Papers Relating to the Foreign Relations of the United States, 1927, Volume I

500.A16/21a

The Acting Secretary of State to the Minister in Switzerland (Gibson)

Washington, February 28, 1927.

No. 598

Sir: In addition to your other duties, you are hereby designated to attend, as the representative of this Government, the meeting of the Special Commission which is to meet at Geneva, March 14, 1927, to prepare a Draft Convention which might serve as the basis for an international conference with regard to the supervision of the private manufacture of arms and ammunition and of implements of war. The membership of this Commission, which has been formed pursuant to a resolution of the Council of the League of Nations, adopted December 9, 1926, will comprise representatives of the present members of the Council and of the United States. It is understood that the Soviet Regime has been invited to send a representative to attend this meeting, but has declined the invitation. A copy of the invitation extended to the United States Government by the Secretary General of the League, under date of December 17, 1926, and a copy of this Government’s reply thereto, dated February 23, 1927, are transmitted herewith for your information.

You will recall the history of the efforts which have been made from time to time by the League of Nations to bring about an international conference and a resulting convention dealing with the problem of the private manufacture of arms and ammuniton. Article 8 of the Covenant of the League of Nations provides inter alia as follows:

“The members of the League agree that the manufacture by private enterprise of ammunitions and implements of war is open to grave objections. The Council shall advise how the evil effects attendant upon such manufacture can be prevented, due regard being had to the necessities of those members of the League which are not able to manufacture the ammunitions and implements of war necessary for their safety.”

This problem was discussed at the First Assembly of the League which requested the Council to instruct the competent Commissions of the League to investigate it without delay. The Permanent Advisory Commission, with whose constitution you are familiar, reached the following conclusions in February, 1921:

(1) No direct action other than that already provided for by the treaties of peace can be taken in the case of producing states against the right of their private factories to manufacture war materials.

(2) Even if at some future time measures were contemplated to diminish production, no action should be taken to prevent non-producing states from becoming producers if they had the will and the means.

In 1921 the Temporary Mixed Commission took up consideration of the problem.⁶⁰ It had before it two proposed methods of dealing with the subject:

(1) The absolute prohibition of the private manufacture and,

(2) The control of private manufacture.

Method (1) was rejected by the Commission as contrary to the interests of states which do not produce all the munitions they require. The Commission therefore decided to recommend a system of international control and suggested the following measures as likely to render that control more effective:

(1) The prohibition of all export of arms without a special license from the Government of the exporting country;

(2) The prohibition of all import of arms without a license from the Government of the importing country;

(3) Such licenses to be published by the League of Nations;

(4) No munitions or implements of war to be manufactured without a Government license, and, possibly, that such licenses should be published by the League of Nations;

(5) Conversion of bearer shares of armament firms to nominal shares;

(6) Armament firms to publish, at stated intervals, complete reports on their financial situation, and any contracts entered into by them;

(7) An audit of the accounts of private armament firms;

(8) No person interested in an armament firm to be permitted to hold stock in similar firms in other countries;

(9) Such persons not to be permitted to publish, or hold stock in companies publishing newspapers;

(10) Non-nationals to be prohibited from holding stock in private armament firms;

(11) No patent relating to munitions or implements of war to be issued to non-nationals;

(12) No warship to be transferred from one flag to another without notice being given to the League of Nations.

It was realized, however, that to institute any system of control it would be necessary to base it upon an international convention. There appeared to be many difficulties in the way of framing such a convention, among them the traffic in arms which at that time was not regulated effectively. The Temporary Mixed Commission finally came to the conclusion that should the traffic in arms and munitions be subjected to a sufficient measure of supervision the continuation of private manufacture would be of little danger.

The efforts of the League were for that reason directed primarily to the formulation of an arms traffic convention rather than to the control of the private manufacture of arms.

Nevertheless, a considerable number of states members of the League consistently expressed the view that an arms traffic convention could never be fully effective unless it were accompanied by a convention supervising and controlling the private manufacture of arms. This view has not been shared by the United States which, while anxious to cooperate with all efforts which appeared calculated really to lead to the reduction or limitation of armament or to remove causes of international discord, did not for many reasons favor the elaborate and often impractical proposals that have been made looking to the control or supervision of the private manufacture of arms. As you are aware, the Arms Traffic Convention signed at Geneva, June 17, 1925,⁶¹ has not yet received the requisite number of ratifications and has not therefore come into effect. Certain countries which favored the simultaneous treatment of the problem of private manufacture with the problem of arms traffic have now advanced the belief that the arms traffic convention will prove ineffective if not totally useless unless a further convention regarding the private manufacture of arms is concluded. It is in response to this appeal that the Special Commission upon which you are to represent this Government has been created. In order that you may have clearly in mind the policy of this Government in regard to international agreements regarding the private manufacture of arms and munitions and may be in a position to explain and carry out that policy at the forthcoming meeting, you are advised as follows:

In its instructions to me while I was American Minister to Switzerland and in subsequent instructions to you in regard to participation in the meetings of the Temporary Mixed Commission during 1924,⁶² the Department pointed out that manufacture or production is not per se commerce and that Congress, under the interstate power, cannot control mere manufacture or production within the states. It was pointed out that Congress could, however,

(a) control production of arms in the District of Columbia and the territories and possessions of the United States, and

(b) prohibit shipment of arms in interstate commerce or foreign commerce except under Federal license.

In addition, it is clear that this Government may collect and publish at stated intervals statistics of arms and ammunition production.

During the course of the meetings of the Temporary Mixed Commission certain foreign members thereof persisted in bringing into the discussion the question of private manufacture. The American representative did not enter into such discussions at any time.

During the arms traffic conference, when the question of private manufacture was again raised—although it was not on the agenda of the conference—the Honorable Theodore E. Burton, Chairman of the American Delegation, made certain statements in regard thereto. These statements taken together set forth the policy of this Government in regard to a practical manner of dealing with this problem and indicate the limit to which this Government would be prepared to go in an international convention. The statements are quoted below for your information as they appear in League of Nations Publication A.13.1925 IX “Proceedings of the Conference for the Supervision of the International Trade in Arms and Ammunition and in Implements of War”:

“This pending discussion on the subject of the manufacture of arms, and upon the subject of publicity for manufacture by producing States, is one of the greatest interest to the delegation from the United States.

“Some weeks ago I stated that it was the custom in our own country to publish statistics of manufacture. That is still our custom, and will be for years to come, and, in view of that fact, we should be willing to join in a Convention providing for publicity for producing states as well as for non-producing states. Having made that statement, I was of the opinion that it was for other delegates from other countries to follow it up by a concrete proposal if they so desired.

“I am aware of the objections that have been raised against doing anything in that way. It has been said that the present Conference was called merely to deal with the control of the trade in arms, of which the main feature is publicity. Let me call your attention, however, to the fact that if we adopt a liberal construction, control of statistics relating to producing countries is within the scope of this Convention. The objection has been raised by the non-producing countries that any agreement would be ineffective if it applied to them only or applied particularly to them, and that, in order to secure their rights, statistical information must also be given as to production.

“It seems to me that we are authorized to give a liberal construction to the work which this Conference was called upon to do. We are not to be bound by any hard and fast rules. If, when the representatives of forty nations come together, a proposal or subject suggests itself, which is closely associated with the main question before the Conference, it is for us to act upon it, at least by adopting a resolution stating the sense of the Conference. I trust, Mr. President, that not merely in order to protect the non-producing states, but in order to secure an ampler result and to make a more progressive step, something will be done in this Conference in this direction.” (Pages 299–300).

“… The point of view of the United States is already on record in some remarks made here yesterday week, and I welcome the proposal introduced by the Roumanian delegate in regard to publicity in the manufacture of arms. The only question that I ask is whether it goes far enough. I could not, however, favour postponement of the operation of this Convention until another is adopted. Postponement of good intentions until some other gathering may meet, or some other Convention be concluded, has been the graveyard of some of the best aspirations of the human race.

“We are here for a purpose. The Temporary Mixed Commission considered the question of joining up with our agenda a proposal regarding the private manufacture of arms. The Assembly approved the conclusion of that Mixed Commission that it was preferable to keep the two matters separate. It was with that understanding that the delegates came from the United States—that we were to do something here of which the central fact should be publicity. And now I must run counter to an opinion which is prevalent among lovers of peace in regard to the prohibition of the private manufacture of arms.

“Many of those in Europe and America with whom I have cooperated for years past in movements for peace think that the solution of their problems rests in the prohibition of private manufacture. They argue, that so long as private manufacture continues, there will be a powerful industrial interest, the prosperity of which will be promoted by war, and this they consider to be a barrier in the way of peace. They consider also that these private manufacturers have also been extremely skilful in the circulation of propaganda unfavorable to peace. Thus, they say, the manufacture of arms, munitions and implements of war should be restricted to Governments.

“Let me point out to you the fallacy of this argument. The private manufacture of arms and munitions is flexible and adapted both to peace and to war. It may consist of the manufacture of explosives and material for industrial purposes, of sporting arms which have nothing to do with war, to which can be added in time of conflict the manufacture of military arms. Take my own country as an example; the manufacture of munitions and military arms was negligible before the late Great War, but, during that period, private industry increased to enormous proportions; it has now fallen back to what it was before.

“Government manufacture and control, on the other hand, are inflexible and look to a state of war. It involves the maintenance of a very considerable force, always engaged in the manufacture of implements of destruction. If that force is disbanded the nation is helpless, and there is always a strong interest in favour of maintaining in any form of Government activity a large force, expanding its operations to the maximum. Thus, I say that, at least in a country like the United States, the idea that the private manufacture of arms should be prohibited, and that such prohibition would promote peace, is a chimera. More than that, why should a Conference be called for the prohibition of private manufacture and leave the Governmental or public manufacture alone? Shall the respective Governments of the world, whether warlike or peaceful in their intentions, build huge structures to make arms, and at the same time prohibit the private manufacture? What of the private manufacturers, many of whom have the most pacific intentions? What have they done that there should be this discrimination against them? What hope have the lovers of peace in prohibiting private manufacture if Governmental manufacture may still go on to an enormous and unlimited extent? …” Page 251.

The American Delegation at the Arms Traffic Conference signed the Final Act of that Conference in which was contained the following declaration:

“That the Convention of today’s date must be considered as an important step towards a general system of international agreements regarding arms and ammunition and implements of war and that it is desirable that the International aspect of the manufacture of such arms, ammunition and implements of war should receive early consideration by the different governments.”

In reply to a questionnaire received from the Secretariat of the League of Nations and prepared by a Committee of the Council on the subject of control of the private manufacture of arms and ammunition communicated to this government under date of January 9, 1926,⁶³ this Government replied on May 7 [17], 1926, as follows:

“The Secretary of State of the United States of America has received the communication of the Acting Secretary General of the League of Nations, dated January 9, 1926, transmitting a copy of a questionnaire concerning the control of private manufacture of arms and ammunition and of implements of war.

“In view of the fact that the Convention for the Supervision of the International Trade in Arms and Ammunition and in Implements of War has not yet been ratified this Government does not desire to make any comment on the questionnaire at the present time.”

This Government is not sanguine as to the possibility of reaching an international agreement which will effectively control whatever evils may be inherent in the private manufacture of arms. It cannot escape the conviction that many of the proposals which have been made for such conventions are in effect attempts on the part of goverments which obtain their armament from government arsenals or government controlled factories to place at a disadvantage countries such as the United States which obtain the vast majority of their ammunition and war equipment from private enterprise. The draft convention prepared by the Committee of the Council and transmitted to this Government with the Secretary General’s invitation of December 17, 1926, is for the most part unacceptable to this Government as a basis for an international agreement. There is transmitted herewith as an annex to this instruction a memorandum commenting in detail upon the provisions of the draft convention in question.

This Government decided to accept the invitation of the Secretary General to designate a representative to attend the forthcoming meeting for two principal reasons:

(1) It believed that a refusal to attend might be interpreted in certain foreign quarters, perhaps disingenuously, as an unwillingness on the part of the United States to cooperate in what purported to be a sincere effort to solve one of the companion problems of the general problem of disarmament. In view of this Government’s participation in the Preparatory Commission to [for] the Disarmament Conference⁶⁴ and in the Arms Traffic Conference and of its long established policy of cooperating with all sincere efforts calculated to preserve the peace of the world and to remove the causes of war, it should give no ground for misunderstandings which might arise out of its refusal even to discuss the question of the manufacture of arms.

(2) The policy of this Government in regard to this question was clearly set forth by Mr. Burton, as noted above, and it was on the basis of Mr. Burton’s statements that the Council of the League of Nations predicated the hope that the United States would be willing to attend the proposed meeting.

You are instructed therefore to make it clear at the meeting that the United States is prepared to consider the conclusion of an international convention which provides for the collection and periodic publication by the governments parties thereto of statistical information covering the production of arms and ammunition and implements of war. The specific arms and ammunition to be covered by such a convention would, in general, correspond to those in the categories established by the Arms Traffic Convention. A separate Memorandum on this subject is transmitted herewith, as an annex, for the purpose of guiding you in the more detailed discussion of this phase of the matter.

You should resist any effort to include in published statistics the names of manufacturers with details of their individual businesses and contracts. Such publication resulting from investigation would not be acceptable, so far as this Government is concerned.

You will observe that in this Government’s reply, dated February 23, 1927, to the Secretary General’s invitation, the intention of this Government not to go beyond the collection and publication of statistics is clearly indicated. You should take an early opportunity to reiterate this Government’s point of view.

Although leaving the matter entirely to your discretion in the light of developments which may occur during the course of the forthcoming meeting, the Department suggests that it would appear to be unwise for you to allow yourself to be drawn into any detailed discussion of the various unacceptable provisions of the Draft Convention.

In case the position of the United States in refusing to agree to the proposed provisions, other than those covering the publication of statistics, is questioned or in any way attacked, the Department believes that you should confine your reply first to an allusion to this Government’s reply to the League’s invitation and second to a statement to the following general effect:

The Arms Traffic Convention has not yet been ratified and has not come into effect. The proposed draft convention for private manufacture presents an involved and complicated agreement, the provisions of which would be difficult if not impossible to administer and the necessity for which is not clear to the United States Government. The American Government believes that an adequate system of publicity as to production for both private and government factories will furnish valuable information to the governments signatories to the treaty. Such an agreement, in addition to the Arms Traffic Convention, will provide effective machinery for making known to the world any abuses either by individuals or governments in connection with the manufacture of or traffic in arms. If, when such agreements have been in operation, it is shown by experience that further and even stricter international agreements are necessary, it will then be appropriate to discuss what further measures are possible.

In this connection, the following remarks made by Lord Cecil at the 8th meeting of the First Sub Commission of the Temporary Mixed Commission at Paris on March 28, 1924 are of interest:

“Colonel Carnegie has said that a certain control over private manufacture would result from the convention on the control of the traffic. He personally agreed, but he thought that they would therefore be much better able to form a judgment after the coming into force of the said convention and that the question of private manufacture could only be finally settled in the light of the experience derived from the application of the convention on the traffic.”

The American Government is particularly impressed by the danger involved in complicated and detailed international agreements, difficult to administer, the alleged breach of any technical provision of which would inevitably lead to international mistrust and ill-will.

Should an attempt be made to separate governmental from private manufacture you should insist that any agreement to be acceptable to the United States must cover both categories. In this connection, you may point out that such a provision would appear to be absolutely essential to make an international agreement for publicity useful since the contingency might arise wherein a government which followed the policy of manufacturing all of its military equipment in government arsenals might engage in practices very similar to those which are imputed to private manufacturers and condemned. A memorandum pointing out the distinction between the position of the United States Government and of certain other governments in regard to methods of supplying needs for military equipment is transmitted herewith as an annex to this instruction.

You will, of course, not join in any report which the Special Commission may make to the Council of the League of Nations. In this connection, you may advise the Commission that you will make your report to your government.

You should make it abundantly clear during the meeting that should the other nations represented on the Commission wish to recommend the formulation of a convention of a more elaborate nature this government would, of course, offer no objection, although it would naturally reserve its right to abstain from adherence to such a convention or to adhere to it with reservations in keeping with its announced and well known policy in the premises.

There is transmitted herewith, as an annex to this instruction, a memorandum covering in general the statistics of production of arms in the United States in recent years.⁶⁵ By reference to this you will observe that the United States has taken a very minor part in this type of business. You should emphasize these data in case an attempt is made to place upon the United States the onus for prospective failure of the Commission’s work or any statements are made to the effect that a convention regarding arms manufacture could not be effective without American participation.

The above-mentioned memorandum further contains certain suggestions as to the statistical material that will be most readily and economically obtainable and also suggestions as to the frequency of collection and publication which should be provided for in any convention.

There is transmitted herewith as an annex to this instruction a memorandum setting forth the existing law and practice of this government respecting the collection and publication of statistics and indicating the general authority of the government in the premises.^65a

I am [etc.]

Joseph C. Grew

[Enclosure 1]

Memorandum Commenting Upon the Preliminary Draft Convention Submitted to the Committee of the Council by the Committee of Inquiry

The following countries . . . . . . . . . . . . . .

Whereas the international trade in arms and ammunition and in implements of war is governed by the Convention concerning the Supervision of the International Trade in Arms and Ammunition and in Implements of War signed at Geneva on June 17th, 1925;

Whereas the International Conference which drew up the said Convention unanimously declared:

“That the Convention of to-day’s date must be considered as an important step towards a general system of international agreements regarding arms and ammunition and implements of war, and that it is desirable that the international aspect of the manufacture of such arms, ammunition and implements of war should receive early consideration by the different Governments”;

Whereas the international trade in arms and ammunition and in implements of war should be subjected to a general and effective system of supervision and publicity;

Whereas such a system is not provided by existing treaties and conventions in regard to manufacture;

Whereas the manufacture of arms, ammunition or implements the use of which in war is prohibited by international law ought not to be permitted for such purpose:

Have decided to conclude a Convention and have accordingly appointed as their plenipotentiaries:

(Here follow the names of the plenipotentiaries.)

Who, having communicated their full powers, found in good and due form,

Have Agreed as Follows:

This preamble appears to be unnecessarily long and involved. It is believed that all necessary purposes could be served by a brief preamble somewhat to the following effect:

“Whereas it is desirable that the international aspect of the manufacture of arms, ammunition and implements of war should receive consideration” etc.

Categories

Article 1

(Same as Chapter I of the Convention for the Supervision of the International Trade in Arms—document A.16.1925.IX, pages 5 and 6.)

This Article is satisfactory.

Supervision and Publicity

Article 2

For the purposes of the present Convention, private manufacture shall be considered to mean manufacture taking place in establishments of which the State is not the sole proprietor.

This Article should be eliminated, since any convention to which the United States would desire to become a party would necessarily cover both governmental and private manufacture.

Article 3

The High Contracting Parties undertake not to permit in the territory under their jurisdiction the private manufacture of the articles included in Categories I, II, III and IV and paragraph 1 of Category V without the written authorization of the Government.

This authorization shall be given in the form of a licence, which shall be valid for a period to be determined individually by each High Contracting Party and which shall be renewable for a further period.

This Article is not acceptable from the point of view of the United States. The constitutional possibility of establishing a licensing system for manufacturers of arms and ammunition is to say the least extremely doubtful. As has been pointed out in the body of the instructions it would probably be possible to require manufacturers to obtain Federal licenses to manufacture arms in the District of Columbia and in the Territories, and also to obtain licenses for inter-State or foreign commerce in arms and ammunition. The possibility of obtaining legislation of this character, however, seems so remote that it is not desirable for the American representative even to discuss the possibilities in this regard during the course of the coming meeting.

Article 4

The High Contracting Parties undertake not to grant a licence for the manufacture of the material referred to in Article 3 and to withdraw such licence if it has been granted to any firm which is in a position to influence a newspaper either because it holds a sufficient portion of its capital or because it conducts the management or any other part of its work, or because its directors, managers or high officials are in a position to exercise such influence.

The High Contracting Parties undertake to withdraw the licence of any holder who has advertised war material covered by Categories I, II and III or who has advertised war material covered by Categories IV and V in the special zones defined in Chapter III of the Convention concerning the Supervision of the International Trade in Arms and Ammunition and in Implements of War.

This Article is obviously unacceptable for the reason stated under the comments on Article 3. Further, the administration of the provisions contained in this Article or of other provisions directed substantially to the same end would appear to be almost impossible from a practical point of view. The most elaborate investigational machinery would be necessary to ascertain the connection of munition manufacturers with the press and it is not believed that an attempt in this direction would serve any practical or useful purpose.

The second paragraph of Article 4 seems likewise impossible to administer effectively.

Article 5

Each of the High Contracting Parties undertakes not to conclude any contracts for the supply of the kinds of war material enumerated in Article 3 with a private firm one or more of whose directors or managers are members of the legislature of that Contracting Party.

The provisions of this Article, while plausible on first sight, would not be acceptable. The war materials included in the Categories of the Arms Traffic Convention are manufactured in many types of industrial plants, some of which could not be termed strictly munitions factories. To endeavor to eliminate from consideration all manufacturing establishments capable of producing any of the articles included in the Categories, in which members of the Senate or the House of Representatives are directors or managers would be both unwise and impracticable.

Article 6

The High Contracting Parties undertake to publish within two months after the close of each quarter the licences granted during that quarter, together with the following particulars:

(a) The kind or kinds of war material which the holder of a licence is allowed to manufacture;

(b) The names, styles and addresses of the proprietor or proprietors in the case of enterprises belonging to a private individual or to the partners in a firm having a collective title, and those of the managers or directors in the case of enterprises organised as commercial companies;

(c) The names of all the enterprises with which the holder has concluded agreements or associations of any kind whatever, with a view to the production of the articles of war material for which the licence has been granted.

The High Contracting Parties also undertake to publish annually a report of each holder’s operations relating to the manufacture of the material for which the licence has been granted such report to be drawn up by the holder and verified by the High Contracting Parties.

The United States Government is in favor of a system of publicity for manufactures of arms and ammunition. It would appear, however, that a more appropriate system of publicity is provided for in Article 7 as noted below, than in Article 6. Eliminating the idea of licenses from Article 6, there remain merely the provisions that the names, styles and addresses of the proprietor or proprietors, partners, managers or directors of munition plants, be published, and that the existence of all munitions contracts be made known along with an annual report of the business of each munitions manufacturer.

It is not perceived how the publication of this information would be of great value to anyone save the competitors of the manufacturers in question. In so far as the trade of individual plants with foreign countries is concerned the Arms Traffic Convention provides adequate publicity.

Article 7

To complete the general system of publicity for armaments, irrespective of their origin, provided for in the Convention for the Supervision of the International Trade in Arms signed at Geneva on June 17th, 1925, the High Contracting Parties undertake to publish within two months after the close of each quarter a statistical return of the articles covered by Categories I, II and IV delivered or held in stock during that quarter.

This return shall be drawn up in accordance with the specimen form contained in Annex^* to the present Convention and shall show under each heading of the said categories in Article 1 the weight, the number and the value of the articles manufactured under a licence. The first statistical return to be published by each of the High Contracting Parties shall be for the quarter beginning on the first day of January, April, July or October subsequent to the date on which the present Convention comes into force with regard to the High Contracting Party concerned.

The High Contracting Parties undertake to publish as an annex to the above-mentioned return the text of the provisions of all statutes, orders or regulations in force within their territory dealing with the manufacture of war material covered by Article 1, and to include therein all provisions enacted for the purpose of carrying out the present Convention. Amendments and additions to these provisions shall be likewise published in annexes to subsequent quarterly returns.

The provisions of the present article shall also be applied as far as possible to articles manufactured in establishments of which the State is sole proprietor.

This Article appears to be acceptable provided always that it is extended to cover the production of Government as well as private factories. The quarterly collection and publication of statistics as provided for in this Article, however, might involve an unnecessary expense that would not be justified by the object sought to be attained. It is believed that annual or semi-annual publication of these statistics would be adequate.

Article 8

The High Contracting Parties, in all cases covered by Category III, undertake to publish within two months after the close of each quarter a return for that quarter, giving the information detailed below for each vessel of war constructed, in course of construction or to be constructed within their territorial jurisdiction on behalf of the State:

(a) The date of the signing of the contract for the construction of the vessel, and the following data:

Standard displacement in tons and metric tons;

The principal dimensions, namely: length at water-line, extreme beam at or below water-line, mean draft at standard displacement;

(b) The date of laying the keel and the following data:

Standard displacement in tons and metric tons;

The principal dimensions, namely; length at water-line, extreme beam at or below water-line, mean draft at standard displacement.

This Article is acceptable.

Article 9

The articles covered by Category V shall only be subject to such publicity as may be prescribed by the national legislation.

This Article would appear to be acceptable.

General Provisions

Article 10

The provisions of the present Convention are completed by those of Annex^* which have the same value and shall enter into force at the same time as the Convention itself.

The Annex to which this Article refers not being available it is impossible to make any comment thereon.

Article 11

The High Contracting Parties undertake to conclude no purchase contract for the supply of articles covered by Categories I, II and III in a State which is not a Contracting Party to the present Convention.

The apparent object of this Article is to force all countries to subscribe to the convention. It is believed that its inclusion in the convention would operate as a strong deterrent to ratification on the part of many Governments which would desire to preserve their liberty of action in regard to the purchase of war materials.

Article 12

In time of war the application of the present Convention shall be suspended as regards belligerents until the restoration of peace.

This Article is acceptable.

Article 13

The present Convention shall not be deemed to affect any rights and obligations which may arise out of the provisions either of the Covenant of the League of Nations, or of the Treaties of Peace signed in 1919 and 1920 at Versailles, Neuilly, St. Germain and Trianon, or of the Treaty limiting Naval Armaments signed at Washington on February 6th, 1922, or of any other treaty, convention, agreement or engagement.

It is believed that phraseology similar to that of Article 34 of the Arms Traffic Convention would be preferable in place of this Article.

Article 14

The High Contracting Parties will use their best endeavours to secure the accession to the present Convention of other States.

Each accession will be notified to the Government of the French Republic, and by the latter to all the signatory or acceding States.

The instruments of accession shall remain deposited in the archives of the Government of the French Republic.

Article 15

The present Convention may be denounced by any High Contracting Party thereto after the expiration of four years from the date when it came into force in respect of that Party. Denunciation shall be effected by notification in writing addressed to the Government of the French Republic, which will forthwith transmit copies of such notification to the other Contracting Parties, informing them of the date on which it was received.

A denunciation shall take effect one year after the date of the receipt of the notification thereof by the Government of the French Republic, and shall operate only in respect of the notifying States.

Should the Convention be denounced by one of the Powers whose ratification is a condition of its entry into force, any other High Contracting Party may also, within a period of one year from the date of such denunciation, denounce the Convention without waiting for the expiration of the period of four years mentioned above, and may require that its denunciation shall take effect at the same date as the first-mentioned denunciation.

Article 16

The High Contracting Parties agree that, at the conclusion of a period of three years from the coming into force of the present Convention under the terms of Article 18, this Convention shall be subject to revision upon the request of one-third of the said High Contracting Parties, which request shall be addressed to the Government of the French Republic.

Article 17

The present Convention, of which the French and English texts are both authentic, is subject to ratification. It shall bear to-day’s date.

Each power shall address its ratification to the Government of the French Republic, which will at once notify the deposit of such ratification to each of the other signatory Powers.

The instruments of ratification will remain deposited in the archives of the Government of the French Republic.

Article 18

A first procès-verbal of the deposit of ratifications shall be drawn up by the Government of the French Republic as soon as the present Convention shall have been ratified by the following Powers . . . .

The Convention shall come into force four months after the date of the notification of this procès-verbal by the Government of the French Republic to all signatory Powers.

Subsequently, the Convention will come into force in respect of each High Contracting Party four months after the date on which its ratification or accession shall have been notified by the Government of the French Republic to all signatory or acceding States.

The above Articles are unobjectionable.

[Enclosure 2]

Memorandum on the Categories and Statistics of the Proposed Convention

1. The categories appearing in the Convention for the Supervision of the International Trade in Arms and Ammunition and in Implements of War, signed at Geneva on June 17, 1925, should be taken without change as a basis for the categories to appear in the proposed Convention on the Manufacture of Arms, for the following reasons:

a. The proposed Convention is supplementary to the Arms Traffic Convention.

b. No reason exists for any distinction in regard to publicity of statistics for export of arms, etc., and for the manufacture of arms, etc.

c. The Arms Traffic Convention lays the basis for coupling private and Governmental production.

2. While it is realized that certain items appearing in the categories as laid down in the Arms Traffic Convention can serve no useful military purpose and in consequence such items might well be omitted, the danger involved in tampering with the categories as they now exist on account of the possibility of including additional items, is such that any attempt to alter or amend these categories should be opposed on the grounds indicated above.

3. As to the type of statistics to be provided for in the proposed Convention on the Manufacture of Arms, it is believed that the statistics required should be, in general, in a form corresponding to the type adopted in the Annex to the Arms Traffic Convention. Such statistics should, in general, be limited to totals and any effort to include the names of firms, either as producers or as purchasers, should be opposed as involving a danger of unfair competition and further as being an unwarranted interference with the industry concerned.

4. As regard the periods of time to be covered by the statistics in question, it is believed that publication at one year intervals is sufficient to serve the purpose of the proposed Convention. While an effort may be made to provide for publication of statistics in conformity with the provisions of the Arms Traffic Convention in regard to export, that is, publications within two months of the end of each quarter, it is believed that any publication at intervals of less than six months might involve so much labor and expense as to be prohibitive.

5. On the other hand, the Bureau of the Census is undoubtedly in a position to collect and publish statistics with as great efficiency as the statistical office of any other government. Therefore, while too frequent collection of statistics should be opposed as unnecessary and uneconomical, argument [agreement?] should be given if there is unanimous insistence on quarterly publication by the other governments.

6. Every effort should be made to restrict the required statistics to those of the production of combined articles. An effort to collect statistics of the production of component parts of many of the articles listed in the categories of the Arms Traffic Convention would entail an excessive amount of labor. If the inclusion of component parts is insisted upon, an effort should be made to enumerate such parts, and to include in this enumeration only the most important parts, essential to the use of the completed article for military purposes. For example, regarding fire control equipment, it might with justice be pointed out that statistics of the production of lenses suitable therefor might be sufficient, without requiring statistics of the other component parts.

[Enclosure 3]

Memorandum on Methods of Supplying Needs for Military Equipment

1. The position of the United States in regard to dependence upon private manufacture for the supply of its wartime needs in arms, ammunition, and implements of war is different from that of any other great Power. The United States is the only great nation which does not maintain Government arsenals in time of peace for the supply of its wartime needs in arms, ammunition and implements of war. While the United States maintains six so-called arsenals, these plants are in reality little more than experimental laboratories. Under the most favorable conditions they can be expanded to an extent which will furnish only a small percentage of our wartime requirements in arms, ammunition, and implements of war. During the World War, Government arsenals as such furnished less than 9% of our munitions requirements. Over 91% of our munitions requirements were furnished by private manufacturers, either on a lowest bidder or cost plus basis.

2. There does not exist in the United States either the large Government arsenals such as are maintained by England, France, Japan, Italy, Czecho-Slovakia, and Spain, or the subsidized or quasi-Government plants such as Krupp, Creusot, Armstrong, Vickers-Maxim, Schneider, Mitsuibishi, Samara, Skoda, etc. Such relatively small private munitions plants as we have owe their peacetime existence in the main to peacetime trade which for various reasons is comparatively small. It takes immeasurably longer to create a new industry in time of war than to expand an industry already in existence. This time element is influenced not so much by the time required to construct the plant as by the time necessary to procure and train the skilled personnel required in the highly technical operations of munitions production.

3. The above statement indicates clearly the necessity for coupling private and Governmental production in any convention whose purpose may be to exercise some measure of control upon the manufacture of arms, ammunition, and implements of war. Measures of restriction if applied solely to private plants would cripple the United States by affecting more than 90% of its source of supply. Such measures would affect other great nations relatively to a very much less degree.

4. The continuance of our present system of relying upon the private munitions industry for meeting war requirements is desirable for the following reasons:

(a) Such a system is comparatively inexpensive.

(b) Under such a system quantity production can be obtained with a reasonable degree of promptness in the event of an emergency.

(c) Such industries are susceptible of prompt and satisfactory conversion to meet new conditions.

(d) The private industries concerned can be engaged upon a variety of development and production within the same plant according to demands.

(e) Under such a system the existence of reserves of material and trained technical personnel will be insured at least to a certain degree.

(f) Such a system develops well trained organizations composed of both personnel and means of production susceptible of quick expansion or development to meet unexpected or unforeseen demands and conditions.

5. On the other hand, the construction of Government arsenals of sufficient capacity to meet probable war requirements as to arms, ammunition, and implements of war under the War Department General Mobilization Plan would require an initial expenditure in excess of two billion dollars. The creation and maintenance of a war reserve of munitions capable of supplying our requirements under the War Department General Mobilization Plan from the beginning of an emergency until the time when production would meet probable war consumption, computed on a basis of expenditure such as existed in the World War, would involve the initial expenditure of a sum in excess of five billion dollars. This amount does not include the initial cost of production plants nor does it include costs incidental to storage. It should be noted that on a basis of a 5% annual turnover for depreciation and obsolescence, the maintenance of such a reserve would involve an annual expenditure of two hundred and fifty million dollars. Since this country is in no position to enter upon a scheme which would involve such colossal appropriations and expenditure, it seems obvious that the only solution in so far as our own country is concerned is to reject any steps which may tend to limit consideration to the private manufacture of arms, and insist that both private and Governmental production must be included. It should further be noted that no measures of restriction, control, or supervision other than those which may follow full publicity in regard to total production will be acceptable.

60. See League of Nations, Report of the Temporary Mixed Commission on Armaments, Geneva, Sept. 15, 1921 (A.81.1921.—C.321.1921), pp. 11-13.
61. Foreign Relations, 1925, vol. i, p. 61.
62. See Foreign Relations, 1924, vol. i, pp. 17 ff.
63. Not printed.
64. See Foreign Relations, 1926, vol. i, pp. 40 ff; also ante, pp. 159 ff.
65. Not printed.
66. Not printed.
67. This Annex has not yet been examined by the Committee of Enquiry. [Footnote in original draft convention.]
68. This Annex has not yet been examined by the Committee of Enquiry. [Footnote in original draft convention.]