[Sailor Steve]

Friday, November 14, 1919

PARIS PEACE CONFERENCE

M Pichon’s Room, Quai d’Orsay, Paris, 10:30

Meeting of the Heads of Delegations of the Five Great Powers.


1. M Clemenceau reports his conversation of the previous day with General Coanda and Mr Antonescu. They had asked that the period for a reply be extended from six to eight days inasmuch as they declared that they were able to assure him that within that time the Supreme Council would receive a favorable answer without qualifications, from the Romanian Government. They had also asked that the sentence dealing with the conclusion of peace, while a Romanian army of 400,000 men was still in the field, be expunged. His impression is that the Romanians are really ready at last to give satisfaction on all points. He thinks that when so doing they might try to discuss the question of the Minorities Treaty, but he does not think that they will offer serious resistance on this point and that any such discussion will really amount to nothing.

S de Martino reminds M Clemenceau that at the previous meeting he had expressed the greatest confidence in the outcome of the interview between M Clemenceau and General Coanda and Mr Antonescu, and he is glad to see that his confidence has in every way been justified.

M Clemenceau replies that it was as a result of his association with his Italian colleagues that he had acquired diplomatic skill. He suggests that a decision as to sending the draft note to the Romanian Government be postponed until all the delegates had received the instructions of their Governments.

(This suggestion is agreed to.)


2. Mr Polk desires briefly to summarize the present status of the question of oil tank ships. On September 27th, after the matter had been discussed at several prior meetings, the Supreme Council had decided to allocate the tankers in accord with the plan of the Allied Maritime Transport Executive. At that time he had accepted and joined in the decision without being fully aware of the purport of the prior discussions and of the attitude of his Government. The position taken by the United States is that behind this question the ultimate and beneficial ownership of the tankers was a question for the Reparation Commission. The remaining question, which is the troublesome one, is as to the temporary allocation of these tankers. Messrs Davis and Hoover had thought that this latter question had already been decided in a sense contrary to that of the decision of September 27th, which had temporarily allocated these vessels between Great Britain, France, Italy and Belgium. When that decision had been communicated to his Government it had protested against it because it felt that this was contrary to a decision already taken. He now wishes to suggest that pending a final decision, which he hoped would very shortly be arrived at, nine of the fourteen tankers in question be allowed to remain where they were so that there would be no change in the situation. He wishes to explain the reasons for this suggestion. There is a great deal of feeling in the United States, and if the temporary allocation decided upon by the AMTE were to be put into effect it would cause his Government great embarrassment. If the decision of September 27th could be rescinded, and the tankers could be held where they then were pending a final decision, the shipping question he thinks will become very simple.

M Clemenceau asks why only nine of the tankers are spoken of. How many are there?

M Berenger replies that there are fourteen.

M Clemenceau inquires why Mr Polk had raised the point with respect to only nine of them.

Mr Polk explains that nine of these tankers are claimed by a subsidiary of the Standard Oil Company.

M Clemenceau says that he understands that no question was raised as to the temporary allocation of the other five tankers.

Mr Polk says that that is the case.

Sir Eyre Crowe points out that a formal demand had been made upon the Germans to deliver these tankers. Furthermore, in the protocol drawn up for their signature, the point of the undelivered tankers had been specifically brought up. With respect to the attitude to be taken towards the German Government it seems to him quite impossible to modify this demand which had already been formally made. The Germans had been playing for time and counting on dissension between the Allied and Associated Powers. If the Germans have not yet delivered these tankers, and do not do so within a week or two, Mr Polk’s views will be partially met and the situation will be facilitated. If the ships have been delivered he is willing in deference to Mr Polk’s urgent representations to agree that the decision of September 27th be modified, but only to the following extent: if the tankers have been delivered to the Armistice Commission they should remain in the hands of the Armistice Commission instead of being temporarily allocated in the manner theretofore decided upon by the AMTE.

M Berenger reads the decision of September 27th. This decision had been arrived at unanimously after a long and careful study of the question.

Mr Polk says that is not so as far as he was concerned.

M Berenger mentions several instances showing that the United States Representatives on various Committees had been thoroughly familiar with the question in all its phases. Mr Polk himself had had the questions put on the agenda on September 23rd. Previously there had been a full discussion at a meeting at which Mr Dulles and others had been present. Telegrams had been exchanged and certainly the question was one of such importance that the United States Government must have been fully aware of it. As soon as the decision had been made known great pressure had been brought to bear both in New York and Berlin. The first effect of that pressure was that the Shipping Board had committed an act of violence in holding up the steamer Imperator and other passenger ships in contravention of the decision of the Supreme Council. Furthermore pressure had been exerted in Berlin to keep the tankers in Hamburg and not have them go to the Firth of Forth. This pressure had been brought by the Standard Oil Company which claimed the ownership of the stock of the Deutsch-Amerikanische Petroleum Gesellschaft. In October 1914 the tanker Leda had been taken by the British as a prize of war and condemned by a Prize Court, but thereafter, as a result of American representations, this ship had been given up by England to the American Government for the Standard Oil Company. The Leda had been given up by the British Government as a result of the Standard Oil Company’s claim of ownership of the stock of the Deutsch-Amerikanische Petroleum Gesellschaft. Twenty-seven other ships of the Deutsch-Amerikanische Petroleum Gesellschaft in United States ports had been recognized as belonging to the Standard Oil Company, and judgments of competent courts had affirmed the Standard Oil Company’s ownership of the stock in question prior to the time the United States entered the war; but the contention of the United States that the tankers now at Hamburg were in the same situation could not be sustained. He had heard rumors from well informed sources, that before the United States entered the war, i.e. in 1916, the Standard Oil Company had alienated its stock-holdings to a German concern. He agrees with Mr Polk that the question of final ownership of the tankers can only properly be settled by the Reparation Commission. He wishes to emphasize the fact that the solution of this question was most pressing; in fact it was vital inasmuch as some 50 thousand tons are involved and the scarcity of petroleum is world wide. On the other hand he agrees entirely with Sir Eyre Crowe with respect to the present disposition of these tankers. It will obviously not do to let the Germans see that there is still dissension on this point between the Allied and Associated Powers, dissension resulting from a question of private ownership and interests. The German need for petroleum had been recognized and that difficulty had been settled. The Germans had only begun to emphasize their lack of petroleum in July and they had requested the use of ships to remedy the existing scarcity. The Supreme Council had decided that these tankers could circulate under the Inter-Allied flag for one voyage; it had been thought that this would supply the German needs. He takes note of what Mr Polk had said regarding the feeling of the United States but he wishes to point out that before any concession can be made to the views of the United States Government the Shipping Board will certainly have to release the Imperator and the other passenger steamers which are being illegally retained in United States ports. The questions are closely connected. If the Shipping Board releases the ships referred to the nine tankers in question might go to the Firth of Forth and be held there until a final decision on this question is reached. In the meanwhile, the other five tankers should be disposed of pursuant to the decision of the AMTE relative to their temporary allocation.

Mr Polk does not wish to take up the Council’s time by replying separately to all the points raised by M Berenger, but he feels obliged to make a few remarks. Of course he also feels that it is advisable not to show that there is any lack of solidarity between the Allied and Associated Powers but he feels that as far as this question was concerned the Germans are well aware that there is a division of opinion. The question of the ultimate ownership of the tankers is a technical and an involved one, which should be decided by competent courts and the Reparation Commission. With regard to the rumored sale by the Standard Oil Company of the stock of the Deutsch-Amerikanische Petroleum Gesellschaft that was far more than a rumor; in fact it had been referred to by the United States representatives in reports submitted by them to their colleagues on Commissions. The question to be settled is what the legal effect of that sale is.

M Berenger says that that is the first time he has known definitely about that sale.

Mr Polk says that he means the sale of the shares of the Deutsch-Amerikanische Petroleum Gesellschaft, and he wishes to point out that said sale had not been recognized by the Alien Property Custodian who had seized the German securities. This had been set forth in a note presented by the United States representatives. It is not within his province to discuss the propriety of the action of the Shipping Board; what he wishes to point out is that his Government feels, rightly or wrongly, that the question of title had been discussed long ago and that because such a question existed, the ownership of these tankers had not been settled, nor had the allocation thereof been settled at Brussels. The matter had been brought up at London where the United States was only informally represented; then it had been referred to the Supreme Economic Council at Brussels, where the United States is not represented at all. At that time it had been unknown to him that an agreement existed covering the division of passenger ships and tankers between Great Britain and France, and that the allocation made depended thereon.

M Berenger says that he had not heard of any such arrangement between Great Britain and France.

Sir Eyre Crowe says he would have something to say on that point.

Mr Polk says that this agreement contemplated the delivery of passenger ships to Great Britain and tankers to France; he understands that a French company had been formed to enter the oil carrying trade. He is not stating these facts with any desire to engage in a controversy. He merely wishes to show the feeling which exists in the United States. He had not been fully informed of all the points of discussion in this controversy, although as to that he is not seeking to present any excuses, but he could not help feeling that the other countries concerned had been fully aware of the delicate nature of the questions under discussion. The question had arisen in the French Chamber and a modification of the temporary allocation decided upon had been discussed. Public opinion in America had looked upon this as a permanent change in the allocation, contrary to the understanding which Mr Hoover thought had been reached. He repeated that the Germans knew that there was a division of opinion on this question. He himself had done his utmost to see that the Protocol to be signed by Germany should not specifically mention these tankers. He only asks that the tankers should remain where they re. He wishes to inquire if M Berenger means to say that if the Imperator and other passenger ships are not released by the Shipping Board the tankers should be allocated according to the decision of September 27th.

Sir Eyre Crowe remarks that it is a notorious fact that whenever the question of oil is touched upon, great difficulties result. With reference to the German knowledge of the division of opinion between the Allies, he thinks he cannot agree with Mr Polk’s point of view. A first decision had been taken and formally notified to the Germans. They had then received information from Standard Oil Company sources that no attention need be paid to this decision.

Mr Polk says that this is something that he did not know.

Sir Eyre Crowe says that from the information in his possession, he feels sure that it is so. There had then been further discussion in the Supreme Council and the Germans had been a second time instructed to deliver the tank ships. The Germans had been aware that there had been disagreement prior to that final decision, but they did not know that such disagreement had continued thereafter. The situation is not now as Mr Polk thinks, and the question has become one of the honor and prestige of the Allied and Associated Powers in the eyes of the Germans. Mr Polk had made two statements which it seems to him might be interpreted as raising a question of the good faith of the British Government and to these, of course, he must object. The first statement is Mr Polk’s reference to a decision taken at a meeting of the AMTE in London where the United States was only informally represented, and the subsequent reference of the question to the Supreme Economic Council at Brussels where it is known the United States is not represented. He wishes to point out that the decision to hand over the ships was taken at a meeting at which a representative of the United States was present. The matter was then referred to the Supreme Economic Council. The suggestion therefore was that the decision had been arrived at over the heads of the Americans. He would emphasize that the proposal to refer the matter to the Supreme Economic Council was made by the United States representative himself with the implication that the United States would accept. He does not wish any possible impression to remain that the decision at Brussels was the result of taking advantage of the United States not being represented there.

Mr Polk says that of course he had meant to imply nothing of the kind.

Sir Eyre Crowe says that the second point referred to by him is the alleged secret agreement between the French and British Governments.

(He then reads from a letter received from the Ministry of Shipping on the subject).

There is no such agreement in existence. There is an agreement between Mr Kemball Cooke and M Loucheur in regard to allocation of passenger steamers which is perfectly plain and above-board. In fact, Mr Cooke had announced it himself to the AMTE and had it circulated to all the Delegates with the Minutes. The following wording occurred in that agreement: “in consideration of the allocation to France of the tank steamers as decided by the AMTE.” Sir Eyre Crowe presumes that Mr Polk is referring to that clause. If so it is a mare’s nest, as that simply refers to the withdrawal of Great Britain’s claim to certain tank steamers which was disclosed by the first examination of the percentage due to her on a rigid ton for ton basis in comparison to losses. As a matter of fact no bargain is possible with the French as neither are they in a position to make one nor are the British in a position to guarantee the delivery of the tank steamers. All the British had said was that they would not claim what they considered their just proportion of the tank steamers. The French Oil Shipping Companies were, of course, preparing for the management of these tankers. As it is now five weeks since the Supreme Council had allocated a considerable proportion of the steamers to France it does not seem unreasonable that the French should have been making preparations to take them over.

M Berenger points out that the agreement is dated November 10th and can therefore have had no effect on the decision taken by the Supreme Council on September 27th.

Mr Polk says that he had not claimed that the agreement was a secret one but had merely said that he had not known of it.

Sir Eyre Crowe says the whole trouble is that the United States claimants would not admit that the allocation is purely temporary; they wish to mix it up with the question of permanent ownership. He now finds himself in a difficult position. The question had been raised of the 10 passenger steamers illegally held by the Shipping Board in the United States. He wishes to remark that though there might be considerable feeling in the United States the indignation in England was even greater. He has just received peremptory instructions from his Government to submit the following decision to the Supreme Council: that the Supreme Council should now address a formal demand to the United States Government that the 10 passenger steamers illegally retained by the Shipping Board in United States ports should be immediately released. He had not wished to present this question at that session, but as the matter of the retention by the Shipping Board of 10 passenger steamers had been raised, he feels obliged to inform the Council of the instructions he has received.

M Clemenceau points out that public opinion in France is also greatly aroused over this question.

Mr Polk says that Sir Eyre Crowe had felt that he had laid great stress on his statements with respect to the fact that the decision reached by the Supreme Economic Council at Brussels was taken in the absence of American representation, and with respect to the formation of French Oil Shipping Companies. He wishes to remind the Council that he was only stating the case as it was seen in the United States, whether rightly or wrongly. It was, of course, not his intention to make imputations of any kind; he merely wished to show that public opinion in America felt that a decision had been taken at Brussels when the United States had not been represented there.

M Clemenceau asks why the United States had not been represented on the Supreme Economic Council at Brussels?

Mr Polk explains that since Mr Hoover had left American representation on the Supreme Economic Council had ceased. With respect to the formation of French Oil Shipping Companies the impression existed in the United States that these Companies were being formed to use ships to which United States interests had a valid claim.

M Berenger says that as far as he knows no French oil shipping companies had been formed.

Mr Polk says that their formation had been reported in the French press.

M Berenger replies that that was no more accurate than a great deal of other information appearing in the press.

S de Martino says that he does not wish to go into detail, but he desires to make a general observation. A good deal has been said about the impression that the Germans would have as to dissension among the Allied and Associated Powers on this question. He feels that on this occasion not only will the Germans receive such an impression but they will, for the first time, profit by it, and the prestige of the Council will be very badly affected. There is no country which does not have a very great interest in this question. Oil is badly needed everywhere and it is most injudicious to keep these tank steamers in idleness. He thinks that public indignation will surely be aroused if the impression is created that these ships are not being used as a result of a theoretical discussion. He fully agrees with M Berenger with respect to the nine tankers; that is to say, that they should go to the Firth of Forth and remain there until a final decision can be reached; while the other five tankers should be allocated according to the decision of the Allied Maritime Transport Executive.

Mr Polk says he will cable his Government with respect to this point.

M Clemenceau points out that the only point of agreement is that the ownership of the tankers in question should eventually be determined by the Reparation Commission. He agrees with Sir Eyre Crowe that the question raised by the action of the Shipping Board in the United States should not be taken up at this meeting. He thinks it would be better to have the nine tankers go to the Firth of Forth until a final decision is had on the question. He appreciates the difficulties of the United States Government and wishes to be of assistance to it as far as possible, because he thinks it was not ultimately responsible for what had happened. He wishes to point out, however, that with respect to the United States, the question is fundamentally one of private interests, whereas in France and England the question was one of general interest which affected everybody. Under these conditions he feels that private interests should give way. He trusts that when Mr Polk, as he had said he would, sends a telegram to his Government relative to the suggestion that the nine tankers should go to the Firth of Forth and stay there until a final decision had been reached on the matter, he would at the same time take into consideration the view he (M Clemenceau) had just expressed, and that feeling in France and England was as fully aroused as it was in the United States.

Mr Polk wishes to make it clear that his Government’s solicitude is not for the Standard Oil Company; his Government feels that a matter of principle is involved. He thinks that the Standard Oil Company did not consider that the present administration was in its favor.


3. The Council has before it three joint notes from the Polish and Czecho-Slovak Commissions relative to the plebiscite in Teschen.

M Laroche reads and comments upon the joint report of the Polish and Czecho-Slovak Commissions consisting of these three joint notes.

(It was decided to accept the recommendations of the joint report of the Polish and Czecho-Slovak Commissions relative to the plebiscite in Teschen, contained in the three joint notes.


4. Mr Polk explains that Colonel Haskell, Inter-Allied High Commissioner for Armenia, is leaving Paris that night and that prior to his departure he thought it would be well for him to give the Council a brief summary of the conditions in Armenia. Situation in Armenia, Georgia and Azerbaijan

Colonel Haskell informs the Council that the three republics of Georgia, Armenia and Azerbaijan are at daggers drawn with each other on almost all points. Georgia and Azerbaijan have perhaps some slight degree of good feeling towards each other, evidenced by a loose defensive alliance concluded between them as a protection against a possible advance southward of General Denikin’s army. Armenia refused to join this alliance. Political and economic conditions in each of the three countries are in as bad a condition as can be imagined. He wishes to point out that these three countries have been arbitrarily carved out and delimited. The only railway system from the Black Sea through to Persia traverses all three of these republics and any one of them has it in its power, under present conditions, to paralyze traffic. Aside from the animosity existing between these states, further material difficulties have resulted from their arbitrary delimitation: for instance, all the railway repair shops are in Georgia and all the fuel for the operation of the railway system comes from Baku in Azerbaijan. Furthermore, between these three republics there are various contested districts, and neutral zones which have been marked out by the British, which it had not been possible to change because they gave rise to such burning questions that no change can be adopted until all three republics are consolidated under one administration. He has been entrusted by the Supreme Council with representing it in Armenia, but he cannot efficiently carry out the necessary work as long as Georgia and Azerbaijan remain without his jurisdiction. Moreover, owing to the fact that these two latter republics do remain without his jurisdiction, an anomalous situation is presented. Thousands of inhabitants of Azerbaijan are receiving relief in Baku and other localities, and the same is true of many Georgians at Tiflis and other points; though those destitute people are entirely dependent on the relief they receive, the Relief Administration has no control whatever over the local administration. If all three republics were put under one administration the neutral zones referred to could be eliminated, and a definite frontier temporarily fixed. Such a solution would preclude the existence of a situation such as now exists, where a large number of Armenians find themselves within the political limits of Georgia. The Georgians will not feed them because they were of Armenian nationality, and on the other hand, the Armenians refuse to give them any assistance inasmuch as they were living within the territorial limits of Georgia. There are no foodstuffs available anywhere, and all three of the republics are virtually living on the salvage of the Russian collapse. Economic life was at a standstill. Practically nothing can be imported inasmuch as the money of all three of the republics have no purchasing value. The Caucasian ruble, which should be worth 51 cents was now only worth about 1 cent, and it had actually been found impracticable to issue paper money in smaller denominations than 10 rubles because the value of the paper was greater than the money. Foreign merchandise shipped on the railroad through to Persia is liable to be requisitioned by any one of the three Republics, as their need for everything is so great. The most essential need perhaps, is to control the system of through railway transportation. In Armenia alone some 800,000 destitute are being relieved and about 15,000,000 francs per month is being spent on this relief work. Armenians in foreign countries do indeed attempt to send some relief to their starving countrymen. Although those supplies get through the ports of Batum and its surrounding territory, where the British have an efficient administration, they are held up at various points in the interior by the Georgian authorities, and the same situation applies to all railway traffic.

Mr Polk explains that the Council has sent Colonel Haskell as its representative for relief work in Armenia and Colonel Haskell feels that it is necessary for him to have the same functions in Georgia and Azerbaijan in order to efficiently accomplish his mission. That matter can be settled later when the experts have been heard. As Colonel Haskell is leaving Paris this night, he (Mr Polk) thinks that it might be of interest to the Council to hear his views.

M Clemenceau thanks Colonel Haskell for his presentation of the question.

(At this point Colonel Haskell leaves the room.)


5. The Council has before it a note from the British Delegation relative to measures to be taken to remedy the dearth of rolling stock in Austria.

M Pichon suggests that the British note be referred to the Committee on Organization of the Separation Commission.

(It was decided to refer to the Committee on Organization of the Reparation Commission the British note relative to measures to be taken to remedy the dearth of rolling stock in Austria.)


6. The Council has before it a proposal from the Committee on Organization of the Reparation Commission relative to the distribution of Upper Silesian Coal.

Major Aron reads and comments upon this proposal.

General Le Rond suggests that paragraph 2 of the proposal of the Committee on Organization of the Reparation Commission relative to the distribution of Upper Silesian coal be modified so as to provide that the requirements of Upper Silesia should first be satisfied.

(It is decided to adopt the draft decision submitted by the Committee on Organization of the Reparation Commission relative to the distribution of Upper Silesian coal, after modifying it so that the end of paragraph 2 should read as follows:

“A - To Upper Silesia: The tonnage which the Commission shall judge suitable to attribute to it.
- to Austria: 200,000 tons per month.
- to Poland: 250,000 tons per month.

B - To Germany: The surplus.”)

(The meeting then adjourns.)