged for the insertion in railways and waterway clauses of the Preliminary Peace Terms of an Article securing the Powers requisite for the functions of the Supreme Economic Council after the signature of Peace.

Article.

“The enemy States will carry out the instructions which may be given them as regards transportation by an authority designated by the Allied and Associated Powers.

(1) (concerns military movements).

(2) As a temporary measure for the transport of relief traffic to various localities, and as regards the re-establishment as quickly as possible of the normal conditions of traffic and the organisation of postal and telegraphic services.”

[Enclosure]⁸

graph showing weekly despatches of relief by trieste

graph showing weekly despatches of relief by elbe

graph showing weekly despatches of relief by fiume

Appendix 208

Note for the Supreme Economic Council by the Sub-Committee on Germany [Respecting] Finance of German Coal

1. The Sub-Committee on Germany reports to the Supreme Economic Council that the Inter-Allied Sub-Committee appointed under the modus vivendi of the 7th May, 1919, to determine the question of quantities to be delivered and prices to be paid in respect of commodities delivered under the Luxemburg Protocol, held its fourth meeting with the German Economic Delegates on the 11th June 1919.

2. As regards the question of quantities to be delivered, an agreement was reached with the German Delegates on the lines of the attached annexe.

3. As regards the prices to be paid, in view of the fact that a complete agreement could not be reached, the following propositions were submitted to the German Delegates and accepted by them:—

a) That the price of Ruhr coal and coal from the German portion of the Saar Basin should be fixed at 35 fr. per ton on waggon frontier.

b) That the price of German coke delivered between the 11th November, 1918, and the 31st May, 1919, should be fixed at 45 fr. per ton waggon frontier.

c) That the Sub-Committee should propose to the French Government that the question of the price of coke deliveries subsequent to the 31st May, 1919, should be submitted to arbitration in conjunction with the price for all minette ore delivered since the modus Vivendi of the 7th May, 1919.

4. In accordance with this agreement, the Secretariat of the Sub-Committee on Germany has requested M. Loucheur to agree to the arbitration referred to in paragraph 3 (c) above.

5. The Sub-Committee on Germany asks the Supreme Economic Council to approve by a resolution the decisions of the Coal Sub-Committee, in particular its recommendation that the outstanding questions arising under the Luxemburg Protocol should be submitted to the same arbitration by which the previous questions have been satisfactorily adjusted.

Annex

Agreement for the Application of the Modus Vivendi of 7th May, 1919

I

As regards the application of paragraph 3 of the modus vivendi of the 7th May, 1919, it is stated:—

1. That the total of 6,500 tons coke is to be understood of deliveries from the mines in unoccupied territory of Lorraine, the Saar and Luxemburg and is to be per day.

2. That deliveries of coke by water shall be included in the sum total of the deliveries of coke in exchange for minette.

II

The unoccupied territories will furnish per day to Alsace-Lorraine and the occupied territories a total of 12,500 tons of coal.

III

The occupied territories will send to the unoccupied territories:—

(a) 80,000 tons of raw lignite per month.

(b) 50,000 tons of lignite briquettes per month.

If the deliveries of coal provided for in paragraph 2 above fall below 375,000 tons per month, the total of 50,000 tons of lignite briquettes can be reduced in the ratio of 7 tons of briquettes for every 5 tons of coal in deficit.

(c) 1,000 tons of Saar coal per day. This quantity of 1,000 tons will be increased by 400 tons for each 1,000 tons of coke received over and above the total of 6,500 tons.

IV

The balance of deliveries effected on one side and the other will be made for each of the quantities listed above at the latest on the 15th of each month for the previous month, and the party whose deliveries show a deficit must make up the deficit in the deliveries of the following month.

Appendix 209

Memorandum [From the Communications Section] on Railway Transportation Situation in Bolshevik Russia

1. Very little definite information is available about the present transportation situation in Bolshevik Russia. All reports received, however, are unanimous in stating that railway transportation has practically ceased owing to several causes, the chief being shortage of locomotives and wagons due

(a) To the low productive output of the workmen and the abolition of piecework in Russia.

(b) To the shortage of raw materials, coal, and spare parts for rolling stock.

2. The length of line in operation at the beginning of 1917 was 64,000 versts. In October 1918 this had dropped to 22,000 versts. Out of an original 20,000 locomotives there were only 4,500 in working condition at the end of 1918, and it is probable that a further 1,500 of these have since become unfit for use. The repair of locomotives decreased from 569 in 1916 to 396 in 1917 and 80 in 1918. It was reported that the Soviet Government hoped to get the workmen to repair 700 or 800 during 1919, but it is not probable that a greater quantity of locomotives than were repaired in 1918 can be dealt with. This situation has led the Bolshevik Government to draw the conclusion that it would be necessary to resume the system of piecework; but as this is the very thing for which they have always blamed the bourgeois party, it is very improbable that they will have any power to carry it into effect.

3. The situation in wagons is very little better than that of the locomotives. No definite figures are available, but the Bolshevik Minister of Communication stated to a reliable Danish Red Cross official at the beginning of March that 80% of the rolling stock in Russia was unusable, and that the remainder would become so in two months’ time.

4. There is not even enough rolling stock to send to the mines in order to fetch the coal necessary to run the railways. The number of locomotives and wagons per verst is still fairly high, however, owing to the closing down of two-thirds of the railways of Russia, but the mileage of the locomotives has proportionately decreased during the last two years. Thus in 1916 the average mileage per diem per locomotive was 60; in 1917, 50; and in 1918 had dropped to 35.

5. The railways which were worked in 1916 at a profit of 140 million roubles, were worked in 1918 at a loss of eight thousand million roubles. The railways are supposed to be administered by the Commissary of Ways and Communications, but in reality railway men and railway unions comprising men of small calibre vested with great authority have practically entire control of all railway administration. Central administration and co-operation between the various districts does not exist, with the consequence that some of the small and useless branch lines have a large percentage of locomotives and wagons on them standing idle, often loaded-with supplies of the utmost importance to the economic life of the country. The existence of this rolling stock is often unknown to the higher authorities, and it frequently remains unutilised for considerable periods.

6. Allowing for very considerable exaggeration in the reports from which this memorandum has been made, there is no doubt that the task of restoring railway communication, which must precede the resumption of normal conditions in Russia, is of very great magnitude.

7. The Allied railway organisations functioning in Russia at the present moment are as follows:—

(a) Siberia:

Railways controlled by an Inter-Allied Commission with a technical board under the presidency of an American. It is understood Americans have over 150 railway experts; the British have 40 out of an authorised establishment of 70 and the Japanese have also a considerable staff. The operation is assisted from Omsk westwards by the British Section; from Omsk to Vladivostock via the Chinese Eastern Railway by the American Section; and on the Amur and Ussuri lines by the Japanese Section.

(b) Archangel and Murmansk:

There are 37 British officers employed on the railways in connection with the Allied Forces operating in North Russia out of an authorised establishment of 63. Further there are a few hundred railway troops.

(c) Don and Caucasus:

Authority has been given to increase the British Railway Mission with General Denikin to 36 officers, the present number being 7. This has been done at the urgent request of General Denikin to reinforce his railway administration for military purposes.

(d) Trans-Caucasus:

There is a British Mission of 18 officers, out of an authorised establishment of 59, under Brigadier-General Brough.

8. Detailed information is available as to the limits of the various railway systems, and of the grouping of such systems in regional administrations prior to the revolution. Information is also available of the maximum capacity of each section of line, based upon the actual traffic during the winter period of 1916–17. Detailed demands, estimated to cost about £4,000,000, have been received of the immediate requirements in the Ukraine, Don and Caucasus areas and thence to Moscow.

9. There are at present in France several representatives of the Russian Government who do not appear to have yet elaborated any plan for the reorganization of the Russian railways. Amongst these representatives, however, are presidents and other high officials of the principal Russian railway companies. It is understood these officials controlled some 40% of the Russian railways before the revolution. They might therefore be of great service to the Russian Government in helping in the problem of restoring the operation of the Russian railways.

The delivery of a considerable quantity of railway material ordered by the Russian Government in America, Great Britain and France before the revolution was suspended. A good deal of the material has since been diverted to other purposes. Most of the locomotives and rolling stock which had been built on British credits is in course of delivery to Siberia. It is understood however that a good deal of this material still exists, and this should be made available again for Russia on the old credits.

10. This information and the experience that we have gained in Central Europe on the one hand, and the maximum number of personnel likely to be available, and rate of supply of material on the other hand, afford sufficient indication for a preliminary guess at the extent of the problem and the measures to be recommended for dealing with it.

11. The re-establishment of normal conditions on Russian railways will necessitate milliards of francs, and can only be effected through commercial channels. All that can and need be done by direct Allied assistance is to help in the reorganisation and re-establishment as early as possible of the local railway administrations, and to supply at the earliest possible moment a comparatively limited quantity of tools and materials which will admit of the local resources being turned to the best account; thus, while the supply of new locomotives and wagons must be left to private initiative, the expenditure of a comparatively small sum would render possible the repairs to large numbers of existing locomotives.

12. It is essential to consider the problem as a whole from the commencement, both to prevent the available resources being used up in too concentrated local endeavours, and because the Allies could probably give the most effective assistance in organising from the top downwards, and to do this must cover the whole field. It would be difficult to submit proposals without involving some consideration of the share in the work to be undertaken by each Allied Power.

13. It is therefore proposed to consider first a scheme based on the assumption of the whole of European Russia being suddenly thrown open for reconstruction, and to consider later how the proposals would be modified if the territory comes gradually under the influence of the Supreme Economic Council.

The scheme which commends itself is generally as follows:—

14. A Central Allied Mission with the executive presidency of one nation would be established at the seat of the Central Government, presumably Moscow. Railway access to the centre of Russia from every quarter would be grouped, following possibly the old regional areas, under Allied Missions, which, with an executive president of one of the Powers, would report to the Central Mission. These Missions would each perform similar functions to those undertaken by the existing Communications Missions in Poland and elsewhere, viz., they would examine and report on the railway situation, and on the essential stores required immediately for the maximum utilisation of the existing resources. They would advise and encourage the local administrations to organise themselves, and would smooth over difficulties between adjoining administrations. They must remember that their primary functions are to assist and strengthen, not to supplant, the local administrations. Only in this way can the problem be tackled, even with the greatest quantity of Allied personnel likely to be available. The assisting Allied Governments would have to provide the necessary credits for essential tools and material purchased in their countries for the railways assisted. In addition, assistance in material would be welcomed from every other quarter, and every effort would be made from the start to encourage assistance through commercial channels and by developing local production in the industrial centres.

15. As regards the credit required for the supply of materials, it is thought that under the most favourable circumstances, if the whole of Russia is available for reorganisation, the maximum amount which would be required under the above proposals, would not exceed £8,000,000 (sterling). This would not provide for clothing the whole staff or for the financing the railway administration generally, and excludes Siberia.

16. As regards the distribution of the work, Great Britain, on account of her previous efforts, is best situated to take the initiative. The British are already responsible for the railways following up any advance from the north, east, and south, and it is provisionally agreed that France will be executively responsible for any missions sent to the south-west, where the railway system is the densest in Russia. There remains the west and north-west, which might be allocated to the Americans whose principal relief organisation would not unlikely operate from that direction. If the reorganisation of the Polish railways has made sufficient progress, General Hammond’s Mission might assist in the reopening of one railway from Poland. Italy is shortly taking over the control and assistance to the Trans-Caucasus railway, and would later extend her field of action to Russia proper. The Belgian Government wishes to send a mission composed of technical experts with a knowledge of South Russia. A zone would be allocated to them, probably between the English and French zones. The exact division between the spheres of the different Missions would be settled later, and may be varied as circumstances render it desirable.

17. As regards the personnel required, the assistance visualised would, it is estimated, require in European Russia some 500 officers and the same number of assistants. After one year it is hoped that a considerable reduction could take place.

18. In the event of territory only being gradually available for reconstruction, the reorganisation of the railways which are accessible should be undertaken at once to the fullest possible extent, and everything possible done to collect the most capable Russian railway officials and organise them on the available lines in order to be prepared for further developments. Similarly, credit should be granted to place the accessible railways in the best possible conditions, especially as regards locomotives and rolling stock, in order that their organisation may be extended to work a greater mileage as it becomes available. As it takes months to obtain and deliver even the simplest requirements, stocks of essential materials might be held in reserve locally.

19. It will evidently be equally necessary to apply the above measures to the reorganisation of the inland waterways of Russia, as it will probably be quicker to re-establish effective water transport than railway transport. A considerable amount of information is available on this subject. The personnel and credits necessary for the inland water and telegraphic and telephonic communications are included in the above estimates.

20. There is no question but that the reorganisation of communications will be the most important thing of all in the reconstruction of Russia, and will be of the utmost importance, not only for the relief of the inhabitants themselves and the restoration of the normal conditions of life, but for the increase of productivity, so essential in this world crisis, by the throwing open of the unlimited resources of Russia to the industry of all nations.

June 19, 1919.

Appendix 210

Geneva, June 14, 1919.

[Letter From the Director General of the League of Red Cross Societies (Henderson) to Miss Gertrude Dixon, Secretary, Supreme Economic Council]

Dear Madam: In continuation of previous correspondence on the subject of the prevention of disease in Eastern Europe, I wish to bring to your attention certain difficulties which have arisen with regard to the arrangements proposed by the Committee presided over by Mr. Hoover.

1. The suggestion that any equipment or supplies provided through the medium of the Economic Council should be charged to the countries in which they are expended is the main source of trouble.

I have received a cable from the American Red Cross, offering a very large contribution of money and help in the provision of personnel, but a condition is made that the Allied Governments shall put at the disposal of the League the supplies necessary for carrying out the operation. I do not think that I can reply that the arrangement proposed fulfils this condition.

2. Whatever arrangement may be arrived at with the Minister of Health for Poland, now in Paris, the general feeling of the Red Cross Societies is against the commitment of highly trained and expensive personnel to work in Eastern Europe, unless the equipment and supplies which are necessary for their operations are entirely at the disposal of the Red Cross.

3. I would venture to urge also that, although Poland has been selected as the theatre of the first operation, it is not actually for the benefit of Poland that this equipment will be used or these supplies expended. The campaign is one of prevention, and although the main centre of epidemic disease is at present in Poland, the operations of the Red Cross will be directed towards preventing its spread from Poland to other countries. Therefore, it seems to me quite unfair that Poland should bear the burden of expense of the provision of these supplies; just as unfair as it would be to charge Belgium with the cost of the war in Flanders.

4. I fear there may be some misunderstanding in the minds of the Committee as to the actual amount of equipment and supplies which have been asked for. The amount put in by the League of Red Cross Societies was distinctly divided into two headings; the first referred to the equipment necessary for sanitary sections and field laboratories for the prevention of the spread of disease, the second referred to equipment and supplies which might be required for general hospitals for the treatment of the sick. The first of these is the one in which the Red Cross is primarily interested, and I have calculated that the cost of that is not very great, probably under £120,000. The cost of the second may be much greater, but I have never had any intention of asking for this as a free issue. It may quite properly be charged to those countries who desire to make use of it. In fact, the second demand was made for the purpose of ascertaining how much of the necessary hospital equipment would be available should we be able to organise the local Red Cross Societies to make proper use of it.

On these grounds I venture to make another appeal to have this equipment for the first demand placed absolutely at the disposal of the League of Red Cross Societies. If that is done, I believe that the League will be able to contribute many times the value of these stores as their share of the cost of the whole operation. Nevertheless, owing to the general feeling that the Governments have a certain responsibility in saving the remainder of Europe from the scourges which are already prevalent in the East, the League will be unable to bring their resources into full play unless the Government will take its share in making this small contribution of necessary and available equipment and supplies.

I should like to say that the feeling among the voluntary societies is very strong on this point. They feel that they have been called in to assist, and now find that it is not assistance that is required but the assumption of the whole responsibility, unless they consent to have their freedom of activity limited by dependence on a foreign Government for essential part of their equipment.

Very truly yours,

David Henderson

Appendix 211

Memorandum From Dr. Tomasz Janiszewski, Minister of Public Health in Poland, to Mr. Herbert Hoover, in Paris

Having come to Paris on your telegraphic invitation I have held several meetings with representatives of the League of Red Cross Societies according to your desire. The final result of these conferences is such that the League refuses all help except for the assistance in recommending 50 doctors and 100 sanitarians and nurses to be engaged by the Polish Government; but the salaries of this staff, quite apart from high travelling expenses, are so much in excess of the average pay of our own personnel that we shall be able to engage but a few of the League’s candidates.

The representatives of the League have declared their willingness in principle to take part in the action of establishing a sanitary cordon on the eastern frontier of Poland if called upon to do so by an international governmental sanitary commission, the Governments concerned bearing all the expenses of the action and taking all the responsibility for any such action. But no such commission exists at present, and in the meantime people are dying of typhus in Poland, our epidemiologists are falling victims to the disease in protecting the whole of Western Europe from the further spread of the epidemic, while here all the time there are experienced people as well as all means to fight the terrible scourge. The summer period is the only season of the year when the action may be conducted successfully. The carrying into effect of this action on a big scale surpasses the ability of our own Government, and it is fair to ask that the campaign conducted in the interests of the whole West should be materially assisted by the Western Governments.

Being now thrown back entirely on our own for the whole programme of the campaign, we ask only that the Supreme Economic Council sell to us at reduced prices the supplies indispensable for an effective campaign, and specified in the second annex of the attached memorandum on the plan of an anti-typhus campaign in Poland, p. 13,⁹ the reduction of prices representing the actual participation in the cost of the undertaking on the part of the interested Governments.

Paris, June 15, 1919.

Appendix 212

20/6/19.

Memorandum by British Delegation on the Future of the Supreme Economic Council

1. Constitution of S. E. C.

The Supreme Economic Council was established by resolution of the Council of Four to deal on its behalf with economic questions affecting the interests of the Allies during the Armistice period, and “to examine such economic measures as should be taken during the period of reconstruction after the war, so as to ensure:—

• “a) The due supply of materials and other commodities necessary for the restoration of devastated areas.
• “b) The economic restoration of the countries which have suffered most by the war.
• “c) The supply of neutral and ex-enemy countries without detriment to the supply of the needs of Allied and Associated countries.”

When the Treaty of Peace is ratified the work of the Supreme Economic Council will necessarily be modified to a large extent. It is urged, however, that there are sufficiently pressing matters affecting the common interest of the Allies to necessitate the continuance of the Supreme Economic Council. The following are among the tasks for which some degree of international consultation and cooperation would appear to be still necessary.

2. Provision of Foodstuffs and Raw Materials to Germany.

The Treaty of Peace provides that Germany shall be allowed to spend out of the reparation due in the first two years as much money on food and raw materials as the Principal Allied and Associated Governments may judge to be essential to enable her to meet her obligations for reparation. It is expressly stated that this decision is to be made by the Principal Allied and Associated Governments, not by the Reparations Commission. The Treaty clearly contemplates decisions from time to time as to the amounts to be allowed for food and raw materials. No single decision on a total lump sum could be made until the extent of Germany’s capacity to meet her obligations is ascertained.

Further, the reply to the German counter-proposals stipulates that such supplies must be imported through State organisations under Allied control. In respect of several commodities the effect on supplies and prices of supplies to Allied countries must be taken into consideration. It may therefore be necessary to decide not only how much Germany can buy, but in what market and at what price. These decisions must be made in concert, and some organisation such as the Supreme Economic Council is essential for this purpose.

3. Position of Allied and Liberated Countries.

If Germany is to be allowed to obtain supplies of essential foodstuffs and raw materials under Allied supervision, it will be almost inevitable that requirements of the European Allies and liberated territories should also be considered in concert so as to ensure that these countries are not in a worse position, as regards the restarting of their industries, than Germany. Provided the financial problem, which is referred to later, can be solved, it is submitted that the special conditions contemplated in the Treaty of Peace will necessitate continued consultation in respect of supplies to most European countries.

4. Financial Problems.

The representatives of all the Allied and Associated Governments agree that before Europe can be restarted there is a financial problem of the first importance to be solved. This problem has not yet been solved. Whilst in matters of finance executive action must be taken individually by the wealthy States, it cannot be doubted that considerable consultation and interchange of information will be desirable.

Solutions must be found for dealing with the financial needs of new States; for regulating German purchases and exchange; and also in regard to Inter-Allied indebtedness. Some common plan will be necessary to avoid overlapping in lending to disorganised States, to rehabilitate their currencies and probably also to lay down a scheme of priority in respect of the needs of the various countries.

Generally it may be said that none of these questions can be settled expeditiously and properly without a very great deal of further Allied consultation between the financial authorities which could not be effectively carried on by Foreign Office or cables.

[5.] Continued Relief and Reconstruction.

Relief work in its present form must in any event continue until about the harvest. The actual executive work which is now being done by the American Food Administration and by the Food and Relief Sections of the British Department cannot terminate abruptly. While it continues it is undesirable and uneconomical for the work to be done independently and without consultation. Apart from the co-ordination of relief measures undertaken by Governments there is the important work of supervising and co-ordinating the activities of charitable institutions. It is clearly desirable, however, that as soon as possible mere relief should give place to more definite co-operation on the part of the receiving countries. It will further be necessary to continue for some time measures of reconstruction and co-operation in regard to communications, transport, and the supply of coal.

6. Food Control.

The position with regard to food is causing anxiety in most countries, and while Inter-Allied control in the form in which it existed during the war is unlikely to be resumed, the continuance or reimposition of national controls in the United Kingdom, France, and Italy, combined with the Allied control of German food purchases, will almost necessarily involve some measure of international consultation and co-operation. Even if anything in the nature of pooling or purchasing on joint account is ruled out, it must be recognised that the food situation is a common problem for Great Britain, France, and Italy, and all European countries, and that machinery for consultation and co-operation cannot with safety be allowed to lapse entirely immediately after the signature of Peace.

7. Supervision of the Rhineland Commission.

It is provided in the memorandum approved by the Council of Four¹⁰ and attached to the Convention setting up the Rhineland High Commission¹¹ that it should be responsible on economic questions to the Supreme Economic Council so long as that body continues to exist. The working of the Convention is bound to raise a number of important issues which must be dealt with promptly as they arise from time to time if friction is to be avoided. It is therefore important that an authoritative body should be in existence to deal with them rather than that attempt should be made to settle them by telegraphic communication between London, Paris, Brussels and Washington.

8. Russia.

Throughout the war there has been special need for Inter-Allied coordination in regard to Russian questions, and difficulties have occurred owing to the lack of any Inter-Allied body competent to deal with such matters.

Many difficult problems remain to be faced, e. g., relief, railway reconstruction and currency reorganisation. It would be a great advantage if these questions, which all involve co-ordination between the Allies, could be dealt with through the Supreme Economic Council.

9. Conclusion.

There is a general expectation and desire that the economic side of the League of Nations should develop out of the Supreme Economic Council and its affiliated bodies. The exact nature of the functions which the League may be required to undertake on general economic and financial matters is at present undetermined, and special Conventions will no doubt be required to define them. In the meantime, it is desirable from the political point of view that the League of Nations should play a prominent part in stimulating and co-ordinating measures of relief, reconstruction and financial reorganisation in Europe.

The position as set forth above shows that continuance of the Supreme Economic Council or some similar body is necessary to consult concerning current problems and to deal with further tasks arising out of the Treaty of Peace. It is therefore proposed that the Heads of States should be requested to authorise the Supreme Economic Council to continue to function as an international body, and that as soon as convenient it should be brought under the direction of the Council of the League of Nations subject to its constitution, functions and terms of reference being reconsidered and submitted for approval to the Council of the League.

Appendix 213¹²

Memorandum From the French Delegation On Inter-Allied Co-operation After Peace

The gravity of the economic situation of the world, and Europe in particular, is too universally admitted to make further emphasis necessary.

The French Government called the attention of its Allies and Associates a long time ago to this point.

On the 28th October a meeting, called on the initiative of the French representatives, united in London M. de Fleuriau, Lord Rustace Percy, Mr. Summers, and the permanent Delegates of Inter-Allied organisations.

The conclusions adopted to hold off the dangers of the transition period provide for a method of Allied co-operation which should at least serve as the basis for discussion.

In December the French Government again specified the policy which seemed to it indispensable in the notes addressed to the British Government on the 12th December and to President Wilson on the 23rd December.^12a

This policy may be summed up as follows:—

Passage, with the minimum of shock, from the régime of absolute control (in operation at the end of the war) to the régime of complete liberty, which must be installed as soon as circumstances permit.

With this end in view, maintenance of concerted and uniform control on certain essential products: fundamental foodstuffs, textile materials and leathers, certain minerals and metals, and wood, mineral combustibles.

Gradual and uniform loosening of the control.

Application of this system, with view of giving the invaded districts the assurance (necessary for their regeneration) of receiving the material indispensable for human alimentation and for industrial stock on favourable terms, that is, for France, on the same terms as her Allies.

Once these guarantees are assured, the lowering to a minimum all economic barriers and return to complete liberty as rapidly as possible.

Great Britain accepted this policy on the 31st December, 1918, on condition of its acceptance by the United States.

The Supreme Economic Council, on the demand of President Wilson, received a triple mission:—

1. Decision of the Council of the Chiefs of Governments of the 8th February.¹³

(1) Under the present conditions numerous questions, which are not essentially military questions, present themselves each day. They should be handled in the name of the Government of the United States and of the Allies by civilian representatives of these Governments having experience in questions of finance, food supply, maritime transport, and raw materials.

(2) In order to treat these questions during the period of the Armistice, a Supreme Economic Council shall be constituted at Paris. The Council will absorb or take the place of such Inter-Allied organisations and their powers as it shall deem necessary according to circumstances.

(3) The Economic Council shall be composed of representatives of each Government interested, of such a number as each Government shall deem necessary.

2. Decision of the 12th February.¹⁴

(4) After the signature of the Peace Preliminaries, Germany shall be permitted to receive, under control, with a view to resuming her economic activity, such quantities of foodstuffs and raw materials as may seem equitable to give her, reserving priority to the needs of Allied countries, notably those who Germany made to suffer losses.

(5) The question of quantities of foodstuffs and of raw materials to be assigned to Germany after the signature of the Peace Preliminaries will be submitted to the Economic Council for examination and report.

3. Decision of the 21st February.¹⁵

The Council decides to refer measures of a transitory character to the Economic Council created by the Conference on President Wilson’s proposal:—

To examine such economic measures as should be taken in common during the period of reconstruction after the war so as to ensure—

(a) The due supply of materials and other commodities necessary for the restoration of devastated areas.

(b) The economic restoration of the countries which have suffered most from the war.

(c) The supply of neutral and ex-enemy countries without detriment to the supply of the needs of Allied and Associated countries.

Having decided to absorb the powers of the existing Inter-Allied organisations, the Supreme Economic Council had, indeed, to busy itself with—

(a) Relations with the enemy.

(b) Inter-Allied questions.

(c) Questions of a general nature.

It has, so to speak, hardly commenced the study of these latter questions.

(a) Relations with the Enemy.

Relations with the enemy will be completely modified by the application of the Peace Treaty, but this modification will not actually occur until after the Treaty has been put into operation.

Indeed, from the very fact of the signature, new principles will enter in which will aid in the solution of current problems; but the complete application of the new régime can evidently not be made until after the putting into execution.

But the state of war will not cease until the day when the Peace Treaty presented for Germany’s signature shall have been ratified by at least three of the Allied and Associated Powers.

(b) Inter-Allied Questions.

Inter-Allied questions keep daily changing in character, Inter-Allied controls disappear successively, but national controls continue. Certain of these latter, like the British control of tonnage, although of a character national in principle, extend throughout the entire world. Thus there results a sensible aggravation of a condition of instability to the detriment of just those States which have suffered the most. The examples which we intend to give in connection with the English controls will show this.

Concerted action by the Allies is certainly necessary in the relations which are being established with the new States or those in course of reconstruction, particularly to ascertain that the pledges given by these States be equitably distributed and utilised, taking into consideration not only the interests of these States but also those of all the Allied States.

The French Government intends to draw up concrete propositions on this subject.

(c) General Questions.

After the conclusion of Peace, it will become impossible to examine any important question from an Inter-Allied point of view only; it must be considered from a world standpoint.

The French Government, following the decision of the Council of the Chiefs of Governments of the 21st February, urged that measures necessary during the reconstruction period be examined by the Supreme Economic Council and by the Economic Commission of the Peace Conference.

The Economic Commission, having authority in measures of a permanent nature, has inserted certain dispositions in the Peace Treaty and discarded certain others which it considered to come within the province of the Supreme Economic Council.

This latter, made cognisant of this fact on the 6th March (Minute 32)¹⁶ by the French Delegates sent out a detailed questionnaire to its Sections, edited by the French Delegation.

The Finance and Maritime Transport Sections declared that they could not work intelligently before knowing the conditions of the Peace Treaty; the Food Section made known that world crops should be sufficient to assure the general minimum of food supplies after Peace.

The Raw Materials Section went more deeply into its task: statistical report on world supplies, studies on coal and the needs of the new States. It found itself blocked by uncertainty regarding the stipulations of the Peace Treaty, especially regarding reparation in kind (coal, reconstruction, &c.).

After a first adjournment on the 17th March, the Council decided on the 1st April to suspend all further examination, Mr. Baruch having declared that the Council of Four had decided to treat problem directly.¹⁷

On the 22nd April it was decided to send a note to the Council of Four, then to await the result of the deliberations of the Reparation Commission.

The question, therefore, remains in its entirety; the Supreme Economic Council remains qualified to handle it and the conditions of the Treaty are now known.

As for the English Delegation, on the 5th April it presented a note¹⁸ setting forth the essentials of the problem as being:—

(1) The re-establishment of a stable monetary system in each country.

(2) The re-establishment of a transportation system.

(3) The reconstitution of a floating capital and of sufficient stocks of raw materials.

(4) The reconstitution of industrial material of all kinds.

Of these different elements, the note in question treated particularly the first—that is, the financial question.

The Council of Heads of States ordered an investigation on this point, following which a first report furnished in June arrived at the conclusion that a more profound concerted examination was absolutely necessary.

It is clear that such investigations are necessary, not only for the finances, but also for the other phases of the problem.

It is equally certain that these investigations could not be conducted other than by constant personal consultations. Even though the solution on the ensemble of such vast problems should exceed the strength of the Associated Governments, still it is essential that the fragmentary measures, taken by each one with a view to warding off the dangers which threaten it most particularly, should be undertaken with enough co-ordination in the different countries to allow each to draw therefrom the maximum advantages.

It seems, on the other hand, that a whole category of Inter-Allied enterprises will continue to exist which will necessitate the continuation of the organisations charged with their managements, for instance:—

• Operation of enemy vessels.
• Liquidation of wheat purchases.
• Sugar crop in Cuba.
• Liquidation of relief in Europe.
• Assistance (railways) to new States.

It seems natural that these questions should continue to be managed by the competent organisations, under the notice of the Council, whatever it may be, which shall be charged with continuing the investigation of problems handling the reconstruction of Europe.

Rôle of the New Council.

The rôle of this Council may be defined as follows:—

(a) Continue the liquidation of the Inter-Allied enterprises.

(b) Advise the Governments as to the policy which should be followed to return to normal conditions.

It is clear that this role does not necessitate the same organisation as that necessitated by the present functions of the Supreme Economic Council.

This latter body, indeed, without having any executive powers so to speak, is still able, from the very presence of the responsible chiefs of the Governments in Paris, to present recommendations which are immediately put into operation, from which the necessity of constant contact between the members of the Council, who are moreover obliged to keep themselves posted on the slightest evolutions of a situation which is constantly requiring rapid decisions. Thence the number of members and frequency of the meetings.

The Sections of the Supreme Economic Council have, on the other hand, been constituted taking into consideration the situation existing at the time of its creation. Certain among them are organisations which must be continued to liquidate the Inter-Allied executive action. Others will no longer have any reason for existing, such as the Blockade Section or the Sub-Committee on Germany, whose functions will pass over to the Inter-Allied Commission for Rhine Countries, the the Commission on Reparations, or to the diverse Allied Legations in Germany.

Composition.

To perform its duties under the conditions which will result from the separation from the Conference, the new organisation, composed of a limited number of Delegates (one or two for each Government) meeting for instance each month, shall—

(a) Supervise the executive organisations which shall continue its functions—Wheat Executive, Sugar Executive, Relief Administration, Transport Executive—which, preserving the executive powers which they held from the various Governments, shall address monthly reports to the Council.

(The Communications Section, in its present form, or as an Inter-Allied or international organisation charged with bringing about the establishment of long-distance commercial trains, shall receive powers permitting it to be assimilated to these organisations.)

(b) Be assisted by political advisers and technical experts on matters:—

• Of finances;
• Of transport (land and sea);
• Of supply—food, raw material and machinery;

(c) Have a permanent administrative secretariat to prepare the meetings and follow up its deliberations.

It would be desirable that in most cases the political counsellors and technicians should prepare the solution of the questions in such a manner that the Council itself shall only consider a few specially important points.

Powers of the Council and of the Delegates.

The powers of the Council, insofar as concern the liquidation of Inter-Allied enterprises, shall be those of the organisations in charge of these enterprises.

In that which has to do with other questions, it should be authorised to present its recommendations to the interested Governments on all subjects of an economic nature which it should deem fit to consider.

The Delegates shall receive the most extensive authority from their Governments to this purpose.

The personality of the Delegates is perhaps more important than their powers; they should be chosen among men familiar with conditions in Europe and practice of Inter-Allied relations, fully informed regarding the negotiations and conditions of the various peace treaties. It is equally important that they have a practical personal knowledge of economic, industrial, and financial problems. A close liaison between these Delegates and the Administrations of their respective countries should permit them to present the point of view of their Governments on any question under discussion with a few days’ notification.

It is imperative that they be members of the Government or that they possess such influence that they may in some degree automatically obtain the ratification of their recommendations.

Place.

From many points of view the seat of the Council should be in the United States; however, by reason of the difficulties in communication, it seems that Paris, London, or Brussels would perhaps be the most convenient for the majority of the Delegates.

Means of Action.

In certain eventualities and, in particular, in case co-ordinated action must be undertaken in Russia, it will be necessary for the Governments participating to place funds at the disposition of the executive organisations allied directly with the Council or placed under its supervision. Operations of this kind can only be decided for concrete propositions with a definite case in view.

Duration.

The organisation planned would seem bound to disappear as soon as the League of Nations should have reached a degree of organisation sufficient to permit the assumption of the charge of the above-enumerated functions in a satisfactory manner.

June 20, 1919.

Appendix 214¹⁹

Belgian Memorandum

Dear Mr. Hoover: In reply to your letter of the 12th June, relative to the future organisation and policy of the Supreme Economic Council, I have the honour to present to you the views of the Belgian Delegation in this connection.

We consider in principle that the Supreme Economic Council should be continued after the signing of Peace, as it is evident that the single fact of the signing of the Treaty cannot result in the re-establishment of the world economic situation.

It appears evident to us that the lack of certain raw materials, the scarcity of tonnage, the difficulties of means of transportation, will require the continuance for a certain length of time of a central organisation, whose duty will be to assure a fair distribution of raw materials, to supervise the judicious use of tonnage and means of transportation.

This point being understood, I reply as below to the different questions asked in the above-mentioned letter.

(a) Character of the Organisation necessary.—We consider that the Supreme Economic Council can maintain its present character, that is, a central committee and a certain number of sections, whose duty is to examine questions to be submitted at full sessions of the Supreme Economic Council.

Under these conditions the purpose of the Supreme Economic Council can be defined as follows:—

1. To assure the proper supply of raw materials and other products necessary to the restoration of the devastated regions (see the text of minutes of the meeting of the Supreme War Council of the 8th February,^* at which the creation of the Supreme Economic Council was decided).

2. To assure economic restoration of the countries which have suffered the most from the war (see minutes of Supreme War Council of the 8th February).^*

3. To consider the best means to re-establish as soon as possible on a normal basis the economic situation of Europe by returning to a commercial liberty, complete except for such measures as each individual country may take to protect its special interests. In the meanwhile to assure between the different countries as fair a division as possible of the raw materials, of which a rationing is still necessary, as well as of tonnage, taking into account in this division paragraphs 1 and 2 above, and to assure, wherever it may be necessary, a proper use of means of transportation.

(b) Period during which the Supreme Economic Council should continue in operation.—We consider that the existence of the Supreme Economic Council can be prolonged until the end of the year 1919.

It may be noted, besides, that nothing is said in the minutes of the Supreme War Council creating the Supreme Economic Council to the effect that the existence of the latter should cease upon the signature of Peace.

(c) The place where the Supreme Economic Council should be established.—According to the idea advanced by Lord Robert Cecil and agreed to by M. Clemenceau, the Supreme Economic Council could transfer its operations to London, certain sections, however, remaining in Paris.

The Plenary Sessions, which would be less frequent at present, could be held alternately at London and at Paris.

(d) Powers conferred upon the representatives of the various Governments.—The Delegates would have the power to take decisions on all questions under the jurisdiction of the Supreme Economic Council as defined in the quotation given above, in so far as these decisions are not contradictory to the laws and regulations existing in the countries which they represent.

(e) Power which it is proposed to give the Council for the division of merchandise, the control of navigation, the furnishing of finance, the means of transportation and internal communications, and all other functions which may be proposed by one of the Governments represented on the Council.—We consider that the Council should have no executive power, this being particularly reserved to the various Governments. The Council will confine itself to taking decisions, the various countries represented at the Council and the various countries profiting by the existence of the Council agreeing to put into execution the decisions taken, in so far as they are not contradictory to the laws and regulations in force in the aforesaid countries. We consider that, under these conditions, the various sections of the Supreme Economic Council should be as follows:—

• Finance Section, sitting at London.
• Raw Material Section, sitting at London.
• Shipping Section, sitting at London.
• Food Section, sitting at London.
• Communications Section, sitting at Paris.

With reference to the Food Section, it appears to us that you alone can say whether it is necessary to have it continue to the end of December 1919 under the form of an Inter-Allied organisation, or whether its existence, differing from the rest of the Supreme Economic Council, should not be limited to the period of the coming harvest. It will be the duty of the Supreme Economic Council to establish relations, whenever it may appear advisable, with representatives of other Powers.

(f) To consider whether it is necessary to put funds at the disposal of the Council to enable it to give financial assistance, food, and generally to put into execution any proposal dealing with the functions, purposes, policy, or authority of the Council.—In view of what has been said above, we consider that, as the Council has no executive powers, it is not necessary to put funds at its disposal. As to the other points raised in the last part of paragraph (f), they have already been dealt with in this memorandum.

E. de Cartier

Member of the Belgian Delegation of the Supreme Economic Council.

June 20, 1919.

Appendix 215²⁰

June 16, 1919.

Note by the Italian Delegation Respecting Inter-Allied Co-operation After Peace

Dear Mr. Hoover: I am in receipt of the letter addressed me by your Secretary Major Boykin Wright, in which you ask for the opinion of the Italian Delegation as to the future organisation and policy of the Supreme Economic Council.

I take pleasure in handing you the following answers to the questions asked in that letter:—

(a.) The character of organisation required: Consultative.

(b.) The period over which it should continue: Transition, until normal conditions are re-established.

(c.) The location of its organisation: London.

(d) The exact authority to be conferred upon the representatives of the different Governments: They should be the responsible and authoritative interpreters of their Governments’ views and inclinations.

(e) The powers which it is suggested that the Commission should have in the determination of distribution of commodities, in the control of shipping and the provision of finance, of inland transportation, of inland communications, or any other functions that it may be proposed by any of the Governments that should be delegated to this body: Consultative powers as to the best method of bringing about the most useful and efficient co-operation in the matter indicated.

(f) Whether it should have some funds subject entirely to its own direction for financial assistance or relief, and, generally, any views as to its functions, purposes, policies and authority: No; vide (e).

Yours sincerely,

Crespi

Appendix 216

Paris, 22 June, 1919.

[Letter From the Director General of Relief (Hoover) to the] Supreme Economic Council

Gentlemen: I attach hereto detailed tables showing the progress of relief measures under my direction for the month of May, and the totals from the 1st December to the 30th May.

During the month of May there was distributed about 168 shiploads of food to the seventeen countries under relief, comprising 738,687 metric tons of supplies, having an approximate value of 162,875,000 dollars. As usual, the great majority has been supplied upon credits and to some extent upon charity. This compares with 591,843 tons distributed during the previous month of an approximate value of 147,800,000 dollars.

The total supplies distributed under the Relief Administration from the 1st December to the 30th May amount to 2,486,230 tons, comprising 512 shiploads and of a value of approximately 636,175,000 dollars.

The port stocks at the 31st May amount to 166,777 tons, as compared with 201,251 tons on the 30th April.

The railway and coal inland waterway administrations in Central and Eastern Europe carried on under this administration continue to show satisfactory progress. The exchange of local surpluses of native food and other commodities arranged by this administration between these States show considerable increases during the month, and while they amount to over 100,000 tons they are not included in the above totals.

During the month further progress has been made in remedy of the terrible situation in Armenia and the Baltic States.

The organisation of wholesale special feeding of undernourished children is now generally complete and some 4,000,000 children are being served.

I am confident that if we meet no interruption through delay in Peace we shall reach completion of this task with the harvest, without any preventable loss of life.

Faithfully yours,

Herbert Hoover

[Enclosure]

Table I

summary of all relief supplies delivered december 1, 1918, to june 1, 1919

(Metric Tons)

	Bread-stuffs	Beans and Peas	Rice	Meats and Fats	Condensed Milk	Clothing	Miscellaneous	Total
Finland	85,396	302	85	1,875	260		1,638	89,556
Poland	139,105	4,492	3,160	16,978	3,772	4,265	128,467	300,239
Esthonia	10,895	210	10	400	50		3,050	14,615
Lativa	2,462	25	7	142	106		2	2,744
Lithuania	2,299	8	8					2,315
Denmark	9,912							9,912
Belguim	578,672	14,796	20,380	66,075	13,046	6,750	23,695	723,414
Northen France	1,509	5,427	7,485	11,109	5,617	1,024	19,406	51,577
Czecho-Slovakia	165,887	378	151	15,119	1,839	105	46,004	229,483
Greater Serbia	74,511	3,788	16	5,593	504	1,413	16,987	102,812
German Austria	186,253	5,487	11,587	31,276	4,589		49,716	288,908
Hungary				635				635
Germany	203,644	29,014	24,221	57,062	12,425		81,894	408,280
Russian Prisoners in—
Germany	779			1,050				1,829
Roumania	143,691	799		2,959	2,733	4,189	20,709	175,080
Turkey	10,944						3,305	14,249
Armenia	18,758	619			459			19,836
Bulgaria	20,846							20,846
Novorossisk	400							400
Russia							14,750	14,750
Total	1,655,983	65,345	67,110	210,273	45,400	17,746	409,623	2,486,230

Table II

total deliveries during may 1919

	Bread-stuffs	Beans and Peas	Rice	Meats and Fats	Condensed Milk	Sugar and Cocoa	Clothing	Potatoes	Miscellaneous	Total
Belguim	85,996	3		2,132	6,075	896	2,145		477	97,724
Northen France				58	798	125	108		672	1,761
Finland	10,841	75	85	25						11,026
Poland	53,269	2,115	3,160	277	474	35	706		56	60,092
Esthonia	2,062	10	10	200						2,282
Latvia	462	25	7	57	29	2				582
Denmark	9,912									9,912
Germany	95,521	13,366	7,040	27,873	8,325			29,874		181,999
Germany,C. R. B	20,955	7,249	15,828	10,054						54,086
German Austria	72,699	2,194	1,935	13,419	2,264	9,720		8,316	215	110,762
Czecho-Slovakia	74,653	95	151	5,673	612	39				81,223
Greater Serbia	17,115	3,788	16	270	477	63				21,729
Roumania	67,564	531			1,773	949			2,356	73,173
Armenia	12,307				282					12,589
Turkey	5,550									5,550
Bulgaria	13,797									13,797
Novorosisk	400									400
Total	543,103	29,451	28,232	60,038	21,109	11,829	2,959	38,190	3,776	738,687

Table III

stocks and internal movements during may 1919

(Metric Tons)

	Bread-stuffs	Rice	Beans and Peas	Fats and Meats	Condensed Milk	Potatoes	Clothing	Miscellaneous	Total
Reserve port stocks, May 1, 1919	97,883	15,636	9,681	43,638	14,865		4,068	15,530	201,251
Supplies received during May	527,519	18,621	24,059	56,883	15,241	38,190	2,464	21,286	704,213
Total available in May	625,352	34,257	33,740	100,471	30,106	38,190	6,532	36,816	905,464
Distribution during May	543,103	28,232	29,451	60,038	21,109	38,190	2,959	15,605	738,687
Reserve port stocks, May 31, 1919	82,249	6,025	4,289	40,433	8,997		3,573	21,211	166,777

1. See CF–74, minute 5, vol. vi, p. 530. For text of note dated June 7, 1919, see telegram No. 2659, June 20, 1919, 10 a.m., to the Acting Secretary of State from the Commission to Negotiate Peace, Foreign Relations, 1919, Russia, p. 149.
2. For text of note containing proposed agreement, see appendix IV to CF–74, vol. vi, p. 541.
3. See appendix 202, infra.
4. For text of resolution dated May 20, 1919, see Organization of American Relief in Europe, Documents Selected and Edited by S. L. Bane and R. H. Lutz (Stanford University Press, California, 1943), p. 505.
4. See appendix I to CF–37, appendix II to CF–60, and appendix I to CF–62, vol. vi, pp. 73, 321, and 356.
5. See CF–63, minute 5, vol. vi, p. 373.
6. Presumably “Treves,” not “Brussels.”—(Note by Secretariat.) [Footnote in the original.]
7. Appendix 11, p. 28.
8. The graphs are filed separately under Paris Peace Conf. 180.0501/35.
9. Memorandum and its annexes not attached to file copy of minutes.
10. Appendix III to CF–64, vol. vi, p. 393.
11. For draft texts of this agreement, see ibid., pp. 382 and 389; for text as signed June 28, 1919, see Treaties, Conventions, etc., Between the United States of America and Other Powers, 1910–1923 (Washington, Government Printing Office, 1923), vol. iii, p. 3524.
12. Appendix 213 is filed separately under Paris Peace Conf. 180.0501/35.
13. See vol. i, page 379.
13. See BC–26, minute 5, vol. iii, p. 934.
14. See BC–30, minute 1, vol. iii, p. 1001.
15. See BC–36, minute 4, vol. iv, p. 62.
16. Ante, p. 42.
17. See minute 89, meeting of April 14, p. 158.
18. Appendix 51, p. 110.
19. The translation is filed separately under Paris Peace Conf. 180.0501/35.
20. The correct date is 21st February (note by Secretariat). [Footnote in the original.]
21. The correct date is 21st February (note by Secretariat). [Footnote in the original.]
20. Appendix 215 is filed separately under Paris Peace Conf. 180.0501/35.