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Volume 718, April 6 – April 7, 1944
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Volume 718, April 6 – April 7, 1944
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Henry Morgenthau, Jr. Papers
Diaries of Henry Morgenthau, Jr.
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Diary
Book 718
April 6-7, 1944
8
- A -
Book Page
Alcohol Tax Unit
See Liquor
Appointments and Resignations
Oliphant, Charles: Transfer to Treasury discussed by
HMJr, D.W. Bell, and C.S. Bell - 4/7/44
718 245
a) O'Connell reports he is coming in "week or
ten days". - 4/10/44: See Book 719, page 148
Olrich, Ernest L.
Coming to Treasury as $1-a-year man; staying on as
president of Munsingwear, Minneapolis - 4/6/44
24
Labor record given by Houghteling - - 4/11/44:
Book 720, page 41
Office of Price Administration report - 4/12/44:
Book 720, page 104
Clayton approves of Olrich - 4/14/44: Book 721, page 3
Edward 1. Brown endorses - 4/14/44: Book 721, page 27
Olrich-HMJr conversation - 4/15/44: Book 721, page 214
Weinberg (Sidney)-HMJr conversation 4/15/44:
Book 721, page 218, and Book 722, page 66
Argentina
See Willkie, Wendell L.
- B -
Bank of America
California now has 50 facilities in Army Posts,
Navy Yards, etc., of which Bank of America has 30;
discussion of situation by HMJr. Bell, Delano,
O'Connell, and Tietjens - 4/7/44
232
- C -
California
See Bank of America
Camp Vittel
See War Refugee Board
Correspondence
Mrs. Forbush's mail report - 4/7/44
289
- D -
Deferments, Military
Surrey, Stanley 8.: Does not wish deferment (up in May)
extended: wishes to go into Navy - 4/6/44
20
Conference; present: HMJr, D.W. Bell, C.S. Bell,
Jordan, and Gaston - 4/7/44
253
a) White House policemen discussed
264,265
b) Bureau of Mint, San Francisco, discussed
266
- D - (Continued)
Book Page
Dies Committee on Un-American Activities
See Internal Revenue, Bureau of
- , -
Financing, Government
War Savings Bonds
Redemption survey by Likert - 4/7/44
718 272
5th War Loan Drive: Telegrams urging acceptance of
State Chairmanships - Gamble told HMJr's name not
to be signed without his personal OK - 4/6/44
117
Foreign Funds Control
See also Deferments, Military
Pehle, John W.: Question of continuing as head
discussed by 9:30 group - - 4/6/44
8
France
French Committee of National Liberation: Financial
questions (civilian supplies for French use to be
paid for in dollars; no decisions now prejudicial to
disposition of French or other frozen funds in
United States) discussed in Treasury-State correspondence -
4/6/44
143
- G -
General Counsel, Office of
General Counsel as Acting Secretary: HMJr wishes
discontinued - 4/6/44
12
Gold
$20 gold piece--1933 issue-offered for sale in New York;
minted but not intended for circulation - - discussion
by 9:30 group - 4/6/44
32
Complete set of all gold coins for Library of Congress
or Smithsonian discussed by group - - 4/6/44
32
a) HMJr's letter to Sproul - - 4/10/44: See Book 719,
page 227
Greece
See War Refugee Board
- H -
Hayes, Carlton J. H. - United States Ambassador to Spain
See War Refugee Board
- I -
Internal Revenue. Bureau of
See Deferments, Military
- I - - (Continued)
Book Page
Internal Revenue, Bureau of (Continued)
Conference: present: HMJr, Gaston, Sullivan, O'Connell,
and Nunan - 4/6/44
718 49
a) Permission for Dies Committee to examine
any income tax return discussed
1) Byrnes-HMJr conversation
53
b) Proposed Executive Order sent to FDR - 4/10/44:
See Book 719, page 219
- I - -
King, Paul (Procurement Division)
C.S. Bell plans to bring over, because of Thompson's
illness - 4/6/44
1
- L -
Latin America
Argentina: Willkie, Wendell - proposed speech to be
made by Willkie on U.S. Argentine policy as written
by Luxford - 4/6/44
124
a) HMJr, after reading, thinks Treasury should
inform Hull all assets must be frozen - 4/17/44:
See Book 722, page 1
Legislative Counsel, Tax
To report to HMJr through Under Secretary - 4/6/44
7,36
Likert, Rensis
See Financing, Government: War Savings Bonds
Liquor
Alcohol Tax Unit: Gaston, O'Connell, and Nunan discuss
Nunan's proposal to send out orders cleaning up cases
on hand and thereafter ceasing to "harass" liquor
dealers - 4/6/44
119
Seattle, Washington, and Portland, Oregon report on
effort to suppress illicit liquor traffic - 4/6/44
120
Lynch, John (Bureau of Internal Revenue)
9:30 group discusses bringing to Treasury temporarily -
4/6/44
4
- M - -
Mint, Bureau of (San Francisco)
See Deferments, Military
- O -
Oliphant, Charles
See Appointments and Resignations
Olrich, Ernest L.
See Appointments and Resignations
- P -
Book Page
Pearson, Drew ("Washington Merry-Go-Round")
See War Refugee Board: Camp Vittel
Pehle, John W.
See Foreign Funds Control
Portland, Oregon
See Liquor
- R -
Rabbis
See War Refugee Board
- S -
Seattle, Washington
See Liquor
Selective Service
Discontent throughout country
Discussed by 9:30 group - 4/6/44
718
22
.
by Hannegan and HMJr - 4/6/44
28
HMJr's letter to FDR - 4/7/44
269
a) Byrnes-HMJr conversation - 4/10/44: See Book 719,
page 172
Hershey's new order discussed: Draft Board to postpone
all consideration of those over 26 - 4/10/44:
Book 719, page 125
Spain
See War Refugee Board
Surrey, Stanley S.
See Deferments, Military
Switzerland
See War Refugee Board
Fi
- T -
-
Tax Research, Division of
See Deferments, Military
(Tax Research, Division of
(Tax Legislative Counsel
To report to HMJr through Under Secretary - 4/6/44
7,36
Turkey
See War Refugee Board
- v -
Vittel Camp
See War Refugee Board
- V -
Book Page
War Conditions
Committee to Shorten the War, with General Strong as
Director, discussed by HMJr and War Department -
4/6/44
718
42
a) Shipping of strategic supplies from neutral
countries to the enemy to be considered
b) Strong-HMJr conversation - 4/7/44
226
c) Memorandum as prepared for FDR and Bell's
covering memorandum - 4/8/44: See Book 719,
page 63
1) Draft of Executive Order: Book 719. page 67
d) Strong (General) not available - 4/14/44:
Book 721, page 30
War Finance Division
See Deferments, Military
War Refugee Board
Evacuation from the camp at Vittel, France, discussed
by HMJr, Pehle, DuBois, and Rabbis Corff, Frankel,
and Kalmanowitz - 4/6/44
86
a) HMJr's conversation with Senator Mead's office
96
b) #
#
a Hull's office
98
c) #
#
# Congressman McCormack's
office
103
d) HMJr-Hull conversation
108
e) HMJr's conversation with Hull's secretary
111
f) Hull agrees to send message as recommended by
Board - 4/7/44
168
1) Discussion by Treasury group
221
g) Group represented by three Rabbis thanks HMJr -
4/7/44
223
h) Chronology
224
1) Proposed cables to Bern and to Latin American
missions sent to Warren of State Department -
4/8/44: See Book 719, page 87
1) Hull-HMJr conversation concerning Drew Pearson
broadcast - 4/10/44: Book 719, page 118
1) 9:30 group discuss: Book 719, page 122
2) Actual Pearson broadcast: Book 719, page 158
3) Gaston memorandum on "leak": Book 719, page 159
4) Hull-HMJr further talk: Book 720, page 43
k) Conference; present: HMJr, Rabbis Corff and
Kotler - 4/10/44: Book 719, page 179
1) State Department conference described by
Rabbi Corff
1) Cable to American Embassy, Madrid: Book 719,
page 271
m) Congressman McCormack-Treasury correspondence -
4/17/44: Book 722, page 136
Greece: Movement of refugees through Ismyr - cable
concerning - 4/6/44
146
- V - (Continued)
Book
Page
War Refugee Board (Continued)
Spain: Hayes again withholds cooperation - 4/6/44
718
155
a) HMJr asks FDR to send Willkie there - 4/13/44:
See Book 720, page 281
b) FDR reply - 4/14/44: Book 721, page 31
c) Hull-HMJr conversation: Book 721, page 212
d) Difficulties with Hayes outlined in Pehle
memorandum: Book 721, page 264
Visa officers from Consulates at Basel, Geneva, and
Bern discuss - 4/6/44
159
Turkey: Von Papen's offer of cooperation reported by
Hirschmann - 4/6/44
164
War Savings Bonds
See Financing, Government
White House Policemen
See Deferments, Military
Willkie, Wendell L.
See Latin America: Argentina
1
April 6, 1944
11:00 a.m.
GROUP
Present: Mr. D.W. Bell
Mr. C.S. Bell
Mr. O'Conneil
Mr. White
Mr. Gaston
Mr. Sullivan
Mr. Smith
Mrs. Klotz
H.M.JR: What are you going to do to strengthen the
Administrative Section?
MR. C.S. BELL: I would like to bring over, with your
permission, Paul King from the Procurement Division,
temporarily, on detail. He is a personnel man and an
administrative man.
H.M.JR: Is he good?
MR. C.S. BELL: Very good. Our relations with him
have been perfect until things settled down SO.
H.M.JR: Where is Sullivan?
MR. SULLIVAN: Here, sir.
H.M.JR: Any objections?
MR. SULLIVAN: No. I think with the situation -
anybody in the Treasury you will have to get. It is
going to hurt over there, but I think this is more
important.
Regraded Unclassified
2
- 2 -
H.M.JR: Nobody any other place in Procurement, is
there?
MR. GASTON: There is a man named Ward Stewart that
has been in Foreign Funds, that is about to get into
military service, that Pehle thinks very highly of.
Do you know him, Charlie?
MR. C.S. BELL: He is in 1-A.
MR. GASTON: It might be possible to make another
effort?
MR. C.S. BELL: He is working on your relief program
now.
H.M.JR: I know, but that is going well and Procure-
ment "ain't." What is his name?
MR. GASTON: Ward Stewart. Of course, he is slated
to go in the Army, now. We would have to make another
fight to get him. I don't know him.
MR. O'CONNELL: He is practically in the Army,
anyway.
H.M.JR: Isn't there anybody else? You have got
eighteen or twenty of these administrative fellows
around. Who has Hall got?
MR. C.S. BELL: Long, principally.
MR. SULLIVAN: How about John Lynch?
MR. C.S. BELL: He has been a very good man, but
Revenue, of course, has a pretty stiff problem.
MR. D.W. BELL: He would be excellent on the
personnel end.
H.M.JR: I hate to take from Procurement at this
time. What about Lynch?
Regraded Unclassified
3
- 3 -
MR. SULLIVAN: He is over in the Bureau of Internal
Revenue.
H.M.JR: Is he a good man?
MR. C.S. BELL: Yes, sir.
H.M.JR: I would much rather take someone from
there than Procurement.
MR. C.S. BELL: Procurement has been pretty well
fortified in the administrative work down there.
H.H.JR: Yes, well, by the time I get through they
are going to need smelling salts! Did you get a copy
of my telegram last night?
MR. SULLIVAN: Sure. I am not disturbed at all.
H.M.JR: I don't want to disturb you. I just want
results.
MR. SULLIVAN: O.K. I will tell you about--
MR. D.W. BELL: May I say that there is a meeting
of the Economic Stabilization Board at eleven? Is there
somebody to attend it?
H.M.JR: You better stick here and stabilize me!
MR. D.W. BELL: It is a couple of hours wasted.
H.M.JR: Oh, well, half of the people never show
up, do they? I mean, look what I have got here--
MR. D.W. BELL: A very small group generally shows
up.
H.M.JR: You better stay here.
MR D.W. BELL: Some of them haven't been there
for months. I understood from John last time that
4
- 4 -
several of them who hadn't been there for months, showed up.
Eric Johnston showed up last time, who hadn't been there
for months.
H.M.JR: You had better stay.
MR. D.W. BELL: All right.
H.M.JR: Do you want to think this thing over and
get at me again?
MR. C.S. BELL: John Lynch has been in before. We
have tried to get him on one other occasion. He is very
good. If you don't want to upset the Procurement, we
can go along with John Lynch.
H.M.JR: If anybody over there in Procurement is
good, I don't want to take him away.
MR. C.S. BELL: This man is very good - Paul King.
H.M.JR: O.K. We will take Lynch. He (Sullivan)
has got two hands. We will take his right or left,
whichever it is.
MR. C.S. BELL: A good name, too.
H.M.JR: All right. Are you people satisfied? Let
me take a look at him when he comes in.
MR. SULLIVAN: Who has John got helping him at the
Bureau?
MR. C.S. BELL: Mrs. Tyree is his prime aid. There
is nothing that John Lynch does that Bain couldn't do.
MR. D.W. BELL: Well, you have Billard.
MR. C.S. BELL: He is General Personnel Director.
H.M.JR: Are you satisfied?
Regraded Unclassified
5
- 5 -
MR. SULLIVAN: Yes, I think John is an excellent
man, Mr. Secretary.
H.M.JR: Of the two places, where would you rather
see him taken from?
MR. SULLIVAN: I think John Lynch is an abler
fellow than King.
H.M.JR: I mean, who could stand it?
MR. C.S. BELL: King.
MR. SULLIVAN: King could.
MR. C.S. BELL: King is younger.
MR. GASTON: Which Bureau would suffer the most,
he means.
MR. D.W. BELL: I should think Internal Revenue
would stand it better.
MR. SULLIVAN: I think SO.
MR. D.W. BELL: If it is the idea of getting some-
body permanently, I don't think Lynch would be interested.
He would be interested in helping out, but I don't think
he would be interested in it permanently.
H.M.JR: Why not?
MR. D.W. BELL: He is satisfied where he is.
H.M.JR: Well, hell! We are at war.
MR. D.W. BELL: He would be tickled to death to
help out, but - we tried him once before.
MR. O'CONNELL: What about McNamara?
Regraded Unclassified
6
- 6 -
H.M.JR: I don't want him. Everybody wants to
shove him at me. That is the fellow who was over at
War Bonds?
MR. GASTON: Yes, came from New York, Internal
Revenue. There is Adams, over there. They probably
need him pretty badly.
MR. D.W. BELL: I suggest Charlie look around and
make recommendations.
H.M.JR: Do you want McNamara?
MR. C.S. BELL: I think you are pretty smart,
Mr. Secretary. (Laughter)
H.M.JR: Well, sometimes! (Laughter)
Well, you bring Lynch over, and get me about
three more men over - or women. I would like to go in
and see somebody twiddling their thumbs, about three
more. I am serious.
MR. C.S. BELL: Yes, sir.
H.M.JR: I would like about three more people in
there. I will ask you each morning, just the way I
did Dan, until I finally got him to take someone back
there in that other office - some woman who couldn't
figure interest rates.
MR. D.W. BELL: Who couldn't?
H.M.JR: This one is out of the bank. She is good,
isn't she? Who was the woman you got from the bank?
MR. D.W. BELL: The one we have down there is from
a college. She was secretary and financial clerk in
Simmons College. Her name is Hodel.
H.M.JR: She is doing all right?
Regraded Unclassified
7
- 7 -
MR. D.W. BELL: She is all right, yes. Her sister
is on the legal staff. She is very good.
MR. O'CONNELL: She was. Unfortunately, we lost
her to John Pehle. She went over to take Olsen's job
when Olsen went to Stockholm. She is awfully good.
MR. D.W. BELL: And this girl is very good. The
other girl we had joined the Air Corps. She got her
wings.
H.M.JR: Hope they don't get in her way!
Anything else? You get two or three more people.
MR. C.S. BELL: All right, sir.
I wondered if you wanted to clear the Pehie and
Blough letters that Norman fixed up before he left.
(Hands two letters to the Secretary for approval)
MR. D.W. BELL: You recall, one day in here we
talked about administration of the things, and you
asked Norman to fix you up some letters, and Norman
never had a chance to talk to you about them.
H.M.JR: (Resding) "Effective after this date, the
Director of Tax Research and Tax Legislative Counsel
will report to the Secretary through the Under Secretary."
Are they the same people?
MR. C.S. BELL: No, sir.
H.M.JR: "Will report to the Secretary through the
Under Secretary;" anybody have any objections?
MR. SULLIVAN: Sorry, I didn't hear it.
H.M.JR: "Effective after this date, the Director
of Tax Research and Tax Legislative Counsel will report
to the Secretary through the Under Secretary." Tax Re-
search is Blough, and Tax Legislative Counsel is Surrey.
Regraded Unclassified
8
- 8 -
MR. SULLIVAN: That is quite right.
MR. D.W. BELL: There was a question there as to
whether you wanted Blough probably to report directly,
because he is in the staff meeting; he is in your nine-
thirty staff meeting. It is a question of whether you
wanted him to report directly to you.
H.M.JR: Me? No, I would much rather have you the
bottleneck than me.
MR. D.W. BELL: The only thing this involves, really,
is signing a few pieces of mail.
H.M.JR: (Reading) "Effective as of this date, the
Foreign Funds will continue to operate under the super-
vision of--" Now what is this?
MR. WHITE: Blough isn't here. I imagine he has
been consulted.
H.M.JR: Has Blough been consulted?
MR. D.W. BELL: Yes, as a matter of fact, he made
the suggestion to Thompson.
H.M.JR: "Effective as of this date, the Foreign
Funds Control will continue to operate under the super-
vision of John W. Pehle, as Assistant to the Secretary.
Mr. Pehle will report directly to the Secretary."
MR. C.S. BELL: Is that the way you want it?
MR. WHITE: No.
MR. D.W. BELL: That was suggested, I think, by
John to Norman. Of course, Norman was to have discussed
it with you.
H.R.JR: In the first place, why is Pehle still the
head of Foreign Funds?
9
- 9 -
MR. D.W. BELL: He isn't. This makes him the head
of Foreign Funds, see? You have no head, now, of Foreign
Funds. The General Counsel is head of Foreign Funds,
and the General Counsel is Acting Secretary in that
capacity.
Now, I don't know, but I don't think there has been
any decision about an Acting General Counsel being--
MR. O'CONNELL: It is obvious an Acting General
Counsel could not be an Acting Secretary.
MR. D.W. BELL: That is what everybody has assumed.
There is no head, now, of Foreign Funds.
H.M.JR: Why not?
MR. O'CONNELL: There isn't, directly.
MR. D.W. BELL: I mean between him and the Secretary.
MR. O'CONNELL: It is an orphan.
MR. GASTON: All it really amounts to at this moment
is that Foreign Funds is under the general supervision
of Joe, but when something is to be signed for them, as
Acting Secretary, they bring it in to somebody else. I
have signed a number of things as Acting Secretary for
them.
MR. O'CONNELL: John Pehle couldn't sign as Acting
Secretary any more than the General Counsel could.
MR. D.W. BELL: I think Norman understood that Pehle
was still handling the Secretary's end of it, and was
still bringing the things to you to be signed.
H.M.JR: Speak up, Mr. White.
MR. WHITE: The only discussion we had had on that
point was that Pehle was going to divorce himself com-
pletely from Foreign Funds because any responsibility
Regraded Unclassified
10
- 10 -
with respect to Foreign Funds would diminish from the
attention he could pay on this other job. When he was
through with this other job, presumably he was going
back. In the meantime there would be an Acting head
and they wouldn't have to clear through John Pehle.
The minute they do, he would have to share some of the
responsibility and there are a lot of details. So I
shouldn't think there is anything to be gained by having
him still responsible for Foreign Funds while he is at
this other job.
H.M.JR: I think you will find, as I remember, he
wanted to have some connection with Foreign Funds on
account of his draft status. I think that was it, wasn't
it?
MR. C.S. BELL: I don't recall, Mr. Secretary.
MR. D.W. BELL: That was discussed between John
and Norman.
H.M.JR: Supposing I have John in and talk to him?
MR. D.W. BELL: He said it was not a heavy job,
that he could handle it whenever it required the signa-
ture of the Secretary.
H.M.JR: I agree with White. I don't think the
two things should be mixed.
Look, the first criticism of the President's
War Refugee Board, last week, in some paper - Star Journal -
I don't know what paper it is--
MR. SMITH: Minneapolis.
H.M.JR: Oh, yes, Andresen, 80 I guess it would be
the Star Journal - said this Board was circumventing the
immigration laws, you see? Well, now, Foreign Funds -
well, it just doesn't mix, because it sort of gives
Pehle as Director of the War Refugee Board the purse-
strings to Foreign Funds.
Regraded Unclassified
11
- 11 -
MR WHITE: Well, it kind of puts the other thing
under the Treasury.
H.M.JR: No, excuse me. He could issue any
Directives he wanted to for licenses and all that, and
there would be no check on him, which is important.
MR. WHITE: I am sure he wouldn't.
H.M.JR: But I mean, I am always going up before
Mr. Andresen: "Do you mean to say, Mr. Secretary, that
Mr. Pehle, in his capacity as Director of the War
Refugee Board can issue himself an order issuing a
million dollars to be sent into Poland, and there is
no check on him? Do you do it yourself?"
"Mr. Andresen, I don't have time." It doesn't sound
right.
MR. WHITE: I don't know as any change is necessary,
Mr. Secretary, because John can sign anything for the
Acting Secretary. And the General Counsel's Office
anyway, keeps very close operating contact. And Orvis
Schmidt is the acting head.
MR. O'CONNELL: The problem is raised by Mr. Paul's
leaving, but this doesn't solve the problem, because
the problem is who is Acting Secretary in connection
with Foreign Funds. John Pehle can't be.
MR. GASTON: That, Joe, is unimportant. That is
just a question of an occasional signature. Really the
question is shall there be somebody who is between the
Secretary and the head of Foreign Funds to supervise.
Now it is you. Should there be any change?
H.M.JR: I want somebody between me - I don't want
to supervise.
MR. WHITE: The General Counsel's Office has a
staff, Luxford and others, who keep very close contact
with it. They, presumably, are responsible to the
Acting General Counsel.
Regraded Unclassified
12
- 12 -
H.M.JR: May I make a suggestion that you draw it
over again this way, giving Pehle a leave of absence
and leaving Schmidt as Acting Director.
But we might as well clean up that business which
was once or twice brought up of the General Counsel
being Acting Secretary. I don't want that any more,
see?
MR. C.S. BELL: Yes,sir.
H.M.JR: I think we will clean that part up, that
he cannot sign (O'Connell) as Acting Secretary in rela-
tion to Foreign Funds. It takes myself or one of the
Under Secretaries or Assistant Secretaries as Acting
Secretary. That is the way I would like to have it.
You talk with Pehle, then I will talk with him. Is
that right, Herbert?
MR. GASTON: Yes.
H.M.JR: Then he will be on leave of absence and
Schmidt will be Acting Director, responsible to the
Assistant General Counsel, Luxford.
MR. O'CONNELL: No--
MR. GASTON: No, responsible to the General Counsel.
H.M.JR: But isn't it Luxford's work?
MR. O'CONNELL: Yes, but Luxford is responsible
to me.
H.M.JR: I want everything the way it is, except
I don't want you to sign Foreign Funds as Acting
Secretary.
MR. O'CONNELL: I can't do that, anyway.
H.M.JR: You could if you were General Counsel.
MR. O'CONNELL: If.
13
- 13 -
H.M.JR: If you should be General Counsel, I
don't want you to do that.
MR. O'CONNELL: That suits me. But you expect as
an operating matter for the Office of the General Counsel
to have the same responsibility with respect to Foreign
Funds as it has always had?
H.M.JR: That is right. After you talk to Pehle,
I will talk to you (C.S.Bell) personally.
MR. C.S. BELL: Yes,sir.
H.M.JR: All right?
Incidentally, I sat around in New York for a couple
of days, but no Henry. Henry didn't show up.
Why didn't you (Sullivan) say your wife was in
the St. Regis, and your mother-in-law? You can't keep
anything from me.
MR. SULLIVAN: She found Mrs. Morgenthau.
H.M.JR: Sure. If she had told her she wanted seats
for Oklahoma, we would have gotten them for her.
MR. SULLIVAN: She has seen it twice.
H.M.JR: Maybe it was your mother-in-law. It was
the one thing she wanted to see. It doesn't pay to be
secretive.
MR. SULLIVAN: I wasn't.
MR. D.W. BELL: We have had two or three letters
asking us about our fall campaign in connection with
the War Fund Drive.
H.M.JR: Willkie says he isn't going to run.
MR. D.W. BELL: I see that. I wonder if we could
indicate to them--
14
- 14 -
H.M.JR: What campaign are you talking about,
Mr. Bell?
MR. D.W. BELL: I am only interested in the War
Finance campaign. I told John Aldrich some time ago
that we might like to have November 15, on. He said,
"Well, if that is the date, and can be made a little
more definite, it would suit me fine."
I think maybe that we ought to tell them all that
November 15 we would like to have reserved. They have
to make their plans in advance.
H.M.JR: It is all right with me. You better check
with Gamble.
How is Winthrop coming along with his case? Is he
in or out of jail?
MR. BELL: You will have to ask Joe. I haven't
heard lately.
MR. O'CONNELL: The trial hasn't started yet. We
have still got a good case, but I don't know how it is
going to come out.
H.M.JR: I suppose he is waiting for the Tall cam-
paign.
MR. O'CONNELL: He probably always had a pretty
definite interest. It may be more acute, now.
MR. BELL: When General Carter was here lasttime,
you asked to send someone over and look at the Lend-Lease
setup in the War Department.
Bartelt and another one of his boys went over to
see General Carter about their records, and here is
quite a memorandum.
Would you like to read it?
15
- 15 -
H.M.JR: Should I?
MR. D. W. BELL: Well, if you are interested in that
kind of record, yes.
There are three points, you remember. One was the
record on the re-transfers of property to other countries
or dominions, which had originally been transferred to the
United Kingdom under Lend-Lease agreements. In other words,
what kind of record do we have showing what United Kingdom
has done with Lend-Lease goods to other countries or the
dominions? The records do not show those transfers. But
they do, of course, show all of the goods transferred to
United Kingdom.
H.M.JR: I would like to read it.
MR. D. W. BELL: Where they go from there, we don't know.
And then there are two other matters.
H.M.JR: This is Bartelt?
MR. D. W. BELL: Yes, Bartelt's memorandum.
MR. WHITE: That is why they were unable to tell us
about the Canadian transfers, apparently.
H.M.JR: Is this embarrassing to the War Department?
MR. D. W. BELL: Oh, no. (Hands the Secretary
memorandum of March 24, 1944 from Mr. Bartelt to Mr. D, W.
Bell.)
MR. D. W. BELL: General Carter was in my office last
week, and I asked him to read over that memorandum. He said
it was perfect, that it stated the case perfectly.
H.M.JR: Can I show it to Drew Pearson?
MR. D. W. BELL: No, I didn't think he wanted that
done, but he said it was a good memorandum.
16
- 16 -
H.M.JR: What else?
MR. D. W. BELL: That is all.
H.M.JR: Mr. White, I had a very good meeting yester-
day morning with Bernstein. He is a very able fellow, and
a good instructor.
MR. WHITE: Yes, I wish there were several more like
him.
H.M.JR: I hear you have fifty of them.
MR. WHITE: Fifty? I wish I had.
H.M.JR: You told us the other day when something
came up--you said, "Why, I have fifty.
MR. WHITE: Oh, stenographers, clerks, messengers,
and people abroad. It amounts to fifty. Actually we
only have very few left.
I have a number of items here. I can go over them
or leave this with you, whichever you prefer.
H.M.JR: I think you had better leave it with me.
Is there anything you want done today?
MR. WHITE: No.
You might be interested in knowing that the cable
which you wanted sent over was sent over. Dean Acheson
called up to say that they wanted one phrase changed,
where it was an invitation for Finance Ministers. They
wanted that changed to r epresentatives of the Government.
They wanted that very definitely. They were telling us,
not 8 sking us.
H.M.JR: Why?
MR. WHITE: Well, they feel that the choice as to who
is going to be sent over should be the responsibility of
particular governments.
17
- 17 -
I said that we wanted the cable to go that day and
that didn't settle that problem, so it was all right to
send it, but I said if there was any question as to
whether that did settle the problem, I wanted to take it
up with you first. It is something they have been uneasy
about for 8. long time. They have tried to change it every
time, but this is the first time that they have actually
succeeded.
We also received a letter from the Budget, copy of
which I have here, telling of the final action of their
recommendation to the President on the Interdepartmental
Economic Committee, and they have substituted the Executive
Order for 8. letter. The letter which they have substituted
is, from my point of view, worse than the original, so the
net result of our activity is we were thrown for a ten-
yard loss. Here is the letter. I will leave it here
if you like. (Hands the Secretary memorandum of April 5
from Mr. Paul Appleby to Mr. White.)
H.M.JR: It sets it up under the State Department?
MR. WHITE: Yes, but it is mainly a letter.
H.M.JR: Has it gone out?
MR. WHITE: They have sent the letter, recommending signa-
ture.
H.M.JR: Well, your pal, Appleby--
MR. WHITE: Delivered the Lorraine Cross!
H.M.JR: He is nobody's fool. I never would pick
him as Assistant Director of the Budget, but he is no fool.
MR. WHITE: No, but there are other things besides
being a fool.
H.M.JR: Oh, yes.
Anything else?
MR. WHITE: That is all. The others are all listed.
18
- 18 -
H.M.JR: Joe, here is a telegram from Wright Patman
which I wish you would take care of. It is a contact with
the Hill. Let him know that I imagine White will do it
for him. I would like to forget about it. (Hands Mr.
O'Connell message of April 5 from Congressman Patman.)
MR. O'CONNELL: It is monetary?
H.M.JR: It is a speech he is going to make.
MR. BELL: But it is on price stabilization.
MR. SMITH: Inflation and credit controls.
H.M.JR: Is that Haas?
MR. BELL: I think so. Let him work it out.
MR. WHITE: Credit and inflation--that is Haas.
MR. O'CONNELL: I thought it related to the speech
he made before, but this is something else.
MR. BELL: I have seen this.
MR. WHITE: He wants to show the Republicans that
they are the inflationary party.
MR. O'CONNELL: Yes, and he has a pretty good case.
MR. BELL: I really think it is Haas' baby to
coordinate with Harry and Blough.
MR. O'CONNELL: I thought at first it had to do with
the International Stabilization.
MR. BELL: I think not.
MR. WHITE: They only raised it at the time we discussed
it with them, but it was really domestic.
H.M.JR: What else, Joe?
19
- 19 -
MR. O'CONNELL: On the legislative front things have
been fairly quiet, but they have been having hearings
before Murray's Sub-Committee of the Military Affairs
Committee the last few days on contract termination
legislation, and including to some extent the disposition
of surplus property. Senator George testified before the
Committee 8 couple of days ago and suggested that they
eliminate from the bill practically all reference to the
disposition of surplus property, in hopes that by eliminating
that part they could get legislation quickly covering
contract termination, purely questioning as to whether the
Murray Committee would go along with George's Committee.
There was a great deal of undercover competition
between George's group and the Murray group. Murray's
Committee has spent a great deal of time thinking about
surplus property, as well as other things. They may not
go along with George's idea. I think his idea is good,
because if we could get quickly legislation covering con-
tract termination, it would be all to the good, but there
is no way of knowing.
It is also mixed up with the question of the Comptroller
General in the position he will have in connection with
contract termination, and the Lord only knows how that will
come out. There was an indication the other day that Murray
was beginning to be more impressed with the desirability
of having the Comptroller General in the picture, and the
chances are that there won't be any legislation very quickly.
I am afraid it is going to get bogged down. There are so
many different points of view and so many committees that
have a stake in it that George has hoped that he could get
a bill agreed upon with the agency introduced and passed
quickly. While it was a good idea, I am a fraid the chances
of it are getting less and less every day. That is really
all I have.
H.M.JR: Does anybody know how Blough has made out on
the Hill? What is happening to the bill?
MR. SULLIVAN: I think they are getting along pretty
well. There is a bad story in the Post this morning that
is carried over from the Herald Tribune, which says that
20
- 20 -
the Treasury Staff and the experts on the Joint Taxation
Committee Staff aren't able to get anywhere because the
Committee failed to decide certain policy issues, and
Doughton left in a huff. Surrey called me this morning
to say that there wasn't a word of truth in that, that
that is descriptive of the situation as it existed about
ten days ago, that the Committee did decide those issues,
and that they are going ahead. They hope that by the time
the Committee gets back they will have the bill completed.
I suggested to Fred outside, just before this meeting,
that if you are having a press conference you might want
to refer to it or issue a statement.
H.M. JR: Well, I think Fred will give it to Charley,
and Charley can go down to the press room and tell the boys.
MR. WHITE: Speaking of Surrey, I presume you know
that he hopes to or is planning to go in the Navy.
H.M.JR: Yes, that is his wish.
MR. WHITE: Yes. The reason I mention it is because
Joe spoke to me about writing a letter to Captain Pence.
MR. O'CONNELL: Stan has been trying to get into the
Navy for something over a year.
H.M.JR: He is thirty-three or four.
MR. O'CONNELL: He is thirty-three, I think. He is
presently deferred. We got a deferment for him which will
be up in May. He doesn't wish to ask for another.
H.M.JR: I am familiar with that; I know about that.
MR. O'CONNELL: It is an outrage in 8. way that he
hasn't been able to get a commission.
H.M. JR: He takes his dog for a walk in the wrong
place.
21
- 21 -
MR. O'CONNELL: He parked his car in front of--
MR. WHITE: Or he has the wrong kind of a dog. Which
is it?
H.M.JR: It is where he walks his dog that got him
in trouble.
MR. O'CONNELL: Yes. I think he used to park his
car outside of Mike Straus' in Rock Creek. He walked his
dog in the park, and that constituted subversive activi-
ties as far as Mike Straus was concerned.
H.M.JR: Why park in front of his place?
MR. O'CONNELL: He has a place that is out in Rock
Creek Park.
H.M.JR: Where? Mike Straus?
MR. O'CONNELL: I think he is subversive, too, accord-
ing to the Bureau of Personnel in the Navy.
H.M.JR: I think it is somebody else.
MR. D. W. BELL: I understood it was in front of a
house that had meetings that were subversive, definitely
subversive. They took the numbers of all the cars in
front of this house, assuming everybody who parked there
was--
H.M.JR: That is what I understood. Dan has it
right.
MR. O'CONNELL: I understand they have finally cleared
him of the charges.
MR. WHITE: Cleared his car, you mean.
H.M.JR: No, the dog!
I saw yesterday or the day before in P.M. reference
to some personnel--two cases in Crowley's office. Would
you (Smith) look that up?
22
- 22 -
MR. WHITE: It was yesterday and the day before.
H.M.JR: Would you (Smith) look those up?
That is all, Joe?
MR. O'CONNELL: That is all, sir.
H.M.JR: Are you looking for some new people, Joe?
MR. O'CONNELL: Yes, we are not having much success.
They are pretty hard to tempt away. I was rather hoping
that we could get two new men. We have been hoping to
get one man from the War Production Board, but it is pretty
difficult to get them away. He would be good on contract
termination and surplus property.
We are apt to lose some of our best men remaining,
mostly in Foreign Funds, like Joe DuBois and--
H.M.JR: To show you how they do, here are these men
under this unit plan of agriculture. You have to have
sixteen units, which entitles you to a man for important
work. This was supposed to have been worked out by the
Farm Bureau. We were entitled to sixteen men; we had four.
This was all worked out. You had to produce so many units--
I mean, so many COWS or acres of corn. Now, suddenly an
order comes through and all of this is disregarded and
all dumped on the local Board, as near as I can make it
out, irrespective of anything. The local Board is
supposed to work this thing out. And everybody--our men
went up to the Farm Bureau, and they figured it out for
them, and these men--two or three men who run tractors and
that sort of thing were exempted. They are really doing
important work on the farm.
Now it is all dumped back on the local Board all over
again. I mean, the discontent in the country, the dis-
satisfaction on the draft thing is just unbelievable.
OPA is nothing compared to the discontent and criticism of
"Why doesn't Washington know what it wants?" and the
cussing and the swearing. You don't hear the people who
have soldiers in this thing complaining.
23
- 23 -
MR. SULLIVAN: The other people aren't complaining
about going, but knowing whether they have to go or not.
H.M.JR: That is the point. I have never seen so
much discontent. That is all they talk about up there.
And when they ask me, there is just no--Washington threw
it back on the local Board. That is what they say. As
near as I can make out, it is true. They hear these
statements all the time, Hershey saying one thing, and
McNutt saying another. I mean, the damage that those
fellows are doing to the Administration, to Mr. Roosevelt,
is something terrible.
MR. O'CONNELL: My brother is chairman of the local
Board up home, and he has been down here for the last few
days and is complaining very bitterly about this thing you
are talking about.
H.M.JR: And it all ends up by blaming the President,
"Why doesn't he know what he wants?"
MR. O'CONNELL: But fortunately, my brother is a good
Democrat.
H.M.JR: No, but you can't answer the thing. Somebody
has made a major blunder, and instead--I think whoever it
is ought to be fired. I don't know who has made the major
blunder, but they haven't the people; the Army hasn't gotten
the people. The worst thing is, when you talk to General
Hershey, he gets the people he doesn't want. He doesn't
want the people over thirty. Those are the people he is
getting.
MR. GASTON: Those are the people we are fighting
with Puryear about now.
H.M.JR: And he doesn't want them. I got it direct
from General Marshall and direct from General Hershey.
They don't want those people, and those are the people
they are taking.
Not knowing all about it, I think that it is McNutt
for some reason or other, and I just don't see it. Believe
24
- 24 -
me, three months from now they won't think of McNutt.
They don't know McNutt in New York State. I don't know
about New Hampshire.
MR. SULLIVAN: No, this is on the President's doorstep.
Yes, they are sore as can be. It is the confusion and the
uncertainty that is bothering them.
H.M.JR: Frederick?
MR. SMITH: Lucy Greenbaum is doing a big story for
the Times on the third anniversary of war bonds. Do you
want to talk to her?
H.M.JR: Yes.
MR. SMITH: She will be here today.
H.M.JR: Yes, she is a swell girl. She is Ed Disney's--
MRS. KLOTZ: She is a swell kid.
H.M.JR: What else?
MR. SMITH: That is all.
MR. SULLIVAN: Olrich is coming back; he is going
to be here Tuesday and Wednesday. We had quite a talk.
H.M.JR: Let me say-Olrich is President of Munsingwear
of Indiana.
MR. GASTON: No, Munsingwear, Minneapolis.
H.M.JR: They told me Indiana, that fellow.
MR. SULLIVAN: I made the mistake in your presence,
if you remember.
H.M.JR: O.K. I also asked you, "Do I have to wear
long underwear?" and you said they had streamlined it.
MR. SMITH: With drop seats.
25
- 25 -
H.M.JR: We will go no further. You give this
fellow Smith a knee and he takes the rest of the suit.
MR. SMITH: Drop-seat underwear has a great history.
That is just a personal perusal. I just wondered about
it one day and I traced it back.
H.M.JR: There are ladies here.
MR. SULLIVAN: There are two catches to it. (Laughter)
I am trying to button this up if you will give me a chance.
H.M.JR: There are only two alternatives.
MR. SULLIVAN: He will have to stay as President of
the company and receive a salary from them. He is willing
to come here at a dollar a year or on any other basis.
H.M.JR: Now, where were we?
I will have Lucy Greenbaum at three-thirty.
MR. SMITH: All right.
MR. SULLIVAN: The other catch is, he said that OPA
was contemplating a substantial suit against his company.
I thought we had better look into it. I then got hold of
Cliff Mack and asked him to inquire of OPA about the
reputation of that company with the implication that he was
considering placing the Procurement. OPA came back with
a clean bill of health. I think I should get hold of their
General Counsel and get the real story.
H.M.JR: What is the man's name?
MR. SULLIVAN: Ernest L. Olrich, of Minneapolis.
He is one of Stassen's Inner Council!
H.M.JR: Is he active?
MR. SULLIVAN: Yes.
26
- 26 -
H.M.JR: That is not SO good, is it?
MR. SULLIVAN: No.
MR. D. W. BELL: He is a great admirer of the man.
MR. SULLIVAN: That is right. Dan, Cliff Mack and
Al Frey and I had lunch with them, and he talked half
the lunch-time about Stassen.
H.M.JR: Do we want a man like that?
MR. D. W. BELL: I would question it. He is a very
likely fellow; he looks good.
MR. SULLIVAN: He has to be here Tuesday and Wednesday
for OPA and WPB.
MR. D. W. BELL: I don't think he makes any bones
about being an admirer of Stassen's.
H.M.JR: He can & dmire him, but is he going to work
for him actively?
MR. D. W. BELL: I don't know. He worked actively for
Stassen in the Governorship and worked afterwards for him
on committees.
MR. SULLIVAN: He is the kind of fellow you can have
an understanding with, and he will keep it absolutely.
H.M.JR: I think you had better begin to look for
somebody else.
MR. SULLIVAN: I still think you should see him Tuesday
and Wednesday.
H.M.JR: That is all right.
MR. SULLIVAN: Clayton had me over for lunch. He
hasn't heard anything since that meeting when he and
Hancock were here, and he naturally wants an answer as
to your plans, whether you intend to continue surplus
property.
27
- 27 -
H.M.JR: Well, that is not 80 easy.
MR. SULLIVAN: I think that he is entitled to know
pretty soon, that is all.
You talked with Cliff Mack about some shearlings.
On the 17th of January we got a million square feet.
Those were disposed of to UNRRA on the 25th of January,
along with two million additional square feet we had not
yet received.
H.M.JR: New York records don't show that. They show
they still have them in the warehouses.
MR. SULLIVAN: They are up at Elmira, where they are
stored for UNRRA.
H.M.JR: That isn't what Young up there tells me.
MR. SULLIVAN: Well, that is what Cliff told me.
H.M.JR: How long will Lucy take, fifteen minutes?
MR. SMITH: No longer.
H.M.JR: You bring Cliff Mack over here at three
forty-five.
MR. SULLIVAN: I have to be at the Board meeting at
three-thirty. I will have him come over alone.
Now, on the motorcycles, there were two thousand one
hundred and forty-six declared to us on the 21st of
December, which was a small part of a larger group, it
was understood. On the 12th of January, we got the balance,
which brought the total to forty-six hundred. On the 17th
of January, at my suggestion, they got hold of manufacturers,
and the negotiations there resulted in the top price of
one hundred and forty dollars. Then we started doing business
with OPA to have retail and wholesale ceilings set, and it
took them from the 7th of March to the 22nd of March to
clear things with OPA and with the Office of Civilian
Requirements.
(The Secretary held a telephone conversation with
Mr. Robert Hannegan.)
28
April 6, 1944
11:50 a.m.
HMJr:
Look, Bob, I'm going to say something that you most
likely know all about but I want to bring it to you
as forcibly as I know how.
Robert
Hannegan:
Yes.
HMJr:
I've just been up in the country and any damage that
O.P.A. in the past did to the President just doesn't
begin to compare with the damage that all this mix-up
on the draft 1s doing.
H:
Yes,
HMJr:
And they blame it all on Roosevelt.
H:
Yes.
HMJr:
Now, somebody has made a terrible mess down here in
Washington. I don't know who it is but I -- I think
whoever is responsible for the mess that we're in
now -- the Army is not getting the people -- they're
getting people over thirty years old. General
Marshall told me he didn't want people over thirty
years old. The local boards -- it's all been thrown
back on them and I -- I don't know who it is, but I
think that whoever it is ought to be fired.
H:
Yes.
HMJr:
And there's nothing that's happened that has caused
so much animosity against the President and against
all of us as this present mess.
H:
Uh huh.
HMJr:
And you can quote me as saying so and I don't know
who's responsible but whoever he 1s ought to be
canned.
H:
Uh huh. Well, I don't know enough about it, except
I do know you are correct about an awful lot of
complaints.
HMJr:
Well, what part of the country are you?
H:
I'm in Hot Springs, Virginia.
29
- 2 -
HMJr:
Oh. Are you resting?
H:
Yeah. Just until Sunday.
HMJr:
Well, when you get back, go anywhere -- ask -- -- call
up anybody in the United States and just ask them
that question.
H:
Uh huh.
HMJr:
See?
H:
All right.
HMJr:
You don't -- don't take my -- call up anybody or
anybody that calls you, you ask them, "How do they
feel in your community about what they're doing
about drafting men?"
H:
All right.
HMJr:
Now they don't mind their sons going to war, but
they do mind the bad administration. See?
H:
I -- that's either Hershey or McNutt, 1sn't it?
HMJr:
It's one or the other.
H:
Maybe it's both of them.
HMJr:
I don't know. When I talk to Hershey, he -- he has
always impressed me that he knows what he's about.
H:
Uh huh.
HMJr:
Of course, Hershey is under the present set-up
that Congress made, responsible to the President,
and McNutt is trying to run it. Now, that's the
situation.
H:
Yeah.
HMJr:
Hershey's responsibility flows directly to the
President. I know that is a fact.
H:
Uh huh. Well, I'll -- I'll come over and see
you as soon as I come back.
HMJr:
Will you do that?
- 3 -
H:
Yes, sir.
HMJr:
Because this situation is doing us an awful lot of
harm.
H:
Yes, sir. Okay, I'll call you as soon as I come
back -- I'll come over.
HMJr:
Do that.
H:
Okay. Thanks a lot.
HMJr:
Good bye.
H:
Thank you, sir.
30
- 28 -
H.M.JR: He is down there at Hot Springs, resting.
He didn't seem particularly to know about it. But if
anybody calls him, all he has to say is, "How do you feel
about the thing?" It is time. Good God, why does every-
body have to be protected when they make mistakes? They
move a man from here and another job and then set up another
Bureau, and all the rest of it.
MR. WHITE: I think you are right. The only question
is, who is responsible?
H.M.JR: I don't know. Somebody ought to find out.
It doesn't make any difference to me. I would just like
to see somebody fired once because he fell down on his
job in this Administration.
MR. SULLIVAN: This will be a good one to pick.
The other time it was bad was when there was so much un-
certainty about the youngsters. You remember, Congress
was this and that way, and everybody was issuing state-
ments. That was over a year ago.
MR. WHITE: The sad part of all this is that there
was precedent in the way England handled their draft.
They had an excellent system worked out. Three years ago
there was very little complaint about it. It is the same
problem, except it is a little larger.
H.M.JR: I came back and said, "Look, Mr. President,
I don't know how you could spend two days to better advantage
at Hyde Park than if you had invited the head of the
labor--what's his name?
MR. WHITE: I have forgotten his name.
H.M.JR: The Labor man, Bevins.
MR. WHITE: It was the man under him.
H.M.JR: Do you remember? You spent a couple of hours--
MR. WHITE: with him, yes, and the man who was
under him whe headed the draft--
31
- 29 -
H.M.JR: I asked him if he would have Mr. Bevins come
to Hyde Park secretly if he wanted to spend two days with
him and get the story. You remember the setup that we had
on this whole thing that we sent a couple of yearsago to
the White House? Canada has a good setup.
MR. SULLIVAN: Well, anyway, we expect that we will
get for these forty-six hundred motorcycles, for which
we were offered one hundred and forty dollars--
H.M.JR: Three hundred dollars?
MR. SULLIVAN: No, we will be getting--the invitation
to bid is already out. We expect we will make the sale
somewhere around two hundred and seventy-five to three
hundred dollars. Three hundred is the top.
H.M.JR: But some of them are going for four hundred?
MR. SULLIVAN: No, that is the retail. Here is a
memorandum I had better give you on that, in case you want
to discuss it with Cliff. I will have him here at three
forty-five.
That is all, sir.
H.M.JR: Herbert?
MR. GASTON: I have my memorandum on the White House
guard situation.
H.M.JR: No, I will get my memoranda at two; I mean,
none of them have come to me.
MR. GASTON: Yes. Well, I wrote you a memo.
MRS. KLOTZ: I haven't seen it, either. Did it come
in today?
MR. GASTON: I thought I sent it in. I signed it
yesterday afternoon.
MRS. KLOTZ: It might have come in this morning.
32
- 30 -
H.M.JR: I try to do things once a day at two o'clock.
You might ask when you go back. There is still time to
get it to me at two.
MR. GASTON: I think it is in, but I will check on it.
H.M.JR: Anything else?
MR. GASTON: You might be interested to know that a
twenty-dollar gold piece of the 1933 issue was offered
for sale up in New York. There weren't any of that issue
issued. There shouldn't be any in circulation, but quite
a large number were coined. Secret Service has been
spending some time trying to run it down. There probably
was some crookedness at the Philadelphia Mint. They first
got the story that it was an official of the Federal Reserve
Bank of Philadelphia who got them as a favor and sold them,
but that seems not to have been true.
H.M.JR: What did they bring, a couple of thousand
dollars?
MR. GASTON: Well, they are worth a good premium, of
course, if they can sell them, but I think--
MR. WHITE: Gold dollars?
MR. GASTON: They are twenty dollar gold pieces, the
issue of 1933, and none were issued legally.
MR.D.W. BELL:They were minted.
MR. GASTON: There appear to be three or four that
got into circulation.
H.M.JR: There are two big sets of gold coins at
the Federal Reserve. I have been kidding around with them
for a long time. I want one.
MR. D. W. BELL: I have that file on my desk.
H.M.JR: I want one, and I want the letter to go out
in the next twenty-four hours. I am making a demand on
them for one; the one I want is for the Library of Congress.
33
- 31 -
MR. D. W. BELL: Do you want to pay for that, Mr.
Secretary, out of your own pocket?
H.M.JR: I want it from the Treasury as a matter of
historical record.. We have no complete set of gold coins
here.
MR. D. W. BELL: What you asked us for was to get 8.
set for the Library of Congress.
H.M.JR: Whatever it was--
MR. D. W. BELL: Or the Smithsonian--now you are
taking it out of the Treasury and it will probably take
legislation to take it out of the Treasury.
H.M.JR: Let's get it out of the Federal Reserve
and get it in to the Treasury first.
MR. D. W. BELL: They have two complete sets; they
wanted to keep one for themselves as an exhibit, and they
were perfectly willing to turn the other over.
H.M.JR: That is what I want.
MR. SULLIVAN: Would the Treasury lend it to the
Library of Congress?
MR. D. W. BELL: The Treasury is responsible for
that under bond, and it is a question of whether you would
put money out in displays in the Library of Congress. At
the time we thought we would want legislation, and the
question was raised as to whether you wanted to pay for it
yourself out of your own pocket.
H.M.JR: I can tell you that I would much rather give
some money either to the Army, Návy, or Coast Guard service.
It is more useful--funds for looking after the families
and children--no, I don't. I want to get it. They are not
entitled to it. Let's get it. In the first instance, we
can stick it in my outer office as an exhibit and then
decide.
34
- 32 -
MR. D. W. BELL: They have been waiting on us. I
have had the file on my desk.
H.M. JR: Let's put in my outer office. Right? It
is almost impossible to get a complete set now.
MR. WHITE: Does the Library of Congress have any
coin collections on display? I didn't think so.
H.M.JR: We can put it right in my outer office. It
would be very interesting.
MR. SULLIVAN: What is the value of that collection,
Dan?
MR. D.W. BELL: I don't know. I think it is about
five hundred dollars.
MR. SULLIVAN: That would be the limit of the
Treasury's liability, wouldn't it?
MR.DW. BELL: Yes.
MR. SULLIVAN: It wouldn't have the value as a collector's
item.
MR. D. W. BELL: No.
MR. WHITE: They used to have a display I don't know
what was done with it-- of all currency in large frames.
Maybe it is still there.
MR. GASTON: It was stolen about eight years ago.
There were some genuine coins. You mean down in the
lobby of the Treasurer's office? They were stolen out
of the exhibit one day, all the genuine gold.
MR. WHITE: Is that when you decreased the guards?
MR. GASTON: That was before my connection with the
guards, in 1934.
35
- 33 -
MR. D.W. BELL: We had some gold brick down there in
a case. We had all these workmen in the Treasury. One
night they broke open the case and stole the things.
MR. GASTON: They stole the gold coins that were
there. Of course, they stole the phoney bricks, too.
H.M.JR: O.K. I want to talk to Smith a minute.
36
THE SECRETARY OF THE TREASURY
WASHINGTON
April 6, 1944
TREASURY DEPARTMENT ORDER NO. 51.
Effective from and after this date, the
Director of Tax Research and the Tax Legislative
Counsel will report to the Secretary through the
Under Secretary.
#M puthanh
Secretary of the Treasury.
FORDEFENSE
BUY
UNITED
STATES
SAVINGS
BONDS
I
37.
April 6, 1944
12:38 p.m.
HMJr:
Morgenthau speaking.
Robert
McConnell:
Good morning, Mr. Secretary.
HMJr:
How are you?
M:
Well, I've got a little touch of sciatica.
HMJr:
Oh - Oh.
M:
(Laughs)
HMJr:
How are the Black Angus?
M:
Well, they're all right. They're not too fat
though.
HMJr:
They're not?
M:
No.
HMJr:
I hear you're not coming in until Tuesday.
M:
Well, I can any time. I'm just sitting on a --
on a hot water bottle really.
HMJr:
Oh.
M:
It isn't -- it isn't as bad that I can't come
in.
HMJr:
Well, there are several things here. I mean,
one thing Sullivan put up to me, I don't know
how to answer until I've talked to you.
M:
Well, see you a minute this afternoon if you
like, sir.
HMJr:
Well, I'm booked -- I could see you tomorrow --
it'd be
M:
Well, that's all right.
HMJr:
The point is that he said that Will Clayton wants
an answer, "Are we going to keep Procurement or
not?"
M:
Yes.
38
- 2 -
HMJr:
And I'd like very much to talk to you about it.
M:
Well, if -- what time in the morning should I
see you?
HMJr:
Would eleven o'clock let you stay....
M:
Oh, fine.
HMJr:
Would that be
M:
Any time you like.
HMJr:
But I mean, so that you could come in, say
M:
Oh, yes.
HMJr:
Would that be all right?
M:
Well, I'm not laid up. I'm just....
HMJr:
No, but you could stay home, couldn't you? And
then just come in and get in here at eleven.
M:
Oh, sure.
HMJr:
How's that?
M:
Any time you like, Mr. Secretary.
HMJr:
Well, let's say eleven tomorrow.
M:
Eleven tomorrow.
HMJr:
Right.
M:
Righto, sir.
HMJr:
Thank you.
39
April 6, 1944
2:40 p.m.
HMJr:
Dan.
Dan
Bell:
Yes.
HMJr:
White sent me in a memorandum about I should
write the President about this business of Hull
and the Budget setting up an Executive Committee
or something on Foreign or Economic Policy.
B:
Uh huh.
HMJr:
Now, I told White before I want to do it, I
want you to take a good look at it because
before I go to the President and say that Harold
Smith didn't show it to me and all the rest of it,
and get Harold down on it, I want to be sure it's
worthwhile. See?
B:
Uh huh.
HMJr:
So it will come -- I just sent it back to White
and told him to take it up with you.
B:
All right.
HMJr:
Now
B:
Are you on the Committee?
HMJr:
I don't know.
B:
Uh huh.
HMJr:
I don't know, but before I write the President
a memorandum like that, I don't know, I want to
be -- in other words, before I take 'on this fight --
is it worthwhile?
B:
Yeah. I think that's right.
HMJr:
See?
B:
Uh huh. I'd be inclined not to unless it's worth
an awful lot.
HMJr:
Well, you talk with Harry about it before it comes
to me.
40
- 2 -
B:
All right.
HMJr:
This idea that the President is going to act on
it today is -- he's not going to act on it right
away.
B:
Yeah. Well, hasn't he gone?
HMJr:
No.
B:
I saw cars over there yesterday. I thought he
was....
HMJr:
No.
B:
pulling out.
HMJr:
No, he's still there and it's indefinite when he's
going to -- I'm willing to take on fights if they're
worthwhile. Is this one worthwhile?
B:
Yeah, well, I'd be inclined to think it isn't but
I don't know enough about it. But tomorrow will be
my last day I guess and -- for awhile -- I think
before I go you ought to take a look at this Bank
of America thing.
HMJr:
All right. I thought you said you weren't going
until Monday.
B:
Well, I thought I'd be off Saturday.
HMJr:
That's just as good.
B:
Only one day.
HMJr:
I'm going to
B:
Yeah, I was going to not be here after tomorrow.
I could if you wanted me.
HMJr:
No, no, no, no.
B:
Because I'm going to be home.
HMJr:
No, no.
B:
And I think a good deal depends, too, on what
happens to Thompson. If anything should happen
to him, why then I don't think I'd go Monday.
41
- 3 -
HMJr:
Well, let's....
B:
But I thought you ought to take a look at this
Bank of America thing with Delano and me probably.
tomorrow.
HMJr:
All right, I can do it at ten o'clock.
B:
Ten o'clock?
HMJr:
Yeah.
B:
Swell. All right.
42
42
April 6, 1944
2:44 p.m.
HMJr:
Hello.
Operator:
Colonel McCarthy.
HMJr:
Okay.
Operator:
Go ahead.
HMJr:
Hello.
Colonel
McCarthy:
Hello, Mr. Secretary.
HMJr:
Good morning. Good afternoon.
M:
How are you, sir?
HMJr:
I understand that you called up about General
Strong.
M:
Yes, sir.
HMJr:
And wanted to know what I wanted -- that General
Marshall wanted to know.
M:
No, General Marshall didn't. He mentioned to
General White, who is our G-1 here, that you had
mentioned to him the possibility that you might
like to have him over with you.
HMJr:
Yes.
M:
General White asked me if I knew what for and I
told him I didn't and I hadn't had a chance to
get to General Marshall with it.
HMJr:
Yes.
M:
And I wondered whether we could get, if possible,
a sort of job sheet 80 I could turn it over to G-1
and then they could go back and say
HMJr:
No.
M:
to General Marshall, "We think you ought to
have him," or whatever they
HMJr:
No. Well, look, it was -- I'll tell you exactly
what I had in mind but I haven't even got yet to
the President on it. You see?
Regraded Unclassified
43
- 2 - -
M:
I see.
HMJr:
As you know what -- about the President these
days -- I mean, I don't want to -- unlese it's an
emergency, I don't want to bother him, and this
1s no emergency.
M:
Certainly.
HMJr:
But I had in mind -- if you've got a pencil, it's
very simple.
M:
I have it, sir.
HMJr:
Of setting -- suggesting to the President to set
up a Committee composed of Hull, Leo Crowley of the
F.E.A.
M:
Yes, sir.
HMJr:
....
and myself
....
M:
Yes, sir.
HMJr:
....
with General Strong as Director, to see what
we could do in connection with neutral countries
to stop them from shipping strategic supplies to
the enemy.
M:
Right, sir.
HMJr:
Now, that, very briefly, was the idea.
M:
I see.
HMJr:
Because the thing is being done in a very half-
hearted manner.
M:
Yes, sir.
HMJr:
But the President would have to make up his mind
that this is going to be done in a very forceful
manner.
M:
I see.
HMJr:
Now, I haven't got to him. I don't know when I
will get to him.
M:
Yes, sir.
44
- 3 -
HMJr:
And if you people have something in mind for
General Strong, it may be a month before I can
get to the President on this.
M:
We don't immediately but apparently General White
didn't understand from General Marshall that it
was a thing for the future. He thought that --
General White had the idea that there was something
more urgent about it.
HMJr:
No.
M:
I'll tell you, Mr. Secretary, I looked up General
Strong, and I find -- he's on his terminal leave,
you know, and I find that his leave -- that's all
of his accrued leave -- his leave is good until
some time in June.
HMJr:
Yes.
M:
So you have lots of time on it.
HMJr:
Well, now that's the point. I was pattern -- making
a -- following the pattern of the President's Com-
mittee on War Refugees
M:
I see.
HMJr:
which is Hull and Stimson and myself.
M:
Yes.
HMJr:
with Mr. Pehle as Director.
M:
Yes.
HMJr:
And I was going to put this up to the President.
Now, I don't want it -- it's all right for General
Marshall to know. It's all right for General White
to know, but I don't want it to get out because I
haven't had a chance to talk to the President.
M:
It won't go beyond us, sir, and we'll forget it
until I hear from you again.
HMJr:
You see? Because it's one of these things I want
the President feeling well because he's got to say,
"Well, all right, I don't want any more ball bearings
to go from Sweden. II
M:
Right, sir.
45
- 4 -
HMJr:
"I don't want any more of this or that to -- any
diamonds to go from the Argentine ....
M:
Certainly.
HMJr:
If into -- I don't want ten thousand -- ten
million tons it is -- of steel to go from Sweden
to Germany.' See?
M:
I understand, sir.
HMJr:
And if he wants a Committee that will -- I had
visioned -- forceful to -- I'd call it a Committee
to Shorten the War.
M:
Yes, sir.
HMJr:
Now, it's a wonderful opportunity for somebody
in a group to do this thing.
M:
Certainly.
HMJr:
It's just crying to be done.
M:
Right, sir.
HMJr:
That we get tough and stop all this damn nonsense
with these neutrals.
M:
I understand, sir.
HMJr:
And that's what I had in mind. I think a group
like that hitting hard might shorten the war
several months. Well, if you could shorten it
one day, that's worthwhile.
M:
Yes, sir. Certainly.
HMJr:
And the material that's going from the neutrals
to Germany is just outrageous.
M:
Well, we're worried about that, too, as you know.
HMJr:
Well, I was willing, quite frankly, somebody's got
to father the thing.
M:
Yes, sir.
HMJr:
And I was willing to be the tough guy if the
President would give me his backing.
46
- 5 -
M:
Yes, sir.
HMJr:
And the stuff that's, as I say, if it's -- nobody
in the town 1s being tough enough.
M:
I see.
HMJr:
And that's what I had in mind.
M:
Fine, Mr. Secretary. I will tell General Marshall
that and General White -- now, General Marshall
probably already knows it.
HMJr:
Well, don't you -- I mean, before I'd have gone
any further, as you know, I never move without
telling General Marshall what I do as far as the
Army is concerned.
M:
I understand, sir.
HMJr:
And, but this hadn't got far enough.
M:
Well, Mr. Secretary, I will put that in my pipe
but not smoke it until I hear from you again.
HMJr:
Now, let me tell you something else if I may.
M:
Yes, sir.
HMJr:
And this also will be for General Marshall.
M:
Certainly.
HMJr:
I don't know what's going on over with General
Eisenhower -- in connection with the various
financial arrangements he's making with all these
Governments in exile, and 80 forth. You see?
M:
Yes, sir.
HMJr:
I know a little.
M:
Yes, sir.
HMJr:
When I was over there -- October, a year ago --
before the African invasion
M:
Yes, sir.
HMJr:
Walter Smith said they were in an awful fix. It
was annoying and everybody was fussing with them
and so forth and so on.
47
6 I I
M:
Yes.
HMJr:
I came along and I was able to straighten the thing
out for them in forty-eight hours and take it off
their shoulders.
M:
Yes, sir.
HMJr:
I've just got a hunch and I may be all wrong and
I'm not looking for any trips now either, but I --
my first interest is the war
....
M:
Yes, sir.
HMJr:
and I know that General Hilldring is supposed
to be doing this, and McCloy also, so you've got
to sort of suddenly have an idea, "Is everything
all right?"
M:
Yes, sir.
HMJr:
You know?
M:
I know.
HMJr:
And make an inquiry of either General Eisenhower
or Beetle Smith.
M:
I see.
HMJr:
But I've just got a hunch that it's a mess.
M:
Yes, sir.
HMJr:
And if it's something that's annoying General
Eisenhower and taking a lot of his time and you
people think that I could be helpful, I want you
to let me know. Now, can you handle it in that
way?
M:
I can, indeed, Mr. Secretary. I'll go into it and
I'll talk to General Marshall about it this afternoon.
HMJr:
But if it goes back to McCloy and all on that front,
they'll say, "Well, it's all under control." Now,
I'm just putting a flea in your ear that you
suddenly are going to be worried about this.
M:
Right, sir.
48
- 7 -
HMJr:
See?
M:
Right, sir, and I'll transfer the flea this
afternoon.
HMJr:
Okay.
M:
Thank you, sir.
HMJr:
All right.
M:
Good bye.
49
April 6, 1944
3:00 p.m.
INTERNAL REVENUE
Present: Mr. Gaston
Mr. Sullivan
Mr. O'Connell
Mr. Nunan
H.M.JR: All right, gentlemen.
MR. NUNAN: Mr. Secretary, there are four things
that I wanted to speak about.
The first was that last week there came to my desk
a memorandum in which it was stated that I was sending
to you a proposed Executive Order which would allow
the Dies Congressional Committee to examine any income
tax return that they saw fit to examine. I have since
found out that that has been done before and it is a
continuation of it. But Mr. Surrey happened to be over
at the office at the time, and I spoke to him and to
Commissioner Graves, and they both thought I should
bring it to your attention, and I am sending it over
again.
Personally, I question whether it is a good thing
to do, but in view of the fact it has been done before,
there is nothing we can do about it.
H.M.JR: I think there is a very simple answer.
Let me call up Speaker Rayburn and ask his advice.
MR. SULLIVAN: When he gets back, yes. He is in
Texas, I think.
MR. GASTON: What is the rule?
Regraded Unclassified
50
- 2 -
MR. O'CONNELL: The practice has always been, with
one glaring exception, to give to a Congressional Com-
mittee access to tax returns if they ask for it.
MR. GASTON: When the Committee, itself, asks. Now,
there is some doubt, and the Attorney General has expressed
some slight doubt about whether it is proper to do that,
but he ended up his letter with the statement that since
it had been done 80 long, he was not going to advise the
President that he should not sign Executive Orders grant-
ing legislative authorities to look at tax returns.
The reason there is doubt is that the legislation
on the books sets forth pretty specifically two or three
alternative ways in which 8. Congressional Committee can
get it; by a joint resolution authorizing the Committee
to inspect tax returns, by a simple resolution of either
House--
H.M.JR: I have another way. Supposing I call up
Justice Byrnes and ask him?
MR. NUNAN: As Joe says, exhaustive search has been
made on it. There have been times when even the President
has refused to give & Congressional Committee--
MR. SULLIVAN: Once. That was the Cox case.
MR. NUNAN: Goes back to President Tyler, who re-
fused to do it. I am going back over the years. There
is a great deal of precedent for it. But it still
occurred to me that some day you might possibly be
criticized by somebody for allowing the Dies Committee
to come in with carte blanche and go over their returns.
MR. GASTON: My own feeling is that no Committee
ought to have them. Of course, the President has esta-
blished a precedent, but my own feeling is that privi-
lege ought not to be granted except on a resolution of
one House or the other.
Regraded Unclassified
51
- 3 -
MR. NUNAN: I think you are right, Mr. Gaston.
That is the way they should do it.
H.M.JR: They have got a Joint Committee on Taxa-
tion. They are entitled to it.
MR. SULLIVAN: That is & statute.
MR. 10'CONNELL: That statute specifically author-
izes the Joint Committee.
H.M.JR: Why not put it up to Jimmy Byrnes? I don't
want to dump it on the President's lap until he has &
chance to look at it.
MR. O'CONNELL: I think you should bear in mind
that the President has probably signed a dozen Executive
Orders in the past few years giving to this Committee
the privilege before. They were continued recently;
they were given a new birth, so to speak.
MR. NUNAN: I found out afterwards, you see--
(The Secretary places a call to Justice Byrnes)
MR. GASTON: I think sometime we ought to seize*
an occasion to talk to the Ways and Means and Finance Com-
mittees, and ask them what their feeling is about this
frequent access to returns by any old committee.
MR. NUNAN: I think the Secretary's suggestion about
Mr. Rayburn is good. I would take it up and say, "In
the future, to relieve us of any embarrassment, where
you want a Committee to have this privilege, will you
please include it in the resolution forming or organiz-
ing the Committee?" that they be allowed to do it, and
then you couldn't be criticized for it.
MR. O'CONNELL: That is the straightforward way.
It has been done in some cases.
Unclassified
52
- 4 -
H.M.JR: Doesn't this Committee have to come up
for an appropriation shortly?
MR. NUNAN: I think they have been continued and
this is the order that allows them to continue to look
at these records in accordance with the continuation
of the life of the Committee, or in conjunction--
MR. SULLIVAN: This might not be an appropriate
time for the President to change his precedent.
H.M.JR: He has given the Committee this privilege?
MR. NUNAN: Yes, sir. But the last time, my in-
formation was that he did it with his tongue in his
cheek. He didn't like to do it very much.
H.M.JR: I wonder how many requests we have had
from this Committee.
MR. NUNAN: That I don't know, sir.
H.M.JR: Will you find out?
MR. SULLIVAN: I think every time it has been con-
tinued.
MR. GASTON: He means specific requests for indivi-
dual returns.
MR. SULLIVAN: I asked Joe if they had been running
amock, and he said they hadn't.
H.M.JR: Find out how nosey they have been.
(The Secretary holds a telephone conversation
with Justice Byrnes, as fb llows:)
Regraded Unclassified
53
April 6, 1944
3:09 p.m.
HMJr:
Hello.
Operator:
All right, Justice Byrnes is coming on.
Justice
Byrnes:
Hello.
HMJr:
Jimmy?
B:
Yes, Henry.
HMJr:
Good morning.
B:
How are you?
HMJr:
Good afternoon. I'm fine. Jimmy, here's one
which would normally go to the President but
before I dump it in his lap, I'd like to get
your advice.
B:
What's that?
HMJr:
As you know, it's been sort of common practice
for the various Committees to ask the President
or ask us to get the President to get out an
Executive Order permitting them to have access
to all income tax returns, and the Dies Committee
is now asking us for that privilege.
B:
Well, I'll be damned.
HMJr:
They've had it before. In one case Roosevelt
refused to let Cox -- Congressman Cox have that
privilege. Hello?
B:
Yes.
HMJr:
And, as I say, I wouldn't be bothering you
but it's the President's business and I don't
want to dump it in his lap until you had a
chance to think about it.
B:
Yes.
HMJr:
See?
B:
Well, what's your -- you say you did allow them
to do it once?
54
- 2 -
HMJr:
They have had it several times before, but the
Committee's been given additional life and now
that -- they want to renew this privilege, you
see?
B:
Well, it's a hell of a thing, 1sn't 1t?
HMJr:
Yes, it is.
B:
To have to. do it.
HMJr:
Yes, it is.
B:
And yet you're put in a position that having
done it before
HMJr:
Yes.
B:
I don't see how you can do it now.
HMJr:
You mean
B:
My first reaction to it 18 that they'd say that
just as soon as he got to attacking Winchell,
whom the scoundrel had intimated in his radio
talk
HMJr:
Yes.
B:
as being encouraged by Roosevelt to take this
attitude.
HMJr:
Yes.
B:
And he'd say that as soon as -- it's now thought
that he was going to touch Walter Winchell
HMJr:
Yes.
B:
that it's denied him.
HMJr:
That's right.
B:
That's what the damned scoundrel would say.
HMJr:
So your hunch is that inasmuch as he's had it
before
B:
Yes. If it hadn't been done, I'd swear, I'd been
disposed to -- to look into it more closely, but
I'm -- I -- my reaction to it 18 that -- that you
55
- 3 -
B:
Cont'd:
couldn't well do it, having granted it before,
and I wouldn't bother the President about it.
I'd go do it.
HMJr:
Well, it will -- it will go to him. I don't
know what he will do with it. We draw up an
Executive Order and send it over, you see?
B:
Well, he -- of course, he's not so well, and
HMJr:
No.
B:
he may just feel like we do about it and
want to kick him in the slats, but my judgement
is that -- that you can't do that well. I don't
think he
HMJr:
Well
B:
In -- on the previous occasions -- I'm talking
about your doing it, he had -- the President had
to do it.
HMJr:
Yeah.
B:
Well, then, hell, he's done it himself heretofore,
how can he do it -- refuse now? I don't think
there's any doubt about it. That's one of those
things that you just hate to do but have got to
do.
HMJr:
Like castor oil.
B:
Yes. (Laughs)
HMJr:
Now
B:
Make a pass though.
HMJr:
Now, while I've got you, one other thing. This
1s a little out of my line but I've been up country,
at home
B:
Yes.
HMJr:
and no criticism of the President on O.P.A.
....
compares with the present one on the way the
draft thing is being run, Jimmy. It 18 something
terrible, and they all blame him.
56
- 4 -
B:
What's it directed against?
HMJr:
Oh, you see -- as near as I can make out,
everything 18 dumped now on local boards.
B:
Oh, yes. Well
HMJr:
And everybody who -- you take the farmers up there
they went up to the Farm Bureaus and they've
figured out these work sheets that took them
days -- how many points they have to have
for each man. They've got to have sixteen
units. They got that all straightened out
about a month ago, see?
B:
Yes.
HMJr:
Now, that's all thrown in the waste paper
basket.
B:
Yes.
HMJr:
And all of these fellows are being called all
over again, although just a month ago they
got themselves straightened out. And it's all
on the local boards and the criticism against
him 18 something terrible. Now, I don't know
whether it's McNutt. I don't know whether it's
Hershey, but by God, somebody ought to be fired.
I swear! I mean, it isn't fair to make him take
all this criticism.
B:
That's a hell of a thing, isn't it?
HMJr:
And I -- I don't know
B:
As a matter of fact from what I saw in the papers
the other day, Dick Russell had been down and
announced that they were making a change doing
away with that unit rule that had applied, Henry.
HMJr:
Well, as I understand it, and this is all from
the farmers -- that unit stuff as I understand 1t.
has all been thrown out.
B:
That's right.
HMJr:
And now, where everybody got straightened out for
their spring work, you see?
B:
Yes.
Regraded Unclassified
57
- 5 -
HMJr:
About a month ago.
B:
Yes.
HMJr:
This 1s the way I get it from the farmers.
B:
Yes.
HMJr:
I didn't check up on it. Now, everybody's been
put back in 1-A and all of these fellows have
been called and everybody's got to go back to
the Board and do it all over again. That's only
a month ago that they got themselves straightened
out, so many units to the farmer.
B:
Yes.
HMJr:
And I don't -- as I say, I read the newspapers
and I'm like Will Rogers, all I know is what I
see in the papers, but the President and the
Democratic Party, my God, we are getting it in
the neck.
B:
And the longer it goes -- the uncertainty goes
on, the worse, too.
HMJr:
That's right.
B:
Yeah. If they settled it and let it stay settled
awhile, people would stop complaining about it.
HMJr:
Yep. Well, I wanted to pass it on to you for what
it's worth.
B:
Well, it don't make a fellow feel good at all.
HMJr:
Oh, well, I couldn't
B:
I'm sure you're right.
HMJr:
What?
B:
I'm sure your're right.
HMJr:
You say Dick Russell says the same thing?
B:
No, I say I'm sure that you are right about it,
but what Dick did, as I got it
HMJr:
Yes.
58
- 6 -
B:
Hershey was -- or McNutt -- between them, they
were reducing the -- they were changing the number
of units so as to tighten up on it.
HMJr:
Yes.
B:
And then Russell and some farm representatives
went before them to get them to abandon that
unit business which they said would take some
more farmers.
HMJr:
Yes.
B:
And to leave it to the local boards. They really
wanted it left to the local boards.
HMJr:
Yes. Well, I think now it
B:
Now, as you say, those folks up there find that
some local boards are less liberal and they are
having more trouble when it's left to the local
boards.
HMJr:
Yeah. Well, it isn't that. I mean -- mind you
this 1s all second hand, you know.
B:
Yes.
HMJr:
I didn't go to the boards.
B:
Yes.
HMJr:
And I'm not -- as far as I'm concerned, I'm not --
it isn't anything personal, but it's just -- in
talking to some of my neighbors, the impression
they give that, my God, why can't we make up our
mind what we want down here and stick to it.
B:
Well, I agree. I think that's really the bottom
of this complaint -- that they started one way
and then a fellow thought he was settled.
HMJr:
Yeah.
B:
then they turn up with another plan.
HMJr:
That's it.
B:
And from what I learned on this other side.
HMJr:
Yes.
59
- 7 -
B:
the -- that's the explanation of the durn
thing.
HMJr:
Yeah.
B:
Well, the whole thing's in a terrible mess,
as you know, of course, and then on this
deferment business
HMJr:
Yes.
B:
the -- the Boss took it in charge himself.
HMJr:
Yes.
B:
You remember that Cabinet meeting
HMJr:
Yeah.
B:
when those fellows discussed it.
HMJr:
(Laughs)
B:
And fought all over the place.
HMJr:
McNutt bellowed at us all.
B:
Yeah, he bellowed. (Laughs) He said he had
the power to decide it, didn't he? But the
law really was different.
HMJr:
He's wrong.
B:
I did not want to interfere and did not, but
later I got back to my office and refreshed my
recollection by looking at the law and getting
the Conference Report which accompanied the
Act, and they met -- they said that -- they
use these words: "This means that no one will
have anything to do with the deferment except
the President or the Director of Selective
Service if the President delegates it to him."
HMJr:
That's right.
B:
The language of the law is that the President
can delegate the powers herein conferred only
to the Director of Selective Service.
HMJr:
It was a direct slap at McNutt. I studied it
myself. And you are quite right and McNutt
was putting up a bluff. In fact he wasn't telling
the truth.
Regraded Unclassified
60
- 8 -
B:
He was just wrong on the thing. What the
President unfortunately did was to take it
on himself and to listen to first Donald and
Wilson -- no, Donald and McNutt.
HMJr:
Yes.
B:
And then the next day to somebody else -- to
Harold -- on his coal miners, and the next day
to Patterson and -- and General Marshall, and
finally he got to hearing them -- one fellow
making statements in the absence of the other
and they all got the -- the old boy all balled
up in the thing and it's just been a pretty bad
situation. Dewey telephoned me this morning
and he had a letter that he wanted to go into
the press
HMJr:
Who did?
B:
criticising the whole thing.
HMJr:
Who did?
B:
Bradley Dewey.
HMJr:
Who's he?
B:
Rubber Director.
HMJr:
Oh, yes.
B:
And he -- he was criticizing the drafting of
men from the food industry and from every --
everything.
HMJr:
Yeah.
B:
I had -- I like him, but I asked him what he would
say if Hershey came out in the newspaper criticizing
the exercise of discretion by the Rubber Director
and criticizing his program -- that he'd be taking
his pen in his hand immediately and we just can't
do it. I finally persuaded him to write his letter
to the President instead of to the Press.
HMJr:
Yeah.
B:
But I Judge from his statement that there's a
terrible lot of dissatisfaction and God knows
how the President can now settle it because
61
- 9 -
B:
Cont'd:
they've all gotten mad, and when they get mad....
HMJr:
Yeah. Without
B:
they're unreasonable.
HMJr:
Without wishing anything on you, 1sn't that
something that your Board could very well take
up?
B:
It should have in the first instance.
HMJr:
Yeah.
B:
It -- but after the President took the thing up
HMJr:
Yeah.
B:
and went into seeing all of these -- all of
these litigants or parties to the suit
HMJr:
Yes.
B:
it was a matter he couldn't well do for this
reason: at that Cabinet meeting.
HMJr:
Yes.
B:
he announced, as you recall, that he would
decide it over the week-end.
HMJr:
Yeah.
B:
Then he got sick.
HMJr:
Yeah.
B:
And Steve began giving out statements just to
help him and without knowing the discussion that
he was considering the matter and his decision
would be announced.
HMJr:
I remember very well.
B:
And having done all that, he couldn't very well
say that he -- I couldn't see how he could give
some critics a chance to say that he didn't --
didn't want to decide it because it was hot and to
turn it over to me.
62
- 10 -
HMJr:
Huh.
B:
And I was -- I talked to him about it once and
told him what I have now told you, but told him
if I could help him
HMJr:
Yes.
B:
and let him do it, I'd gladly do it, but I
didn't want him to be in the position of, after
saying that "I'm going to do it", then not do it.
HMJr:
Yeah.
B:
And he -- it's come -- what's happening now, it's
coming back on him today, I judge, from Army and
Navy and particularly McNutt, who's been asking
to go to see him to put it on his desk again, and
he really can't do it.
HMJr:
Well, of course, McNutt's all wrong. I mean, he
hasn't got the authority. You're quite right
and I checked it -- the law, too.
B:
Yes. Well, he's just done it and he had the
President -- the President can't keep those things
in mind.
HMJr:
No, no.
B:
You and I know it is just utterly impossible
and he should have turned it over to someone
then and gotten the -- gotten the law and
really Hershey -- if Hershey would really take
that law, he could do it.
HMJr:
Yeah.
B:
When the law said he should.
HMJr:
Yeah. I think well of Hershey. I don't know
how you do.
B:
Huh?
HMJr:
I think Hershey has been -- done the best he
could.
B:
Oh, I think he's done the best he could, but
I think in this thing that he ought to just
say, "Mr. President, under the -- the " law says
you can delegate this only to me
Regraded Unclassified
63
- 11 -
HMJr:
Yeah.
B:
If
and if you have delegated it to me,
If
and he has already. He's delegated this thing
of deferments, you know.
HMJr:
Yeah.
3:
If
I'm going to go ahead and do it. II
HMJr:
Yeah.
B:
And that would take it off the Boss.
HMJr:
That's right.
B:
It really seems to me would be about the best
solution of it.
HMJr:
Yeah.
B:
Well, I'm glad to talk with you, Henry.
HMJr:
Thank you very much.
B:
Bye.
HMJr:
Thank you.
64
- 5 -
MR. NUNAN: He said yes! (Laughter)
H.M.JR: The answer is that with the Walter Winchell
business they would say here was Dies wanting to get
it and the President was protecting Walter Winchell. The
answer is yes.
MR. NUNAN: I appreciated that after I heard that
this was only a continuation, but I thought it was
well to call it to your attention.
The second thing was the liquor situation. Similar
to what you were just discussing--
H.M.JR: Got any?
MR. NUNAN: No, sir; wish I had.
Of course, at your suggestion our Alcohol Tax Unit
went in and did a great job, and I think they have
broken up the black market.
H.M.JR: Did you see the pictures of the new labels
which I insisted on, ninety-five percent spirits and
five percent whisky? I insisted on that before you
were here.
MR. NUNAN: I am glad you did. I wouldn't want
to get 8. drink of it.
(The Secretary holds a telephone conversation with
Judge Rosenman, as follows:)
Regraded Unclassified
65
April 6, 1944
3:24 p.m.
Operator:
Here you are.
H&Jr:
Hello, Sammy.
Judge Samuel
Rosenman:
Henry?
HMJr:
How are you?
R:
All right, Henry. How are you?
BWr:
I have no liquor today.
R:
What do you mean "no liquor"?
HMJr:
Well, I didn't know - I thought you were calling me up --
we were just talking about liquor here, so I had liquor
in mind.
R:
Have you got any meat? Never mind liquor.
HWr:
Meat?
R:
Yeah.
HMr:
Well, do you want some last year's venison?
R:
Yeah. (Laughs) I've heard of worse things.
HWr:
Yeah.
R:
Well, what I called you about was, there was a Rabbi Korff
in here to see me.
HMJr:
Yeah.
R:
Who says you are going to send me B. memo, and I was
wondering why you are getting so formal.
HMJr:
I don't know. Congress -- Senator Mead and some -- and
Congressman McCormack called me up to see three Rabbis
at three o'clock.
R:
That's why I saw them, because Congressman McCormack
called me up.
HWr'
Well, I
Regraded Unclassified
66
- 2 -
R:
But I just saw one, because only one got past the gate.
HMJr:
Maybe they're three-in-one.
R:
There are three. No, there are three. He brought two
others, but I was away and they hadn't cleared the other
two and they wouldn't let them in.
HMJr:
Three-in-one is an oil.
R:
Yeah. (Laughs) Well, I
....
HMJr:
I haven't seen them yet.
R:
Well, then then I'm crazy. He said he saw you ....
HMJr:
No.
R:
.... and you were very much interested, and you were
going to send me a memorandum.
HWr:
Rabbi Corff - - four o'clock.
R:
I see. Well, what - what it's about is, there seem to
be some refugees in Vitell.
HMJr:
I don't know -- I don't know a thing about it, Sam.
R:
All right. Well, I was wondering why you should ....
HMJr:
Send you 8. memorandum.
R:
....
send me a memorandum when the phone is working,
and, after all, it's
....
HMJr:
No, I can't send you a memorandum ole dear until I
see them.
R:
Well, he -- I W&S misinformed.
HMJr:
I thought you were down at Hot Springs.
R:
No. Well, I haven't gone -- I don't want to go away
until he goes.
HMJr:
I see. I'll send you a memo. Don't worry.
R:
I don't want the memo. I want ....
67
- 3 -
HWr:
(Laughs)
R:
.... it's a matter for the War Refugee Board, as he
explains it to me.
HMJr:
Yeah.
R:
All right. He must -- either he's crazy or I am.
HMJr:
I'll take care of it.
R:
.... your -- he said you were very interested when he
saw you.
HMJr:
Well, he must be -- the way I understand it is this:
after we get - the War Refugee Board gets them to
Palestine, you look after them.
R:
I'm going to be the Prime Minister?
HMJr:
(Laughs) Okay?
R:
All right.
HMJr:
All right. You don't sound very happy today.
R:
I - - I am. I - what I'd like to know, as long as you're
pressing food on me, is what about some more of those
pig's feet?
HMJr:
Ah ....
R:
The way
....
HMJr:
....
would you like to come over tomorrow for lunch?
R:
The way Elinor - no, I want you to send them over the
way Elinor makes them.
HMr:
Do you want lunch tomorrow?
R:
No, I - - no, really I - - I've got tomorrow and the next
day taken.
HMJr:
Oh, my.
R:
But if I'm 'm in town Monday, I'd like it. But I
....
HMJr:
I'll put you down tentatively for Monday.
68
- 4 -
R:
If I'm in town.
HMJr:
All right. My office will call your office.
R:
Good.
HMJr:
Okay.
R:
All right. Good-bye.
69
- 6 -
MR. SULLIVAN: I have a three-thirty meeting.
H.M.JR: At least we have settled one thing out
of four.
MR. SULLIVAN: You four can clean up the other three
without me.
H.M.JR: Let's adjourn and put them all on Sullivan's
desk.
(Mr. Sullivan leaves the conference)
MR. NUNAN: I want to say, briefly, Mr. Secretary,
they did a good job and I think it is pretty well
broken. Now some of the agents are getting a little
over-ambitious and going in and annoying legitimate
business and trying to get information from them. My
thought was to issue instructions, or for me to see
the District Attorney got information, and certain
people were indicted where indictments would lie, but that
otherwise I don't think we should be annoying the people
in legitimate business.
H.M.JR: If you don't mind, when you leave, talk it
over with Joe O'Connell and Herbert Gaston. Whatever
the three of you agree - I would have to go into this
at great length. After you go, Herbert, as the senior
member, if you will write a little memo and tell me
what you decided.
MR. NUNAN: The other thing in mind was whether you
had given any further consideration to George Schoeneman.
H.M.JR: Do we understand each other about it?
MR. NUNAN: Yes, sir.
H.M.JR: No, I don't know where that stands. I
know where it stood. Somebody raised the question of
whether he wanted it.
Regraded Unclassified
70
- 7 -
MR. NUNAN: He does, sir. I have spoken to him
and he is almost near the end - I guess he has two or
three more years. He thinks it would be quite a nice
thing if he finished up his service as Assistant
Commissioner.
H.M.JR: All right with me if that is what you want.
MR. NUNAN: Yes,sir. It would be a good thing be-
cause Schoeneman is very well thought of in every
Collector's Office in the country.
H.M.JR: Is he a Democrat?
MR. NUNAN: I can't say that, but I will say this,
that I discussed it informally with Bob Hannegan and
it would be agreeable to him.
H.M.JR: It would be?
MR. NUNAN: Yes, sir.
H.M.JR: All right with me.
MR. GASTON: He is getting corrupted, you see. He
is non-partisan, non-political.
MR. NUNAN: I think George lives in the District
and I don't think they vote in the District.
H.M.JR: It is funny what the Washington Civil
Service will do to a fellow in a month.
MR. GASTON: He comes down here red hot.
MR. NUNAN: I still am. Probably more so than when
I came down.
Mr. Kelly's name is the other matter I mentioned
to Mr. Gaston. It has to do with the appointment of the
Collector in Drooklyn.
Regraded Unclassified
71
- 8 -
H.M.JR: I will tell you about that. Bob Hannegan
came in on that thing and said, "Gentlemen, I want that
thing." He leafed through and saw he had a clean inves-
tigation. He said, "Thank God for that. I was worried
about that one."
MR. NUNAN: There is a little situation there I
have talked to Mr. Gaston about.
MR. GASTON: There is one little circumstance. I
think we have got that pretty well ironed out.
H.M.JR: What did he do - just steal from his
mother-in-law?
MR. GASTON: No, a great deal of gossip about his
cavorting with the blond lady he got appointed in the
office there, in the Collector's Office in Brooklyn.
MR. NUNAN: He has been seen out to dinner and
lunch with a blond in Brooklyn.
H.M.JR: Is she good-looking?
MR. NUNAN: Yes, sir. As a matter of fact, I used
to be a little jealous about it when I was Collector.
She was a former hostess in one of Schraffts stores.
MR. GASTON: Also a former clothing model.
MR. NUNAN: His wife - Frank Kelly is anxious. There
is a vacancy on the County Court. He would like Mr.
Marcelle, an Italian, appointed Collector.
H.M.JR: Why doesn't he marry the girl?
MR. NUNAN: He already has a wife.
MR. GASTON: Perfectly good Italian wife, now.
H.M.JR: What are you going to do about this situa-
tion?
Regraded Unclassified
72
- 9 -
MR. NUNAN: He has been spoken to and I am sure
no scandal will develop.
H.M.JR: Have you spoken to her?
MR. NUNAN: Yes, sir. She worked for me for three
years in Brooklyn.
H.M.JR: And went out with you?
MR. NUNAN: Yes, sir.
H.MJR: You must be slipping.
Regraded Unclassified
73
April 6, 1944
3:00 p.m.
HMJr:
Hello, Cliff.
Clifton E.
Mack:
Yes, sir.
HMr:
In the first place, how is your mother?
M:
She is about the same.
HMJr:
I see. Well, I was sorry to hear that she had this
illness.
M:
Yes, it was very sudden.
HMr:
Is - she's conscious, is she?
M:
Well, she - she gains consciousness, and then she
loses it, and it has been going on that way now for
about a week.
HWr:
Oh, I'm sorry.
M:
But - of course, she's pretty old.
HWr:
Yeah.
N:
She's over eighty.
HMJr:
Yeah. Cliff, when you come over this afternoon, on
these shearings ....
=
M:
Yes, sir.
HMr:
.... my impression is, from your memorandum, that they're
still in the hands -- our hands. We're still charged
with them.
M:
Yes, they're still in store.
HMr:
Well, I mean, but the Army was asked could they count
on the Treasury, so to speak.
=
That's right.
HMJr:
Now what I want to know is: how long has - time has
passed since we've asked UNRRA to take them off our hands,
and -- if you could bring over your correspondence between
yourself or your office and UNRRA on this thing.
74
- 2 -
=
Very good.
HWr:
I - - I wanted to tell you that.
M:
Very good.
HMJr:
See?
M:
I'll do that.
HMJr:
Now, is there anybody that you wanted to bring with
you, or have you got this stuff that - you know it
your self?
M:
Well, I think I have. Yes.
HMJr:
Well, I'd just as leave see you alone.
M:
Well, all right. All right, fine.
HMJr:
Thank you.
M:
Thank you.
75
April 6, 1944
4:00 p.m.
DISPOSAL OF SURPLUS PROPERTY
Present: Mr. Mack
Mr. Tickton
H.M.JR: Cliff, I went in there yesterday. I was
very much pleased. Now, the point that I don't seem to be
able to get over--I don't know what is the matter. I
never had any trouble when I was trying to get you to
buy stuff for the Russians; you would get it there on
time.
Do you remember the study we made about how many
days it takes to get this and that and the other thing?
We were always better than everybody else. Now, you
take shearlings. The fact that UNRRA says to us on
January 25, see, that they want this stuff--if you have
to go up before a committee in Congress and they learn
that this stuff is still at Elmira at your warehouse, we
are charged with it.
Now, let's just take this one thing here, see. I
haven't as much time as I should have. What about the
correspondence between you and UNRRA on this?
MR. MACK: Well, we have their requisition, and
then, of course, our file that we keep of the various
discussions with them, as well as requisitions. (Hands
the Secretary requisition and file on disposal of
shearlings.)
H.M.JR: Boil it down for me.
MR. MACK: There are two situations: First, when
the UNRRA people heard that we had shearlings, their
thought was that they could use them for the clothing
program, and they asked that we set them aside for their
needs, at thirty-five cents a square foot, and we did.
Regraded Unclassified
76
- 2 -
We immediately moved the goods from the Army stores
to our own space in the holding and reconsignment depot
at Elmira, New York, and then, of course, received their
requisition for the shearlings.
Following that they gave us their requisition for
the making of garments, as you notice from the requisition
I just handed to you. We are placing contracts to make
these coats in which the shearlings are to be used, and,
of course, we are getting the cloth on Army-cancelled
contracts.
H.M.JR: You are making it into clothing?
MR. MACK: Yes, sir.
H.M.JR: It doesn't say that in this report.
MR. MACK: No, it doesn't.
H.M.JR: You must have found this out later On.
MR. MACK: I didn't have all of the information when
I got that together last night, but those shearlings are
to be used for the manufacture of coats for UNRRA. We
are starting to issue invitations today for the contract-
ing for cut, making, and trim.
H.M.JR: But that is since the 8th of March.
MR. MACK: That is right.
H.M.JR: Why does it take so long?
MR. MACK: That was known as.an advance copy from
Lend-Lease, and, as a matter of fact, we don't have
from Lend-Lease yet the approved copy which is cleared
through us. But nevertheless we have gone ahead on this
basis.
H.M.JR: Now, look, Cliff, you know sooner or later
I am going to get the facts.
Regraded Unclassified
77
- 3 -
MR. MACK: Of course.
H.M.JR: Gosh ding it, I went through this whole
business with you getting the stuff for the Russians.
I went through he whole thing with the English before
there was Lend-Lease. I had my schedules and all the
rest of the thing. There is just too damned much time
expiring.
MR. MACK: Yes, I know.
H.M.JR: Why should we manufacture this stuff for
UNRRA? Why don't they do it themselves?
MR. MACK: They don't have the organization, and they
look to us to do the job for them.
H.M.JR: I don't know where the trouble is or what is
wrong, but it just takes too damned long.
MR. MACK: I agree with you that it takes a long
time. You know, what we are doing, in effect, now is
this: We have all of these controls and restrictions
and price limitations for buying. Now, we find ourselves
in the business of selling, and as you notice from the
other memorandum, it took weeks to establish price ceilings
before we could go ahead.
H.M.JR: All right, but that has nothing to do with
this. You didn't have to bother with prices.
MR. MACK: No, other than just conferences, no.
H.M.JR: This is separate. The motorcycle thing is
another deal, but this thing is something else.
(Mr. Tickton entered the conference.)
H.M.JR: Mr. Tickton, come in here and sit down.
I was up in New York yesterday, and hereis 8 typical
case of where we were given some shearlings by the Army.
It says January 17.
Regraded Unclassified
78
- 4 -
MR. MACK: That is right.
H.M.JR: UNRRA says they want this stuff on the 25th.
Then on March 8 they say they want us to manufacture them
into clothing, and their bids to manufacture clothing are
just going out now. It is just too damned long. My God,
the war will be over.
Now, I don't know where it is, but I want a schedule
set up on this thing, see. And if Mr. Mack has some other
things that have to do with UNRRA, let's do anything
between Procurement, Treasury, and UNRRA, and see how long
it takes to do business.
MR. MACK: All right.
H.M.JR: Now, remember the thing you did for me, the
number of days. Wasn't that in connection with the
Russians?
MR. TICKTON: Yes.
H.M.JR: All right. Now, here is one kind of business
between the Army, the Treasury, and UNRRA. Let's see how
many days it takes the Army, how many days it takes us, and
how many days it takes UNRRA.
MR. TICKTON: O.K.
H.M.JR: Is that agreeable to you?
MR. MACK: Surely.
H.M.JR: What the hell is the matter? Between the
16th of January and the 6th of April--it takes practically
three months for somebody in the Government to make up
their mind what we are going to do with this stuff. I
can't be connected with that kind of business. Treasury
Procurement once did the thing. We did it, my God, in much
bigger stuff. Maybe we are no good; maybe UNRRA is no good.
Maybe we are all right, I don't know. Maybe UNRRA is all
right. I want to know. I am entitled to know. But that
is one kind of business, see?
Regraded Unclassified
79
- 5 -
MR. TICKTON: Yes, sir.
H.M.JR: Let me give you another kind of business
which is just as good. Here we have motorcycles. On
December 21 we get two thousand one hundred and forty-six
motorcycles. The request for bids went out on the 29th
of March. Now, Walsh tells me the regular schedule is
this--I learned more from Walsh in thirty minutes than I
have learned in a long time--and Young--is that his name?
MR. MACK: Yes.
H.M.JR: Both of them were very frank. They didn't
stall. I got more information from them in thirty minutes
than I have gotten in this town in 8. long time. Here comes
this stuff, and they tell me the normal procedure for Treasury
Procurement is sixteen days to do the paper work.
MR. MACK: Within Federal agencies, that is right.
H.M.JR: Then it takes two weeks to allow the people
to bid. But they said they could do a lot of things in
two or three days. Granted they have to go to OPA and
over to the WPB; but if OPA and WPB can't give me things
in twenty-four to forty-eight hours, I am going to tell the
world about it. I am not going to sit here and take it,
see?
I want you to take this motorcycle deal, and find
out how many days we fussed with it from the time the
Army gave it to us, and how many days we fussed with
OPA and with Nelson. When I did that and showed them
that time--do you remember how Nelson tightened up on
his stuff?
MR. MACK: That is right.
H.M.JR: Now, there are other things besides motor-
cycles. I understand the dealers came down and wanted to
get them for one hundred and forty dollars. I got that
from Walsh. This is only one deal.
Take the motor truck deal and the automobiles. This
is the position, Cliff: I don't know what has happened
80
- 6 -
over there; I am just talking here. But my God, there is
no law that says we have to give all the trucks and all the
automobiles to the Government itself, or divisions of the
Government. And if somebody can't make up his mind--we
have seven thousand cars. Let's put them on the market.
I think it is bad business to feed off ourselves, anyway.
I would like to see this stuff moved into consumption.
There should be a directive going out over your signature,
which I C ouldn't find up there. This stuff has to move
into consumption; it can't lay around here. I asked them
if they didn't have a directive. They couldn't find any.
MR. MACK: Well, this is the story: We started in
on this program by trying to have the field officers
locally--and we found we were running into troubles. So
on February 22 we requested each of the field offices to
let us know when they had any excess above Federal needs,
and so forth, that would be available for public sale,
and that means that everything before it is released for
public sale has to be cleared by us over here 80 we will
be sure to check on ceilings and methods of sale and dis-
tribution and all that sort of thing. They are doing it
as quickly as they can. For example, we have one situation
right now I would like to tell you about, batteries, the
dry-cell batteries. The Army sold the first lot themselves,
and they sold them in a hurry. Here is what happened: They
sold batteries to a civilian employee at an Army post in
Ogden, Utah.
H.M.JR: I know.
MR. MACK: Now they are declaring some of those to us.
So what we are doing is checking to make sure that every-
thing is considered before we release them, and we are
doing it just as quickly as we can.
H.M.JR: Let me ask you this: I got the impression,
going through this New York office--in the first place I
will refresh my memory. It was only February a year ago
that we decentralized this question of handling of surpluses.
I got the impression that maybe because they were on separate
floors that we could, if we wanted to, detach the surplus
Regraded Unclassified
81
- 7 -
property thing from Procurement for Lend-Lease and other
things. They are pretty much separate. We have separate
accounting, and so forth, and 80 on,
MR. MACK: It is 8. branch of the work, of course, in
each field office.
H.M.JR: But if I wanted to get rid of it, you could
get rid of that business.
MR. MACK: Oh, yes.
H.M.JR: It is separate.
MR. MACK: Well, we could get rid of it. The tie
is administratively, finance, personnel, accounting, and
like that.
H.M.JR: I want you (Tickton) to study that, too,
and you can get it much more clean-cut spending a day in
New York if you can see it up there. It is on separate
floors. Surplus property seems to be entirely separate,
except for central accounting. But surplus property
would be so much bigger than Procurement; they could
afford to have their own central accounting.
MR. MACK: Now, on this matter of time, to be very
frank with you, I started out with the thought in mind of
pushing and crowding, and I started to get into trouble.
We had to pull it into Washington for review of public
sales before we authorized them to sell. Perhaps we have
been a little bit overcautious. The trouble seemed to be
that in our field offices from the beginning of the
program primarily to other agencies of the Government--they
would sell a machine shop to the construction battalion of
the Navy. It was one machine shop, inventoried all in the
family, and so forth.
But when you offer a machine shop for public sale,
people want to be considered; they don't want to be left
out. You have to be sure that you inventory, and the con-
ditions and all that has to be gone into very carefully.
Regraded Unclassified
82
- 8 -
Perhaps we have been reviewing it too closely. But Clayton
said 8 little while ago--or he emphasized that in making
sales to the public that we should test the market, that
we should know what stuff is worth rather than just moving
it so fast that we didn't have a chance to.
H.M.JR: But I went through the cards of NYA. You
still have NYA stuff that hasn't been sold.
MR. MACK: Most of that is earmarked. There may be
some that isn't sold, but most of it is earmarked. We
have fellows out in the field now going to the offices.
At least one was just sent out recently to check with
these offices, and tell them to get that paper work through,
because we want to get the stuff off our books, because
after all, that has been out too long.
H.M.JR: I don't know the dates, but it seemed awfully
long to me.
We will let Tickton make a little study. In the mean-
time, I just don't know. Frankly, the more I see of it,
the more it worries me. I just don't feel that as Secretary
of the Treasury I want to get mixed up in this thing,
because the more I see of it, it is a job. If anything
goes wrong, if you sell a battery for a dollar when it
ought to bring two, I am going to get the blame.
MR. MACK: We had some chicken wire the other day.
Now, we have every possible hurdle prior to making a sale
if you do the thing right. If you do some of the things
that are being done, that is different. Like, as you
probably read about, we have to offer that only to pro-
spective buyers that have have an allotment number from
the War Production Board. You have to comply with price
ceilings; you have to do this and that.
H.M. JR: Well, like every other business, it drives
you crazy. It does. It is terrible. What was the thing
they told me up there in New York? Oh, yes, if they have
any brass pipe, or brass connections, they can't sell to a
plumber because he is not allowed to handle those. They
have to give this perfectly good pipe to a junk dealer.
Regraded Unclassified
83
- 9 -
You can't sell it to a plumber who would pay you a decent
price. He is not allowed to use it. So you sell perfectly
good brass pipes and connections and valves to a junk
dealer.
MR. TICKTON: You would never be able to explain it
away if you decided to make a case of it.
MR. MACK: For example, on electrical equipment--
H.M.JR: Cliff, I don't know what the hell you want
this thing for.
MR. MACK: Well, I want it for this reason: Maybe
it doesn't make sense to you; it does to me. I was in
Boston the other day, and the Army is selling a million
irons, the most desirable merchandise there is, and an
individual is telling me that he could go over there and buy
any or all of that. Of course, I didn't check it; I don't
know. I know about some of the things that have been
sold, Army and Navy, beautiful merchandise. I know that
we are trying harder than anybody else to do a good job,
and there is going to be criticism. I don't say you can
get away from it. If we offer, for example, merchandise
only to dealers--I had the Army and Navy stores over there
to see me fifteen minutes ago. The retail associations
don't believe that they are a legitimate retailer, not
legitimate, but outside of retail dealers. They have
been going for twenty-five years. Who is right, and who
is wrong? You just have to do the best that you can, and
I know that our fellows are just trying so much harder
than any other agency that is handling surplus that they
are way out in front of them. Even at that, we have done
things that--
H.M.JR: Well, you did a swell job on procurement for
Lend-Lease, and I am very proud of you. I don't want the
Treasury Procurement ruined with this stuff. I am not sold
on it; that is all. The more I see of it, the less I like
it. That is the way I feel. It is just 8 blankety-blank
headache.
84
- 10 -
MR. MACK: Well, so far as I am concerned--of course,
as you know, we don't want to be a headache to you, because
you have troubles enough. Lord, you have a financing pro-
gram, war bond program; and if anything we do upsets any
of those things, then it is no good.
H.M.JR: That is my worry.
MR. MACK: I can understand that.
H.M.JR: My worry is that you fellows can't help but
make mistakes. You are human just like I am, and you are
going to be handling millions of articles and millions of
dollars, and you are going to make mistakes. I have fifty
million people as stockholders, and because I am in the
secondhand junk business and making a mistake, my war bond
program is going to suffer. There is nothing personal in
this, but what am I hired for? To finance the war, not
be in the secondhand business.
MR. MACK: The other day they said we were selling
and buying horseshoes. They were different sizes. We
are selling motorcycles.
I was in Boston the other day, and in the newspapers
there is a big article about Ordnance buying motorcycles.
They have a different kind. But to the fellow in the
street--he will still think that we aren't doing the--
H.M.JR: And there were some telephone sets from
World War I.
MR. MACK: Yes, and a harness from World War I.
H.M. JR: I have to think it over, but frankly, I
don't expect it to go any further. Well, you can make
up your own mind, but I think from the Treasury's view
I just can't see it. I will think about it some more.
MR. MACK: Well, of course, so far 88 I am concerned,
whatever you want to do is what I am for. I don't want
to upset anything.
Regraded Unclassified
85
- 11 -
H.M. JR: I will talk to you about it some more.
The way my mind is running now, I think we can go on
in a nice quiet way with Procurement in the Treasury
and let them take the surplus property and give it to
somebody else. I haven't decided, but that is the way
I feel.
I will talk to you some more.
86
April 6, 1944
4:30 p.m.
JEWISH EVACUATION
Present: Mr. Pehle
Mr. DuBois
Mrs. Klotz
Rabbi Corff
Rabbi Frankel
Rabbi Kalmanowitz
MR. DuBOIS: You heard about Judge Rosenman at
twelve-forty-five.
H.M.JR: Rosenman called me up and said, "These
men had seen me and I am sending you a memorandum."
MR. PEHLE: The Judge refused to see the delegates.
He doesn't receive delegates, so Rabbi Corff refused
to go in unless the delegates went in. So Rosenman
had to come out and see him personally and beg him to
come in alone.
H.M.JR: Where is he?
MR. DuBOIS: He is there.
H.M.JR: Who are these Rabbis?
MR. PEHLE: Two of them are connected with the
Union Orthodox Rabbis. Corff is more or less their
representative and spokesman, as I get it, a very able
person.
(Rabbi Corff, Rabbi Frankel, and Rabbi Kalmanowitz
enter the conference)
Regraded Unclassified
87
- 2 -
H.M.JR: Which of you gentlemen will speak?
RABBI KALMANOWITZ: Coming to you, Mr. Secretary,
about saving the lives of the Jewish. We have a ques-
tion from two thousand twohundred and thirty-eight
interned people in the camps in Vittel and Tittmoning.
We received yesterday a cable, a long cable, that
every minute there is danger of life and death.
We come to the office of Mr. Pehle, and Mr. Pehle,
I know very well, in the four or six weeks or less that
he is working very hard to save the lives. Mr. Pehle
has two or three people - I know Mr. Lesser, Miss Hodel,
and Mr. DuBois, who are willing to work night and day
for the saving - I know very well, and I recognize - the
saving has not come. I don't know about the blame. I
think the blame is in the State Department. There is
every danger not only for the lives of the two thousand
two hundred and thirty-eight people, but for three and
a half million people. We have not very much help.
Please, Mr. Secretary, do the utmost that you can
to save them, every one.
H.M.JR: Now, look, you get upset and you get me
upset, and I can't do anything, either.
RABBI KALMANOWITZ: I know Mr. Lesser and Hodel and
DuBois have at hand three cables that must go yesterday,
and the cables are not going; one cable to Spain, one
cable to the Swiss, one cable to the South American
countries. You know very well, the less cables you
have to send through the State Department--
H.M.JR: Let me ask you (Pehle) this. This may not
be at all practicable, but there are five thousand
passports which have been issued to bring the people
into Switzerland, for children, aren't there?
MR. PEHLE: Yes, sir.
Regraded Unclassified
88
- 3 -
H.M.JR: Are those children coming in?
MR. PEHLE: Some are coming in, yes.
H.M.JR: What would be the most that will come in
during the next three months under that arrangement?
MR. PEHLE: I doubt very much whether five thou-
sand--
H.M.JR: What would be the maximum?
MR. PEHLE: There is no way of knowing, Mr. Secretary.
H.M.JR: Twenty-five hundred?
MR. PEHLE: You just don't know. There is no way
of knowing. A few hundred got in.
H.M.JR: I was trying to think, if they would issue
five thousand for these children, I wonder if you could
get an additional blanket passport.
MR. PEHLE: what we were doing for the children
was to issue them visas to me to the United States,
admitting their foreign citizenship. The passports these
people have on their face show that these people are
citizens of various Latin-American countries. Nothing
must be done to cast any cloud on that citizenship. If
that citizenship is valid, they need nothing further.
They need no visas.
H.M.JR: But in the room here, there is a question
as to the validity of these.
MR. PEHLE: Oh, yes, a serious question as to the
validity, but the strongest position that we can take
is one of insisting on the recognition of these pass-
ports by the Germans, and ask the Swiss Government as the
intervening power to insist with the Germans that these
passports be recognized.
Regraded Unclassified
89
- 4 -
MR. DuBOIS: We have had a cable pending in State
for a month and 8 half which, if it had gone out,
might have protected these people.
H.M.JR: What isn't clear to me is this. These
two thousand three hundred people in France who osten-
sibly have passports to South America - one country, or
more than one country?
MR. PEHLE: Various countries - not visas, passports.
H.M.JR: Now they are in France and they want to
get from there into Switzerland.
MR. PEHLE: No, they want to stay where they are.
Of course, they would like to get into Switzerland, but
the main thing is to continue to protect them. They
are at Camp Vittel in France.
H.M.JR: Is that near the border?
MR. PEHLE: Not to my knowledge. The main thing
is to stop them from being deported to Poland.
H.M.JR: Following this thing - I am thinking up
a blind alley - but following this thought, you are
saying you want Mr. Hull to say to Mr. Harrison, what?
MR. PEHLE: "You go to the Swiss Government."
They agreeto that. "You tell the wiss Government
that it is the strong view of the United States that
these passports must continue to be recognized as valid
until after the war."
H.M.JR: Tell this to the Swiss?
MR. PEHLE: Who are the intervening power, and get
all the questions which come up between Germany and any
of these Latin American countries.
H.M.JR: Have you a draft of that?
Regraded Unclassified
90
- 5 -
MR. PEHLE: It is in the State Department's hands.
H.M.JR: Haven't you a draft here?
MR. PEHLE: I have something here, yes. (Hands the
Secretary "Proposed Cable to Minister Harrison at Bern")
This is the crucial sentence, Mr. Secretary (indicating)
H.M.JR: "You should request appropriate officials
of the Swiss government to approach the Germans in an
effort to induce them to continue to recognize the
validity of Latin-American passports held by persons
in Vittel and elsewhere unless the Government in whose
name the passport has been issued takes affirmative
action to cancel or revoke it or deny its validity."
That they refused to do?
MR. PEHLE: Yes, they are willing to say this
(reading from "Proposed Cable to Bern on Latin-American
Passports"): "You should request appropriate officials
of the Swiss Government, in dealing with specific cases,"
and so forth - that is, instead of a blanket one, in
which the passport may be questioned by the German
authorities.
But the difficulty is, the Germans aren't raising
the question. They are just starting to ship these
people out. We are quibbling on this sort of thing
while this goes on.
H.M.JR: Let me put it another way. I am sure
you people have thought of this thing. Supposing we
would say to the State Department, "All right, you don't
want to do it this way - supposing we issue them
blanket American passports."
MR. PEHLE: They are in enemy territory. You would
never get State to issue American passports.
H.M.JR: You did it to the children.
Regraded Unclassified
91
- 6 -
MR. PEHLE: No, those with children when they arrive
in Switzerland. They are covering the border, sneaking
through, Mr. Secretary. These people are in a concentra-
tion camp, Mr. Secretary. There is no chance for them to
clandestinely get into Switzerland. This is & very
simple thing we are asking State to do. All we are
saying is this: Tell the Swiss Government, who should
have some regard forwhat our wishes are, that they must
insist with the Germans, as the intervening power between
these Latin-American countries and the Germans, that
until the Government which issued the passports says
it is invalid, it must be regarded as valid. That is all.
H.M.JR: Is there any inclination on the part of
these foreign countries to revoke them?
MR. PEHLE: There has been, but we have gone to
all of them. I think they will go along until after
the war. We can pretty well force a Latin-American
country to refrain from revoking these things until
after the war.
RABBI CORFF: If negotiations are started in the
matter of exchanging these people. You see, Germany
puts a price on these internees; if the merchandise
is of any value, they will keep them there until eventu-
ally they will be exchanged. If they are not of any
value to the United States or Latin-America, why should
they keep them there and feed them?
One of the gentlemen of the State Department said
yesterday or the day before - I think it was yesterday -
to realiable sources, that he has reason to believe
that these passports which the victims, all from Para-
guay and Latin-American countries, were issued by Gestapo
agents, and are not even Paraguayan passports, and on this
assumption he refused to cooperate.
H.M.JR: Who is that?
Regraded Unclassified
92
- 7 -
RABBI CORFF: One of the officials of the Ptate
Department.
MR. DuBOIS: Culbertson.
MR. PEHLE: We understand, at least these people
have been told, that Mr. Stimson is out of town and
McCloy is out of town, and that Patterson was trying,
I understand from the Rabbi here, to get in touch with
Mr. Stimson in order to get his approval.
RABBI CORFF: To get Mr. Stimson's cooperation to
whatever the Secretary of the Treasury will indicate.
H.M.JR: Spell this camp.
Mr. PEHLE: V - i - t - t - e - 1.
RABBI CORFF: There is a Miss Thomas, Mr. Secre-
tary, and Miss Thomas in the Office of Secretary Stimson,
I believe - is it Miss Thomas who had quite a talk with
Mr. Kinnaily, John McCormack's secretary? John McCormack
has telephoned Mr. Kinnally to please cooperate in this
matter.
(The Secretary speaks to Mr. Patterson over White
House phone, as follows:)
Hello, Bob. This is Henry talking. Good afternoon.
I am all right.
I have this delegation of three gentlemen from the
Orthodox Synagogues in regard to these Jewish people
in this Vittel Camp in France, who are there under South
American passports. Have you heard about that at all?
Well, these people say there are over two thousand
three hundred of them - yes. In France. With South
American passports. They are beginning to deport them
to Poland.
Regraded Unclassified
93
- 8 -
What we are trying to do is to get the State
Department to send a cable to Switzerland to intervene
with the Germans to recognize these South American
passports.
Both Senator Mead and Congressman McCormack called
me up about this, and we have had no luck over in the
State Department, and I wanted to get Mr. Stimson inter-
ested in this.
Will he? How late?
Will he be at home? He will be home tonight?
O.K. Thank you, Bob.
(End of conversation)
H.M.JR: Stimson gets in late tonight. What do you
think if I ask Hull to convene the President's War
Refugee Board? That is all. Let's take it up with the
Board immediately. What is the use of beating around
the bush?
MR. DuBOIS: Can't you call Hull?
MRS.KLOTZ: He may not be fully informed.
MR. PEHLE: I think if you and I would talk to
Mr. Hull he would do it.
H.M JR: We will find out.
RABBI CORFF: Judge Rosenman was kind enough to
assure me this afternoon that they will call Mr. Hull
and--
H.M.JR: No, Judge Rosenman told me this is a War
Refugee matter and he has nothing to do with it.
RABBI CORFF: He called you, sir?
Regraded Unclassified
94
- 9 -
H.M.JR: I understood him to say that this is a
War Refugee matter. I may have misunderstood him, but
I don't think so.
RABBI CORFF: He was greatly distressed over there.
H.M.JR: Excuse me just a minute (speaks to Mrs.Kiotz).
I think the easiest thing is to let me call Hull and
ask him.
MR. PEHLE: I think SO.
(The Secretary places & call to Secretary Hull)
H.M.JR: Are they beginning to move people out of
this camp?
MR. PEHLE: That is what we are told.
MR. DuBOIS: The latest cable indicates they are
about to ship out two hundred and fifty. We have had
this pending for a month and a half in the State Depart-
ment.
H.M.JR: For a month and a half?
RABBI CORFF: Six valuable weeks.
RABBI KALMANOWITZ: Only the first cable.
H.M.JR: How did you get to Senator Mead? Did you
get to him direct?
RABBI CORFF: You see, Mr. Secretary, I was married
a year and a half ago, and Senator Mead was my best man -
a Catholic was a Rabbi's best man - and he is very close
to me and I think a great deal of him. He is a liberal
in the full sense of the word, and he is all-out for it.
As a matter of fact, he said if public opinion is
necessary to stimulate the State Department, by all means,
public opinion should be brought to the attention of the
public.
Regraded Unclassified
95
- 10 -
H. JR: Did you get to Congressman McCormack
direct?
RABBI CORFF: Yes, John McCormack of the Twelfth
Congressional District. He is a Bostonian. I got to
him direct. John McCormack presented a Palestine
resolution in Congress which is now a dead issue.
H.M.JR: What issue?
RABBI CORFF: A dead issue, sir.
H.M.JR: What did you put before them a month and
a half ago?
MR. PEHLE: The proposal that is more or less pend-
ing now, and that is the one that we want them to tell
the wiss Government to intervene with the German Govern-
ment. Part of the difficulty, I think, comes from
their dislike of these passports, and the people over
there that deal with such things dislike anything that
questions the sanctity of a passport.
(The Secretary holds a telephone conversation with
Mr. Brown in Secretary Hull's office, as follows:)
96
April 6, 1944
4:51 p.m.
Operator:
K-e-e-f-e.
HWr:
Miss Keefe.
Operator:
Right.
HWr:
Right.
Operator:
Go ahead.
HMJr:
Hello.
Miss Keefe,
Hello.
Sen. Mead's
secretary:
HMJr:
Miss Keefe.
K:
Yes.
HMr:
This is Mr. Morgenthau.
X:
Yes, sir.
HMJr:
I think your office -- your office asked me to see these
three Rabbis in regard to this refugee camp at Vitell.
K:
Yes.
HMJr:
Did you do that?
K:
No, it was Mr. Milcahey. He's not here now.
HMJr:
Well, you ....
K:
It was in connection with Rabbi Corff, for one, wasn't it?
HWr:
That's right.
K:
Yes. I know about it.
HMJr:
Well, now you tell Mr. Morkay -- is that the name?
K:
Mulcahey.
HMJr:
Well, you tell him now that 8.8 far as I'm concerned,
we're doing everything we can, but Congressman McCormack
will have to bring pressure directly on Mr. Hull.
97
- 2 -
K:
All right.
HMJr:
I mean, he'll have to bring pressure directly on Mr. Hull
if anything is going to happen.
K:
Uh - huh.
HMJr:
Because I'm going - I've going - I am going as far as I.
can, but you people will have to bring pressure on
Mr. Hull.
X:
All right. I'll be very glad to pass that along.
HWr:
And the sooner the better.
K:
Uh - huh.
HMr:
Okay?
K:
Yes. Thank you very much.
HMJr:
Good-bye.
98
April 6, 1944
4:46 p.m.
Operator:
Secretary Hull is in conference, and I have Mr. Brown,
his secretary.
HMr:
Hello.
Mr. J. E.
Brown:
Hello, Mr. Secretary.
HMJr:
Brown ....
B:
Yes, sir.
H&Jr:
....
at the instigation of Senator Mead and Congressman
McCormack, I ....
B:
Uh - huh.
HWr:
.... have here now in my office, three representatives
of the Orthodox Jewry ....
B:
Yes.
HWr:
.... and -- in regard to this Camp Vitell.
B:
Uh - huh.
HMJr:
I don't know whether -- are you familiar with it?
B:
No, I'm -- no, I don't know about that.
HMJr:
Well ....
B:
Camp Vitell.
HMJr:
Well, let me explain to you, there is ....
B:
Yes.
HMJr:
.... this camp in France where there are -- has been
interned over two thousand Jews on South American
passports.
B:
Uh - huh.
HMJr:
We have been -- well, I say "we" -- Mr. Pehle's been
trying for a month and a half to get a telegram to
go out
B:
Uh - huh.
99
- 2 -
HiJr:
.... unsuccessfully.
B:
Yes.
HMJr:
I believe Mr. Hull met on this thing this morning.
B:
Yes.
HMJr:
Now, the point is that these people are beginning to
be moved out and, of course, to them it means death
B:
Yes.
HMJr:
And all we want to do is to try to get a cable to
Mr. Harrison to make representations with the Swiss,
in turn make representations with the Germans ....
B:
Yes.
H&Jr:
....
and these people's lives are at stake - it's been
delayed a month and a half, and I'd like to still try
to get a decision tonight.
B:
Yes.
HiJr:
And, if necessary, to have Mr. Hull call a meeting of the
War Refugee Board. Either tonight or the very first thing
tomorrow morning, but tonight would be still better so
that the cable could still go.
B:
Yes.
HMJr:
Now, I - - I -- Mr. Pehle and I'll come over and see
Mr. Hull still tonight if he'll see us.
B:
Yes.
HMJr:
But I - I - - I hate to see the sun set on this thing
without the thing being settled.
B:
Uh - huh. I - now, may I inquire about that then,
Mr. Secretary, and then get word back to you ....
HMJr:
Has Mr. Hull got somebody in there?
B:
Well, he has & group of people in there with him, but I'd
try to go in, but it - it looks as if it wouldn't be a
very satisfactory time for you to have a talk with him.
I mean, just at this moment.
100
- 3 -
HMr:
Well, how long do you think it will be?
B:
I - I think it will probably be another quarter of an
hour -- another quarter of an hour to half an hour.
We may be able to get a break in there
....
HWr:
Yes.
B:
.... during that time.
HWr:
The thing really ought to be settled tonight.
B:
Yes - yes.
HMJr:
The question of sending a cable, and - and if you don't
mind my saying, the record over there isn't very good --
it's been pending a month and a half
....
B:
Uh - huh.
HMJr:
and now these people are being moved out, and when
they're moved out, of course it just means murder to them.
B:
Yes, yes. Well, now, I'll get that message along,
Mr. Secretary, just as promptly as I can, and ....
HMJr:
Well ....
B:
....
and I'll call you back.
HMJr:
Well, either you or Mr. Hull call me back
....
B:
Yes.
BiJr:
....
and I'll just sit here and wait until I hear from
you.
B:
All right, sir. Fine.
HMJr:
Thank you.
B:
I'll let you know.
101
- 11 -
RABBI CORFF: John McCormack is sick in bed.
Kinally's secretary is at the Capitol now, and Mr.
Kinnally is at the Senate Office Building now. They
are both due in church in ten minutes. Yes, sir,
today and tomorrow is more or less of a Catholic
Good Friday. They may be on their way to church.
H.M.JR: Why don't we do this - I will wait now and
see these gentlemen. Then if you people won't mind
waiting outside until I can get Mr. Hull, do you see?
They said he would be about fi fteen minutes, but if you
people don't mind--
(The Secretary holds a telephone conversation with
Miss Keefe in Senator Mead's office, as follows:)
102
- 12 -
H.M.JR: I expect another telephone call from
John McCormack before six o'clock. I understand he
is in Maine.
I am doing everything any human being can do.
I will do everything I can do. I had a doctor's appoint-
ment; I have cancelled that. There is no use bringing
any pressure on me. Dring pressure on Mr. Hull.
Don't let John McCormack call me. Let him call
Mr. Hull.
RABBI CORFF: He did, sir. If you will talk to
Mr. Kinnally--
H.M.JR: He called Mr. Hull himself?
RABBI CORFF: He called Mr. Hull himself.
H.M.JR: He had better call him again.
You gentlemen wait. I will see you before you go.
(Rabbi Corff, Rabbi Frankel, and Rabbi Kalmanowitz
leave the conference)
(The Secretary holds a telephone conversation with
Mr. Kinnally in Congressman McCormack's office, as follows:)
103
April 6, 1944
4:54 p.m.
HMJr:
Hello.
Mr.
Kinnaly:
Hello, Mr. Secretary.
HMJr:
How are you?
K:
Nicely, thank you. Incidentally, may I thank
you for seeing the Doctor -- Dr. Corff.
HMJr:
Well, it was a privilege.
K:
He's a good friend of my Chief.
HMJr:
Well, it's a privilege, but here -- here's what
I'm up against.
K:
Yes, sir.
HMJr:
I'm now -- Mr. Hull's in a conference and my --
we've had this matter before the State Department
for a month and a half
X:
Yeah.
HMJr:
trying to get them to send out a cable.
K:
Uh huh.
HMJr:
And we've been unsuccessful 8.8 late as today.
K:
Yes, sir.
HMJr:
The cable should go.
K:
Yeah.
HMJr:
And I'm asking Mr. Hull whether he will see me
still tonight.
K:
Yes, sir.
HMJr:
I don't know whether he will or he won't. And
if he doesn't I'm asking him to convene the War
Refugee Board tomorrow just to consider this.
K:
Uh huh.
HMJr:
Now, I don't know whether Mr. McCormack has
communicated directly with Mr. Hull. Has he?
Regraded Unclassified
104
- 2 -
K:
Not -- no, sir, just through me, sir.
HNJr:
Just through you?
X:
To make these appointments.
HMJr:
Well, I think it will take a call from John
McCormack direct to Mr. Hull to get anything
done.
K:
Uh huh. We'll try to do that. John was to
be out of town for a day or two, leaving today.
HMJr:
Yes.
K:
Over the week-end, you know.
HMJr:
Yes.
K:
I'll see if I can reach him. Is it out of order,
Mr. Secretary, if I tell him I'm directed to do
it?
HMJr:
Directed?
K:
Directed by my Chief to do that -- would you say
it would be out of order if I called the Secretary
and say that my Chief directed me to get in touch
with him? It won't be nearly as effective.
HMJr:
To be honest with you, I don't think it's as
effective as though it were Mr. McCormack.
K:
Oh, surely, I appreciate that. I mean in the
event I can't reach my Chief. I'll get going on
it right away to see if I can reach him.
HMJr:
Well
K:
I mean
HMJr:
it's second -- I mean -- I realize it would
be helpful, but the best thing would be if John
McCormack would call himself.
K:
Yes, sir.
HMJr:
Lacking that, if you would do it, that would be
helpful.
105
- 3 -
K:
Well, it's nice of you and once again, Mr.
Secretary, John does appreciate this. Rather
he will appreciate it when I tell him.
HMJr:
I don't want any thanks for this. I mean this
1s something that I want to do.
K:
Yes, sir.
HMJr:
But you give John my best regards.
K:
I surely will and thank you, sir.
HMJr:
All right.
106
- 13 -
H.M.JR: McCormack never talked to him. I just
was checking.
MR. PEHLE: Rosenman told these people that he
would see Mr. Hull, but all he wanted was a memorandum
from DuBois.
H.M.JR: He called me up and said, "What is the
matter? Isn't your telephone working?"
(To Mrs. Klotz) Let them see the conversation
afterwards.
"What is this stuff about a memorandum? Can't you
call me to the telephone?" Then he goes on and says,
"I don't want the memo. It is a matter for the War
Refugee Board.'
MR. PEHLE: You know, Mr. Secretary, it is a
terrible enough thing that nothing is being done for
these people, but to constantly tell them that things
are being done when they are not--
MR. DuBOIS: The worst crime about this - you know
.hat State is doing - when they offer to see State,
State promises them the Sun and blames It on us that
something isn't being done. I gave these people the
whole fact.
As a result, they have given the facts out, and
I hope they give them out further. State Department
is blaming us for this. They saw Long and Taft and Warren
over there, and in effect they said it was we who were
delaying it.
H.M.JR: Suppose Hull says, "What do you want me
to do, Henry?"
MR. DuBOIS: Send that cable out.
H.M.JR: Where is the part that I want? (Mr. Pehle
indicates)
Regraded Unclassified
107
- 14 -
Of course, these people are 80 excited. You heard
him say they saw John McCormack call. He didn't call.
This man says, "Is it all right for me to say I am
calling for John McCormack? Is that all right?"
I said no.
MRS. KLOTZ: These fellows aren't misinformed. That
is the information they get.
MR. PEHLE: That is right. They are misled all
around.
MR. DuBOIS: The Judge misled them just the same
as the State Department.
H.M.JR: I don't see how Taft and those people
can tell them.
MR. PEHLE: They told them there were just a few
words difference between what they were willing to send
and what they wanted to send, and we were just quibbling.
MR. DuBOIS: A few words make all the difference
in the world.
H.M.JR: I will let you know.
Regraded Unclassified
108
April 6, 1944
6:00 p.m.
Occrator:
He'll be right on.
HM Jr:
Hello.
Hull:
Hello.
HM Jr:
Cordell?
H:
Yes.
HM Jr:
This 18 Henry talking.
H:
Yes.
SM Jr:
Cordell, Senator Mead and Congressman McCormack
asked me to see these three Rabbis, which I did,
and the poor fellows broke down and cried here in
my office, and we had quite a time.
H:
Oh, I'm sorry.
HM Jr:
And it's about - there are some 2300 Jewish people
in a Camp Vitel in France who have got various
kinds of South American passports.
H:
They're in France, are they?
HM Jr:
They're in France.
H:
Has Italy got - has Switzerland got control of it?
HM Jr:
No, and about a month and a half ago the War
Refugee Board suggested a cable to your people
that Minister Harrison would approach the Swiss
to speak in turn to the Germans.
H:
Now by the way Henry, I got hold of that proposed
despatch, and 1 directed my man to strike out
"At the request of this Commission," and say
"At the request of the Government - of the
State Department." Then go on with those things
setting them out. You have seen it, haven't you?
HM Jr:
I have seen it, but that ien't a part - could I
read you a very short sentence?
A
Yes, sir.
Regraded Unclassified
109
- 2 -
HM Jr:
Hello?
H:
Yes, sir.
HM Jr:
The part that our boys thought would be most
helpful is this - "Accordingly, you are requested
to approach the officials of the Swise Government
and advise them of this Government's views."
in
Well, that's what I have Just given our man.
HM Jr:
Yes. Then it goes on - well, we are together 80
far. Then it goes on - "You should request
appropriate officials of the Swiss Government to
approach the Germans in an effort to induce them
to continue to recognize the validity of Latin
American passports.!
H:
Well, that's just what I have done.
HM Jr:
" held by persons in Vittel and elsewhere unless
the Government in whose name the passport has been
issued takes affirmative action to cancel or re-
voke it or deny its validity."
Now that's the meat of it.
H:
I told my man to take this amended thing and call
up your man and read it to him.
HM Jr:
Yes.
H:
And I think it will cover this thing. At any rate,
I have put the Government in there as saying to
the Swiss Government that it is anxious that the
Swiss Government handle this thing along those
lines.
чм Jr:
Well, I think that by mentioning the Government
rather than the Committee that that strengthens
it. But the other part - the draft that I eaw
which a man by the name of Culbertson did we
didn't t feel would do the trick.
H:
Well, I struck out - they had "The Commission" -
I struck that out.
HM Jr:
Well, what I read to you - does that sound all
right?
Regraded Unclassified
110
- 3 -
H:
Well, they had "The Board" on that, and I struck
that out and put in "The Government."
HM Jr:
Well, what I read to you now - does that sound all
right?
H:
I think that's what they have got now with the
changes that I made, and I've got this fellow -
I've been 80 busy on-a thousand things that I
haven't been able to follow all the details.
I told him to get with your man, and I thought
that would take care of it, and he can - I think
you will find that that is what happened.
HM Jr:
Who is looking after it for you?
H:
A man by the name of Warren.
HM Jr:
Warren?
H:
Yes.
HM Jr:
Could Warren come over and see me now?
5:
Yes, I'll be glad to send him over.
HM Jr:
Could he come right over?
H:
I'll tell him - I'll ask him to.
HM Jr:
Well, that is all that would be necessary.
H:
He's not in my office at this time.
HM Jr:
Well, if he could come over now and if you would
tell him that what I read you sounds all right to
you?
H:
I'll tell him to come over.
HM Jr:
I'll wait until he comes.
in
Yes, all right.
HM Jr:
Thank you.
Regraded Unclassified
111
April 6, 1944
6:47 p.m.
J. E.
Brown:
Mr. Secretary.
HKJr:
Mr. Brown, we haven't got any further at all.
I'm really quite upset about this thing. Mr.
Warren is sitting here.
B:
Yes.
HMJr:
He's not questioning my word in my conversation
with Mr. Hull, but he says he can't act until
Mr. Hull gives him instructions.
B:
Yes.
HMJr:
Now, we're no further.
B:
Yes.
HMJr:
I -- I read the paragraph in point.
B:
Yes.
HMJr:
to Mr. Hull. I don't know whether you heard
the conversation or not.
m
Well, he's -- the Secretary mentioned about it.
HMJr:
Yes. And I read it very carefully and I said
a couple of times, "Have you any objection to
this?"
iii
Uh huh.
HMJr:
And he raised no objections.
B:
Yes.
HMJr:
And he said, "I told them not to talk about the
War Refugee Board -- to talk about the Government."
I said, "Well, that's fine."
B:
Uh huh. Uh huh.
HMJr:
Now, here we are -- I've got these
in
Well, do you -- Mr. Secretary, could I venture
this suggestion that if you have
Regraded Unclassified
- 2 -
112
MMJr:
If you please.
B:
the draft as you and Mr. Warren have worked
it out as far as is possible, would you want Mr.
Warren to bring that back and then take it up
with the -- get hold of the Secretary or someone
else who can okay it and get it moving?
HMJr:
Well, look
E
Would that be satisfactory?
HMJr:
We can write the draft the way we'd like -- we'd
like to see it go.
B:
Yes.
HMJr:
I mean, I don't think that -- Mr. Warren's here --
I don't think he will approve or disapprove it
unless he gets instructions. Just a moment.
B:
Yes.
HMJr:
Will you hold the wire a minute? (Aside: Is that
right? I mean, you're not going to say "yes" or
"no" to a draft that We make?) Well, he says he'll
do whatever Mr. Hull suggests, so what it gets down to
1s this: I'd like to have our -- the War Refugee
Board, Mr. Pehle, prepare a draft the way we think
it should go.
in
Yes.
HMJr:
It won't take him fifteen minutes to type it.
B:
Yes.
HMJr:
Hello?
P:
Yes.
HMJr:
Then how can we get it 80 that Mr. Hull can say
"yes" or "no" tonight?
Well, We could, if you felt it necessary, Mr.
Secretary, We could, of course, telephone it out
to the Secretary.
HMJr:
Well, I
Regraded Unclassified
113
- 3 -
B:
Would you think it will be satisfactory if we
hand it to him to take care of the first thing
in the morning?
HMJr:
Well
B:
When -- he'd be a little clearer about it and
have a chance to give it clearer thought then.
Just whatever -- would that be agreeable to you,
sir?
HMJr:
Well, he seemed to understand 1t, but do you
know what time he is usually through with his
dinner?
B:
Frankly, I don't, but I would guess it would be
around eight -- eight to eight-thirty, something
of that sort.
HNJr:
Yeah. Well, the tragedy is, Mr. Brown, this
thing has been delayed so long.
B:
Yes.
MJr:
that I -- I'm afraid I'm going to have to
ask that it be read to Mr. Hull tonight.
F:
Yes.
HWr:
And after all, it can be read to him or it could
be sent to him.
a:
Yes.
HMJr:
So that it could still, after all, if it goes
out tonight, it will be in Switzerland tomorrow
morning. If it goes out tomorrow, it can't get
there until Saturday.
iii
Yes.
HMJr:
You see?
is
Yes.
HMJr:
So, how can we get it in your hands?
mi
Well, if Mr. Warren could bring it back here,
we could take care of it from then and help him
get in touch with the Secretary.
Regraded Unclassified
114
- 4 -
HNJr:
Well, Mr. Warren ought to be back over there in
not more than fifteen or twenty minutes.
B:
Yes.
HMJr:
Hello?
3:
All right, sir.
HMJr:
Do you mind waiting?
in
Not at all, sir.
HMr:
Well, I appreciate your cooperation, but this
is a tragic situation.
mi
Now, if -- Mr. Hughes, who is the night officer
who comes on in the Secretary's office
4MJr:
Yes.
3:
from the close of the business day here,
when the day people go off -- Mr. Hughes 18 on
here tonight.
HMJr:
Yes.
B:
(Clears throat) Excuse me. And he is familiar
with this situation this afternoon.
HMJr:
Yes.
B:
And he will be able to carry on and take care of
it this evening.
MMJr:
Right. Well, certainly when I read it very slowly
to Mr. Hull, what we wanted, I kept saying, "Have
you any objection?" And he said, "No." He said. --
I got the distinct impression that this met with
his approval.
in
Yes. Yes.
HMJr:
But it would be much better for -- from Mr. Warren's
standpoint, that we have a clean draft
B:
Yes.
HMJr:
And that
Regraded Unclassified
115
- 5 -
3:
I think you understand, of course, that Mr.
Warren would want to check it with people
here, wouldn't he?
"MJr:
Yes.
in
Before actually sending it out.
MMJr:
Right. I -- I'm not blaming Mr. Warren, but
all I'm trying to do is to get something done.
B:
Yes. Absolutely.
HMJr:
But if you're not there, Mr. Hughes will be on
duty?
B:
Mr. Hughes will be here. Yes.
HMJr:
And when do you go off duty?
BY
Well, I'm going off probably in -- I'll be going
off just after Mr. Warren gets back here.
HKJr:
Oh, you'll wait for him?
B:
Yes.
H/Jr:
Well, now, wait a minute. I think we already
have -- just a -- (Aside: Do we have a copy?)
B:
All right, sir.
HMJr:
They have a copy so he can leave -- I want to
read it and make sure it's all right -- he'll
leave here within five minutes.
B:
All right, sir. Fine. I'll be here.
HMJr:
You will wait?
B:
Yes, indeed.
HMJr:
I thank you.
B:
Not at all, sir. Any time.
4MJr:
Thank you.
B:
Bye.
116
TREASURY
WASHINGTON
DEFENSE SAVINGS STAFF
April 6, 1944
REGIONAL CONFERENCES
WAR FINANCE DIVISION
April 22 - Saturday
Boston, Massachusetts
Hotel Statler
April 24 - Monday
Atlanta, Georgia
Capital City Club
April 25 - Tuesday
Cleveland, Ohio
Hotel Statler
April 27 - Thursday
Tulsa, Oklahoma
Mayo Hotel
April 29 - Saturday
Minneapolis, Minnesota
Hotel Nicollet
May 1 - Monday
Portland, Oregon
Multnomah Hotel
FORDEFENSE
BUY
CHITED
STATES
SANTINGS
Boxps
other
Regraded Unclassified
117
April 6, 1944
FROM: SECRETARY MORGENTHAU
TO:
MR. GAMBLE
Please do not sign my name to a telegram
of this kind, in the future, without first getting
my personal 0. K. Thanks.
Regraded Unclassified
TED R. GAMBLE
118
WAR FINANCE DIVISION
EXPENSES OF LOANS
APRIL 4, 1944
DR. FRANKLYN BLISS SWYDER
PRESIDENT, NORTHWESTERN UNIV.
EVANSTON, ILLINOIS
I WISH PERSONALLY TO URGE YOU TO CONSIDER SERIOUSLY THE
ACCEPTANCE OF THE CHAIRMANSHIP OF OUR ILLINOIS WAR FINANCE
COMMITTEE. THERE IS NO MORE IMPORTANT JOB TO BE DONE AT
HOME THAN THAT OF FINANCING THE WAR. IT IS UPON MEN SUCH
AS YOU THAT WE MUST RELY IN CARRYING ON THIS VITAL WORK.
HENRY MORGENTHAU, JR.
SECRETARY OF THE TREASURY.
TRG: ecb
X
Regraded Unclassified
119
April 6, 1944
MEMORANDUM
To:
Secretary Morgenthau
From: Mr. Gaston
I talked to Commissioner Nunan in the presence
of Joe 0' Connell about his proposal to send out orders
that the Alcohol Tax men clean up the cases they have
on hand and cease "harassing" liquor dealers. I told
him that I didn't think we had information sufficient
to justify such an order at this moment. I suggested
that he get further information from Berkshire and
Avis as to just exactly what their men are doing and
what further cases they hope to make, and bring that
back for your decision. He said he would do that and
would also look into the situation personally when he
goes up to New York over the week-end.
Mr.
Regraded Unclassified
120
APR 6 1944
Dear Mr. Becket:
I have read with a great deal of interest and
satisfaction reports we have received from William
E. Frank, District Coordinator of the Fifteenth Dis-
trict, Treasury Enforcement Agencies, at Seattle,
of the formation of the Northwest Control Agency to
suppress illicit traffic in liquor and to promote
more effective enforcement of other laws in the States
of Washington, Oregon, Idaho, Montana and Utah.
I was especially pleased by your courtesy in
inviting representatives of Treasury Enforcement Agen-
cies to participate with you in your organisation
meeting and I want to offer you the fullest cooper-
ation by all Treasury agents.
It has long been By belief that the most effective
route to better enforcement and better observance of
both Federal and State statutes lies in good relations
and good coordination between Federal, State and local
law enforcement agencies.
I want to wish the utmost success to the North-
west Control Agency and also to express the hope that
its operations may set a pattern for similar coordi-
nation in other states and regions leading to sub-
stantial improvement in the machinery of law enforcement.
Sincerely,
(Wigned) H. Morgenthau, Jr.
Secretary of the Treasury.
Mr. Evro M. Becket,
Chairman, Washington Liquor Board,
Olympia, Washington.
HEG/mah
Regraded Unclassified
121
/4/6/44
Carbon of memo returned to Gaston
with note that the Secretary asks
"Can you get other sections of the
country to do this.
N
L
76
122
) 7 - 16
April 1, 1944.
MEMORANDUM
TO: Secretary Morgenthau
FROM: Mr. Gaston
At a meeting in Portland, Oregon, on February 8-9,
1944, State Police and liquor control officers of the
five northwestern States of Oregon, Washington, Idaho,
Montana and Utah, set up a permanent organization to be
known as the Northwest Control Agency, which is frankly
patterned after Treasury Law Enforcement Coordination.
The principal Treasury enforcement officers from the 15th
District were present.
The purpose of the new organization, as stated in
the document entitled "Organization Structure", is "to
consolidate and coordinate, voluntarily, all state enforce-
ment agencies, over which the members of the agency have
jurisdiction, in dealing with illicit traffic of alcoholic
liquor in all forms and other enforcement problems."
The concluding paragraph of this document reads:
"The chief coordinator is hereby empowered to establish and
maintain contacts with the United States Treasury Enforcement
Agencies of the Fifteenth District which have pledged their
complete cooperation and assistance with the agency in carry-
ing out the purposes hereinabove outlined."
The Northwest Control Agency elected the following
officers:
Chief Coordinator - Evro M. Becket, Chairman, Washington
Liquor Board.
Assistant Chief Coordinator for Administration -
Ray Conway, Administrator of the Oregon
Liquor Commission.
Regraded Unclassified
123
- 2 -
Assistant Chief Coordinator for Enforcement -
James A. Pryde, Chief of the Washington State
Patrol.
Executive Secretary . - D. B. Rigg, Sergeant, Washington
State Patrol.
State Coordinators were chosen as follows:
Montana - Charles L. Sheridan, Supervisor, Montana Highway
Patrol.
Idaho -
J. C. Sorenson, Director, Liquor Law Enforcement,
Idaho.
Oregon - Ernest M. Jachetta, Attorney, Oregon Liquor
Control Commission.
Washington - Thomas G. Jordan, Member of the Washington
Liquor Board.
Utah -
Lawrence A. Johnson, Commissioner.
Our coordinator in Denver is discussing with Colorado
State officials the possibility of the formation of a similar
organization in that district.
I am attaching a letter to Mr. Becket which you may
wish to sign.
-
6M
Regraded Unclassified
TO:
124
moklitg
attached is to "spech"
u Secty requested me +
I have not chessed of distibuted
is t w hit ,Pelle, is al sime
Ithought u Sity might page
to dicide who should see J.
I have written the way g
think w like would write 3
not u way te Prident milt
want t has is,
28
MR. LUXFORD
4/2/49
125
SECRET
TYPE OF SPEECH WENDELL WILLKIE COULD MAKE
ON OUR ARGENTINE POLICY
In many of my recent speeches, I have taken the occasion
to criticize the foreign policy of the Roosevelt Administration.
This criticism was addressed to the deeds of this Administra-
tion - not its utterances. The old adage "Actions speak louder
than words" finds no more fitting application than that
evidenced by the Roosevelt foreign policy. In fact, careful
analysis will disclose that just as this Administration always
ends up with two agencies charged with doing one job; with two
regulations controlling one act - so, too, we have the paradox
of two foreign policies applied to one world.
Let me be explicit. I charge the Roosevelt Administra-
tion with mouthing one foreign policy and simultaneously by
deeds pursuing another. On the one hand, the American people
are told that the foreign policy of this country is embodied
in such expressions as the Atlantic Charter, the Four Freedoms,
the Good Neighbor Policy and the like, including Secretary
Hull's sentimental 17-point statement. On the other hand, when
the American people behold the deeds of this Administration in
the field of foreign relations, they discover that in
application our foreign policy is a sordid hodgepodge of
Regraded Unclassified
126
- 2 -
expediency, appeasement, vacillation and plain bungling. They
see our foreign policy of deeds exemplified by our relations
with the Vichy France of Petain and Laval. They remember our
"den1" with Admiral Darlan and our petulant insistence upon
forcing General Giraud down the throats of the French in North
Africa in the face of a tidal wave of support for those
Frenchmen who chose to fight for the freedom of France ever
since its downfall in June 1940. They have ever before them
the spectacle of our shabby and begrudging "partial recognition"
of the French Comite, notwithstanding the universality of the
acceptance of this provisional French Government by the French
people.
The American people see our long record of pandering to
Fascist Franco continue despite his consistent aid to Hitler
and notwithstanding the insidious machinations of the Spanish
Falange right in this hemisphere -- yes, right in this country.
They are confronted with the well-nigh unbelievable repetition
of the Darlan incident -- this time in terms of the little
Italian King and Marshal Badoglio. They cannot comprehend our
Regraded Unclassified
127
- 3 -
lack of forthrightness and decisiveness in dealing with Finland
and getting her out of the war.
Thus we see the Dr. Jekyli-Mr. Hyde nature of the
Roosevelt foreign policy. Our foreign policy of words rings
with idealism and the traditions of our national heritage. Our
foreign policy of deeds reeks with appeasement and short-sighted
expediency. No wonder thinking people in this country are
befuddled at our foreign policy! No wonder the whole world is
cynically indifferent to our plethora of high-sounding words;
words which other countries can hardly be expected to use as
guides when we ourselves blandly ignore them! No wonder that
this country, under the present Administration, is witnessing
the withdrawal of the offer of world leadership which was made
to it by a sick world exhausted by old-school diplomacy and
anxiously groping for spiritual and moral leadership, symbolized
by America!
But let me be specific in this analysis of the Roosevelt
Foreign Policy. I propose tonight to put one of our current
blunders in foreign policy under the microscope of public
consideration so that one and all alike can determine the
ultimate cost to this nation of an ineffective foreign policy.
Regraded Unclassified
128
- 4 -
I refer to the Administration's policy toward Argentina.
The Argentine people are perhaps more nearly like us
in customs and mode of living than any of the other people of
this hemisphere. We have many things in common with each other
and I know that the peoples of these two countries mutually
hold each other in high esteem, but strange as it may seem,
the relations between the Government of Argentina and the
Covernment of the United States have not been good for many
years and recently those relations have grown progressively
worse.
Today Argentina is ruled by a small minority of
militarists espousing Fascist principles and anti-United States
views. This minority is not representative of the Argentine
people but is a minority which seized power by force of arms
and forced totalitarianism upon the Argentine people. Thus
today when the American armed forces are fighting on foreign
battlefields against Fascism, we have a Fascist Government in
our own hemisphere. We have 8. Fascist Argentina working
against us at every turn when our State Department has been
proclaiming hemispheric solidarity from the roof tops and
Regraded Unclassified
129
- 5 -
preaching continental security on all sides. Unfriendly
Fascistic Argentina stands today as a monument to the blunders
of our foreign policy -- a monument which grows as our blunders
increase. When we are confronted with such a situation, some
explanation is required on the part of those responsible for
the policy which led to this predicament.
Our policy toward Argentina, if we can be said to have
one, can well be characterized as a series of blunders inter-
rupted only by periods of inaction and indecision while waiting
for a miracle or windfall to improve the steadily deteriorating
situation. To our everlasting shame, we pampered and petted
the Castillo regime which was in power from 1940 to the middle
of 1943 by sending gast quantities of American goods and
materials to Argentina. Merchandise and materials which were
in scarce supply in the United States -- rationed, if you
please -- these were sent to appease Argentina at the expense
of American civilians and at the expense of our loyal Allies
in Latin America who had cast their lot with us from the
moment of the treacherous attack on Pearl Harbor. This aid
not go unnoticed by our friends in the other American Republics
who wondered why Argentina should receive goods which they
Regraded Unclassified
130
- 6 -
needed so badly but could not get at a time when they were
making sacrifices in the war and Argentina was making none.
I might add that our policy has puzzled many pro-Allied
Argentines.
On June 4, 1943, the Castillo Government was driven
from power by force of arms. Unfriendly to us as Castillo
was, and although his government started the suppression of
the free institutions of the then Argentine Republic, it
cannot be denied that he held office under color of consti-
tutional authority, but the same is not true of the
revolutionary regime which installed itself at the point of
guns and finally proclaimed General Ramirez as President of
Argentina. In view of the events leading up to the
revolution, it is difficult for me to understand why our State
Department was not alert and could not have foreseen the events
which appeared likely to follow.
We literally fell over ourselves in recognizing the
Ramirez regime notwithstanding the fact that many of the
leaders of the Argentine coup were men who had close associa-
tions with the Germans and were men of known Fascist background.
Regraded Unclassified
131
- 7 -
We recognized that regime within a week after Ramirez had
proclaimed himself President of the Argentine. Have we ever
acted so quickly in recognizing a. people's Government? Then
Why such speedy recognition in this? Why was this done? Were
the American Embassy in Buenos Aires and our State Department
dsinformed, or uninformed? Who was responsible for this
blunder? Was there any reason to think that men with the
background of the leaders of the revolution would set up a
type of government other than that which they have established?
Our blunder in our speedy uncalculated recognition of the
present Argentine government has helped fasten the yoke of
Bascist oppression upon the necks of the Argentine people at
a time when this country has proclaimed to the world that it
is fighting Fascism.
A policy of action on the part of this Government aimed
et the Fascist clique in Argentina might possibly be questioned
il the activities of the Argentine di ctators were limited to
the oppression of the Argentine people, but there is no
question on this point when the activities of this Nazi-Fascist
group have gone beyond Argentina's boundaries. In fact, this
Regraded Unclassified
132
- 8 -
group has helped stage a successful revolution in Bolivia and
has actively attempted to foment revolutions of a similar
nature in four other South American countries in an effort to
form a bloc of anti-democratic, anti-United States nations in
the southern part of this hemisphere for the purpose of
thwarting the efforts of this Government and those of our
Allies in the successful prosecution of the war and in the
preservation of democratic principles. So long as this group
rules Argentina, there is a threat to the security of the
Whole continent and the hemisphere. For some time to everyone
excent our State Department, this has been evident.
What, I ask, did our State Department hope to gain by
its speedy recognition and policy vacillation? Probably there
is no one answer to this question. Rather the question is
answerable only by understanding that the Administration in its
foreign policy has pursued consistently, and almost without
exception, a policy of expediency; expediency in the worst sense
of the word. To our State Department expediency has meant
seizing upon any short-range advantage, regardless of what the
long-term consequences might be. Always our State Department
has followed the same line. Be sweet and gentle to your
enemies. You can afford to neglect or at least not favor your
friends.
Regraded Unclassified
133
- 9 -
The Ramirez Government in Argentina was able to establish
Fascism in that country more quickly than Hitler had been able
to establish it within Germany. Perhaps our State Department
does not believe that Argentina is Fascist. If it is not, what
would they choose to call it? The Argentine Fascist clique has
mussied the press, dissolved the legislature, intervened the
schools, whose teachings are now patterned along Fascist lines,
and dismissed from school faculties those teachers given to
liberal and democratic ways of thinking. It abolished labor
unions, jailed large numbers of political prisoners and enacted
anti-semitic measures. Many pro-Allied organizations have been
closed down by it. It abolished political parties and called
off scheduled elections. Today the prospect for any free election
in that country does not exist.
The State Department has proclaimed loudly and has pointed
with pride to its Good Neighbor policy. Whenever its foreign
policy is criticized it issues a 17-point program or it pulls
the Good Neighbor policy out of a hat and explains how this
Administration suddenly discovered Latin America and decided
that we should be helpful to the twenty republics to the south
of us. The Good Neighbor policy is not one of the issues which
Regraded Unclassified
134
- 10 -
I desire to debate tonight, but it is my purpose to bring out
into the open and make it clear that the Good Neighbor policy
is not something behind which our foreign policy toward
Argentina can be hidden or in the light of which it can be
justified. I have never understood that the policy was devised
to protect Fascism in this hemisphere. The essence of the
Good Neighbor policy, as I understand it, is that the United
States recognizes the complete sovereignty of the free and
independent peoples of Latin America and undertakes to assist
them wherever possible and to refrain from interfering in their
internal affairs. Does any person in my audience believe that
we are pursuing the Good Neighbor policy towards Brazil, Uruguay,
Paraguay, Chile, Bolivia, Peru or any of the other countries
of South America by fostering on the soil of that continent a
Fascist state imbued with the Hitlerite idea of domination of
what it believes to be its justified sphere of influence?
This sounds like strong language. Let us consider
whether it is justified. I make these charges before the whole
world tonight -- and I challenge the Administration to refute
these charges --
Regraded Unclassified
135
- 11 -
I charge that unless steps are taken quickly to insulate
Argentina and to counter her activities in neignboring countries,
Argentina will be able to create a bloc favorable to her,
sympathetic to her Fascist ideology, and antagonistic to the
United States, consisting of all or some of the following
countries: Uruguay, Paraguay, Bolivia, Ecuador, Chile, and Peru.
I charge that the present Argentine Government is at least
partially under the control of the Nazis and specifically, that
by means of loans, bribes and financial transactions, the Nazis
have a hold on certain members of the "Colonel's clique" now
in power in Argentina.
I charge that Argentina allows pro-Axis propaganda to
flow into this hemisphere and that Argentina is the headquarters
for such activities while at the same time suppressing the
expression of pro-Allied views.
Nor is this all! I categorically assert that Argentina
is rendering positive economic aid to the German war effort.
Argentina is serving as a base of operations where
smugglers engaged in clandestine purchases of diamonds, platinum
and materials vitally needed by the Nazis may concentrate
purchases made throughout Latin America and ship them to Spain
Regraded Unclassified
136
- 12 -
and then to Germany. The two largest government-controlled
Argentine banks are openly aiding the Axis.
German industry is moving to Argentina with the blessing
of the German Government. Fritz Mandl, former Austrian munitions
manufacturer, is now in Argentina actively engaged in founding
an Argentine munitions industry. He was permitted to remove
$12,000,000 from Germany with the consent of the German
Government and now with the blessing of the militarists he
will use it to establish a "little Krupp" in Argentina.
Long as this list is, let me continue with it. The
indictment is not yet complete. Here are further facts, Mr.
President. Can you deny them? I charge that Argentine ports
serve as depots from which Spanish and other neutral ships
carry war materials and couriers engaged in espionage activities
to Axis Europe.
I charge that the extent to which Brazil can provide
expeditionary forces for overseas duty is limited by her need
for having adequate defenses against Fascist-minded Argentina
and the bloc that Argentina is building for itself.
I charge that Argentina is a tool being used by the
Mazis to create a diversion in Latin America which will cause
the United States to divert its concentration from the main
war effort.
Regraded Unclassified
137
- 13 -
I charge that Argentina is being used as a cache for
the loot of leading Nazis and is intended by them to be their
haven when they lose the war and have to leave Europe.
I charge that the Argentine Government is cooperating
with Franco's Spanish Falange in Argentina and that the
activities of the Argentine Government in the other American
Republics duplicates and reinforces the Falangist movement
in attempting to create anti-United States sentiment and an
anti-United States bloc.
And finally I charge that Argentina is probably furnish-
ing aid to the Axis in its submarine warfare.
I call these matters to the attention of the American
people not only because they illustrate how our whole Good
Neighbor policy and doctrine of hemispheric solidarity are
crumbling but, of more immediate importance, because they
offer tangible proof of how Argentina is prolonging the war.
Step by step, there is building up in Argentina a force with
which we will have to reckon. Our victory is hollow if we
defeat the Fascists of Europe, only to find that we have
allowed these same forces to establish and entrench themselves
in our own hemisphere.
Regraded Unclassified
138
- 14 -
Again, what has our State Department done about this
situation? The answer to that question is a clear "nothing",
except, of course, to permit and encourage the purchase of
Argentine meats, grains, edible oils, leather, wool, minerals,
and a host of other things. All, I might add at phenomenal
prices. We, the American people, are giving Fascist Argentina
a prosperity the like of which she has never before witnessed
in her history. But that is not all!. American merchandise
is still being sent to Fascist Argentina.
I maintain that this situation has lasted too long.
We have seen too much of this sort of wishy-washy pusillanimous
attitude. We have seen too much of coddling the Fascists on
the part of American foreign policy makers. We have lost too
much of the respect of the free peoples of the world. I say
that we should stop immediately any merchandise going to
Argentina and we should stop immediately purchases from that
country so long as it is given to Fascist principles and is
actively working against the best interests of the United
States and the United Nations. We should do nothing that
would in any way benefit those Fascists in our neighboring
state. Mind you, I have nothing but love and respect for
the Argentine people, but I have nothing but contempt for
Regraded Unclassified
139
- 15 -
Fascism, regardless of where it may be or in what form it
appears. It seems to me a simple proposition that with your
right hand you cannot fight Fascism and all for which it stands
on the battlefields of Europe and Asia and with your left hand
encourage it in your own hemisphere. I repeat that until
Argentina cleans her house and the Fascists are thrown out,
we should cease all financial and commercial intercourse with
her -- we should treat Argentina as if she didn't exist and
by that I mean more than a mere failure to recognize Dictator
Peron's present puppet, Farrell. I feel that we owe such à
move to our troops on foreign battlefięlds, to the free people
of the world as well as the people of Argentina, to all of whom
we have proclaimed ourselves the champions of freedom and
democracy and fighting a battle against oppression.
It is bad enough that our foreign policy has been one
of a succession of mistakes each following close upon the heels
of the preceding one. It is worse that thus far our leaders
have failed to profit from the lesson to be learned from those
mistakes. We must stop pursuing the policy of feeding the
tiger. Hitler was made strong by the concessions which
preceded his plunging the world into bloody warfare. Hirohito
Regraded Unclassified
140
- 16 -
was nourished on our copper, oil and scrap iron. We must not
build in South America another Fascist state with which
ultimately we shall have to do battle.
It is true, and I do not attempt to deny it, that
severing commercial and economic relations with Argentina
would cause us discomfort and inconvenience and perhaps make
it necessary for us to tighten our belts. Much raw material,
and particularly food, comes to us and our Allies from
Argentina. If, however, we are to achieve our end, the
triumph of demo cracy over Fascism, we must be prepared to pay
the price. Armies and munitions and preparedness all cost
money, but the enslaved peoples of Europe now know that it
would have been better to pay the price of protecting themselves
than to have been ground under the wheels of Hitler's war
machine. It is the same here and now. We have the alternative
of refusing to suffer temporary hardship at the price of allow-
ing the entrenchment of Fascism in our hemisphere. But in
reality this would mean the paying of a far, far greater ce,
perhaps five, perhaps ten, perhaps twenty years hence. We
Americans stand for democracy and freedom. We are opposed to
Fascism. In every speech made by a member of this Administra-
tion on foreign policy, this noble sentiment is stressed with
141
- 17 -
words, but one can examine our foreign policy in action very
long and very earnestly without finding any evidence in deeds
of the sentiment so nobly and so often expressed.
I say to you that when one reviews the action taken on
specific cases, he cannot but conclude that the keystone of
any foreign policy which we may have, appears to be that of
talking democratic principles but of dealing with Fascists
wherever possible on mistaken grounds of "expediency". The
time has come for a change. We have already learned the price
involved in having ultimately to resort to war for want of
taking courageous action in time. I firmly believe that all
parents, sisters, wives and families of American soldiers are
determined that this shall not happen again, but so long as we
continue to deal on all sides with Fascists and at the same
time avow that we are fighting them on the field of battle,
We can only lose the respect of the free people of the world
and cause them to wonder about the principles for which we
are fighting.
I repeat again, Mr. President, that the great tragedy
of this hour is that our government, which alone has any
control over our foreign policy, has lost its sense of
Regraded Unclassified
142
- 18 -
direction and is failing to carry out the great purposes for
which we are fighting. I repeat again, Mr. President, that
the Administration's repeated excuses of "expediency" for
failing to observe the objectives of the Atlantic Charter
are no longer acceptable to either the American people or
to the Allied and ensiaved nations.
What the American people want to know, Mr. President,
is this: When is the American foreign policy of deeds going
to conform to the American foreign policy of words?
Regraded Unclassified
DEPARTMENT OF STATE
WASHINGTON
April 6, 1944
dear Mr. Secretary:
This is in reply to your letter of March 21, reply-
g to the Department's letter of February 24, regarding
rtain financial questions involved in our relations
1th the French Committee of National Liberation.
We have informed the French of the decision that
ivilian supplies for French use are to be paid for in
ollars.
We are in complete agreement also with your view
that no decisions should be taken now which will preju-
dice the disposition of French or other frozen funds in
the United States. In our discussions with the French
representatives here we have in no way discussed the
disposition of Metropolitan France funds located in the
United States and we have no intention of doing 80 un-
less the question 1s raised by the French themselves.
We are not yet prepared to agree to the use of such
funds in preference to other assets held in territories
under the jurisdiction of the French Committee of Nation-
al Liberation. We note, however, your view that such
funds should be used if such use is proposed by the
rench themselves. As you point out, the question need
not now arise, since the assets held by the French in
Africa should be adequate to meet present needs.
I shall write you further if any additional prob-
ems arise in the course of our negotiations with the
rench.
Sincerely Corducesture yours,
The Honorable
Henry Morgenthau, Jr.,
Secretary of the Treasury.
Regraded Unclassified
144
TELEGRAM SENT
PLAIN
UNRRA
April 6, 1944
AMERICAN EMBASSY
LONDON
2679, SIXTH
TO OSBORNE FROM MENSHIHOV AND SALTER #97
APPOINTMENTS OF CHIEFS AND DEPUTY CHIEFS OF FIELD MISSIONS WILL
BE MADE BY DIRECTOR GENERAL AND WILL PROBABLY AWAIT HIS RETURN
HERE. YOUR CABLE RE FARBER WILL BE BROUGHT TO THE GOVERNOR'S
ATTENTION UPON HIS RETURN.
HULL
(GHK)
Forwarded by
Dowsy Anderconiy
4 April 44
DCR:RIH:ATM
Regraded Unclassified
145
RMN-787
PLAIN
Regraded Unclassified
London
Dated
April 6, 1944
Rec'd
11:47 p.m.
Secretary of State
Washington
2831, 6th.
FOR WAR REFUGEE BOARD.
Pursuant to Department's 1812, March 10 and 2273,
twenty-fourth.
Embassy wrote Foreign Office on thirteenth and
twentyseventh and now has reply dated April fourth.
"On the former I have to inform you - have sent
a copy to all our diplomatic missions abroad most in-
timately concerned with refugee problems for their in-
formation.
As regards your letter of the 27th relating to the
President's warning statement to enemy powers and in
particular to Germany issued on the 24th March, you
will by now have seen a declaration of warning similar
in character which was made by our Secretary of State
in the House of Commons on the 30th March. The original
draft had been previously telegraphed to our Embassy in
Washington for communication to the State Department, but
as there were one or two minor changes in the text as it
finally issued, I enclose a copy - 1.E. of the text as read by
M. Eden - for your information. No have also communicated
a copy to the various Allied governments in London and Cairo.
We of course fully share the President's view
of the importance of the psychological warfare value
of his declaration, and on and since the date of
issue of the British statement we have been taking
parallel action in the case of our own statement which
has been broadcast in all our foreign transmissions
so that it should come to the notice of the matellite
governments and their peoples."
Enclosure to letter comprises statement by Eden
house Commons as reported in Embassy's 2647, thirtyfirst.
Miss Chauncey (for the Sec'y) Aksin, Bernstein, Cohn,
Dublis, Friedman, Gaston, Hodel, Laughlin, Lesser, Luxford, Mann,
Mannon, Marks, McCormack, Paul, Fehle, Pollak, Rains, Sargoy, Smith,
Standish, Stewart, Weinstein, H. D. White, Files
146
(Received at WRB April 6, 1944)
2628 (B-2445)
(Received at State Department
undated.)
AMERICAN CONSULATE GENERAL
STRICTLY CONFIDENTIAL
SUBJECT: Movement of Refugees from Greece Through Izmir.
THE HONORABLE
THE SECRETARY OF STATE
WASHINGTON.
SIR:
I have the honor to submit a report on the present
movement of Greeks ascaping from Greece through Immir
gogether with a review of the movement since the oceu-
pation of Greece.
The refugee movement is traced from the early mass
migrations from the islands to the present selective
"escape" service under British-Greek auspices. A review
is given of the changing policies of this service, of
the interruption in the service as a result of EAM policy
and of the Turkish attitude toward the refugees. Sta-
tistics of the movement and an analysis of the present
situation are followed by an account of the experiences
of two parties, which throws light on conditions in Greece
and the extent of German control of land and sea.
Greeks began to reach Turkish shores in small num-
bere both from the islands and the mainland in April 1941
just before the completion of the German occupation. It
was not until the late auturn of that year that large
numbers of refugees began to arrive from the islands.
They continued to come throughout the winter at the rate
of about 300 a week. Most of them were from Chios and
Samos, a smaller number from Icaria, and very few from
Mytilene where the German control was very strict. They
continued to come in small numbers during the summer and
autumn of 1942, and although the number increased during
the winter of 1942-43 it diddnot approach the migration
of the first winter. By August 1942 when British arrange-
ments for moving the refugees southward were completed
there were over 7,000 in Chesme, about 55 miles from
Imir and several miles from Chios. By February of 1942
only
Regraded Unclassified
147
- 2 -
only a few hundred were left there. The first step in
the long journey southward, which for some thousands
ended in the Congo, Abyesinia and Kenya, VAE Aleppe, where
those eligible for military service were mobilized.
The movement of the refugees from the islands and of
A much smaller number from the more distant maillandies
the result of famine conditions. It was not until the
winter of 1942 that with the establishment of & British-
Greek service operating from Izmir, the escape movement
was organized and to some extent controlled from outside
Greece. Local organizations within Greece had facilitated
departures but had lacked regular contact with the British
And Greeks in the Middle East. After a time the organized
service developed the policy of discouraging large scale
migrations of refugees with the idea of encouraging the
departures of selected groups eligible for the free Greek
forces in the Middle East. Still later, probably about the
beginning of 1943, an effort was made to route island refu-
gees to Cyprus.
The selective escape movement that began early in 1942
was actually directed by Greeks, who were, however, attached
to the British service and subject to British orders. Major
Tsignates, who was later killed in Athens by the Italians,
headed the work in Greece and Captain Zangas directed the
activities from the Ismirend. Their political opponents
make the charge that they brought out chiefly democratic
officers who were responsible for the revolts in the army
in the winter of 1943. Greek democrate were undoubtedly
responsible for an organised effort to change the leader-
ship of the army, which they believed to be Boyalist-
Hetaxas. The revolts in the army led to the reorganization
of the Government and the inclusion of a majority of repub-
licans but at the same time the Greek service in Ismire,
always nominally under the English. lost all freedom of
action. The independent policy of Captain Zangas, to which
the events in the army were attributed, led to an open
break and he was replaced. His successor, though sharing
his views, lacked his power. For a time, at least, the
policy was reversed and royalist officers and sympathisers
were given preference. There were to branches of the
British service and the smaller and less influential is
said to have been at a disadvantage in pursuing a policy
similar to that of Zangas. The present set-up of the or-
ganisation and the relations of the Greeks to the British
remain substantially what they were after the departure of
Captain Sangas, although B. reasonally smooth working arrange-
ment seems to exist."
The recaputre of Samos by the Germans in November 1943
brought a temporary renewal of the mass refugee movement.
Over 5,000~took refuge in Turkey but these were quickly
moved south to Syria. Shortly afterwards in December 1943
%ote: It 1s understood that the American Office of Strategic Services operating from
Imir does not engage in "escape" actifities, at least not on 8 large scale.
Regraded Unclassified
148
- 3 -
there vas an almost complete stoppage in the escape move-
ment, when RAM in centrol of Euboea seized two of the boats
operating in the British-Greek service and refused to allow
departures, except for Jews. Although Greeks continued
to escape in small numbers from the Attic coast and else-
where. the British-Greek service had lost its Euboean
port and until late in January what had come to be its
more or less regular service of boats crossing and re-
crossing the Asgean ceased. It is said that NAM relented
only when threatened by the British with complete stoppage
of supplies. Even then EAM reserved the right, however,
to control all departures with the understanding that
army officers and men of military age, with the exception
of naval and air force personnel, wold not be allowed to
leave. Thus the arrivals in Benir began to decrease about
February l. In the five following weeks 357 names appeared
on the liste compiled by the Greek Consulate, by far the
greater number coming from Buboean ports. It is probable
that in addition various small groups totalling about 50
arrived during the same period.
In the early days of the movement many parties were
fired upon by the guards on the Turkish coast. Some
parties were prevented from landing and others ordered
to get back into their boats and depart, The Refugees
then began the practice of landing some distance from
Chesme and destroying their boats. As late as the summer
of 1943 wrecks of these boats could be seen on the coast
near Chesme. Turkish policy varied from time to time,
sometimes because of the attitude of the local authorities
and possibly occasionally because of instructions from
higher up but difficulties were usually solved on the
spot, probably through the use of time-old methods. For
some months a better understanding on the subject at
Ankara is said to have facilitated matters for arriving
refugees and this understanding is probably enforced by
A. better and more regular financial arrengement with the
local officials. The arrangement stood the severe test
of the migration of 5,000 from Samos in November, when
in fact the Turkish authorities facilitated their entry
and special trains were promptly provided to take the
refugees to Syria.
Boats from Greece land frequently. with few diffi-
culties and a minimum of formalities. There have been
rare but serious exceptions. It is reported that two
parties, one from Samos and one from Chies within the
last two months, have met with tragic fates. The men
were brutally murdered and the women raped by Turkish
gendarmes but the authorities are said to have taken
drastic measures to punish the offenders and to prevent
a recurrence. Boats coming in still run the risk of
being fired upon but this is probably unavoidable, be-
cause of the impossibility of giving notice of arrivals Breeks
and the difficulties of establishing identity.
Regraded Unclassified
149
in general take the attitude that in view of Turkey's
status as a neutral, her willingness to countenance the
continual movement of Greeks from German-occupied terri-
tory to her shores, and her failure to intern those who
have escaped illegally for the purpose of joining the
Greek army, most be gegarded as most gratifying. The
arriving Greeks are no longer detained at Chesme but
are brought to Ismire. Those who have funds to engage
rooms in hotels or pensions are free to go about the
city. The others are quartered in an old Turkish han
and are under police surveillance. Most of them in
Immir less than a week awaiting transportation to Syria.
According to the Greek Consulate of Izmir approxi-
mately 37,000 Greeks, including about 1,100 Jews, have
reached the Imir region since April 1941. About 19,000
of them have come from the mainland and about 18,000 from
the islands. It is e stimated that 18,000 of them have
joined the Greek forces in the Middle East. The above
figures do not include 300 Grakks from the Dodecanese
who went through Ismir nor the 8,000 from those islands
that landed near Kushadasi in the Aidin region.
Of the appoximately 400 that arrived between
February 1 and March 7, 77 came from the island of Icaria
and practically all the others, including about 50 Jews,
from the Athens region. A large majority of those from
the mainland came out through Euboea and 60 were controlled
by RAM. Probably a third of the total have come out by
their own arrangement or with the assistance of local
organizations. For these the only requirement is the
price of the passage but those who come out through the
regular Allied services are supposedly selected and
brought gratis. An effort is made to select those who
can best serve the Allied cause but EAM insistance that
it is the patriotic duty of all army men and officers to
stay in the country to fight the enemy no doubt compli-
cated the selection. Navy personnel is permitted to
leave and among recent arrivals they have represented a
large proportion of the men of military age. However,
the demand is now said to be less for navy personnel which
at present numbers approximately 10,000. Those who have
served in the air force are also permitted to leave but
this is a smallgroup, and for one reason or another an
insufficient number of mechanics and technicians for the
air force and army are brought out. The departure of men
over 45 is not encouraged and ordinarily no women and
children, except Jews, are included in the parties.
Regraded Unclassified
150
5
The experiences of refugee parties are of interest
in showing conditions in Greece and the extent of German
cortrol both of the coasts and the sep. One party that
left in February assembled at a small village on the
east coast of Attica, the arrangements for the trip having
been rade within Greece, They left Athens in groups of
two or three, some by train, some by bus. Since all were
obliged to pass 8. German control, each was supplied with
permission to leave A thens, which vas obtained on one
pretext or another. They spent 8. night and day in the
village and were picked up the following night, as sche-
duled, by a small fishing boat with a motor and sails,
The captain drank for several hours with the German guards
in a nearby port and when he judged they were no longer
awake to their duties he sailed out of the port. A stormy
sea caused the boat to put in on the north coast of Andrea
where the party spent a. night and a day in a cave. Then
they proceeded to Tinos, as planned, to pick up other
passengers, bringing their number to 27. A guide avaited
themat the cave where they put in and led them for four
hours in rain and darkness up steep rocky trails to the
lodgings in a village. The next night they returned to
the boat by the same route. From Tinos the boat, favored
by a following wind but sometimes endangered by rough seas,
made good progress toward the Turkish coast, arriving at
a point near Ismir in 16 hours.
Another party of 50 left Athens in small groups about
the same date, crossed the Gulf of Euboea in bright moon-
light and reached the shore of Euboea within sight of a
German fort north of Kretria. They crossed the island on
foot or by mule back and vaited for eighteen days in a.
fishing village. Before leaving Athens, their names were
approved by RAM and they were told that the organization
in Bubesa would have the necessary instructions regarding
their departure, On arrival, however, it was found that
the local EAM authorities had not received notification
and therefore could not permit the party to proceed. One
of the group was sventually sent back to Athens to arrange
the matter but before he returned the party was ordered to
report to the BAM commander] The group of 60 was called
together and told that in fifteen minutes theywese to
start out for the commander's headquarters in the mountains.
They walked for twelve hours, much of the time through
deep snow, before reaching the village where the commander
had his headquarters. There an old peasant appeared and
announced that he was the leader (politices Mathodiyitis)
of EAM and informed them that they were to continue for
another five hours to the place where the regimental com-
mander was at that time. Their desparir at this announce-
Regraded Unclassified
151
- 6 -
ment was somewhat tempered an hour later when the leader
returned to inform them that they were to return to the
fishing village from which they had come. Because of re-
ports of Germans being in the neighborhood, they were ad-
vised to take a different route for their return and this
required fourteen hours of walking. Some days later an
EAM representative who became a member of the party ar-
rived from Athens, bring the permit for their departure.
An incident that occurred during their wait in the
village furnishes another illustration of the control ex-
erdsed by EAM. About twenty young men, most of them
veterans of the Albanian front, came to the port from
nearby villages in the hope of joining the party, giving
the EAM authorities the excuse that they had come to do
some fishing. They were sent back to their villages
after being required to sign a statement that they would
not leave Greece.
The party, which by this time numbered 77, finally
embarked 16 days after the original group of 50 reached
the port. They erossed the Aegean by daylight and, sur-
prising as it may seem, took a course north of Chios and
reached Chesme through the narrow strait between that
German-occupied island and the Turkish coast.
A boat carrying escaping Greeks or one returning to
Greece crosses the Aegean almost every day. The ports of
departure, even those in territory not held by the andarts,
appear to be reasonably safe from interference by the enemy
and once at sea, except for the hazards of weather, there
is little to fear. Allied planes were a source of concern
until a signal system was arranged. Some of the boats are
small and not seaworthy and unsuitable landing places pre-
sent considerable danger. Recently five of a party of 50
were drowned when the boat hit a rock just off the Turkish
coast and capsized.
Respectfully yours,
Button Y. Berry
American Consul General
To Department in original
and hectograph
File No. 820.02
RWD:gdw
Regraded Unclassified
152
TO CONSUL GENERAL, JERUSALEM, FOR ARYEH BENELIEZER, TELAVIV
Please deliver the following message to Aryeh Beneliezer,
35 Rashi Street, Telaviv, from the War Refugee Board.
QUOTE Imperative you proceed Turkey immediately take
charge our rescue activities there very urgent STOP cabled
expenses thousand dollars via American Express STOP cable reply
STOP Will Rogers Co-Chairman Emergency Committee. UNQUOTE
It is noted that the State Department refused to transmit
the attached cable when it was signed by Will Rogers and Peter Bergson,
on the ground that Bergson is a political figure. Bergson's name has
been removed and it is signed only by Mr. Will Rogers as Co-Chairman.
(r.Rogers, as you know, is a member of Congress.
It will be appreciated if you will have the cable dis-
patched at once to Mr. Aryeh Beneliezer, 35 Rashi Street, Telaviv,
and bill the Emergency Committee to Save the Jewish People of Europe,
for the cost of the message.
JHMann:cb 4/6/44
April 6, 1944
11:35 am
Regraded Unclassified
153
PARAPHRASE OF TELEGRAM SENT
FROM:
Secretary of State, Washington.
TO:
AMLEGATION, Tangier.
DATED:
April 6, 1944, 3 p.m.
NUMBER: 43
CONFIDENTIAL
The following message to Childs from War Refugee Board.
Please transmit the following message from Jacob S.
Cohen to Aaron S. Cohen, Calle Tetuan, 17, Tangier:
There is being held for your account $3,000 received
from Vaad Hahatzala pursuant to Treasury license issued
to that organization. Renee Reichman, 25 Rue Moliere,
Tangier, will communicate with you and it is requested
that you pay the equivalent of $3,000 to him.
HULL
Regraded Unclassified
154
RECT-594
PLAIN
Lisbon
Dated April 6, 1944
Rec'd 5:12 p.m.
Secretary of State,
Washington.
1033, sixth,
Following for War Refugee Board and Rabbi Stephen
Wise Nahum Goldman, World Jewish Congress, New York,
from Isaac Weissman.
"Our different children rescue organizations
already working. Received 11 children others awaited
daily and continually please intervene urgently for
cable transfer from War Refugee Board budget to
American Legation Lisbon with necessary instructions or
do utmost for other urgent cable transfer if rescue
work should not. Expecting cable answer".
NORWEB
EJH
Regraded Unclassified
155
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Ambassador, Madrid
TO:
The Secretary of State, Washington
DATE:
April 6, 1944
NUMBER: 1195
SECRET
For reasons pointed out in my message number 974 dated
March 20, I do not feel that steps should be taken toward
putting into effect any such plan of operations as that which
was proposed in Department's message number 799 dated March
23 until and unless it becomes more clearly evident that the
War Refugee Board's efforts to stimulate the exodus of un-
protected and stateless refugees from German occupied terri-
tories will result in fact in an increase in the number of
such refugees entering Spain sufficient to tax the facilities
which already exist for their care. My strong recommendation
is that the Board attempt to take full advantage of the already
proven facilities which are already in existence in the form of
Blickenstaff's organization instead of endeavoring to set up
an elaborate organization on the assumption that it will be
justified by future developments, an assumption with which I
am not prepared to agree as yet. Blickenstaff's organization
has shown itself to be fully capable of coping with the problems
which have arisen sofar in connection with the care of state-
less refugees and it has also already obtained the confidence
of the Government of Spain. It is essential that the wishes
of the Spanish Government in the matter be not disregarded
inasmuch as the success of the activities of the Board in
Spain would depend in a large part upon the willingness of
the Spanish Government to cooperate and although it would
quite willingly recognize Blickenstaff as & representative
of the Board I can state with assurance that the Government
of Spain would prefer that this work be left in the hands
of Blickenstaff and his organization. The Government of
Spain would be suspicious of and disfavor any endeavor on
the part of the Embassy to set up in Spain such an organiza-
tion as is envizaged by the Board 80 long as the problem of
stateless refugees can be handled adequately without such an
organization and an unsalutary effect on other more important
objectives might well be caused by such an attempt. In the
absence of any apparent need for the presence of the numberous
personnel mentioned by the Board, & request for admission
into Spain might for example prejudice the admission of other
personnel whose importance to the war effort is more direct.
If the existing facilities for the care of stateless and
Regraded Unclassified
156
2- #1195 from Madrid
unprotected refugees should be overtaxed and if a situation
should develop in the future as the Board foresees, doubtless
the Government of Spain would look favorably upon the expansion
of such facilities but it is felt that no good purpose could
be served by endeavoring to press the proposal of the Board
until such time arrives.
The efforts of the Board to assure further destinations
to which these refugees can proceed should be of the utmost
value regardless of arrangements made for their care within
Spain. During the past year the most important single ob-
stacle to the complete effectiveness of Blickenstaff's work
has been the lack of such destinations. It is to be noted
in this connection that the French authorities have rejected
nearly one fourth of the Fedhala applications which have
been submitted BO far to North Africa for final approval.
HAYES
DCR:MPL
4/8/44
Regraded Unclassified
157
PARAPHRASE OF TELEGRAM SENT
TO:
American Legation, Bern
FROM: Secretary of State, Washington
DATE: April 6, 1944
NO.:
1168
CONFIDENTIAL
Following is for Harrison from War Refuges Board.
It is requested that the following message from
Andre Meyer, New York, be transmitted to Jean Frederic
Bloch Laine, Hotel de l'Ecu, Geneva.
There have been appointed members of the War Refuges
Board the Secretaries of War, State and Treasury for the
purpose of taking all action to resoue victime of enemy
persecution and bringing them relief. In a public state-
ment on March 24 President Receivelt urged the free peoples
of Europe to open their frontiers temporarily to all via-
time of enemy oppression. It was stated by him that means
will be found for their support and maintenance until the
tyrant is driven from their homelands and they may return
and in the meantime havens of refuge will be found for
them.
According to a report received here, the Swiss Govern-
ment is not admitting Jewish refugees from France except
children, old people, pregnant women and those having
close relatives in Switzerland. I have consulted with
the War Refuges Board and with their approval I ask you
to enlist the aid of influential Swies persons (1) the
make inquiries into the accuracy of the report mentioned
above and (2) if the report proves to be correct, to
intercede with the appropriate authorities to obtain -
modification of the Swies procedures on humanitarian
grounds. We will appreciate whatever you can accomplish
in this direction and you may have suggestions for action
to be taken here by use The American Legation at Bern
will transmit messages to me through the War Refugee
Board and you can report to no through this channel any
developments in the matter which may take place.
Regraded Unclassified
158
PARAPHRASE OF TELEGRAM RECEIVED
THE
The American Minister, Bern
The Secretary of State, Washington
MX:
April 6, 1944
TODER: 2122
CONFIDENTIAL
Aa outlined in paragraph one (E) of Legation's number
1334 lated March 4, the list of surgical dressings and
edical supplies for purchase shipment to Jewish refugees
been submitted to two Legations by the mixed relief com-
dission, International Red Cross. Insulin and what appears
to be marectics are among the supplies. Is the Legation cor
nivet in its belief that the list mentioned above is not subject
711 the joint approval of the British and this Legation and that
rercotics and insulin not required be referred to London
jointly under instructions contained in the exchange of messages
lietween the British Legation and the Ministry of Economic war-
Care since purch (*) itties funds turned over to the Red Cross
under Treasury license with full leeway? In this connection
please see telegram number 44 Embassy London to Legation dated
February 25. To London this is being repeated.
Since the Legation is withholding 8. reply to the mixed
relief commission, early instructions from the Department are
requested.
HARRISON
(*) Apparent omission
4/7/44
Regraded Unclassified
159
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Minister, Bern
TO:
The Secretary of State, Washington
DATE:
April 6, 1944
NUMBER: 2123
CONFIDENTIAL
US URGENT
The following message is from Zurich.
On April 3 there was held here a conference of visa
officers from the Consulates at Basel, Geneva and Bern. Upon
production of the following evidence it is proposed to facili-
tate the issuing of immigration visas to the refugee children
referred to in Department's number 891 dated March 18 to the
Legation at Bern, provided the Department has no objection.
1. Date and place of entry into Switzerland which could
be contained in a statement from the Swise Federal police.
2. There should also be produced a birth certificate
but if this is not available the above statement of Federal
police should include date and place of birth as given on entry
into Switzerland (the Swies Federal police will readily give
such statements since they are very cooperative).
3. Also a medical certificate from a doctor approved by
the Consulate.
4. Photographs - three.
5. If available, passport or other travel document;
however, if not available visa should not be denied because of
this.
6. Ten dollar fee.
Upon reissuance only fees and photographs will be neces-
sary. It is the expectation that almost all children will be
presented by refugee organizations to the Consulates.
It is
Regraded Unclassified
160
2- #2123 from Bern
It is reported by Dr. Donald Lowrie of the YMCA who is
on the committee of refugee organizations in Switzerland, that
since January 1, 1944 approximately 120 refugee children under
sixteen have entered Switzerland from France, and that the most
optimistic estimate 18 that before June 30 less than 1,000
additional may enter. It is reported by Dr. Lowrie also that
the authorities of Switzerland have been most cooperative and
that last November they confidentially agreed to accept fifteen
hundred unaccompanied children but that there has been a great
increase in difficulties on the French side of the border. Be-
cause of the strictness of the German border control it is most
unlikely that any children will come in from Germany. Accord-
ing to Dr. Lowrie it was also confidentially agreed by the Swiss
in February to allow "passers" with children to stay for twenty
four hours in Switzerland and that it is not yet certain that
American immigration visas for these children will be required
by the Swiss. Up to the present time none have applied
HARRISON
DCR:MPL
4/7/44
Regraded Unclassified
161
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
American Legation, Bern
TO:
Secretary of State, Washington
DATED:
April 6, 1944
NUMBER: 2137
CONFIDENTIAL
On April 3 there were delivered to Bertholst through
the Burich Consulate General the messages contained in
Department's cables of March 14, no. 839, and March 24,
no. 980.
HARRISON
Regraded Unclassified
162
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Minister, Bern
TO:
The Secretary of State, Washington
DATE:
April 6, 1944
NUMBER: 2139
SECRET
US URGENT
The following message is for the Union of Orthodox
Rabbis Vaadhahatzala from Sternbuch.
Regarding interned at Vittel, substance was sent to
you through the Department of State by the American Legion
at Bern in my last report. It is urgently necessary that
the Spanish Ambassador in Berlin, who either ignores the
interests of Paraguayan citizens or is not watching them
well enough, take energetic action. (See Legation's number
1994 dated March 31 for the Department.) Firmness by
Spanish Ambassador is urgently necessitated because of the
fact that the Geneva ruling against Jews, according to the
Red Cross, has been particularly drastic for about three
weeks. Kindly take immediate action and urge intervention
with the Government of Spain at Madrid by the Paraguayan
Government.
HARRISON
DCR:MPL
4/7/44
Regraded Unclassified
163
COPY
THE ROYAL LEGATION OF RUMANIA
Ankara, April 6, 1944
Simond:
Since our conversation yesterday I have learned that the American bombing
of the cities of Bucharest and Ploesti has caused numerous victime among the
civilian population. Women, children are dead or have been seriously injured.
I fear gravely in these dark hours which my country is now undergoing that
the resentment which these bombings will not fail to provoke and the confusion
A:ch they will undoubtedly cause vill render more difficult the task in which
-* CIP commonly interested.
It is possible that simple souls with little knowledge of the complexity
of military problems will ask whether there is not & certain lack of harmony
Setween the noble and highly humanitarian task which is being pursued on the
one sice, and the bombings on the other which strike down persons who have
"ever committed En act of hostility against the United States.
To desire to save children with one hand end to kill them with the other -
is that not 8. tragic contradiction?
The Allied bureaus of information give us, however, an explanation according
to which the American Military High Command purports to carry out these bombings
46 display of solidarity with the Soviet Union and in order to aid Soviet
_ilit-ry operations.
However, cannot one ask why the United States, at the exponse of Rumania,
-roves its solidarity with the Soviet Union when this solidarity does not find
it. counterpart on other battle fields?
It is only necessary to glance at a map in order to realize that the war
og-Inet Janan could be ended in three weeks if the Soviet Air Force were to bomb
the cities and norts of Japan or at the very least if the Soviet Union placed
in territory st the disposition of the American Bomber Command.
Should we conclude that for the United States, Rumania 1s P. more formidable
méversary than Japan?
1n jerson to Hr. you Hirschmann at the time of our interview yesterday, if I
I beg of to excuse these long observations. I would have mentioned I had at them
that tive known about the bombings of Bucharest and Ploesti, I fear that will shall
not Es able to him again before his departure. Perhaps, however, you of
be villing to tell DOB him about this in transmitting to his with the sesurence
as TENSONAL respect and esteem the expression of my hore that despite everything
our common efforts will not be in vain.
Thanking you in advance, I am
Sincerely yours,
e E. CRETZIANU
Minister of Rumania.
Translated from the French by M.J.Marks)
Regraded Unclassified
164
COPY
American Ankara,
April G.,
MEMORANDUM TO THE AMBASSADOR
Upon returning to Ankara today, Mr. Sincern transmitted
further data regarding his talk with Von Paper, the German
Ambassador.
After importuning him regarding the 38 TRUTY and the
release of the Jews, V. P. is alleged to have said, "I
don't understand my government when it has the opportunity
to release these people and it fails to do SOL, They can be
a dangerous fifth column besides everything V. P.
is even worried about the children to be released asking if
Simond was certain that they would be properly taket care
of in Palestine. V. P. also said that he coulto not under-
stand why the requests for safe conduct in mar instances
had not been forthcoming. He promised immediately to send
a straight cable to Berlin to the effect that, "You must
let these people go. It is not a military mestion."
V. P. said that he had already sent a to his
government protesting the German government policy in
molesting the Jews in Hungary. "why kill the ne said,
"It would be much wiser to put them in caros. Bixond also
reported that V. P. indicated, but not in any NOTOS, his lack
of sympathy with the Hitler government; that 2 had never
expected it to last so long; that as an aristontat and a
Catholic, he could not be in sympathy with it., end that
V. P. has indicated on a number of occasions du record
that he is not anti-Semitic and that in suite di visat
others say, he left many good friends in Wassington among
whom were some Jews.
At the end of the conference, V. P. 3810 TOO Simond,
"You can trust me-the ship will go." He me no
restrictions whatever and did not resort to TO usual
reservation of promising subject to his government / F
authorization. Simond had the impression tost L. F, had
heard about the War Refugee Board's work and = V. P. was
aware of the United States Government's croftami interest
in the subject. Simond sent a cable to General covering the
above situation. If he does not hear from To Fanen within
a week, he will go back to him.
Simond volunteered and was rather emportir in H18 state-
ment that if and when I return, it would be to have
a talk with Von Papen and him.
I. A. Hirscomeam
Regraded Unclassified
165
CABLE TO AMBASSADOR STEINHARDT, ANKARA, TURKEY FROM WAR REFUGEE BOARD
Please refer to your No. 590 of April 3.
If SS TARI chartered to War Refugee Board war risk will be insured
through War Shipping Administration at seven and one-half percent.
Notify us when insurance to be placed so that arrangements can be made
here. It will be necessary to know that vessel is safely in port and
that it will sail within fifteen days of the time insurance is obtained.
Please advise of final value placed on boat in order that value in
dollars may be computed in determining insurance and premium.
This is WRB Cable to Ankara No.
19
JBF:bbk - 4/6/44
April 6, 1944
9:50 a.m.
Regraded Unclassified
166
URGENT
CABLE TO MINISTER HARRISON, BERN FROM WAR REFUGEE BOARD
Reference your cable 2049 of April 3.
Obtaining of German safe conduct for SS TARI is matter of
extreme urgency. If you have not yet received & reply from the Swise
Government it is suggested that you again approach the Foreign Office
on this matter. For your confidential information, Turkish Government
has agreed and Swedish Government is now being requested to support
the Intercrose request for safe conduct.
This is War Refugee Board Cable No.
April 6, 1944
5:20 p.m.
MJM:JBF:bbk - 4/6/44
Regraded Unclassified
167
NOT TO BE RE-TRANSNITTED
COPY NO. 11
SIX RET
OPTIL No. 111
Information received up to 10 a.m., 6th April, 1944.
1. HAVEL
Convey of 49 ships has arrived North PUSSIA without loss,
Duving
passage this convoy total 3 U-boats sunk and 6 German
shot down
On 20th March, one of H.H. Submarines danaged a 5,000
too twice by gun fire in ONEGLIA Harbour near GENOA.
2. ALLETARY
RUSSIA. Russians have cantured RAZDELNAYA on ODESSA-
TIPNEPOL railway and have closed in further on Germans surrounded
in SKALA free.
BURMA. Our troops have mrde further progress in ARAKAN.
Jepanese have made several small attacks on our positions about
10 miles north of IMPHAL and appear to have reached the IMPHAL-
KOHIM. Doad 35 miles north of former.
3. AIR OPERATIONS
RECLRN FRONT. 5th. Total 510 Thunderbolts, Mustangs
and Lightnings sent to attack airfields in Bestern FRANCE and
GLAMANY. A large number enemy aircraft claimed destroyed or
demaged on ground in GERMANY. 8 Tighters missing. Other fighters
over Central and Northern France cirfields scored 12, 1, 15 on
ground and in the cir.
5th/6th. 147 Lancasters and 1 Moscuito sent to air-
croft repair and assembly plant and airfield TOULOUSE. Pre-
Jamin my reports indicate successful attack in good visibility.
Landoster missing. 24 Stirlings sent sea-mining. /. Mosquito
Intruder destroyed 3 and Gamaged 3° aircraft on ground at METZ.
ROUMANIA. 4th. 313 escorted U.S. heavy bombers dropped
786 tons from high altitude on goods yards and repair shops
M
BUCHAREST. About 200 enemy sircraft net, soveral were shot down.
9 bombeys missing, 1 in sea.
5th. 521 U.S. heavy bunbers with 191 fighter escort
sent PLOEST). Teather adverse but 230 bombers Ltacked dropping
520 tons on railway centre. Cemen reaction by about 150 eir-
assft, claims not yet available. 10 bombers missing.
HUNGARY. 3rd/4th. 7 heavy and 63 medium bombers
thered in aero engine Pactory at BUDAPEST. 5 mediums missing.
Regraded Unclassified
168
April 7, 1944
9:15 a.m.
JEWISH EVACUATION
Present: Mr. Pehle
Mr. Luxford
Mrs. Klotz
MR. PEHLE: At ten o'clock last night Warren called
back.
H.M.JR: Talk a little louder.
MR. PEHLE: I am trying to be quiet.
Mr. Warren called at ten o'clock, and he said that
Mr. Hull had agreed to send a message that the War Refugee
Board wanted sent, but that he was going to have a meeting
this morning in his office the first thing to go over the
language. I asked who would be at the meeting, and he said
Mr. Hackworth, their Legal Adviser, Dunn, and probably
Culbertson. So that was that.
H.M.JR: He agreed to send it, but--
MR. PEHLE: But he was going to go over the language.
And Warren said that Mr. Hull didn't want this thing to
interfere with other things that might be in the mill,
but he was very vague on it, and it was obvious he didn't
know what the other things were.
Two minutes later Rabbi Corff called me and said,
"Well, you will be glad to hear they are sending the
message out."
H.M. JR: They said Corff tried to get me. The lights
were off, and I was practically asleep at nine-thirty. I
just couldn't take it any longer.
MR. PEHLE: There is no reason why you should.
He said, "They are sending the message out."
Regraded Unclassified
169
- 2 -
I said, "That is interesting."
He said, "I just talked to Warren and he said they
were sending it out."
I said, "They are going over the language tomorrow
morning."
He said that Warren had assured him that there would
be no changes. So right in the space of two minutes they
were giving them one side of the story and giving me
another. That is where we stand.
H.M.JR: So you don't know.
MR. PEHLE: I don't know, but I will hound them all
morning.
H.M.JR: I don't think there is any sense in that now.
MR. PEHLE: I don't think there is at this point. We
have to see what changes they want to make.
MRS. KLOTZ: Did he see Hull last night?
MR. PEHLE: He said he got to Mr. Hull through Mr.
Dunn; Warren said that.
H.M.JR: How did the Rabbi know?
MR. PEHLE: The Rabbi talked to Warren.
H.M.JR: He just called him up?
MR. PEHLE: Yes.
MRS. KLOTZ: They won't stop at anything.
H.M.JR: They are right.
MR. DuBOIS: He was calling at ten-thirty to find out
what had happened. The Rabbi has some further news up
his sleeve if nothing happens by ten-thirty.
Regraded Unclassified
170
- 3 -
H.M.JR: What is it?
MR. DuBOIS: Well, he may make some publicity of it;
I hope he does.
H.M.JR: I don't blame him. It is time somebody
began to shout from the housetops.
MR. DuBOIS: I agree one hundred percent.
H.M.JR: Do you have the timetable?
MR. PEHLE: Not yet.
H.M.JR: As soon as you get it, shoot it in. If
Mrs. Klotz isn't there, give it to Mrs. McHugh. He might
call.
MR. PEHLE: Yes. I will get it.
H.M.JR: I don't blame him. I think it is time a
lot of people shouted from the housetops.
MR. DuBOIS: I told him that I agreed a hundred percent.
He will probably call a conference this afternoon if he
doesn't get action.
H.M.JR: Well, it knocks me for a loop.
MRS. KLOTZ: Don't you think the State Department
ought to know that?
MR. DuBOIS: I would rather see them hit over the
head.
H.M.JR: If you do that, that is almost like
blackmail, and they will hook DuBois up with the thing.
Regraded Unclassified
171
April 7, 1944
9:35 a.m.
DISPOSAL OF SURPLUS PROPERTY
Present: Mr. Dan Bell
Mr. Gaston
Mr. Smith
Mr. White
Mr. Sullivan
Mr. Haas
Mr. O'Connell
Mr. Charles Bell
Mr. Lynch
Mrs. Klotz
H.M. JR: I hear that there is a chance for Norman.
MR. CHARLES BELL: He had a very tough night, and I
think the doctors about gave up all hope and decided to
give him a blood transfusion this morning. We got the
plasma from the Naval Hospital and got it down there by
eight this morning. They gave him the transfusion, and
his reaction is favorable.
Mrs. Thompson called me with the first note of en-
couragement in her voice. They wanted more, and we are
having more brought over.
H.M.JR: Rather than the Army, you got it from the
Navy?
MR. CHARLES BELL: That was the closest to me.
H.M.JR: There is a little hope, is there?
MR. CHARLES BELL: Yes, a little hope, but I think
he is paralyzed in one leg and arm in the side.
H.M.JR: While we are waiting for Bell, I had a
horrible experience last night. These three Orthodox
Regraded Unclassified
172
- 2 -
Rabbis came in. There are a little over twenty-three
hundred people in the camp at Vittel, France. They are
under South American passports, which may be fraudulent
or not; it doesn't make much difference. But for a month
and a half the War Refugee Board has had & cable lying
over there in the State Department urging them to ask
the Swiss to ask the Germans to recognize these people.
Well, two hundred and fifty of them have been moved, and
that means death. They put them in a gas chamber, and
that is that. For a month and a half it has been lying
over there. And these people have been fussing around
with different people in the State Department. I sat
here, and finally Mr. Hull came to the phone at six
o'clock. I read the thing over the phone, what we
wanted. He said it sounded all right.
(Mr. D. W. Bell enters the conference.)
H.M.JR: Then he sent Warren over here, who is supposed
to look after it. He said, "I have no instructions; I
was simply told to come here. I can't do anything; I have
no instructions."
I said, "You had better get instructions."
I got word to Mr. Hull's secretary. Well, he didn't
think he had better bother Mr. Hull.
I said, "You better bother him tonight. After all,
if you get a cable out tonight it will be Friday morning.
If you don't see him until tomorrow, it will be Saturday.
You get him tonight!"
Now, there are two stories, one that the cable went,
and one that they are meeting at nine o'clock this morning
to decide it, because they had a Policy Board meeting in
the State Department yesterday in which they won't give
us the language, just weasel-word stuff.
But these people were sent to me with telephone calls
from Senator Mead and Congressman McCormack. They say if
they don't get action they will call a press conference and
announce it. Personally, although it isn't my suggestion,
it is about time.
Regraded Unclassified
173
- 3 -
MR. SULLIVAN: What is the answer for the delay of 8
month and a half?
H.M.JR: They don't want to do anything to help these
refugees. There is a man by the name of Culbertson who
has been handling it. Here is Culbertson. Just get this,
see. He is the Acting Chief of European Division, and
when the State Department decided without the President's
knowledge that certain things that we wanted done in Tunisia--
I don't know just what they were, property to be returned
or something in Tunisia. Do you know?
MR. WHITE: No, I don't.
H.M.JR: There were certain things in Tunisia that
we wanted done, I don t know whether it was property
returned or refugees, or something. And when they decided
to do it, mind you, the President didn't know anything
about it; Culbertson storms out of a meeting and in the
presence of a responsible person says, "Well, that damned
Jew in the Treasury must have gotten to the President."
That man is the Acting Chief of the European Division today.
MRS. KLOTZ: He did this drafting.
MR. SULLIVAN: I thought the position, officially, of
this Government was that we were to extend help wherever
possible.
H.M.JR: My dear Mr. Sullivan, the President, the
great man that he is--one of his unfortunate weaknesses is
that when he gives an order and it isn't carried out, he
never fires anybody.
MR. SULLIVAN: Isn't that the official position of
the Government?
H.M.JR: It is the President's position.
MRS. KLOTZ: State Department doesn't belong to the
Government.
Regraded Unclassified
174
- 4 -
H.M.JR: And I called Mr. Hull up--fortunately, I
have 8 record--and said, "I am going to read this thing
to you slowly. Is there anything in here that you object
to?"
He said, "No, that is part of what I old them."
Then this fellow Warren C omes over here and says, "I
have no instructions; I can't do anything. I was simply
told to report to you.
That isn't what I called you together for. If I am
a little off my feet this morning, that explains it.
There are two stories; one is that it went, and one is
that they are meeting at nine this morning to reconsider.
What I wanted to do is this, in as calm a manner as
I can. I am not very calm, but I will try to be extra
calm. I would like to have a discussion this morning and
find out about the future 'of the Procurement Division, and
I wish Mr. Sullivan would act quite as though he were an
advocate before the court. He can be just as aggressive
as he wants and argue. I am inviting it. As an advocate
for the thing, if anybody argues, you be just as aggressive
as you wish. Let me just state the thing as I look at it.
It is quite true that going back some time--I can't
get my dates quite straight--I asked for the job of dis-
posing of surplus Army and Navy stuff, and it was decided--
and we had quite a fight about it--that we would be given
so-called consumer goods. Now, I asked for it; that is,
months have passed.
Now, the little contact I have had, fortified by what
I saw in New York, and fortified by what I gained from
my talk yesterday with Mr. Mack, I find myself in the
junk business. I am not being disinterested in this argu-
ment, you see. I mean, I can't be. But please, anybody
get in on this thing. I find that I am in the same
position that any other businessman is who wants to do
business with the Government, and it is God awful.
Regraded Unclassified
175
- 5 -
I will give you some examples: If the Army declares
brass pipe and brass valves surplus and they give it to us
to dispose of, I can't, 8.S the head of the Treasury, sell
them to a plumber who desperately needs them, because the
WPB says no plumber can have any brass fittings. He is
not allowed to. It is verboten. Now, he would pay me a
good price, because everybody needs a brass pipe or a brass
valve who has any plumbing. But you can't do it. I have
to send those to a junk man. Now, & junk man can buy them.
He will pay ten cents on a dollar where I might get a hun-
dred cents on a dollar from a plumber. It is rulings like
that which are perfectly crazy. But as I say, I now can
begin to see in a very small way why businessmen are so
mad at Washington.
Take the motorcycles--I don't know whether it was
December or January--sometime in there we were given,
beginning with twenty-three hundred, motorcycles, and then
a lot more. What happens? We want to sell them. Representa-
tives of the Indian Motorcycle Company come down and go to
work and use all the pressure they can on OPA and WPB so
the Indian Motorcycle Company should be allowed to buy
them back at one hundred and thirty dollars.
John and other people go to work and see that the
thing has a fair price, and they find--my figures may not
be exact--they arrive at the fact that they are supposed
to be sold at three hundred dollars. The story is approxi-
mately correct, isn't it?
MR. SULLIVAN: That is right.
H.M.JR: As a result of which we have this stuff on
hand. The policemen, the protective agencies of the country
desperately need motorcycles. These are the kind that have
high horsepower and low speed. They are bought for Lend-
Lease. The English don't want them.
MR. SULLIVAN: These are specially built for desert
warfare.
H.M. JR: And now as of March 29, three or three and
B. half months more or less having passed, we are now asking
Regraded Unclassified
176
- 6 -
for invitations for bids. But now, the Indian Motorcycle
company having delayed this thing--these are just a few
isolated cases. As we get in the thing there will be 8.
thousand cases, not the few that I have gone into.
We get some shearlings, which are the woolen pelts
off sheep, because the Army suddenly decides that if an
aviator has a wool-lined coat and he is unfortunate enough
to drop in the ocean the thing gets wet and he sinks. They
decided--God knows why they didn't test the thing before-
hand. We now own three or four million square feet of
this stuff. The Army says, "We don't want any of it," and
we are given these millions of square feet of this stuff.
MR. SULLIVAN: Which UNRRA has already taken.
H.M.JR: But then UNRRA then turns around--he didn't
have all the facts; he has learned subsequent facts which
I don't think you know.
MR. SULLIVAN: No.
H.M.JR: What I am telling you now was not in the
memorandum. UNRRA took them, but left them in our ware-
houses so Congressional investigation would find them on
our books. They are in our warehouse at Elmira. You
don't know this, but subsequently UNRRA gave us some nine
hundred thousand dollars to have them manufactured into
clothing; he didn't know that until last night. He should
have known it, but he didn't. You didn't know that?
MR. SULLIVAN: No, I did not.
H.M.JR: And we are now in the clothing business,
manufacturing this stuff into clothing, and the bids are
now out to have the thing out, and again two or three
months have passed and we have these millions of square
feet of sheep pelts, known as shearlings, on our hands.
I also found we had some brass mosquito netting wire.
They can't get anybody to bid on it. It looks like they
have to melt it down into scrap.
Regraded Unclassified
177
- 7 -
The batteries that the Army got into such a bad
situation on in Utah when they sold them to some fellow
for twenty thousand dollars--we now have those lovely
batteries.
We also have--I mean, these are just a few things I
have picked up--some telephone sets left over from World
War I. They gave us the telephone sets and their radios,
but we have no tools, so the things won't work. Now they
are trying to find some tools. The Army has the tools,
but they don't give us the tools, just the telephone sets.
We were given some harnesses from World War I. We
go up on the Hill. We are asked to sell certain horseshoes,
and the Army turns around a few days later and sellsother
horseshoes, but they are of a different size, and so forth,
and so on. These are a few cases. I haven't had much time,
but they are approximately correct, aren't they?
MR. SULLIVAN: Yes, they are.
H.M. JR: They are roughly correct. And John most
likely can give you a hundred other cases, because he has
been following it very closely, and I haven't. When I
went up to New York I found on one floor the division that
does the buying for Lend-Lease; and as far as I know, that
has been going along very satisfactorily.
On another floor is a setup which was set up only
February, a year ago, and has the job of selling surplus
property. For a while that was handled in the field, and
now I learned yesterday that instead of being in the field,
everything has to be referred back to Washington. If they
want to sell one toothbrush, they can't decide it in the
field; they have referred it back to Washington to have
the thing surveyed or reviewed. They won't let anything
be sold in the field. It has to all come back to Washington.
Now, that is only one little thing, but this is going to be
billions instead of hundreds of thousands of dollars, or
millions. These two things are separate identities except
for personnel and financing, and so forth, and so on. They
have the same administrative organization.
Regraded Unclassified
178
- 8 -
I had a talk with Clayton and with Hancock, and I
broached the subject of trying to get rid of this thing.
Their attitude was, "Well, this is & tough job and Morgenthau
is trying to run out from under. I haven't tried to
correct their viewpoint, because I didn't want to criticize
my own organization. The remark was made that if we wanted
to get rid of it, we would have to get rid of all of it.
That is not correct. I am satisfied that if the surplus
property disposal wants to be gotten rid of, whatever
organization there is is there. It is 80 big that they
could have separate personnel, a separate pay roll, and
so forth, and so on, and that is separate as it is in
New York. It is run completely separate by separate people;
and if we wanted to continue to do the Lend-Lease buying
we could do the buying for the various stock.
Now, the question before the House is, should the
Treasury continue in this? Now, the thing that bothers me
is this: My principal job, when you get all through and
done, is to finance this war. That is my job. We have
taken the avenue against the judgment of some people in
this room, but I think the thing has been proven to be on
the whole a success, the volunteer plan. At present we
have, roughly, fifty million people--maybe it is more--
who own shares in America. I had hoped to get five million;
we had fifty. Those people are sensitive to any criticism
of the Government, and particularly the Treasury. Now, is
it worth while to continue this thing, being a secondhand
junk dealer, and at the same time being the biggest issuer
of securities in the world? We have really gotten for
the first time in written history the people themselves
financing a war, which they are. We have sold over
eighty billion dollars worth of securities, over thirty
billion dollars of which are to individuals. And the
policy is to sell this thing to the people and have the
people finance the war themselves, at the same time going
along in this junk business! Now, that is the thing.
I mean, the thing that bothers me is, maybe we can
get the thing going; maybe we can start the thing; I don't
know. It is terribly hard. It will take a lot of time from
the top side to get the thing going. No matter how good it
Regraded Unclassified
179
- 9 -
is, one transaction in twenty-five is going to be wrong.
I don't think that is exaggerated.
MR. SULLIVAN: I shouldn't think that is exaggeration.
H.M.JR: One in twenty-five. Somebody can point a
finger and say--I don't know, they sold millions or bil-
lions of wooden screws in the South, and all the hardware
dealers got blocks. They said, "You can't sell them
that way; you have to sell them in small lots so every
hardware dealer can get some."
The Army now asks us to work the thing out. If John
says I am right, one in twenty-five is going to be sour,
and why did I sell two million or two billion of wooden
screws in one block instead of selling them in blocks of
ten thousand, see? Then we have all got to get busy and
answer it. There is no answer. Congressman X, Congressman Y,
and his--I will get letters asking, "Why did Morgenthau--"
it will always be Morgenthau--"s the things in lots of
ten thousand? It should be in little packages instead of
one big one." I am not trying to belittle the thing.
The other side is, we will save money; the Treasury
will do it honestly; the Treasury will do it well, and
we hope not to dislocate the normal channels of trade,
and so forth, and so on. There are several agencies who
would love to have this thing, either Public Works, or
the Department of Commerce. They have their tongues hang-
ing out, so it isn't that somebody doesn't want it.
Now, I have made quite & long speech for me. I don't
care how rough the conversation gets. I can take it, and
anybody who is for it--I think we ought to hear first from
Mr. Sullivan.
MR. SULLIVAN: First of all for the record, you did
not go out trying to grab this. Your position, as I
stated it before Congressional committees, and the Byrd-
Baruch group, was that the Treasury was not looking for
new fields to C onquer; neither were we trying to duck any
job however distasteful, and that all we asked was that
the people in charge of dividing up this work would survey
Regraded Unclassified
180
- 10 -
the personnel and the facilities we had and determine
whether or not we were better fitted than anybody else
to handle any particular part of the work.
I don't share your view that the Treasury is going
to be free of criticism if somebody handles this property
and makes the mistakes. I can recall quite well a great
deal of correspondence we had by holders of war bonds,
and during the war bond campaigns about the CCC and the
NYA. I think that so far as the public is concerned, the
reaction to blunders that are to be made in the disposal
of surplus property will affect the Treasury just as much
if those blunders are made by the RFC or War Foods, or the
Maritime Commission, or anybody else.
H.M.JR: I have not discussed this with anybody, so
they are all getting it cold. This meeting has not been
prepared, so if anybody makes up his mind it is without
conversation with me. Since the other day I haven't dis-
cussed it with anybody, so they are getting this cold,
John.
MR. SULLIVAN: Right. So I don't think in the mind
of the average person it makes a bit of difference which
part of the Government handled the goods or make the
mistake. The reaction of the person is going to be just
the same whether it was a part of the Treasury or a part
of some other Government Department that made the mistake.
Now, I think a good deal of your feeling here has
been caused by delay. Most of the trouble the Army has
gotten into has been because they have rushed ahead; they
haven't adequately tested the market; they haven't taken
their time to set up procedures, to get in touch with
different possible purchasers. That is why they got into
trouble on machine tools, on batteries.
To be sure, three months have gone by since we got
the motorcycles, but we are going to get seven hundred
and fifty thousand dollars more for those motorcycles in
April than we were offered for them in January. And I
Regraded Unclassified
118RU
- 11 -
think that if we had sold those motorcycles at one hun-
dred and forty dollars we would then be subject to justifill-
able criticism.
Now, there is going to be a terrific accumulation of
goods; there is no question about that. In addition to
the criticism you spoke of and the potential error in
twenty-five cases, there is going to be 8 very much greater
criticism which will come whenever a decision is made that
you should sell through one group rather than through
another. That is going to be a general criticism that goan
all the way down the line. It is something of the same:
type you mentioned in the criticism of not selling in small
enough lots.
H.M.JR: Like selling through the Army and Navy stores.
That is up now. They are not supposed to be legitimate De-
tail outfits, and they have been in business twenty-five
years.
MR. SULLIVAN: Well, there is more than one side to
that.
H.M.JR: But I am mentioning that as a case.
MR. SULLIVAN: Yes, that will be a big fight in and of
itself.
H.M.JR: If the Army and Navy want to handle some of
that and somebody says they are no good--
MR. SULLIVAN: In addition to that, you have to face
this problem, and I would like to fight it out on your
own ground, not what is best for the Government, but what
is best for the Treasury. If your concern about this is
based mostly on the effect of this disposal of surplus
property on the sale of war bonds, I should say from what
I have seen of the other outfits, you are in a much better
position to protect your bond campaigns if you are running
it yourself. There is a lot of grief that goes with it,
but from what I have seen of the others--and regardless
of the defects of the Procurement Division, of which I am
as keenly aware as you are, if you are in control, you will
Regraded Unclassified
182
- 12 -
- able to protect yourself to a degree that will not be
present if this goes to other agencies.
Your statement that the Procurement Division can be
livorced from the disposal of surplus property is correct,
ut that separation will involve a duplication of a great
reall of effort. And more serious than that, it will in-
vodive: 8: duplication of personnel at a time when it is very
dificult to get people. It is true that people who have
ben in the business of buying through the years do not
033858 the last word in techniques of merchandising and
de new force will have to be built up solely to merchandise
this surplus.
Nevertheless, the people who have been buying com-
lodities for a long while have a knowledge of prices and
markets that is helpful, and that knowledge is complementary
too the merchandising experience. I think that the best
thing for the Treasury to do is to build up the organization
sand: go ahead and do this job. Some part of the Government
is going to have to do it, and I don't think there is any-
täng in the post-war picture that will have as serious an
inpact on our economy as the disposal of this surplus. It
iss inseparable from a great deal of heat and a great deal
od. criticism.
H.M.JR: I don't think White will agree with you on
that. Are you through for a minute?
MR. SULLIVAN: I am for a minute.
H.M.JR: I would like to be excused for a moment.
(The Secretary leaves the conference temporarily.)
(Mr. Smith leaves the conference.)
MR. SULLIVAN: I think that if the Treasury decides
too let surplus property go, they should also let Procurement
19 SD) there would be an organization upon which it could be
stilt.
Regraded Unclassified
183
- 13 -
MR. O'CONNELL: I wouldn't think that was necessary.
MR. SULLIVAN: In the particular type of things that
the Treasury is going to deal with, every retail store in
the country is concerned.
(The Secretary held a telephone conversation with
Mr. Pehle, as follows:)
Regraded Unclassified
184
April 7, 1944
10:02 a.m.
HMJr:
Hello.
Operator:
Go ahead.
HMJr:
Hello.
John
Pehle:
Mr. Secretary?
HMJr:
Yeah.
P:
I called Brown.
HMJr:
Yes.
P:
And Brown told me that a number of people at
State, including Mr. Warren, were trying to
redraft the cable we sent over.
HMJr:
Yes.
P:
And that nothing further had been heard.
HMJr:
I see.
P:
That may mean -- probably means real trouble,
I think.
HMJr:
I see. Okay.
in
Right.
185
- 14 -
H.M.JR: They are trying to redraft the cable; Mr.
Warren and others are trying to redraft it.
MR. SULLIVAN: I have finished for a moment.
H.M.JR: Does anybody want to answer? Bell?
MR. D.W. BELL: Well, I am inclined to agree with
John that we are going to have to take some of the criti-
cism wherever it is lodged. I don't know that we would
take as much as if it were in the Treasury, but all the
waste of the Navy and Army over the country--we have gotten
hundreds of letters about it, so anything that is done by
some other Department along that line does have some effect
on our program. We do get criticized for it. They look
to us to sort of correct it.
I think if we had considered this originally, it might
have been well to separate the Procurement from the sales,
but now having taken it over and publicized it and separate
it and give it to somebody else would be registered as 8.
black mark against both the Procurement and the Treasury
in general. I would be inclined to go ahead and do the
job. I think we will do a better job than anybody else.
We have the nucleus, and I think it is our duty to go
ahead. We have accepted it.
H.M.JR: Joe?
MR. O'CONNELL: Well, I feel somewhat as Dan does. I
feel that we are more or less stuck with the job as of the
moment. I do have a feeling that this thing might be worked
out just by the logic of events over the next few months.
It might very well be that as the RFC continues to build
itself up to do a part of this job and we continue to do
another part of the job, that over a period of time the
advantages of a consolidation, which are not so readily
apparent and which would be looked upon as a move to con-
solidate or turn it out of the shop at this time, would be
more apt to subject us and Procurement to criticism than
might be the case later. That is only a holding operation,
but I honestly think that for the time being we ought to do
Regraded Unclassified
186
- 15 -
the job and look forward to the possibility of a consolida-
tion of functions a little later.
MR. SULLIVAN: May I interrupt a minute right there,
Joe? I think I should tell you that the way this thing is
going, it looks to me that rather than the RFC taking over
more of the things we are supposed to handle, it is going
to go the other way, because as specific problems have
come up, Clayton and Husbands have said, You had better
handle that; we don't have the people." I want you to
know that the drift is away from the thing you are sug-
gesting, Joe.
MR. O'CONNELL: I had assumed they would have to build
up an organization which would be even larger than the one
we have, or will have, because the division in the
Executive Order seemed to me to indicate that the larger
part of the job in terms of volume would go to RFC.
MR. SULLIVAN: I am not sure of that, Joe.
H.M.JR: Herbert?
MR. GASTON: I think the vital questions are, who can
handle this job in the best way, and associated with that
is the question, in what way is the Administration going
to come out with the least blame and difficulty.
There is no question there is going to be a lot of
grief and criticism, whoever handles this. It is going
to be a very difficult job to handle. But the better it
is handled, the less the criticism. It really gets down
to a question as to whether somebody else is better
equipped to do this job than we are to do it. That is
modified by the fact that after an original survey it
was decided to put it in the Treasury.
What John says is rather important, that we didn't go
out and ask for that. I think we are rather under more
obligations, in view of the fact that it was wished on us,
it was assigned to us in the belief that the Treasury was
best able to handle it, rather than on the basis that we
went out and asked for it.
187
- 16 -
MR. O'CONNELL: A part of that, Herbert, was that the
Treasury Department was the only shop in town that had even
& nucleus of an organization, or appropriated funds, or a
setup at all to do any kind of B. disposal job. We began
to get into that a couple of years ago in a very small way.
MR. GASTON: I am inclined to agree with John that
the criticism will not react against the Treasury, against
the Government's credit any more with this operation in
the Treasury than it would if it were being operated by
some agency outside the Treasury. I think it amounts to
about the same thing.
Then there is just one other consideration that hasn't
been mentioned: That is, to what extent will the difficulty
and the time consumed and the grief in operating this sur-
plus disposal thing interfere with the proper operations of
other functions of the Treasury Department? That would
be 8 reason, if it were going to interfere seriously with
our doing our regular job in other lines; that would be a
reason for wanting you to give it up. I myself don't think
the reason is so greatly important. I doubt that it is
going to interfere very greatly with carrying on our
regular functions, but my belief is that in view of the way
in which this job was assigned to us, that we ought to
go ahead and try to do the best job possible with it.
H.M.JR: Do you want to say anything, Lynch?
MR. LYNCH: Only this, Mr. Secretary, that I think
the answers given are inevitable answers because of the
conditions that exist today. I would think that in addition
to that, we might consider, also, whether or not as this
thing goes along a better arrangement isn't possible. I
have this in mind--it is 8. bit vague, I admit--it seems to
me this whole problem of disposal of surplus property is
80 far beyond any proportions of any job that has been done
before and so different in character from any job that has
been done before--I mean by that, that I think nearly every
transaction of any substance is going to offer a separate
question of policy that no general sanction is going to
take care of, and the policy will have to be made. The
Regraded Unclassified
188
- 17 -
substance of what I have in mind is this: As we go along
it seems to me we might have in mind the working out of
a different arrangement where it might be consolidated in
the way that there will be a better realization on the
part of the public of the character and size of the job.
Maybe you would want to organize a surplus assets realization
corporation or something of that sort, to give it a name,
to put the job in there, and to put it where there is a
conception that this isn't the regular routine Government
job that the Procurement Division has been carrying on
where you have so much property and your whole object is
to get rid of it as soon and as fast as you can, that the
task may be a very complicated one; you may have to make
arrangements for repair or for reconversion of articles.
H.M.JR: Here we have just under 8. million dollars
to manufacture clothing.
MR. LYNCH: I am thinking about putting it on a--
H.M.JR: They give us nine hundred and some odd
thousand dollars to manufacture these shearlings into
clothing. We are now in the manufacturing business.
MR. SULLIVAN: Somebody has to be.
MR. LYNCH: So all I would add to it, which is, I
confess, a bit vague, is that we are just at the thresh-
hold of this problem, that the Procurement Division is in
it and should contribute everything it can, but I think
what we have to contribute at this point is not very
extensive as compared to the job that is going to come, and
that we should keep in mind whether it isn't possible to get
8 better approach to it by putting it on an entirely different
footing where there would be realization that the job is a
different type of job from what is ordinarily handled, where
you require financing, where you require repair facilities,
where you require industrial arrangements and working out
with various industries. I am not certain that I am making
my point clear.
H.M.JR: You are making it perfectly clear.
Regraded Unclassified
189
- 18 -
MR. LYNCH: In the first place I would say that if
we were talking at the beginning, that the place for the
exchequer should not be in the junk business. Against
that is the fact that we should contribute everything we
possibly can. We have the job, and I don't see where
the result can be anything in the interest of the Govern-
ment but what we are going to keep the job until a better
method is found. I don't think we should put out of our
minds the prospect of a better method, and I feel that
possibly a better method could be worked out from the
public standpoint, from the standpoint of the Government
itself, by putting this thing on an entirely different
footing, not just as the sale and disposal of property,
that the Procurement Division as the ordinary Government
Department carries out, but just as though you were
organizing a Lend-Lease Administration or organizing
& Foreign Economic Administration.
The thing to do is to organize & surplus war property
realization corporation, give it very broad powers, powers
that the Procurement Division doesn't have now and isn't
administratively in the habit of exercising or carrying
out.
H.M.JR: Then you don't agree with Joe that if you
are going to do this thing you want to wait a couple of
months?
MR. LYNCH: I don't think Joe and I are different
at all.
H.M.JR: Joe says wait a couple of months and slip
it to them.
MR. LYNCH: I don't think you can bring this change
about for a little while.
MR. SULLIVAN: What are you going to do in the mean-
time?
MR. O'CONNELL: Go to work and continue as you are
doing. What I was thinking was that the logic of events
would maybe bring us to the conclusion in a relatively
Regraded Unclassified
190
- 19 -
short time of what Tom is saying as the practical way
to solve the thing in an over-all fashion. I don't think
you can do it oday. The only basis for doing--not that
there is a better way of doing it, but I don't think Tom
and I are very far apart.
H.M.JR: I think you are miles apart. You say wait
and if the RFC gets going, gradually slip it to them.
MR. O'CONNELL: Well, the obvious place to have any
administration setup along the lines of what Tom is talk-
ing about is the RFC, because they have the corporate powers
and they can create corporate setups to do particular jobs.
It seems to me that we have at the moment to continue
on as best we can. What will happen after a little more
trial and error is something that no one can tell exactly,
but I don't see how you can stop today.
H.M.JR: George, do you have any ideas?
MR. HAAS: Yes. on't pretend to be an xpert in
this. I will give you my conclusions first. I think the
problem here is how to get out of this thing clean. We
shouldn't have gone into it in the first place. What
Herbert said in the latter part--I think one man has all
he can do handling the fiscal and monetary affairs of
the Government. You just can't spread him thin over a
whole area. I agree that you get criticism, but you are
more effective on the outside. You have criticism of WPA.
In many of these things there is grief appended to doing
the job right. You have a pattern here as a way to get
out of it.
You recall when the foreign purchases were coming in,
the President immediately assigned you as the man; after-
wards an organization was set up. You did it temporarily
at the start. It might give a pattern as to how to get out
of this, but I feel strongly you shouldn't be in it; it
diverts too much of your energy over into other fields than
financing the war. I agree with you perfectly it can't be
an avocation; it is a main job, and one of the biggest
jobs that faces the country. One man can't take all the
Regraded Unclassified
191
- 20 -
responsibility for everything that happens in the Administra-
tion. If you do that job well, you have made your contri-
bution, it seems to me. I think now if you can get an
agreement that you want to get out of it, I don't think
it is clear that you can just step out without getting
injured, but you can work out a formula of how you can
come out clean. That is the direction I would take.
H.M.JR: Roy?
MR. BLOUGH: Well, as a layman with no competence in
this field, and professing none, I think you ought to get
out of it, and I think Tom Lynch has indicated the best
and cleanest way to get out.
H.M.JR: Harry?
MR. WHITE: I should begin with an alibi, shouldn't I?
But I really don't feel like one.
H.M.JR: Why don't you begin with & dirty story?
MR. WHITE: I think that the task of handling the
disposal of surplus property does involve, as John has
said, extremely important matters. I think as other men
have said, & task which is so large that it can be handled
in the way in which I am sure you would like to handle it
if you were going to handle it, only by considerable
attention on the part of yourself and on the part of any
people you would select to handle it, even with tke best
administration under you there is going to be these dif-
ficulties which you spoke of. I don't think there is any
significant relation between the way this is handled and the
sale of bonds and the attitude toward bonds. That would
make a good excuse to get out if it weren't so thin. But
I think it is pretty thin. I think we can go into that
aspect of the problem, but I do think that it is too big 8.
job and fraught with too many difficulties and complexities
and dangers to be handled unless you want to make up your
mind that you want to devote a substantial time or get
some men to devote substantial time to it. I think it
appropriately belongs under some separate organization, and
Regraded Unclassified
192
- 21 -
I agree with much of what has been said, that there is a
way of getting out, and that way of getting out is a
perfectly legitimate way. It is not a way of getting
out, but it is suggesting a way as to how it should best
be handled.
I think there should be a report by you to the
President based on such experiences as you have had, which
should contain constructive suggestions as to what appropriate
powers, what appropriate protective devices, and what appro-
priate type of agency can best handle it. In other words,
let the recommendations of the kind of setup that is in the
minds of the men who have the most experience with it so
far--and that would be the Treasury--be the basis for a
report for the establishment of a new agency, 80 that 8.8
far as the public is concerned it will not be a question
of your getting out from under, not a question of their
having taken it away from you because it wasn't properly
handled, but rather a question of your doing the most
unusual thing from the point of view of the Government, of
saying that this thing, for the following reasons, can best
be handled by some other agency than our own.
(The Secretary held a telephone conversation with
Mr. Pehle.)
H.M.JR: It is going out in the cable as of the way
we had it on March 16.
MR. GASTON: But it is going out on April 7 as it was
drafted on March 16.
H.M.JR: By us.
The thing, of course, has upset me SO. They had this
grand old Rabbi here with a wonderful beard like the Catholics
wear in the Near East. He just completely broke down and
had hysterics in my office, wept, and wept, and wept.
(Mr. Pehle enters the conference.)
H.M.JR: John, put it here.
Regraded Unclassified
193
- 22 -
MR. PEHLE: Well, it wasn't me, but it went just
as it was sent over to them.
H.M.JR: It is worth my being sick for a day. Can
I have the March 16th?
MR. PEHLE: It went there by letter to Stettinius.
H.M.JR: Do you mind if I call them up?
MR. PEHLE: No. I will see that the operator puts
them on. It went as we sent it to them on March 16.
MR. BLOUGH: It has actually gone?
MR. PEHLE: It is in the coding room right now.
MRS. KLOTZ: Aren't you suspicious?
MR. BLOUGH: I am suspicious.
H.M.JR: Strictly in this room, and not to be repeated,
they went to see Judge Rosenman yesterday. What did he
tell them?
MR. PEHLE: He told them that he would be glad to take
it up with Mr. Hull if he had a memorandum from Mr. DuBois,
explaining--
H.M.JR: Then he calls me up five minutes later and
says it is none of his business, it is strictly a War
Refugee matter; he doesn't want anything to do with it.
That is just in this room.
MR. PEHLE: Mr. Secretary, the one that did all the
work on this, Mr. Lesser, is outside.
H.M.JR: Tell him to come in.
(Mr. Lesser enters the conference.)
H.M.JR: Come in, Lesser. I just want to thank you
for what you have done on this thing. Just sit down a
Regraded Unclassified
194
- 23 -
minute. I am trying to get the Rabbi. It is only too bad
it didn't go out on the 17th. Terrific, isn't it?
MR. LESSER: I think so.
H.M.JR: As I understand it, two hundred and fifty
have already gone to their death, haven't they?
MR. PEHLE: That is right.
MR. HAAS: Where are they located?
H.M.JR: Camp Vitell, in France. They all have South
American passports. They are arguing whether they are
authentic or not. Let's say they are all phoney. And so
what? We should sit back and say to the Germans, "We
can't do anything because we think they are phoney or void,"
when the Germans don't pay any attention to anything, see?
The assumption is, if we said to the Germans, via the
Swiss, "We want you to recognize this thing, the Germans
will.
But over in the State Department they said these are
forged passports, although we are forging passports our-
selves every day.
MR. HAAS: That was my suggestion, get somebody in
there to give them something.
H.M.JR: They are forging passports every day; it is
no secret.
MR. D.W. BELL: It is a regular business.
MR. PEHLE: We are now going to send over, Mr. Secretary,
another cable, asking the Swiss Government to let the German
Government know that we are working on an exchange of people.
Now, it isn't going to be possible to work an exchange, but
the mere fact that one is being considered will tend to
make the Germans leave these people alone.
H.M.JR: Does it have to be a Catholic that goes to
Spain? Must it be a Catholic?
MR. PEHLE: No, that is not a requirement.
Regraded Unclassified
195
- 24 -
H.M.JR: Aren't you well enough organized that you
could spare DuBois to go?
MR. PEHLE: Yes, as the President's representative.
It has to be all the way of to the top.
H.M.JR: Why don't we ask for him to go?
MR. PEHLE: I am for that.
H.M.JR: Why not stop loosing time? DuBois is a
Protestant, isn't he?
MR. PEHLE: Yes.
H.M.JR: Are you sure?
MR. PEHLE: I know he isn't a Catholic. If he is
anything, he is a Protestant.
H.M.JR: He shouldn't be Jewish.
MR. PEHLE: He is not Jewish.
H.M.JR: I mean, for the sake of the cause.
MR. PEHLE: No, he isn't.
H.M.JR: He is a Protestant?
MR. PEHLE: Yes.
H.M.JR: I would send DuBois. I would get him off
on the first Clipper.
We have been trying to send Tom Corcoran, you know.
MR. SULLIVAN: I don't see how catholism would
affect that job one bit in Spain today.
H.M.JR: It affects Mr. Hayes, our Ambassador.
196
- 25 -
MR. SULLIVAN: Is he a Catholic?
H.M.JR: Yes. I would send Joe DuBois.
MR. PEHLE: If DuBois can go, he will bring back
the story.
H.M.JR: I would send Joe. I would get him right
off. And in this case, I will ask General George, if
necessary.
The funniest thing - this Ambassador Hayes walked
in here - he hadn't been in here two minutes before he
and I had a row.
MR. GASTON: When was that?
H.M.JR: Before he left, when he was first appointed.
Everybody said, "There is something the matter with
Morgenthau. Ambassador Hayes is one of the greatest
liberalists of the country. He is this and that." I
said, "He is a stuffed shirt." I said to Mrs. Morgenthau,
"You have to read the New Republic and the Nation.
She said, "He is 8. wonderful character," and I, "He is
a stuffed shirt and I think the President would give
anything to get rid of him."
MR. GASTON: He has been the biggest disappoint-
ment.
MR. WHITE: He came in to see me and said he was
sent over - he spoke to me and I suggested that he meet
some of the Treasury staff. He wanted to know about
Spain and I said I would get them all together and we
would tell him whatever we had about Spain. We made
the appointment and he never showed up.
H.M.JR: He wasn't in here two minutes before we
had a row, and I don't row with Ambassadors, normally.
MR. PEHLE: Unless it is to your credit.
Regraded Unclassified
197
- 26 -
H.M.JR: Mrs. Morgenthau said, "There is something
the matter with you. He is one of the great liberalists."
You know, he was. Didn't he get some medal from
the Catholics, or something?
MR. SULLIVAN: I don't know. I don't know too
much about it.
MR. BLOUGH: I thought he had shifted some years
ago.
H.M.JR: No, no, he was a very importany lay Catholic.
MR. WHITE: He is a pretty good historian, or was.
MR. GASTON: So is Bowers.
H.M.JR: I think he is good.
I won't tie you gentlemen up, but, Lesser, that
is a good job. I am very much pleased. I will call up
Brown to thank him.
(Mr. Pehle and Mr. Lesser leave the conference)
H.M.JR: Whate was in the middle of making a speech.
MR. WHITE: This Lesser is a very able fellow. You
are going to lose him. He has been in the Legal Division
working on Foreign Funds.
H.M.JR: I thought he was out of your shop.
MR. O'CONNELL: We loaned him to John Pehle.
MR. WHITE: There are & few good men in the Treasury
outside of my shop.
H.M.JR: Why are we going to lose him?
MR. WHITE: Going in the Army.
Regraded Unclassified
198
- 27 -
MR. O'CONNELL: The Puryear Committee gave us &
sixty-day deferment and they will not extend it, so
he will be in the Army shortly.
MR. SULLIVAN: I think that is nonsense. I think
it is time we stood up and fought with fellows like him.
H.M.JR: (To White) I don't know what you said.
MR. WHITE: A good time to stop. (Laughter)
MR. SULLIVAN: Harry said the way to get out of
this is to think up some better system.
MR. GASTON: I listened very carefully to what
Harry said. I will sum it up for you: Yes and no!
MR. WHITE: I am getting to be pretty good.
Mr. SULLIVAN: We interpret the news!
H.M.JR: Now, Harry, everybody else has been very
frank.
MR. BLOUGH: I thought Harry had a very good
suggestion, and I didn't interpret it yes and no. I am
right with you, Harry.
MR. WHITE: I must be slipping if that can be
interpreted yes and no. I am sure it is due to the
interruptions and not to your perspicacity, Herbert.
(Laughter)
I will re-state my view as I see it. I said I
thought this was an extremely difficult, complex, and
important job. I think it requires a lot of attention
from yourself or your top men. I don't know whether I
am supposed to know it or not, but I suppose there is
some doubt even as to whether John will continue to be
here, which makes the situation very different. It
means you have to go out and find somebody to either
take the job, or do it yourself, or represent you on it.
Regraded Unclassified
199
- 28 -
H.
JR: You are talking about the Senator, now?
MR. WHITE: Was it Senator or Vice President, John?
MR. SULLIVAN: Well, it wasn't Vice President.
MR. WHITE: They are looking for a good Vice
President.
The reason why it is fraught with some difficulties
is obvious to everybody. It involves the possibility
of very considerable scandals, and what is equally
disturbing is that you are bound to displease important
segments of the body of the citizens no matter what you
do because of the ramifications of the disposal of SO
much property.
I think that it belongs in a separate organization.
I think it belongs, if possible - and here I speak
knowing almost nothing about it - that it should be
initiated with proper powers.
I gather from the few illustrations that you gave
that there are all kinds of obstacles to the disposal
of this property under conditions which would be best
for the country.
Now, I think your men are in a position to outline
the kind of legislation and the kind of organization
which that could function best under. I think you
should also offer your experienced personnel. Maybe
they might want to take Mack or have some other men who
would be valuable to them during the year, or two or
three, in which this was operating.
I think you ought to help as much as possible, but
I think the only way you can get out of it well - and
I would interpolate, unless you can get out of it well,
I don't think you ought to get out of it - the only way,
it seems to me you can get out of it well is not to
say it will hurt bonds, and not to say your time is
Regraded Unclassified
200
- 29 -
all occupied with financing, but rather to make a
recommendation based on the experiences of the several
months or more that you have had, as to how this thing
should best be handled, and submit that report to the
President.
That would be my suggestion.
MR. SULLIVAN: I would like to answer Harry and
Tom a moment, if I may, Mr. Secretary. I think they
both agree with me that they know of no better plan at
the moment.
The Baruch report made a great hit with the
country. It was very well received by the public as
a painstaking job of surveying the whole situation and
working out the most practical method of handling this.
They put in a lot of time on that report.
Now, I am sure that sometime somebody may be able
to think up a better plan. I think if Harry is contem-
plating that within a week or ten days we will be able
to draft some suggestions that will be an improvement
on this setup under the present Executive Order, I
think we are holding out a little bit too much hope.
It is too difficult a problem for that.
MR. WHITE: Why does it have to be settled within
a week or ten days?
MR. SULLIVAN: I don't know. Joe has said as the
months go by maybe something will work out. I was
merely pointing up that it is apt to be more a question
of six months or a year rolling by before any better
plan suggests itself.
The other comment I make on the situation is purely
political. We are concerned with dealers and with re-
tail stores. We are fighting the fight of the small
businessman. Our contacts have already been established.
For instance, the National Automobile Dealers Association,
which was our most bitter enemy up until two months ago,
Regraded Unclassified
201
- 30 -
now sends out weekly bulletins to each one of its districts
setting forth the year, capacity, the location, the ceiling
price - and that is a service that we have arranged with
them. That is Nebraska, there; here is Georgia (hands
builetins to the Secretary).
H.M.JR: I get the idea.
MR. SULLIVAN: And we have established these con-
tacts with these Associations and these National Trade
Associations, and the letterswe are getting in from
individual dealers indicate & degree of confidence and
hope that they didn't possess six weeks ago; and I
think, having started this process, having acquired the
confidence of these people, if we then throw it out the
window on the political side, we have definitely lost
something that we are now acquiring.
MR. WHITE: I shouldn't look at that as throwing
it out the window. I should rather look at the thing
from the point of view of how it can best be handled
and what have been your experiences, of what you have
learned during the months or years during which you
have handled the problem.
MR. SULLIVAN: It is just like any other job;
you learn by trial and error and darned hard work.
Now, I am just as critical of Procurement as the
Secretary. I think more so, because I have seen more
of not only errors, but short-sightedness and in some
cases stubborn-ness and resistance to change. It took
me weeks to convince them that they had to have a
central inventory, a central record of pricing and
sales; something that anyone would, you would think,
consider indispensable to 8. nation-wide operation.
So I am not fighting the battle of Procurement
here. I think I have been as critical of them as any-
body in the room. But I have also seen the other
agencies, and Procurement, on the basis of what I have
seen, is better fitted to handle this than any other
agency in the town.
Regraded Unclassified
202
- 31 -
MR. WHITE: I confess I may be looking at it some-
what differently.
MR. SULLIVAN: That leads up to what I said to Joe
a minute ago, that I thought in fairness to the job, if
is decided that the Treasury should not handle surplus,
we should be ready to let this group, who do know more
about it than anybody else, go to whomever is to have
the job. I don't think it is going to be fair to the
Government to say that we are not going to handle
surplus, but we are going to hang onto the people who
know more about it than anybody else.
MR. WHITE: I am assuming that Procurement has
done not only as good a job, but an excellent job. I
wasn't at all suggesting they haven't done a perfect
job. I was rather looking at it from the point of view
of the responsibility of those who are going to run
this. And the responsibility is not going to be any-
where down the line; the responsibility of the general
operations of the sale of disposal property is going
to be on the top desk.
H.M.JR: Where?
MR. SULLIVAN: Right on that desk (points to the
Secretary's desk).
MR. WHITE: If it is in the Treasury, it is going
to be with the Secretary of the Treasury; if some
other agency, it will be with the top. ¹hat is the
way people personalize the thing, and that is the way,
I think, to do it.
Therefore, the question is, should the Secretary
of the Treasury, in addition to his other duties and
other responsibilities, take on the task of being
responsible for the operation of such & Gargantuan
task as the disposal of several billion dollars
to a community that doesn't want the stuff. Certain pro-
ducers want it only under certain onditions. 8 It is not
a matter of honesty and having the funds properly audited.
Regraded Unclassified
203
- 32 -
If that is all there were to it, the Treasury should
do the job. That is merely a matter of honesty and
ideal. The Treasury has & reputation, justly, of being
as honest in those matters as any other agency. But
it is more than that, John. It is a question of assum-
ing the responsibility of the sale, under conditions
which will be regarded as reasonable, of millions of
items involving - I imagine the surplus property will
run into several billions, won't it?
MR. SULLIVAN: Oh, yes.
MR. WHITE: It is one thing to sell several
billions, it is another thing to buy it.
MR. SULLIVAN: Harry, you agree with me that the
most important problem for the Secretary of the Treasury,
after the responsibility of financing the war, is going
to be the problem of conducting the country's financing
in the year and 8. half or two years after the war.
MR. WHITE: Well, no, I think the responsibility
of the Secretary of the Treasury is to see that all the
functions that are undertaken by the Treasury are
properly performed. I would regard one of them as the
financing of the war. It happens to be important.
There are a lot of other important things and will be
a lot of other important things. If he undertakes the
disposal of property, that will be another important
thing for which he will be responsible.
MR. SULLIVAN: But it seems to me that the economic
condition of this country in the year and & half after
the war will be a very grave concern to the Secretary
of the Treasury. I don't know of anything that is
likely to have a greater impact on it than the man
under whom these surplus properties are disposed of.
MR. D.W.BELL: John, there has been some thinking
about this on the Hill. How do they feel about the
Treasury handling it? Are they inclined to make it
separate?
$
204
- 33 -
If so, maybe that is a good way for the Secretary
to get rid of it - to allow one of these bills to go
through.
MR. GASTON: I would like to examine Joe's and
Tom Lynch's suggestion, here, which as I understand it
is substantially that we try to organize now, facing
the present problem, that we try to build an organiza-
tion to handle this surplus and go along with the
problem, with the possibility in mind that as we learn
more about this thing by experience, it may develop
that we need a different sort of an organization.
MR. D.W.BELL: Independent, I understand.
MR. O'CONNELL: I think, as of today, there isn't
a man in the Government who has any very clear concep-
tion of a better way of doing the job, which isn't on
our doorstep yet, than we have in this room. You read
the Baruch report. It is almost entirely glittering
generalities with respect to disposition of surplus
property.
When they start dealing with contract termination
on the Hill, the best thing the George Committee can come
out with is a few very nebulous comments with respect to
surplus property, and tell Will Clayton to come back
in sixty days and tell them what he wants in legislation.
When Clayton testified he said, "I don't know."
He said, "This is so new, we haven't the slightest con-
ception of what we are going to be into."
All that means to me is that it is going to take
a little time.
MR. WHITE: I wonder if that is relevant to the
immediate problem. It is not a question as to whether
the handling of the problem can be better performed
than the way in which the Procurement Division is per-
forming it. I doubt whether that is the immediate
problem.
Regraded Unclassified
$
205
- 34 -
Let us assume that no better technique can be
developed than what is now being done. To me the
problem is not that, but where shall the responsibility
lie. Had it best lie with someone who devotes all his
attention to the task, or can it best lie with an al-
ready busy departmental head, to whom that will be only
one of many important responsibilities? It is not a
question of techniques.
I am sure that possibly Mack is handling it as
well, or knows more about it than anybody.
MR. O'CONNELL: I think in order to get out of it
gracefully, we have to have a better technique, unless
we have 8. better way.
MR. WHITE: I think the better way - I am sure,
from the illustrations you suggested there, or impedi-
ments which have been presented on the part of getting
the most money out of these funds for the public - I
think that you certainly can list all these impediments
and certa inly say this job is 80 large that it ought to
have a special agency or maybe & commission - maybe a
committee - maybe an individual if he had--
MR. O'CONNELL: We have an Executive Order which
creats a Surplus Property Administrator, Will Clayton.
(The Secretary holds a telephone conversation
with Mr. Brown, as follows:)
206
April 7, 1944
10:32 a.m.
HMJr:
Hello.
Operator:
Mr. Brown has stepped out for a minute and Mr.
Gray 18 answering.
HMJr:
No, I want Mr. Brown.
Operator:
I'll have him for you.
HMJr:
And when you get the -- when you get the Rabbi,
let me know.
Operator:
All right.
10:49 a.m.
J. E.
Brown:
Good morning, Mr. Secretary.
HMJr:
Brown, I just want to tell you how much I
appreciate how cooperative and sympathetic you
were on this thing.
B:
I'm very -- very glad to help, Mr. Secretary,
in any way that I can to keep things -- to keep
things moving.
HMJr:
Well, I understand they sent out our suggestion
of May 16th -- March 16th.
B:
Yes.
HMJr:
I understand that that's gone.
B:
Yes.
HMJr:
And I want to tell you from the bottom of my
heart that I appreciate it.
B:
Well, don't -- don't think of that at all, sir,
because we're glad to
HMJr:
Well
B:
do anything that we
Dogradod
207
- 2 -
HMJr:
this was
B:
anything that We can.
HMJr:
After all, there are really lives at stake and
I think there's an excellent chance of saving
them.
B:
Yes.
HMJr:
My thanks to you and when you see Mr. Hull, please
tell Mr. Hull I appreciate very much his....
B:
I'll- I'll certainly -- certainly do that, Mr.
Secretary.
HMJr:
But you were most helpful.
B:
Oh, don't -- don't think of that at all.
HMJr:
Well, I do think....
B:
Mr. Hull is the one that did it all.
HMJr:
No, I know, but I'm thanking you personally.
B:
Well, now don't -- I'm glad to hear that, Mr.
Secretary, but it really wasn't I.
HMJr:
Well, may I think it's you anyway?
B:
All right, sir.
HMJr:
Thank you.
B:
Not at all. Thank you very much for calling.
208
- 35 -
MR. WHITE: If I were the Secretary, I certainly
wouldn't share the responsibility with anybody. From
what you tell me - I didn't know that - there is &
lot I don't know - from what you say, Will Clayton is
responsible for the disposal of surplus property.
Then why should the Secretary be placed in the position -
I thought it was he who was going to dispose of surplus
property.
MR. O'CONNELL: The President signed an Executive
Order setting up a Surplus Property Administrator in
the Office of War Mobilization, at a policy level. In
the same order they made a tentative division of respon-
sibility with respect to actual disposal or disposition
of property. Will Clayton's organization is not going
to be an operation agency. Procurement Division has
the responsibility for the sale of consumers' goods;
RFC has the responsibility for certain other types of
property; War Foods Administration for the disposition
of surplus foods; the Maritime Commission for the dispo-
sition of surplus maritime property.
MR. WHITE: I think that is & poor way.
MR. O'CONNELL: When Will Clayton protested to
the Committee last week, they asked him if he had any
suggestions. He said, "No, this is guinea-pig organi
zation.
MR. WHITE: Joe, one thing we have learned from
the last five years, we here, is that divided responsi-
bility on important matters always is bad, and if Clayton
is going to be in charge of the surplus property, I
think he ought to be responsible for the physical dis-
tribution or the decisions of the policy of price and
who should sell it, and all of that.
MR. O'CONNELL: You can only go at a certain rate.
I think, to unload this entire job is just a literal
impossibility.
209
- 36 -
MR. WHITE: What I would gather that you indicate
is that you think this thing ought to be handled
directly under him, and you will play along until he
can get his organization. I didn't think there was
any suggestion to say, "We are through with it and you
take it."
I thought it was merely a question of moving
toward an objective.
MR. SULLIVAN: It isn't contemplated that he will
have any operations organization, Harry.
MR. WHITE: What does his responsibility, as
distinct from the Secretary of the Treasury, consist
of in the sale of these motorcycles?
MR. SULLIVAN: He determines general policy.
The understanding is that we go ahead in the manner in
which we have been operating unless he indicates other-
wise.
MR. WHITE: I think that is very dangerous. If I
were the Secretary, I would have no part of it, because
of that divided responsibility. As soon as he can turn
it over gracefully - that is the sine qua non.
H.M.JR: Are you through, Harry?
MR. WHITE: Oh, yes.
H.M.JR: I have heard from everybody but Charlie
Bell.
MR. C.S. BELL: One sour apple in the whole barrel.
The criticism is going to be pretty bitter. People are
still talking about sales in the last war. I agree with
John and Mr. Gaston and Danny Bell.
(The Secretary holds a telephone conversation
with Rabbi Corff, as follows:)
210
\
April 7, 1944
10:54 a.m.
HMJr:
Hello.
Rabbi
Baruch
Corff:
Hello. Good morning, Mr. Secretary.
HMJr:
Rabbi, I've got a nice Passover present for
you.
0:
Oh, that's wonderful.
HMJr:
The cable that the Treasury suggested as of
March 16th has gone.
C:
I see. This morning?
HMJr:
This morning.
C:
And Mr. Pehle -- does he have a copy of it?
HMJr:
Yes, he can show it to you.
C:
Oh, I see. Well, thank you very much and a
happy and closer Passover to you, Mr. Secretary.
HMJr:
Well
C:
And God bless you.
HMJr:
Well, it's -- it's -- let's hope now that we
can save
C:
Let's hope.
HMJr:
....
the people that are still there.
C:
Thank you very much, Mr. Secretary.
HMJr:
Well, thank you for letting me have the opportunity.
C:
Thank you, Mr. Secretary.
HMJr:
Good bye.
Regraded Unclassified
211
- 37 -
H.M.JR: Have you any sense of humor left?
MRS. KLOTZ: Sure.
H.M.JR: He wished me a Kosher Passover. (Laughter)
MR. WHITE: I think he has his suspicions.
H.M.JR: He belongs to the Union of Orthodox Rabbis
and he says, "May I wish you a Kosher Passover." You
don't have. those "isms" in the church, do you, except
as between the Greek and Roman?
MR. WHITE: There are only good Catholics or dead
ones!
MR. SULLIVAN: And Brooklyn!
I am glad to see this Rabbi is still working at
his job, though.
MRS. KLOTZ: He hasn't given up hope of converting
the Secretary.
H.M.JR: All right, you will have to give up eating
ham sandwiches!
MR. C.S. BELL: I can't help but feel that the
Treasury is the best organization to do the work and
it will do a good job. It is going to throw a lot of
criticism in this office, and that is regretted. I
think much of that can be offset if Fred Smith were
to undertake to acquaint the public with this problem
and keep them educated throughout, so that they would
know or expect this sour apple from time to time. It
is bound to come up. But passing it over to a new
organization isn't joing to be for the benefit of the
Government, generally, though it may be a little bene-
fit for the Treasury.
H.M.JR: Is that all?
Regraded Unclassified
5
212
- 38 -
MR. C.S. BELL: Yes, sir.
H.M.JR: All right. Does anybody want to know
how I feel?
MR. SULLIVAN: Rather!
MR. WHITE: If you feel it is important! (Laughter)
H.M.JR: Well, if I can get out of this thing
gracefully, I would like to. That is the way I feel.
Someone want to cross-examine me? I am willing to be
cross-examined.
MR. SULLIVAN: Would you be willing to give up
Procurement to whoever is willing to take over this
responsibility?
H.M.JR: If necessary, yes.
MR. SULLIVAN: I think you would have to.
MR. O'CONNELL: I don't understand that, John. It
doesn't seem to me it would be any more difficult to
split the existing Procurement Division that it was to
split it when we did it once before.
MR. BLOUGH: I thought you said a few minutes ago
that it wouldn't be necessary.
MR. SULLIVAN: I said it would not be fair to ask
some other agency with no trained, experienced men to
take on this responsibility without giving them the
group that everybody admits is the best qualified to
handle it.
MR. O'CONNELL: That is not the entire Procurement
Division, though, John.
H.M.JR: In New York in the office building, on
the fifteenth floor is the floor devoted to surplus
property. On the thirteenth floor is the floor that
has to do with Lend-Lease.
Regraded Unclassified
$
213
- 39 -
They told me up there - Walsh is a good man,
isn't he?
MR. SULLIVAN: He is Assistant Director.
H.M.JR: There is a man in charge by the name of
Young. One thing has to do with buying. With the
exception of pay roll and the administrative end, the
things are completely separate.
MR. SULLIVAN: And they are serviced by one adminis-
trative group.
H.M.JR: You could have another administrative
service.
MR. SULLIVAN: Whether you can accumulate a nation-
wide administrative service right now or not--
H.M.JR: The point is, gentlemen, this organiza-
tion of the surplus disposal only came into being, as
far as the field was concerned, February, a year ago.
MR. WHITE: I think they ought to have any
personnel whom they want, but I think there is this
difference, isn't there, John, that the Procurement
Agency is a continuing agency in normal times, and
more routine.
MR. D.W. BELL: They have surplus right along,
but on a very small scale.
MR. WHITE: It lends itself to a routine job,
whereas this surplus disposal is a major issue. I
will say this, in contradiction to the position I
have been taking, Mr. Secretry--
H.M.JR: I am accustomed to that! (Laughter)
MR. WHITE:
...is that I have always felt that it
is a mistake to create new agencies when the work can
appropriately fit under an old department.
Regraded Unclassified
214
- 40 -
I think the samiles of that have beenbadd. There
is that to line maid on the other side. Bet the condition
in which the responsibility is shared as itt liss in this,
makes it much warse than I had thought.
H.M.JR:: Tow, just for the moment, mode you mind
summarizing Where Unite is? White versus Whites.
MR. HITE: May conclusion is--
MR. SULLIIVAN: With qualifications!
MR. MHITE: If you can gracefully gét out, and it
seems to ne you ORD, that you should. Det itt should be
on the basis XII E recommendation of constructive measures
to handle it uncropriately, and you should bee prepared
and offer too give over such personnel as toges iss in
the Treasury 78.00 have been working on this, and who
would be of value to whatever organization would take
it over.
H.A.B: I an very interested in nast you. say now.
I also think 7000 muld be very interested LIY you saw
the record on Unite.
MR. WHTN: Yes, it May be that wast have been
saying is very munfusing. It has been simile to me,
but that iss all right.
MRS. KIDTZ: Everybody else shifted (E couple of
times, Harry.
MR. WHITE: but I haven't shifted.
MR. GASTON: Harry hasn't shifted. line hass weighed
the argumentus 000 both sides and come to 18 conclusion.
H.M.JR:: limit is the point. I an afrádo that I
haven't, but missing gave me any argument area. I am
going to tie very honest with you people. everybody
around here have got too much to do and I, reakly -
Regraded Unclassified
5
215
- 41 -
I mean, let's just take the things which are pending.
You take White and his World Bank and world Stabiliza-
tion. There is a thing which is absolutely the
Treasury's business.
I have Mr. E.M. Bernstein up at New York, I spent
a little over two hours with him. I go over the thing
and I am just beginning to get the thing. If we are
going to have this meeting, and the President has
approved calling the meeting, it is going to take every
hour that I can get, and every hour that anybody around
here who can help me, can get, to put this thing across.
It would be a great feather in Mr. Roosevelt's cap - of the
Allied Nations - if there is something to offer the satel-
lite nations as a hope of stability. Mr. Bernstein, when
he was here, was hopeful of Czechoslovakia. This sort
of thing is an assurance to Mr. Bernstein that three
months after the armistice that Czechoslovakia can begin
to export business if these World Stabilization plans
go through. If we here, with all the magnificent work
that White has done for the groundwork, can get this
thing across, there is something to hold out to these
countries now, that there is work for them on a post-war
basis. And I ought to give that thing every minute
and ounce of energy that I can, just as I do to this
President's War Refugee Committee.
Now, I can only do so much. All of us are tired,
everybody around here. You can only spread yourself
so thin. Now, how thin can I spread myself?
Sullivan hasn't said to me, "Morgenthau, you
needn't worry about this thing; you don't have to give
it any attention."
MR. SULLIVAN: No, I think you do.
H.M.JR: You think that I do. It gets down to
something like that. It gets down to a thousand and
one things that I have to do, and, frankly, I don't
see the day long enough.
Regraded Unclassified
216
- 42 -
I should go around and visit these things. Ted
Gamble gave me a list last night. He wants me to go
to ten different cities at the end of this month. I
don't think I am going to go. I don't think I can do
it. It isn't that I can't do it - I can do it if I
have to, but I just don't think I have the time to go
from here to Texas and Minneapolis and Portland and
Cleveland and Boston, where he wants me to go. I
don't think I am going to be able to make the trip.
There isn't anybody in this room who can't stand &
month's rest. That is the trouble, the wear and tear of
the war on people who aren't at the front.
In other words, only ten percent is fighting and
ninety percent is waiting, and the damnedest part is
waiting here. It is worse than even if you were in
uniform.
here we will lose Surrey. Take this fellow here
(blough); for ten days I haven't been able to sit down
and talk with him, and Surrey was going on the Hill. I
should do it, sit down with Roy Blough and give him an
hour to bring me up to date on what is going on.
I ought to go up and see Mr. Doughton and Walter
George. Right?
MR. BLOUGH: Yes, sir.
H.M.JR: I haven't been able to physically do it.
And here is something entirely new. When the President
took the present Lend-Lease organization, he just took
it bodily and lifted it out of the Treasury and set up
this enormous organization with two thousand employees
to handle Lend-Lease. This is something de novo. It
is all very nice to say that the Treasury can do it
better than anybody else - sure, let's say that they
can; but also, it is going to be an organization to
handle billions where we are handling millions. I can
take criticism. I will be criticized no matter what I
do, 30 it isn't a question of trying to duck the criti-
cism.
Regraded Unclassified
217
- 43 -
If I am not criticized for this, I will be criti-
cized for something else; just as long as I am here I
will be criticized. I was explaining to somebody the
other day - again diverting - why I am criticized. In
the old days, first Governor Strong and then Governor
Harrison was the go-between between wall Street,
Washington, and Europe. Well, Mr. Roosevelt and I
took that away from them. Is that worth while getting
back for the Federal Reserve of New York? Sure, that
is worth fighting for. Sure it is worth while cutting
the throat.
When I went on the air, I was sick. A very impor-
tant businessman wrote a letter to a friend of mine.
"With Morgenthau out of the way, I am making new plans.
will you come and go to work for me?"
Sure they want to get me out of the way. It is
a question of what can I do, and what can Mr. Sullivan
do, and Mr. waston, and looking around the room, there
is just a handful of us left. Now, what can we do?
This is an all-time-consuming business. Go to RCA,
RCA says, "No, can't even have this man as a consultant,
this Folsom. Wouldn't even let me have him as a con-
sultant. They tell me whom I can get in other businesses,
very generous, but I can't even have Mr. Folsom as
consultant.
The President of Marshall Field came down here;
wonderful about suggesting other businesses, but I
can't even have them. American business doesn't want
Mr. Roosevelt's Administration to dump this thing, but
will Americanbusiness come in here and help us? I
haven't seen anybody yet who would. And that is &
heartache. I am going to have nothing but heartaches
and headaches, and this is the thing - I am talking
about myself and the people - where can we put the energy
where it will do the most good? There are things right
in this room - people crying to see me. Here is Bell
waiting on the Bank of America; here is Charlie Bell
waiting on deferments. Everybody is waiting. I try to
clear the things before sunset.
Regraded Unclassified
218
- 44 -
I did accomplish something yesterday by just
sitting here and sweating out Mr. Hull. I did get
something done. But the question is one of relative
importance. This is something brand new. You will
agree with that?
Mr. SULLIVAN: Oh, yes.
H.M.JR: Should I take this thing or not? My feel-
ing is that I shouldn't take on this kind of & thing
which is brand new. I will take on something if I
think I can stop Sweden from sending steel and ball
bearings to Germany. I will take that on.
MR. BELL: Seen Drew Pearson this morning?
H.M.JR: Yes. If I can keep diamonds and platinum
from going from the Argentine to Spain and Germany, I
will take that on. But, frankly, I don't think I want
to take this on. I can't be any franker than that,
can I? That is turning myself inside out.
MR. SULLIVAN: No, you can't. That is perfectly
frank.
H.M.JR: Here is Dan; Dan is tired. Charlie Dell
is tired, Herbert waston is tired, I am tired; but we
can still function. But we have first got to do the
things that are here. Harry White is tired; we are all
tired. Hell, we burn ourselves out on this thing, be-
cause we are the one Department that hits and hits hard.
I don't think we should take this kind of thing on that
is new if we can get somebody else to do it. That is
the way I feel, John. It is no reflection on anybody.
I mean - again to be personal - all right, suppos-
ing we take it on. Everybody in the room knows that if
things break right in June, John wants to run for Senator.
More power to him; I hope he does - I hope he gets elected.
MR. WHITE: In fact, we are banking on it.
Regraded Unclassified
219
- 45 -
H.M.JR: But I can't count on John to carry this
thing. If I could count on John to carry the thing,
that would be something else. But John says I am on
notice. If everything isall right in June, he leaves
me. Then who is going to carry this thing on? It
means somebody else amongst us has to take onthe extra
burden. And June isn't very far off, and the chances
are excellent. Well, there goes another member of the
nine-thirty Group.
MR. WHITE: And there is a good excuse right there.
I mean, even a good public excuse.
H.M.JR: I don't think better.
MR. SULLIVAN: Well, I am convinced that you have
got to plan to carry this along for another three or
four months, anyway, Harry. I don't think any sort of a
device will let you out in the meantime.
MR. WHITE: I didn't think it was a question of
cutting it off immediately. After all, the big problems
of disposal of surplus property, I imagine, will not
occur until after the cessation of the European conflict.
MR. SULLIVAN: Yes, the big ones, but not the real
big ones.
MR. O'CONNELL: The volume will be later, of course.
MR. WHITE: Certainly not in the next few months.
MR. BELL: They are getting big right now.
MR. GASTON: we have this thing - it isn't a ques-
tion of whether we take it or don't take it. Now the
question is technique and timing.
H.M.JR: Excuse me, Herbert, I don't think you
are quite correct, because I understand that on the re-
quest of Clayton the Army has stopped all surplus sales
for the time being. There is a stop-order out issued
by Clayton stopping all surplus sale on the part of the
Army.
Regraded Unclassified
220
- 46 -
MR. SULLIVAN: And they turn it over to us.
H.M.JR: No, I understand that Clayton issued an
order, I think more or less as & result of this battery
trouble in Utah, telling the Army to stop all surplus
sales until he could have & look at it.
MR. GASTON: That doesn't affect us?
H.M.JR: It affects us in this way: It doesn't
place an additional burden on us immediately.
Clayton has stopped the thing, all right. He
wants to have a look at the thing. In the meantime the
Army isn't dumping anything on us.
MR. GASTON: As the record stands now, this job
has been assigned to us. The question is, what is the
technique?
H.M.JR: That is right. But the point I want to
make is, he has more time to look around. Not because
I raised the question, but for reasons of his own, he
issued an order to the Army to stop the sale of surplus
goods until he could study it.
di
Sullivan: But I think that was to order them
to turn it over to the appropriate agency rather than
selling it themselves.
H.M.JR: Granted, but what I am trying to get at
is, we have a little more time to think about it, be-
cause the Army isn't dumping stuff on us every day.
That is all I mean.
Well, thank you for your patience.
Regraded Unclassified
221
April 7, 1944
11:30 a.m.
JEWISH EVACUATION
Present: Mr. Pehle
Mr. DuBois
Mr. Lesser
Mr. J. B. Friedman
Mr. Abrahamson
Miss Laughlin
Miss Mann
Miss Hodel
Mrs. Klotz
H.M.JR: I just wanted to say to all of you that
nothing has pleased me more than being able to get the
State Department to send out this cable in regard to Camp
Vittel. It just shows that if we put enough heat in the
right place it can be done, and believe me, we have put
plenty of heat on Mr. Hull, proper. The unfortunate
thing is he has surrounded himself with a lot of people
who are very prejudiced and just have no vision at all.
I hope the world doesn't know it, because all of these
are little drops of water on the stone, which must give
confidence to the suppressed people of the world that there
is some hope somewhere.
When these things are out and nothing happens, they
must ask themselves, "Well, after all, what is all of this
fighting for?" So the fact that the March 16 cable went--
of course, in the room I can say it is a tragedy it didn't
go on March 16. Most likely two hundred and fifty people
have been murdered because it didn't go out on the 16th
of March.
I made up my mind last night, and I told these people
I would stay here until it did go. I did stay here with
the help of you people, and with the result that people
over there who were opposed to the thing--evidently Mr.
Hull, although I haven't spoken to him since last night
Regraded Unclassified
222
- 2 -
at six o'clock--I haven't been able to get hold of him
to thank him. But the results were good. I just made up
my mind I would stick it out.
Each of you is entitled to a personal inward satis-
faction.
MR. PEHLE: We have that, and want to thank you for
going to bat on this thing.
H.M.JR: It was just one of these things where Mr.
Hull was given this memorandum--what is this terrible
person's name?
MR. PEHLE: Culbertson.
H.M.JR: Culbertson's memorandum. And that was the
last word.
Well, it turned out it wasn't the last word, and he
most likely can say again as he did once before, "It is
that damned Jew in the Treasury" who over-ruled him. He
said it once before, and now most likely he will say,
"God-damned Jew." It is a badge of honor.
It is unfortunate that such people exist in Mr.
Roosevelt's Administration, and they should be gotten rid
of, but Mr. Hull doesn't seem to want to get rid of them.
There you are.
Anyway, thank God for people like yourselves. I just
want to say thank you.
Now, to get off the serious side for a minute, I
will give you all a good laugh. You don't know, I don't
think, but I called up this Rabbi and wanted to thank him.
After all, it was a nice Passover present. He said, "I
want to wish you, Mr. Morgenthau, an orthodox Passover."
(Laughter) So I wish you all a very orthodox Passover.
223
nbsnn ТУӀ
Rd
VAAD HAHATZALA
(Emergency Committee for Refugee Scholars,
Yeshivoth, Rabbis and Communal Leaders)
132 NASSAU STREET
(ROOM 819)
NEW YORK 7. N. Y.
PHONE RECTOR 2-4235
April 7, 1944
Honorable Henry J. Morgenthau, Jr.
Secretary of the Treasury
Washington, D. C.
Honorable Sir:
In name of all orthodox organizations, may we
express our sincerest appreciation for your grac-
iousness in receiving our delegation, and for your
warm sympathetic concern in the fate of the unfortun-
ate Jews for whom we pleaded. We pray that your
proposed action will result in their rescue.
We are indeed grateful t you and your able staff
of the War Refugee Board, her by Mr. John W. Pehle,
for the cooperation which We been manifested at every
oceasion. They show utter devotion to the historic
task which is theirs, and it is our hope that their
efforts will be most successful.
We express our sincerest best wishes for a most
pleasant holiday.
Very respectfully yours,
VAAD HAHATZALA EMERGENCY COMMITTEE
Rabbi A.Rolmanounitz Abraham Kalmanowitz
AK:r
224
4/7/44
CHRONOLOGY OF HANDLING CAMP VITTEL MATTER
December 18, 1943
Matter first raised with State
Department by Winant.
December 24, 1943
Matter raised with State Department
by Polish Embassy at Washington.
December 24, 1943
State Department cabled Asuncion
requesting cooperation of Paraguayan
Government.
December 29, 1943
Matter raised with State Department by
American Embassy at Lima.
December 23 and 28, 1943
Matter referred by the State Department
and
to the Intergovernmental Committee for
January 11, 1944
investigation and report.
January 27, 1944
State Department petitioned by Agudas
Israel to take action in this matter.
February 21, 1944
Having received no word from the
Intergovernmental Committee, the War
Refugee Board delivered cable to State
Department for transmission to Bern
on this subject.
March 14, 1944
War Refugee Board received from State
(late in the afternoon)
Department cable from London dated
March 2, 1944, containing the report
and recommendations of the Inter-
governmental Committee.
March 16, 1944
War Refugee Board delivered to State
Department substitute for cable
delivered on February 21, 1944,
rewritten in light of the Inter-
governmental Committee's report and
recommendations.
April 5, 1944
War Refugee Board advised by State
Department that Policy Committee dis-
approved of War Refugee Board cable
requesting Swiss to take blanket
affirmative action. Matter was dis-
cussed promptly with Culbertson and
Keeley of State, who, it turned out, did
not even agree with limited action
approved by Policy Committee.
225
- 2 -
April 6, 1944
War Refugee Board received entirely
unacceptable redraft of cable to Swiss
prepared by Culbertson.
Secretary Morgenthau was visited by
representatives of the Union of Orthodox
Rabbis and Agudas Israel, appointment
having been arranged by Senator Mead and
Congressman McCormick's offices. Secretary
Morgenthau talked the matter over with
Mr. Hull and read to him the crucial
sentences in the cable prepared by the
War Refugee Board requesting Harrison to
have the Swiss take affirmative blanket
action on the matter. Hull raised no
objection to these sentences but kept
saying that he had directed the cable to
be changed 80 that it represented the views
of the Government and not just of the War
Refugee Board, & point which the War
Refugee Board had previously contended for
but had been overruled on by the Policy
Committee at a meeting over which Mr. Hull
is said to have presided. Mr. Hull sent
George Warren to see Secretary Morgenthau
to work out the matter. Warren came to
the Treasury but said that Mr. Hull had
been focusing on Culbertson's draft and
consequently there was nothing he could
do to straighten the matter out without
taking the matter up again with Mr. Hull.
Late in the evening Warren advised Pehle
that Mr. Hull had agreed to send a cable
as requested by the War Refugee Board but
was going to call a meeting the first thing
the next morning to clear the language of
the cable.
April 7, 1944
Mr. Brown in Mr. Hull's office advised
Pehle at 10:00 a.m. that Warren and other
State Department officials were redrafting
the cable which the War Refugee Board
requested to be sent.
George Warren called Pehle at 10:25 a.m.
to say that the State Department was
sending the cable exactly as transmitted
to it by the War Refugee Board on March 16,
1944.
Insure
226
April 7, 1944
12:51 p.m.
HMJr:
Hello.
General
Strong:
Good morning, Mr. Secretary.
HMJr:
Good morning.
S:
This is General Strong.
HMJr:
Yes, General.
S:
I was just wondering whether there had been any
developments in the matter We had talked about
the other day because I have had an intimation
that fairly heavy effort is being made by State
Department to get me on duty over there.
HMJr:
Well, the only development is that General
Marshall's office wanted to know what it was
all about.
S:
Uh huh.
HMJr:
And I told them yesterday.
S:
Uh huh.
HMJr:
And then they told me that you had until June
on your leave and I explained to them my diffi-
culty in getting to the President and I haven't
been able to see the President.
S:
Uh huh.
HMJr:
And that -- that is my difficulty. So they said,
"Well, there's no hurry."
S:
Well, I can give that up any time.
HMJr:
What?
S:
The leave.
HMJr:
Oh. No, but I meant there was no -- I explained
to them that I couldn't -- I doubted whether I
could get to the President until his return
S:
Oh, I see.
HMJr:
from his rest, which is confidential.
Regraded Unclassified
227
- 2 -
S:
Yes.
HMJr:
So they said to me, "Well, there's no hurry."
And so -- well, I said, "That's that." But
if you've got something from the State Depart-
ment, this is very nebulous and I -- I wouldn't
wait on it.
S:
Uh huh.
HMJr:
But....
S:
Well, if anything comes up, let me know and in
the meantime
HMJr:
The way it is now, he's going away and it will
be a couple of weeks before I can see him.
S:
Well, I'll try to stall off for some time.
HMJr:
Yeah. But General Marshall's office seemed to
like this idea that I had in mind.
S:
Uh huh.
HMJr:
They said, "Well, that's fine. We're worrying
about that, too." I just thought I'd pass that
along.
S:
All right, Mr. Secretary.
HMJr:
Well, I'm sorry, but due to the President's
illness, I haven't been able to see him.
S:
Huh.
HMJr:
I've had a request in now for ten days.
3:
I'll -- I'll stall on the State Department and
if, as and when you get a chance to see him, if
anything comes up, please let me' know.
HMJr:
I certainly will.
S:
Thank you very much, sir.
HMJr:
Thank you.
228
April 7, 1944
4:15 p.m.
Operator:
Here you are.
Treasury
Operator:
He's on the line.
HMJr:
Hello.
Operator:
Just a moment, sir.
HMJr:
Hello. Hello.
Henry
Wallace:
Henry?
HMJr:
Yes, Henry.
W:
Why do you want to grow corn between your apple
trees?
HMJr:
Well, we're just planting them. I don't actually
mean -- it's in the rows between them.
V:
Oh, you're just putting the trees out?
HMJr:
Yeah, just putting the trees out and we've got
a lot of room there. We won't plant up to four
feet, you see, of the trees.
W:
Oh, I see. Yeah.
HMJr:
But I don't want to let the ground go to waste.
Y:
Uh huh.
HMJr:
And we were -- I wanted
W:
What do you -- what do you want to plant, sweet
corn....
HMJr:
No.
W:
....or field corn?
HMJr:
Field corn.
V:
Want to plant field corn?
HMJr:
Yeah, for husking.
Regraded Unclassified
229
- 2 -
W:
Uh huh.
HMJr:
But I don't want any of that tall corn that
grows in Iowa twelve feet tall, if that's the
way it grows.
W:
Well, it grows pretty tall.
HMJr:
It does?
W:
Yeah.
HMJr:
You have no short variety?
W:
Well, yes, they have some relatively short
sorts. I don't believe they're as short as
you have in mind though.
HMJr:
You haven't?
W:
I think -- how about this Cornell Number 12?
HMJr:
Well, we're getting Cornell Number 11.
W:
Eleven rather.
HMJr:
Eleven -- that's the one they've recommended.
We have that, but I was just trying to
W:
Trying to do a little experimenting, huh?
HMJr:
That was it. Of course, we could experiment
a little on sweet corn. I haven't grown it
for years.
W:
Well, I'll tell you -- I'll -- I'll have the
boys send ten pounds up here just for fun to
try.
HMJr:
No, I'd be glad to try enough to make it
worthwhile 80 we could market it. And I want
to buy it.
W:
(Laughs) I just don't want to sell it to you.
HMJr:
No, no, no.
W:
No, I really don't.
230
- 3 -
HMJr:
What?
W:
I really don't. I'll
HMJr:
No, well, why not?
W:
Because, frankly, I just don't know whether
it's adapted to New York State or not.
HMJr:
Oh.
W:
And so, therefore, I'd suggest -- I'll have
them send ten pounds to you and you can find
out whether it is or not.
HMJr:
Well, that isn't what I
V:
That won't be difficult. Ten pounds will plant --
oh, half an acre or 80.
HMJr:
Yeah. Well, that will be wonderful.
W:
Let's see, as a matter of fact, ten pounds --
a bushel plants -- a bushel plants about seven
acres and ten pounds would plant an acre.
HMJr:
Yeah.
W:
Yes, I'll -- I'll have them send ten pounds to
you and
HMJr:
You don't know whether it's adapted?
W:
Frankly, I don't know of any experiments in New
York State. And I just don't -- you can never tell
about corn until you've had experience.
HMJr:
Well, we'd like to try it.
W:
All right, sir, I'll see that ten pounds are sent
to you.
HMJr:
Now, if they'll send it to James Bailey
W:
James Bailey?
HMJr:
Hopewell Junction, New York.
231
- 4 -
W:
It shall be done. James Bailey, Hopewell
Junction, New York.
HMJr:
That's terribly nice.
V:
Thanks, Henry.
HMJr:
Thank you.
232
April 7, 1944
4:30 p.m.
BANKING
Present: Mr. Bell
Mr. Delano
Mr. O'Connell
Mr. Tietjens
Mrs. Klotz
H.M.JR: I am very sorry about this morning, but Mr.
Bell kept me--
(Mr. Bell and Mr. Delano enter the conference.)
H.M.JR: Where is my General Counsel?
MR. BELL: Do you want the General Counsel?
H.M.JR: Don't I?
MR. BELL: I don't think you need him. It is just a
question of where we are going and what the policy is. We
think we ought to bring you up to date.
H.M.JR: Well, all right. Go right ahead. I always
need 8 lawyer.
MR. BELL: Out in California we have over fifty facili-
ties established in Army posts, Navy yards, and so forth,
and the Bank of America has about thirty of them. Of course,
we don't consider these in any sense branches, but they are
often close to it, and I must say that they have done one
swell job. You could ask nothing more from them in the
way of service. They have just turned over their whole
bank to this Army and Navy crowd.
Now, they have asked for some branches, and Mr. Delano
will tell you about three places. There is some political
233
- 2 -
pressure on two of them. Senator Downey has been right
hot. He told Mr. Delano the other day we were going to
be responsible for his defeat, and possibly the defeat
of the Democratic Party out there.
H.M.JR: Sure, that happened last time. Roosevelt
carried California by three hundred thousand.
MR. BELL: But we thought you ought to know about it,
particularly these three places.
H.M.JR: They had better not cry "wolf! wolf!" too often.
(Mr. O'Connell enters the conference.)
H.M.JR: The Bank of America--you may not know about
it, but maybe you should.
MR. DELANO: The first place, where the heat is the
hottest is a place called Sherman Oaks, which is a little
community about seventeen miles north of the heart of
Los Angeles. We have several times turned down requests
for a branch at Sherman Oaks.
H.M.JR: What part of California is that?
MR. DELANO: Southern California.
MR. BELL: Not far from Hollywood, is it?
MR. DELANO: That is right. It is in the incorporated
limits.
(Mrs. Klotz entered the conference.)
MR. DELANO: It is in the incorporated limits of the
City of Los Angeles, but about seventeen miles from the
heart of the city.
Up to the present time we have turned down the
applications for branches there on the general theory that
the service was adequate. There is good service at two
branches, about two and a half miles from this particular
Regraded Unclassified
234
- 3 -
location. But in the last few months there has been
quite an increase in population there; and, of course,
there is gas rationing, which adds to the inconvenience.
Under those circumstances we thought we would put &
facility there 80 that it would be temporary and we wouldn't
be expanding the system of the Bank of America, and they
would provide all the necessary services for the community.
I told that to Downey, that we would put a facility
there, and we are in receipt of some pressure from him
stating that isn't adequate.
H.M.JR: Leave Downey out of this thing and just
give it to me on a question of straight backing necessity
of the community.
MR. DELANO: The facility is adequate.
H.M.JR: It is adequate?
MR. BELL: We would much prefer to have the facility,
and then we could take another look at it after the war
is over, and the population - certainly some of it will
leave.
H.M.JR: You mean the present banking facility?
MR. DELANO: No, I mean the thing we call 8. banking
facility that we propose to put in there.
MR. BELL: The same as an Army post.
H.M.JR: I didn't understand. You mean it isn't a
permanent branch; it is, so to speak, as long as necessity
dictates.
MR. DELANO: That is right. And at our option it
can be extinguished.
H.M.JR: Who thought that up?
MR. BELL: I think it was probably Mr. Batchelder and
you (Delano) talking together.
235
- 4 -
H.M.JR: Is this the first time we have done this?
MR. BELL: We have facilities around other places.
H.M.JR: Other than camps?
MR. BELL: Not all e xactly in camps. We have that
one in Wichita, which is more or less in a housing development
tied into the Boeing Plant. We have one at Seattle which
is at the Boeing Plant.
H.M.JR: Is that what those are?
MR. BELL: Yes, those are facilities, not branches.
H.M.JR: I see. This is the first time I have heard
the word "facility" used.
MR. BELL: You didn't get it the other day when I told
the story. I used the word "facilities" all the way through.
H.M.JR: I thought you were talking about a gadget for
an airplane.
MR. BELL: We have coined that word. It now has a
technical meaning, S0 we are sticking to it.
MR. DELANO: The difference between that and a branch
is that the branch is more or less permanent. When you
give them a branch permit, they can keep it until they
want to give it up. In the facility, the option rests
with us to extinguish it.
MR. BELL: It has to keep the main part of its books
at the parent office. The loans are really made at the
head office, though they may initiate the loans.
H.M.JR: How far is the nearest bank?
MR. DELANO: The nearest branch to this particular
location is two and a half miles.
H.M.JR: How many people are there?
Regraded Unclassified
236
- 5 -
MR. DELANO: About fifteen thousand.
H.M.JR: Are they war workers?
MR. DELANO: Largely, but there will be a large
permanent part of those--
H.M.JR: They work at--I don't know whether I know
the names of the plants. They work at various war indus-
tries within & reasonable distance. They live in this
community.
MR. BELL: This is more a residential section.
H.M.JR: I think this is a damn nice wrinkle.
MR. DELANO: I think it is a good one, myself.
(Mr. Tietjens enters the conference.)
H.M.JR: You are just too late; we opened & facilit.
MR. TIETJENS: To help Giannini?
H.M.JR: It is a wonderful thing. It is not a branch,
not a bank, it is a facility. I think it is wonderful!
MR. BELL: You ought to read the telegram.
MR. DELANO: Do you want to see the telegram? When
we told them we were going to give them the facility, we
had this. (Hands Secretary telegram of April 6, 1944,
signed by Sherman Oaks delegation.)
H.M.JR: My God! Why not say, "America first," and be
done with it?
MR. DELANO: The whole thing is staged.
H.M. JR: (Reading telegram) "Copy to President.
Cannot understand refusal of Comptroller of Currency and
Regraded Unclassified
237
- 6 -
Secretary Morgenthau in refusing branch banks. Sherman
Oaks Encino districts serving communities of 25,000
population and several hundred business concerns when
building to house bank is available, according to wire
from Senator Downey. Impossible because of gas rationing
to contract business in districts. Nearest bank from Encino
is 12 miles round trip. During Fourth Loan Drive people
unable to buy bonds at post office with payroll or personal
checks. Local theatre one evening sold $150,000 of bonds.
We need bank and leave selection of same to Treasury Depart-
ment. Facility referred to in Senator Downey's wire would
not in our opinion be satisfactory."
Well, what the hell? They have a facility.
MR. DELANO: That is right. It would give them all
they need.
H.M. JR: Unless somebody says no, I would give them
the facility.
How about it, Norman?
MR. TIETJENS: That is the least you can give them.
(Laughter) And that is what you ought to give them.
HyM.,JR: To that what you are for?
MR. TIETJENS: I thought they didn't want it. I
heard that.
MR. BELL: Well, the Bank of America said that they
didn't want the facility. Of course, they want the branch,
and they may say no on the facility.
MR. DELANO: We will get another bank to put a facility
in.
MR. BELL: Haven't we exhausted it pretty much?
MR. DELANO: No, we have tried it on branches, but
not facilities.
Regraded Unclassified
238
- 7 -
H.M.JR: Why don't you give it to somebody else
first besides the Bank of America?
MR. BELL: We tried to get an independent bank.
H.M.JR: How about the other Italian there?
MR. DELANO: You might try Security first.
H.M.JR: What is that? Is it a trust company?
MR. DELANO: It is not Sartori?
H.M.JR: No, no, a very able Italian down there has
a trust company. Why not offer it to him?
MR. DELANO: Suppose we do this, suppose we try to
give this--he is a good man, that is right.
H.M.JR: There are good ones and bad ones.
MR. DELANO: You may try this on other people first.
H.M.JR: There is a very able Italian down there, a
very prominent fellow; I had him lined up.
MR. DELANO: I remember. His name escapes me.
H.M.JR: I think it is a trust company. Could they
open?
MR. DELANO: I think so, if they will.
MR. BELL: Rossi, is that his name?
MR. DELANO: No, Rossi is at San Francisco.
H.M.JR: Well, there is a man; there can't be so
many Italians down there.
MR. BELL: Oh, no, there are several in the Bank of
America.
239
- 8 -
H.M.JR: Is that all you want?
MR. DELANO: No, sir, that disposes of one case,
H.M.JR: How many do you have?
MR. DELANO: The next one is two little towns in
Southern California. One of them is Maricopa and one of
them is Arvin. They are about twenty miles south of
Bakersfield, which is the nearest on banking services.
And at Maricopa, the Bank of America has a permit, which
at the present time is dormant and closed under that
agreement that we have; they can close it for the duration
of the war and then revive it.
H.M.JR: I didn't know that. Mr. Bell will most likely
say he told me.
MR. BELL: I think it is in the record. We froze
them at four ninety-five.
H.M.JR: We did?
MR. BELL: Yes, absolutely.
H.M.JR: Bell has one foot in Atlantic City already.
MR. DELANO: No, the proposal of the Bank of America
is to extinguish this dormant permit and open a branch
at Arvin. Arvin needs banking facilities. We can't put
a facility, facility quotes, there for the reason there is
no war effort there. I am disposed to let them move this
branch from Maricopa, where it is not needed, to Arvin,
where it is needed.
H.M.JR: What is at Arvin?
MR. DELANO: Nothing, except--
H.M.JR: The only Arvin I know was that place near
Rockaway. Anyway--
240
- 9 -
MR. DELANO: Arvin has between six and eight thousand
people. It has no banking facilities. I think it is in
the public interest to transfer this one from Maricopa
to Arvin.
H.M.JR: Are you fellows for it?
MR. BELL: I agree.
MR. O'CONNELL: I take it you can't get anybody else.
MR. DELANO. That is right. That is always the
condition precedent.
H.M.JR: That wasn't true in Los Angeles. But no
one else wants to go to Arvin?
MR. DELANO: That is right.
MR. BELL: I think you will find that it is pretty
much Bank of America territory in the Sherman Oaks area.
MR. DELANO: That is right.
H.M.JR: Let's bust it open.
MR. BELL: Well, we tried to get an independent bank,
but we weren't successful.
H.M.JR: Let's bust it open.
MR. DELANO: We will proceed on this theory, we will
try the other banks first; and if we can't get them to put
a facility in--
H.M.JR: I don't know whether you are old enough to
remember, but the New Deal used to be reform.
MR. DELANO: I am old enough!
H.M.JR: I pulled that the other day. This reporter
was in. I said, "I don't know whether you are old enough
to r emember an organization called the OCD!"
Regraded Unclassified
241
- 10 -
MR. DELANO: I have one more.
H.M.JR: Yes, you are doing all right, the best you
have ever done on Giannini. I am in a good humor today.
MR. DELANO: We think we are holding them, anyway.
Pat McCarran, who is from Nevada--
H.M.JR: So they tell me.
MR. DELANO:
...has been riding us very heavily to
granta permit to the First National at Reno to absorb two
small banks; one at Minden, and one at Eureka. They are
all in Nevada, and they are in very small communities.
He wants to absorb those by the assets, and branch the two
banks. They are all three owned by Giannini, by Transamerica.
H.M.JR: How long have they owned them?
MR. DELANO: Oh, for several years.
MR. BELL: But they are not a part of the branch system.
They are owned separately.
MR. DELANO: Up to the present time we have consistently
denied Transamerican's request for this sort of thing, because
we don't like to extinguish an independent bank and put it
into & chain system.
Now, Pat is after us hot on the thing; up to the
present time I have said simply, "It is under consideration."
We were opposed to it on general principles. But the
door is open if we want to give it.
H.M.JR: Wouldn't these banks continue with local
directors?
MR. DELANO: Yes.
MR. BELL: Local directors? Probably local personnel.
MR. DELANO: They are paper banks, as far as directors
are concerned, because Giannini owns all of the stock.
Unclassified
242
- 11 -
MR. O'CONNELL: Transamerica owns the stock of all
three banks involved?
MR. BELL: Yes. They are probably right under the
branch system just as they are operating now.
MR. DELANO: There is no public interest in doing it,
Mr. Secretary.
H.M.JR: It looks better the other way.
MR. O'CONNELL: It looks better the way it is.
MR. TIETJENS: They come in and buy it, and all at
once they consolidate it.
MR. DELANO: It encourages the complete expansion
of the program based on that procedure.
H.M.JR: You are not recommending that?
MR. DELANO: I am not recommending it.
H.M.JR: I am with you. I would rather raise the
price of silver.
MR. BELL: You may have to do one or the other.
(Laughter)
Pat is out of town now.
MR. DELANO: You stand pat on that?
H.M.JR: I stand pat on McCarran!
All right, you are doing all right.
Norman, are you still happy?
MR. TIETJENS: Yes.
H.M.JR: With what I did today?
243
- 12 -
MR. TIETJENS: Sure, I have no complaints at all.
H.M.JR: You give this other "Wop"--
MR. DELANO: I will give this other "Wop"the first
crack at Sherman Oaks. They will move this branch from
Maricopa to Arvin.
May I add one thing? The Federal Reserve a short time
ago, in admitting a small bank in Lockwood Village, made the
condition they should not sell any of the stock to Giannini.
They have sold some of the stock to Giannini.
H.M.JR: Naughty, naughty!
MR. DELANO: And they have at the same time gone into
the courts and asked for an injunction against the Federal
Reserve for kicking them out of membership.
H.M.JR: Have they kicked him out?
MR. DELANO: They haven't, but they have anticipated
that they will, because of this development. John McKee
just called me and said, "This is very confidential, but
this is the boat we are in." Itold him I would treat it
as confidential. I consider this as confidential.
MR. BELL: I don't think they had any right to attach
a condition.
MR. DELANO: They are pretty far out on 8 limb on it.
H.M.JR: What did they want us to do?
MR. BELL: Cooperate, if we can.
H.M.JR: Hell, I am not going to do any more Bank of
Kentucky cases for the Fed. What should I do on this?
MR. BELL: Nothing. It is just a matter of information.
H.M. JR: Where is this place? Bell will come in here
seven months from now and tell me that he told me this. Now,
where is this?
244
- 13 -
MR. DELANO: This is in California, Lockwood.
H.M.JR: And the Federal Reserve said, "If you
sell any of that stock to Giannini, we will revoke your
membership"?
MR. DELANO: That is right. They made that a condition
in admitting them to membership.
MR. BELL: I don't think they can qualify.
H.M.JR: Now, what do I do?
MR. DELANO. Nothing; it is just information.
MR. BELL: You will hear about it, of course.
245
April 7, 1944
4:50 p.m.
RE: CHARLES OLIPHANT
Present: Mr. D. W. Bell
Mr. Charles Bell
Mrs. Klotz
H.M.JR: What I did is, I had Charles Oliphant in
here. He works over in Internal Revenue under Phillip
Wenchel, and he had an offer to go with Mr. Clark, who
heads the Tax Division of the Attorney General's office.
I told him that as long as I am here I always wanted
an Oliphant in the Treasury. I asked him if he wanted to
pursue tax law.
He said, "I just don't know what I want. Some day--
I don' t know when--I want to go into law practice with
Sol Diamond, but I had an offer today of twelve thousand
dollars, which I am not interested in. Phil Wenchel said
he could get me twenty."
Isn't that nice?
So I sent for Joe O'Connell and I said, "Listen, Joe,
who passes on the tax cases when they come over here to
the General Counsel's office?"
He said, "I do."
I said, "I don't want you to do that."
He said, Well, Paul used to do it, and Surrey used
to do it."
I said, "You are losing both of them, and I don't
want you to do that. I don't know whether Charles Oliphant
is good enough; but if he is--and that is for you to decide,
246
- 2 -
and I hold you responsible--think it over. You bring
him over here and let him pass on the tax cases that come
over from Phil Wenchel's office."
Then he told me of the two cases that he is handling,
just got through handling, which is the John L. Lewis case,
and he said, "Now I am handling this Mrs. Patenotre case.
Those are the kinds of cases that I have." He is very
much interested in the two.
You have to have somebody. They are bringing 8. complete
stranger in, and this man may be a damned sight better than
8. stranger.
MRS. KLOTZ: I have no idea about his ability.
H.M.JR: It old Joe O'Connell that he has to decide
that.
MR. BELL: He just went out, didn't he?
H.M.JR: If he is good enough to handle the John L.
Lewis case and the Patenotre case-they are the two biggest
cases we have. The latter is only eight years old!
All right.
MR. BELL: You have a letter from the Minnesota
Bankers Association that was sent in to me yesterday,
asking you to make a speech on June 13 or 14 at their
fifty-fifth annual convention in St. Paul.
H.M.JR: You?
MR. BELL: No, you. You have never been there, and
they have done a grand job out there. I don't know what
you want to do about it. It was sent to me.
H.M.JR: I will go to Los Angeles, but not there!
MR. BELL: I think you might consider that.
247
- 3 -
H.M.JR: Listen, fellow--
MR. BELL: You would have a nice time in Minnesota.
H.M.JR: The answer is no. I am saving June. You
may not have heard about it, but we are having the Fifth
War Loan.
MR. BELL: That is what this is for.
(Mr. Charles Bell enters the conference.)
(The Secretary talking to Commander Fox on White House
phone:)
Hello
How are you?
Fine
Look, Fox, I have a favor to ask
Do you have a pencil?
I have an Administrative Assistant by the name of
Norman Thompson who has only been in the Government service
thirty-seven years, just a newcomer. He had a very, very
bad heart attack here a couple of days ago. Captain Harper
was kind enough to give us some blood plasma
Now, there is about one chance in ten that we may have
to move him to a hospital
We don't even know whether the poor man will be able
to
But if there is that one chance in ten, I would like
Admiral McIntire to authorize that we could move him to the
Navy Hospital, because there is no private hospital we can
get him into
How soon?
248
- 4 -
Right
Yes. How long are you going to be in your office?
Well, between now and six. If I am not here--I am
going to the pool, and I will stop by your office and get
the answer on my way from the pool
You try me; and if I am not here, I will stop by
after I have had my swim and talk to you then. But you
tell the Admiral this is something I would really like
O.K
There is only once chance in ten I will need it
Thank you
The name is Norman Thompson. He is the Administrative
Assistant here
Incidentally, he does all kinds of thing for the
White House
I don't know how many Treasury people are on the
White House pay roll-detailed to the White House
I mean, I don't know how many of our people are over
there
No, but I mean actually--I am talking about clerks,
see
You must have a dozen or more
There are twenty-five Treasury people, clerks, who
come under Norman Thompson, that are detailed to the White
House
O.K
Roberta is one of them. Did you know that?
249
- 5 -
She is on my pay roll
No, she is on my pay roll
There are twenty-four others like her
Like hell she does!
She is under the Roosevelt-Morgenthau Regime
You tell that to Roberta, and she will spit in your
eye
O.K
All right
H.M.JR: He said she must come under the Ogden Mills
Regime!
MRS. KLOTZ: Mr. Morgenthau, he didn't have & heart
attack; he had a stroke.
MR. BELL: Probably close.
H.M.JR: What is the difference? The heart fails to
pump the blood into the brain.
MRS. KLOTZ: I am glad you put it that way, because if
you said a stroke, they might not take him.
H.M.JR: Don't worry about that. It is a favor.
MRS. KLOTZ: I just wanted you to know.
H.M.JR: It is the heart not being able to pump the blood
fast enough into the brain.
250
April 7, 1944
4:54 p.m.
Operator:
Go ahead.
HMJr:
Hello.
John
Harper:
Good afternoon, Mr. Secretary.
HMJr:
Is this Captain Harper?
H:
Yes, sir.
HMJr:
How are you?
H:
Just fine.
HMJr:
I haven't heard of you in a long time.
H:
No, it's good to hear your voice.
HMJr:
Captain, I'm calling up in regard to Norman
Thompson who is my Administrative Assistant.
H:
Yes.
HMJr:
You people were kind enough to let him have
some blood plasma a day or two ago. He's had
a very bad heart attack.
H:
Yes, they called me and I fixed them up with
it.
HMJr:
I know you did and I want to thank you. I'm
calling up on two things. We may need some
more blood plasma. This first treatment he's
had seemed to have done him a lot of good.
And then there may be one chance in ten that
he may have to be hospitalized.
H:
Yes.
HMJr:
And there isn't any private hospital we can get
him into. Now, if that should come about
H:
I'll tell you just what I'd advise on that.
HMJr:
Yeah.
H:
That will be all right. If you can get his
authorization
251
- 2 -
HMJr:
Yes.
H:
....from Admiral McIntire.
HMJr:
That's all right.
H:
You could do that.
HMJr:
I don't need that on the blood plasma though?
H:
No.
HMJr:
But on the other, I do?
H:
I'll take care of the plasma.
HMJr:
All right. Well, I'll do the....
H:
It might not be amiss to take that right up
so that if anything -- you have to act in a
hurry, why, everything will be arranged.
HMJr:
I'll do it immediately, on the hospitalization.
H:
Yes.
HMJr:
You'll
H:
I'll take care of the -- of the plasma and
anytime they need it, Mr. Secretary, just tell
them to get in touch with me.
HMJr:
Thank you 80 much. Ever so much obliged.
H:
Well, it's good to hear your voice.
HMJr:
Right. I'll get in touch with Admiral McIntire
right away.
H:
I think that would be a good move.
HMJr:
Well, that's easy.
H:
Even if we don't need it -- you may have to act
quickly on it.
HMJr:
Right.
H:
Yes, sir.
HMJr:
Thank you, Captain.
252
-.3 -
H:
You're quite welcome, sir.
HMJr:
Bye.
253
April 7, 1944
5:00 p.m.
DEFERMENTS
Present: Mr. D.W. Bell
Mr. C.S. Bell
Mr. Jordan
Mr. Gaston
Mrs. Klotz
H.M.JR: Come on, boys, do your stuff.
MR. C.S. BELL: White House policemen, Mr. Secretary;
we are all three in agreement on them. Mr. Gaston feels
right keenly about it. He happens to be out of the build-
ing.
H.M.JR: What are you going to do, defer a lot of
White House policemen?
MR. C.S. BELL: I am afraid so, on that group. We
are all three in accord on that. There is some disagree-
ment on the others.
H.M.JR: How old are they?
MR. C.S. BELL: Just one under thirty, Yost.
MR. JORDAN: One under thirty, and five that are thirty.
H.M.JR: Take the one under thirty out. (The Secretary
signs attached deferment list No. 1 with the exception of
Paul L. Yost.)
MR. C.S. BELL: There is one under thirty-eight,
Hoffman, but he is in Africa. That is a group that Norman
had approved earlier - all of those. (Hands Secretary
attached list No. 2.)
H.M.JR: What do these fellows do over at the Bureau
of the Mint?
254
- 2 -
MR. C.S. BELL: That brings up another question.
Mrs. Ross wants to defer practically every one in San
Francisco, including all of the laborers and guards.
H.M.JR: Nuts!
Jordan is a new man. We will let Jordan tell
Mrs. Ross that she can't have it. We have to break you
in, 80 you tell Mrs. Ross, no.
MR. JORDAN: I know Mrs. Ross. I have dealt with
her quite a bit. Of course, her idea is that you can't
get anybody in San Francisco.
MR. D.W. BELL: That is very critical.
(Mr. Gaston enters the conference)
H.M.JR: We had policemen first. The tell me
you are all for the White House policemen, herbert.
MR. GASTON: Yes, I think we have seventeen there.
We have one who is twenty-nine, I think, and four who
are thirty. The rest are between thirty and thirty-
seven.
H.M.JR: Why, Herbert?
MR. GASTON: I don't see how we are going to main-
tain the White House police force up to strength unless
we begin to grant deferments. We have eighty-one left
of the regular force of authorized strength of one hun-
dred and forty. We have got nineteen men borrowed
from the Metropolitan Police. We are scraping every
barrel to try to get this force kept up to strength.
We just can't do it, as far as I can see, unless we do
get deferments for those.
H.M.JR: Mr. Yost is twenty-nine. I have taken
him out.
255
- 3 -
MR. GASTON: I am content with that rule if you give
us thirty and above.
H.M.JR: Wait a minute. There are five thirties,
and then there is one thirty-one. What would you say
about the thirties?
MR. GASTON: I would like to keep the thirties.
We lose too many unless we keep the thirties. We have
got to get that force up. If we can hold those above
thirty and then with the help of the Civil Service
Commission we have a fair chance of building that force
up to strength where we can practically dispense, if
not entirely dispense, with the military guard. If
we could get one hundred and forty men we wouldn't
need the military guard.
H.M.JR: It is six of one and half a dozen of the
other.
MR. GASTON: I think it is a lot better with these
fellows than to tie up soldiers.
MR. BELL: Aren't they 4-F's?
MR. GASTON: They can't be, no.
H.M.JR: Now, Hoffman--
MR. GASTON: He is a Revenue Agent. You see, they
all have auditing experience. All auditors are on the
critical list.
H.M.JR: I see. Now, the Mint Cyril J. Brughelli,
Senior Melter.
MR. BELL: These are all San Francisco.
H.M.JR: I can see a machinist, but not at twenty-
eight.
256
- 4 -
MR. D.W. BELL: You can't get any of these people.
MR. C.S. BELL: These are all San Francisco.
MR. D.W. BELL: Which is a very critical area. You
can't get anybody outside. Mrs. Ross offered to trans-
fer people from Denver to the San Francisco Mint, and
thenthe Manpower Commission wouldn't give her any
assurance they wouldn't take them away from her after
she took them out there.
H.M.JR: I will not do a machinist at twenty-eight.
(The Secretary holds a telephone conversation with
Mr. Fox, as follows:)
257
April 7, 1944
5:10 p.m.
HMJr:
Hello, Fox.
Operator:
Go ahead.
HMJr:
Hello.
George
Fox:
Hello, Mr. Secretary.
HMJr:
Yes, Commander.
F:
That's all right. I talked with the Admiral
and that's authorized.
HMJr:
Fine.
F:
And the hospital has been notified.
HMJr:
What a man!
F:
So it's okay.
HMJr:
You're still my pal.
F:
Well, fine.
HMJr:
Okay, and listen, you tell Roberta that if she
goes back to Ogden Mills or to
E.
We won't even let her go back to Woodin, huh?
HMJr:
No.
F:
(Laughs)
HMJr:
Okay.
F:
Righto, Mr. Secretary.
HMJr:
Ever. 80 much obliged.
F:
Bye, sir.
258
- 5 -
MR. GASTON: I would pretty near, myself, be willing
to sign up for dropping any argument on anybody under
thirty - I am just about to that point.
H.M.JR: I don't get it.
MR. GASTON: I am willing to sacrifice anybody
under thirty.
MR. C.S. BELL: That takes two off of this list.
MR. D.W. BELL: Supposing you haven't an electroly-
tic refiner, and can't get one.
H.M.JR: Then we will stop making money; to hell
with them. We have to win the war.
MR. D.W. BELL: Furnish them paper money for twenty-
five cents.
H.M.JR: Sure, they will find anybody.
MR. D.W. BELL: No, they can't find them today,
that is the trouble.
H.M.JR: Listen, Mr. Bell, if you don't mind, I
have been in England and I have seen women doing jobs.
I have been in the railroad stations at midnight -
dirt, filth, and everything else - and I have seen
women doing jobs there that you would say three years
ago no woman would do. And they have done it. Now,
until you begin to tell me they put women on these
jobs, I won't exempt people under thirty.
MR. D.W. BELL: These are technical people and
have to learn this.
H.M.JR: All right. I have told the Treasury for
three years to get women and to teach them, and they
haven't done it.
259
- 6 -
MR. GASTON: I suppose an electrolytic refiner is
working on gold. I don't suppose it matters a lot
if we don't just refine the gold and store it - where?
H.M.JR: We store it unrefined.
MR. D.W. BELL: Silver, too.
MR. GASTON: But we have to assay it to pay for it.
MR. D.W. BELL: Ha, ha, this is good! That would
be a nice thing to say.
H.M.JR: We just haven't faced the situation. A
man under thirty can fight.
MR. BELL: I thought it was twenty-six and under.
H.M.JR: Well, 1 am making it thirty. No, I
will take fellows up to thirty. That isn't the only
electrolytic refiner?
MR. D.W. BELL: I don't know. Supposing we can't
get one, and he is the only one. I don't know.
H.M.JR: We will do this and see how bad the
squawk is.
MR. D.W. BELL: I imagine on that one it may be
pretty bad.
H.M.JR: Well, we will see. (The Secretary signs
deferment list No.2, excepting E. Breslin and .H.Mancuso.)
This Hoffman is the fellow from the Philippines?
MR. D.W. BELL: Honolulu, I think.
MR. GASTON: He is in charge at Algiers, isn't he?
I will let that go.
Regraded Unclassified
260
- 7 -
MR. D.W. BELL: The main Treasury man in Algiers.
MR. C.S. BELL: This is the next group. (Hands
Secretary list No. 3, attached)
H.M.JR: That is all right. (Secretary signs defer-
ment list No. 3)
MR. C.S. BELL: One more. I didn't go along with
Mr. Gaston and Mr. Jordan on any of these.
I don't know as I altogether understand your policy
on deferments. I understood awhile back that it was
almost an all-out no-deferment policy, but now, as I
understand it, it is thirty years or over you are willing
to hold.
H.M.JR: No, if they have these key positions--
MR. GASTON: Expert qualifications that we can't
replace.
MR. C.S. BELL: Well, there are two on this list
that haven't key positions, Sonnabend and Cross.
H.M.JR: Not in key positions?
MR. GASTON: Well, there is a man thirty-seven
years old. What good is he to the Army? He is an
Assistant Collector, isn't he, or Comptroller?
MR. JORDAN: I think he is chief of one of the
divisions.
H.M.JR: He is an Administrative Officer.
MR. GASTON: He is described further in there.
MR. C.S. BELL: "Responsible for coordinating and
administering the revenue accounting in the Collector's
Office and instructing different employees in collection
of assessment features of the revenue law."
261
- 8 -
MR. GASTON: Chief Accountant in the Collector's
Office.
H.M.JR: What good is he to the Army?
MR. GASTON: Not a bit, and also as an accountant
he is on the critical list.
H.M.JR: Now, what about John C. Cross. I am glad
you raised the question, Charlie.
MR. C.S. BELL: Responsible for planning, coordi-
nating, and directing of the activity pertaining to
all Internal Revenue taxes other than income and em-
ployment taxes.
H.M.JR: I don't know what good the fellow would be.
Is Cross on the key list?
MR. C.S. BELL: No, sir.
MR. GASTON: I don't know. He probably qualifies
as an accountant.
MR. C.S. BELL: We can get him on the key list,
probably. That would have to be submitted.
MR. GASTON: Charlie, if he is an expert accountant
he is on the critical list, anyway.
MR. C.S. BELL: That is true, Mr. Secretary, what
Mr. Gaston says. Accountants are all on the critical
list, and the critical list and the key list are one
and the same thing.
MR. D.W. BELL: They are thirty-five and thirty-
seven.
H.M.JR: I didn't read this. (Refers to attached
memorandum re: Charles L. Trowbridge)
262
- 9 -
MR. JORDAN: I discussed with Mr. Graves the matter
of getting these positions on the key list and he
didn't want to submit them. He said he would rather
submit them individually.
MR. GASTON: They are on, anyway; they are auto-
matically on if they are accountants.
H.M.JR: I think that is all right. General Marshall
tells me men over thirty of this kind are no good to him.
MR. BELL: He is going to do the same kind of work
in the Army he will do here.
H.M.JR: Sure.
MR. C.S. BELL: Can we attempt to save your time
by operating on that as a general policy and submit a
summary?
H.M:JR: No, because I change every day, Charlie.
MRS. KLOTZ: That is fair enough!
H.M.JR: I change every day.
MR. GASTON: I would rather have your check. We
know pretty well what lines you are following.
H.M.JR: You have the gist, but today I say nobody
under thirty unless he is very, very unusual. But I
change every day, more or less.
Now, what about Trowbridge?
MR. GASTON: Is that the War Finance man?
MR. C.S. BELL: No, he was 4-F, by the way--
H.M.JR: This man is thirty-seven.
Regraded Unclassified
263
- 10 -
MR. C.S. BELL: Same kind of case you have just
signed - identical.
H.M.JR: O.K. (The Secretary signs deferment appli-
cation of Charles L. Trowbridge)
Now, one fellow did an outstanding job for Pehle
and his name is Lesser. How old is he?
MR. C.S. BELL: We haven't checked his age.
H.M.JR: Look into it, will you, and let me know?
MR. GASTON: I think about thirty-six or thirty-
seven.
H.M.JR: Don't lose Lesser or Joe DuBois if we
can help it.
MR. D.W. BELL: I shouldn't think DuBois would.
MR. GASTON: Lesser has been applying for a
commission.
H.M.JR: We need a few of those fellows around.
Can you understand my policy?
MR. C.S. BELL: No, sir.
# I
264
April 1, 1944
The Committee on Deferments gives approval to requests
for the deferments of the seventeen Privates, White House
Police, U. 8. Secret Service, shown on the attached list.
The White House Police are engaged in the protection of
the Executive Mansion and grounds. Approximately 50 per cent
of our seasoned White House Policemen have been placed upon
military furlough and it has become impossible to find a
sufficient number of replacements who are qualified as to
experience, character and physique. No have an authorised
strength of 140 men for this force, but there are now only
92 men on the force of whom only 47 are experienced officers.
It is imporative that the utmost security be provided for the
Executive Mansion and grounds, particularly during war time,
and any further loss of experienced officers would seriously
impair the efficient functioning of the force.
(Signed) Herbert E. Gaston
Chairman
Beer agnes
47-44
Joseph a.Jondan
Approved: Greph Paul Loyesh
(Signed) H. Morgenthan, Jr.
Secretary of the Treasury
LB
265
Title
Name
Age Be. of children
1. s. SEGRET SERVICE:
Cash, John J.
Private, White House Pelice
Grawford, William s.
a
6
1
Decker, Harold 1.
#
#
Douns, Joseph H.
$
Dyke, Edward J.
$
Finotti, Donald B.
1
Gay, Charles be
Limp, Albert 1.
1
Merson, Edward 1.
.
1
Mundy, Harry B.,Jr.
1
Morrison, Janes T.,Jr.
Prostor, Villias F.
1
Robbins, John 1.
Seckel, Kenneth 3.
Smihula, Hartin, Jr.
1
Talbott, Leland s.
26
own
Test Pail L.
#2
266
DEVERMENTS
April 6, 1944.
Title
Are
No. of Children
KIGN FUNDS CONTROL:
offman, Michael
Asst. Director (Field Oprns.)
28
None
ERNAL REVENUE:
lmor, Harry R. Jr.
Agent, Income Tax Unit
33
2
I BUREAU:
Brughelli, Cyril J.
Sr. Melter
30
2
Wehnson, John A.
Sr. Melter
33
1
IcLaughlin, Denis
Sr. Melter
35
1
Breslin, Eugene F.
Electrolytic Refiner
29
2
Mancuso, Francis H.
Machinist
28
2
RESEARCH:
Faricletti, Marius
Pr. Economic Analyst
35
1
R. FINANCE DIVISION:
Rauen, Arnold J.
Adm. Asst. (Illinois)
37
1
Deferments for the above 9 employees are recommended by the Agency Committee.
(Signed) Herbert 1. Gastom
I Charles S. Bell
Joseph a.Jondan
Approved: APR 7 1944
Exph Empre 3. Brealin 4 Francis H. mansues
(Signed) H. Morgenthau, Jr.
Secretary of the Treasury.
je
XIII
267
X
April 6, 1944
Title
Age
No. of Childre
TERSAL REVENUE:
Monnabend, Jerome
Jr. Adm. Officer
37
3
(Comptroller)
Cross, John C.
Jr. Adm. Officer
35
1
(Chief, Misc. Tax Div.)
(uninsky, Michael
Agent
35
2
Weiner, Philip
Agent
34
1
Cres, Frank J.
Agent
31
1
Less, Ladislav J.
Special Agent
34
3
Mr. Gaston and Mr. Jordan recommend that the above 6 employees be deferred but
F. Charles S. Bell does not agree.
(Signed) Herbert E. Gastom
Juph a.Jondan
Approved: april 7, 1944.
(Signed) H. Morgenthau, Jt.
Secretary of the Treasury.
268
2
April 1, 2044
The Committee en Deforments gives approval to the attacked request for
the deferment of Mr. Charlies L. Treabridge, Internal Revenue Agent (incountant),
Income Tax Unit, Buress of Internal Revenue, Pittsburgh, Pennsylvania. Be is
37 years of age, is married and has ⑉ child. the position of ascountant is
on the Critical Occupations List.
Mr. Trowbridge conducts field audits of difficult corporation, partnership,
fiduciary, and individual income tax returns, in order to determine correct tax
liabilities. His post of duty is Bradferd, Pennsylvania, which 10 regarded #
the center of the Pennsylvania eil fields, and Agent Treateridge, having vericed
as an accountant for the Tropical 011 Company for ten years prior to his
appointment as an Internal Revenue Agent, 10 exceptionally well qualified to
handle large oil company cases, M well us other types of investigations, includ-
ing fraud. He is one of two agents located at Bradford, and ⑉ agent cannot
possibly handle all the investigations is that territory. Due to the shortage
of qualified agents 1% has been impossible to find a replacement for M.
Trowbridge, and if ⑉ is found, it will require at least six menths' training
before be will be qualified to take ever the duties of Agent Trowbridge.
(Signed) Dorbert a. Gaston
Chairman
a.Jordan
APR 7 1944
Approved:
(Signed) H. Morgenthau, Jr.
Secretary of the Treasury
269
25
April 7, 1944
My dear Mr. President:
In talking with some of my neighbors
over the week-end, I find that the state of
feeling against the Administration over the
recent moves on drafting men for military
service is becoming bitter. Resentment is
keener than it has been at any time over any
O.P.A. orders or restrictions. The feeling
in the farm community is that Washington
doesn't know its own mind.
I am told Lyneightons that farm people who were
exempted about a month ago on a basis of how
many units the farm produced have now learned
that the unit basis has been completely dis-
carded and responsibility for decisions has
been thrown back on the Local Boards.
The suggestion I have to make is that,
before you go away, you ask Jimmy Byrnes to
make a study of this draft situation and
submit a recommendation to you.
I believe something drastic has to be
done to clear up the confusion.
Yours sincerely,
(Mgned) 8. Morgenthau, Jr.
The President
The White House
HEG:pm way
sent h Suret Sumie to Miss Tally 2:10 P.M- 9/7/94-
Regraded Unclassified
270
My dear Mr. President:
In talking with some of my neighbors over the
state of
week-end, I find that the feeling against the
Administration and over the recent moves on
drafting keiner men from satisfactory. The
for military to far service is becoming filter
has been
ment 18 much werse than it was over O.P.A. at any
over any OPA, adm restrictions
time 12 They just feel that Washington doesn't know
my in The farm community is
its own mind. Right new the farm people who were
lack - told that
exempted about a month ago on a basis of how many
units the farm produced, have 0.0 near 00 T can make out
now
learned
by second-hand information that the unit business fasis
has been completely dieregarded and every everything thing
discorded and responsibility
for decisions has been
again
thrown back on the Local Boards.
The suggestion
I have to make is that,
before you go away,
you ask Jimmy Byrnes to
submit
make a study of this draft situation and
a
2 believe diastic
recommendation to you.
Fronkly, something has to
be done to clear wh The composion.
Yours sincerely,
4-7-44
271
ASSISTANT
SECRETARY OF THE TREASURY
The Secretary:
You may be interested in the real reason why
Congressman Frank Keefe, Republican, Wisconsin,
was in to look over the Treasury and call on you
this morning.
He had brought his son in to introduce him to
Chief Wilson in an effort to get him a job in
Secret Service.
The son, Bateman F. Keefe, 27, has recently been
given a medical discharge from the army (glider
forces). He is 6ft. [email protected], weighs 197 lbs.
(212 lbs. on induction and is B. college gradu-
ate.
He can be placed as a traines-agent, but I told
the chief to look over his war department papers
and get all possible information on his disability.
Nos.
272
TREASURY DEPARTMENT
n
INTER OFFICE COMMUNICATION
DATE APR 7 1944
TO
Secretary Morgenthau
FROM
Subject: Survey of Redemptions Conducted by Dr. Likert
Mr. HAS Hasp
Between March 23 and 28, 1944
I am transmitting herewith a memorandum prepared
by Dr. Rensis L. Likert, Head, Division of Program
Surveys of the Department of Agriculture, covering a
survey of war bond redemptions made by his staff during
the period March 23 to 28, 1944 in New York City. The
persons interviewed were a sample of those who had re-
deemed bonds on March 6, 1944. The major findings of
Dr. Likert's study are summarized below.
(1) Two reasons for cashing bonds were mentioned
the most frequently. These were income
tax payments and emergency expenses to
meet unforesecable items, chiefly illness.
Each of these reasons was reported in 39
percent of the interviews.
(2) Nonemergency expenses such as expenditures
for clothes, property, insurance premiums,
investments, rent, vacations, etc., were
mentioned in 31 percent of the interviews.
More than one reason was mentioned in some
of the interviews which accounts for the
fact that the percentages in this paragraph
and the preceding one add up to more than
100 percent.
(3) It 16 the repeaters -- those who have redeemed
several times -- who tend to use the money
for nonemergency expenditures. These people
seem to use their bonds much as one ordinarily
uses a savings account.
273
Secretary Morgenthau - 2
(4) About 72 percent of the redeemers have
no savings other than war bonds and
insurance. Much of the latter has
little or no cash value.
(5) Ninety-six percent of all the redeemers
still hold some bonds after the last
redemption. Very few of these redeemers
regularly cash all the bonds available or
have had to cash all in at any one time.
(6) Middle-income redeemers (those who earn from
$36 to $55 a week) tend to redeem bonds
more often than other people, although
those with higher incomes tend to cash
larger bonds when they redeem.
(7) Nine out of ten redeemers regularly purchase
through the payroll savings plan. More of
the redeemers who buy through payroll de-
duction than those buying elsewhere have
redeemed two or three times, but they tend
to cash in the smallest bonds.
With respect to the last point, it might be mentioned
that these statistics should be evaluated in the light of
the fact that a very large proportion of the customers for
war bonds in a big city like New York are buying all or
part of their bonds on the payroll savings plan.
274
UNITED STATES DEPARTMENT OF AGRICULTURE
BUREAU OF AGRICULTURAL ECONOMICS
56531
MEMORANDUM
March 30, 1944
TO: Mr. George C. Haas, Director of Research and Statistics
Department of the Treasury
FROM: Dr. Rensis Likert, Head, Division of Program Surveys
At the request of the Secretary of the Treasury, the Division of
Program Surveys has conducted a study of certain factors related
to the redemption of War Bonds.
A sample of bond owners who had redeemed bonds in the city of
New York on March 6, 1944 was selected from records provided by
the Department of the Treasury. These redeemers included bond
owners who had cashed bonds of various denomination; in this Nov
speot the present sample differs from those previously surveyed
in which only redeemers of $25 bonds were selected.
Two hundred and fifty-six bond redeemers so selected were inter-
viewed regarding their reasons for redeeming. These interviews
were conducted in New York City between March 23 and 28, 1944.
The major findings of this study are presented in the following
pages.
OPVICTORY
BUY
UNITED
STATES
SATENDS
BONDS
AND
STAMPS
275
SUMMARY
1. Income tax payments are mentioned as the reason for redeeming more
frequently than any other reason. Forty percent of those who re-
deemed bonds state that the income tax payment was a primary
reason leading them to oash their bonds. Since larger denomination
bonds are cashed for this purpose, tax payments account for a higher
proportion of the dollar volume of redemptions than the above per-
centage would indicate.
2. The second major type of reason given for cashing bonds is the need
of money to meet emergency expenses - large, unforeseeable items,
chiefly illness. About four out of ten redeemers state that such
a need led them to cash bonds.
3. Non-emergency expenditures of the kind usually taken care of by
short-time savings, such as clothing, property, insurance premiums,
and child-birth are mentioned by about one-third of the redeemers
as contributing to their need for bond money.
4. It is the repeaters, those who have redeemed several times, who
tend to use the money for these non-emergency expenditures. These
people seem to use their bonds much as one ordinarily uses a savings
account.
5. Nine out of ten redemers regularly purchase their bonds through the
payroll deduction plan.
6. More of the redeemers who buy through payroll deduction than those
buying elsewhere have redeemed two or three times, but they tend to
cash in the smallest bonds.
7. Most redeemers ladk other liquid savings. The minority who have
bank accounts say that they would prefer to use this money in an
emergency rather than cash their bonds, but most of the redeemers
have either no savings, or only insurance, much of which has little
or no cash value.
8. Ninety-six percent of all the redeemers still hold some bonds after
their last redemption. Very few of these redeemers regularly cash
all of the bond 5 available or have had to cash all in at one time.
9. Middle-income redeemers (those earning from $36 to $55 a week) tend
to redeem bonds more often than other people, though those with
higher income tend to cash larger bonds when they redeem.
276
Payment of Income Tax is the Most Common
Reason for Redeeming Given by These Bond Owners
The most frequently-mentioned reason for the cashing of bonds is the
payment of income taxes - 39 percent of these redeemers mention this
item when asked why they had cashed their bonds.
An equal number of respondents said they needed the money for emergency
expenses, those due to unforeseeable major events, such as illness,
unemployment and furlough. Of these, illness is by far the most impor-
tant, since it accounts for at least half of the unemployment as well
as bringing heavy dootor and hospital bills itself.
Nearly a. third of the redeemers mentioned non-emergency expenses. The
great part of these represent items that usually require saving, in-
dicating that a sizeable number of persons may be using War Bonds as a
means of saving for unusual expenditures that they can foresee a long
time ahead.
Table 1. Reasons for Cashing Bonds: Summary
Tax
39%
Emergency Expense
39
Medical
26%
9
Unemployment
Furlough and travel
4
Non-Emer gen cy Expense
31
6
Clothes and personal
6
Inve strents
3
Child birth and medical
3
Rent and moving
2
Marriage
11
General and miscellaneous
N-199
* Reasons from more than two ontegories were given in some
cases, cashing. Within any category such as Emergency Expense, the
making the total larger than the number who admitted
items are non-duplicative.
- 2 -
277
The $25 Bonds are Most Commonly Cashed
to Meet Emergency Expenses; the
Larger Bonds to Pay Income Taxes
Among these redeemers the smallest bonds are most frequently cashed to
meet emergency expenses, such as those arising from medical needs, un-
employment, or military furlough. Payment of income taxes is the
second most frequent use of these small demomination bonds. Nearly
40 percent of both categories of larger bonds were redeemed to pay the
income tax, with emergency expenditures slightly less common. The
most important non-emergency use of the money redeemed from bonds
larger than $25 is investments, including property purchase.
Table 2. Relation of Size of Bond to Reasons for Redeeming
$50 - $100
Over $100
Reasons for cashing
$25 bond
bond
bond
Income tax
30%
39%
39%
Emergency expenses
42
33
32
Medical
22%
26%
22%
Unemployment
11
5
10
Furlough and other
travel
9
2
o
Non-Emergency expenses
28
28
29
Clothes and personal
8
6
0
Investments
1
7
6
Child birth and medical
3
3
7
Rent and moving
4
2
0
Marriage
o
3
3
General and Miscellaneous
12
7
13
100%
100%
100%
N=74
N=112
N=31
278
- 3 -
Nearly Half of Those Redeemers who Cashed
Bonds for the First Time Said They Used
the Money to Pay Their Income Tax
Fifty-four percent of these redeemers sepethey have never cashed bonds
before the redemption regarding which they were being interviewed.
Only eight percent admit having cashed bonds on more than three 00-
casions.
Table 3. Frequency With Which Bonds Have Been Redeemed
Frequency of Redemption
Have redeemed only once
54%
Have redeemed two or three times
38
Have redeemed more than three times
8
100%
N=197
279
- 4 -
Forty-four percent of those redeemers who have cashed bonds for the
first time give the income tax as their major reason for cashing. Half
of these redeemers who had redeemed two or three times in all used the
money for emergency expenses, chiefly medical.
Over half of those who had redeemed more than three times made non-
emergency use of the money, chiefly for olothes and other personal items.
Table 4. Relation of Frequency of Redemption to Reasons for
Redeeming
Cashed
Cashed 2
Cashed more
Reasons
once
or 3 times
than 3 times
Income tax
44%
29%
18%
Emergency Expenses
25
51
29
Medical
17%
35%
12%
Unemployment
4
10
17
Furlough and other
travel
4
6
0
Non-Emergency Expenses
31
20
53
Clothes and personal
4
Б
23
Investments
6
3
12
Child birth and medical
3
1
12
Rent and moving
4
1
0
Marriage
3
1
0
General and misc.
11
9
6
100%
100%
100%
N=110
N=88
N=17
Regraded Unclassified
280
- 5 -
There are Some Indications of Overselling
While there is no evidence of a great amount of overselling, some re-
deemers seem to purchase more than they plan to hold (see Table 3).
Respondents who buy through payroll deduction only) report multiple
redemptions more often than those who buy through other means only
(Table 5).
Table 5. Relation Between Frequency of Redemptions and
Participation in Payroll Deduction Plan
Bought through
Bought through
payroll deduc-
other means only
tion plan only
Redeemed once
70%
52%
Two or three redemptions
25
41
More than 3 redemptions
5
7.
100%
100%
N=20
N=160
Although payroll-deduction buyers seem to redeem more frequently than
other buyers, they redeem bonds of smaller denomination. These redeemers
account for nearly nine out of ten redemptions of $25 bonds, but less
than two-thirds of the redemptions of over $100 (Table 6).
Table 6. Relation Between Sise of Bond Redeemed and Par-
ticipation in Payroll Deduction Plan
$50 - $100
Over $100
$25 bond
bond
bond
Bought through payroll
88%
82%
64%
deduction only
Bought through other means
12
18
36
100%
100%
100%
N=113
N=36
N=72
Regraded Unclassified
281
- 6 -
It is interesting that despite their recent redemptions nearly all of
these redeemers say they still own at least one bond (Table 7).
Table 7. Proportion of Bond Redeemers Who Still Retain
Some Bonds
Cashed all bonds
4%
Still hold some bonds
96
100%
N=256
- 7 -
282
Seventy Percent of These Redeemers
Report Savings Other Than Bonds
When asked if they had "any kind of savings other than bonds, like bank
accounts, insurance, securities, and so forth," only 30 percent of
these redeemers admitted that they had no savings other than their
bonds (Table 9).
Table 9. Relation Between Size of Redemption and Possession
of Other Savings
Value of Bond
Bank
Redeemed
Account
Insurance
Securities
None
Total
$25
29%
37%
+
43%
36%
$50-100
48
46
o
47
45
Over $100
23
17
+
10
19
100%
100%
+ x
100%
100%
N=65
N=106
№5
N=75
N=254
All redeemers
26%
42%
2%
30%
100%
Forty-two percent mayothey have insurance. Most of these insurance
owners prefer to cash bonds in an emergency rather than touch their in-
surance, which is not regarded as 5. form of savings by more than a very
few (Table 9).
283
- 8 -
Table 10. Relation Between Kind of Savings and Preference
for Use of Bonds or Other Savings in an Emergency
Have bank
Have
Have both (or
account
insurance
one and
only
only
securities)
Would use bonds
27%
79%
26%
Would use other
securities
72
21
74
100%
100%
100%
N=14
N=42
N=23
Three-quarters of the minority (26 percent) who have bank accounts would
prefer to draw on this asset in an emergency rather than cash bonds, but
did not do so in most cases because the account was too small (Table 12).
Table 11. In an Emergency Would You Rather Cash Your Bonds
or Use Your Other Savings?
Respondents who
Respondents
cashed $50 bond
who cashed
or larger
$25 bond
Cash bonds
52%
64%
Use other savings
48
36
100%
100%
N=84
N=42
Regraded Unclassified
284
- 9 -
A majority of these redeemers who have other savings, particularly
redeemers of $25 bonds, indicate that they would rather cash their
bonds than use their other assets (Table 12). In view of their recent
redemptions, this preference is probably not very strong in many cases.
Table 12. Reasons Given for Preferring to Cash Bonds or Use
Other Savings in Emergency
Prefer to cash bonds
Insurance not thought cashable
24%
Policy overborrowed or not old enough
16
Other savings are too small
16
General: Just don't like to touch insurance
15
Insurance takes too long, too much trouble
13
Bonds more easily replacable, more likely to
involve less loss
9
Insurance needed for burial or protection in
00.80 of death
7
100%
N-68
Use other savings
Patriotic reasons; help the Government
41%
Quicker, less trouble than bonds
23
"Just like to keep them"
18
Best investment; security
18
100%
N=44
Of those redeemers who give reasons for preferring to cash bonds rather
than other savings, 24 percent say there is no way of getting cash
from insurance. Another 30 percent have other reasons which make in-
surance seem an impractical source of cash in an emergency (Table 12).
The most frequent explanation that redeemers give for preferring to
draw on other savings is that it is unpatriotic to cash bonds. A quar-
ter of those preferring to use other savings state that it is more
difficult to cash bonds than to draw on other savings (Table 12).
285
- 10 -
People With Larger Incomes Cash
Larger Bonds But do so Less Frequently
As might be expected, the size of bond cashed increases as the weekly
income of the respondent goes up. (Table 13)
Table 13. Relation Between Income and Size of Bond Cashed
$50-100
Over $100
Weekly Income
$25 bond
bond
bond
Total
$35 and under
39%
25%
25%
30%
$36-55
38
44
39
41
$56 and over
21
25
34
25
Not ascertained
2
6
2
4
100%
100%
100%
100%
N=87
N=127
N=41
N=255
The middle-income groups are the most frequent redeemers, accounting
for more than half of the respondents who have redeemed more than two
times (Table 14).
Table 14. Relation Between Income and Frequency of Redemp-
tions
One
Two or three
More than 3
Weekly income
redemption
redemptions
redemptions
#35 and under
37%
24%
23%
$36-55
35
53
53
$56 and over
26
22
18
Not ascertained
1
6
2
100%
100%
100%
N=106
N=74
N=17
Regraded Unclassified
286
- 11 -
Nine Out of Ten Redeemers Buy
Through Payroll Deduction
The bulk of those redeeming bonds purchased them through the payroll
deduction plan. This finding is partially explained by four facts: A
very large proportion of bond buyers are on the payroll deduction plan;
they are ordinarily submitted to more pressure to buy; those who buy
in this manner own larger quantities of bonds for their income than do
people who buy in other ways; and for many of these people the payroll
deduction plan has taken the place of other forms of savings (Table
15).
Table 15. Usual Method of Purchase of Bonds by Redeemers
Method of Purchase
Payroll Deduction only
80%
Payroll plus other buying
10
Other buying only
10
100%
N=199
AAGY
287
April 7, 1944.
Dear Mr. Wiggins:
I have your letter of April 5, 1944, advising no
of two additional bankers appointed to the Sub-Committee
headed by Tom Smith to act as lisison during the Fifth
War Loan Drive. I an sure this Committee is going to
be very helpful.
If there is anything additional we would like you
to do, we will get in touch with you.
Sincerely yours,
(Haned) L Morgenthan, dr.
Secretary of the Treasury.
Mr. A. L. M. Wiggins
President
The American Bankers Association
Hartsville, South Carolina.
DWB:ew
DWB
Regraded Unclassified
THE AMERICAN BANKERS ASSOCIATION
OFFICE OF THE PRESIDENT
HARTSVILLE, SOUTH CAROLINA
A. L. M. WIGGINS
April 5, 1944
PRESIDENT
Hon. Henry Morgenthau, Jr.
Secretary of the Treasury
Treasury Department
Washington, D. C.
Dear Mr. Secretary:
Some time ago, we discussed the desirability of having
on our ABA Committee on Treasury War Borrowing some repre-
sentatives from the West Coast. In line with our discussion,
I have appointed the following two men, both of whom have
accepted:
Mr. James K. Lochead, President, American Trust Company
San Francisco, California
Mr. Lawrence M. Arnold, Chairman, Seattle First National
Bank, Seattle, Washington.
The Sub-Committee on Banker Participation in the Fifth
War Loan Drive, of which Mr. Tom K. Smith is Chairman, will
meet in Chicago on April 16th, and both of the above named
will attend the meeting.
If you have any further suggestions of actions we may
take in preparation for the Fifth War Loan Drive, I hope you
will not hesitate to pass them on to me or to Mr. Smith.
Yours very truly,
A. L. Mr miggins
President
w/h
289
$
MEMORANDUM FOR THE SECRETARY.
April 7, 1944.
Mail Report
Like the week's weather, the mail has been going
from one extreme to the other. On Monday, letters
came in record-breaking numbers, then fell to a new
low, and again on Friday, poured in in quantity. No
new subjects emerged on any of the different fronts,
and there were almost no quotable letters.
Except for an angry protest now and then against
the necessity for the declaration on April 15, or
against the complexity of forms in general, tax corre-
spondence was in the doldrums. The Collier's editorial
disappeared from our mail, and the campaign for an
entry on Form W-2 of anticipated charitable donations
has fallen away to almost nothing. Most of this week's
communications on the subject came from business firms
which said that in spite of the extra work involved,
they would be glad to allow the deductions before
determining individual withholding rates, SQ that
educational and charitable institutions might not suffer
loss of income.
Announcement of the date of the Fifth Drive gave
a pleasant lift to the humdrum bond mail of recent weeks.
With a number of slogans, a song or two, several sales
suggestions, and early organization plans, the corre-
spondence end of the Drive is off to a fast start.
Half a dozen persons connected with schools pointed out
that the heretofore productive sales result of school
campaigns will be lost if the Drive is not started be-
fore June 12.
Close to 70.bonds were submitted for redemption,
one-fourth postmarked from Puerto Rico. Again complaints
290
- 2 -
.
Memorandum for the Secretary.
April 7, 1944.
about delays in delivering, redeeming, or reinscrib-
ing bonds were exceptionally low.
A few copies of an advertisement entitled, "How
Would You Like to Live in Germany Today?", as published
on page forty-seven of the April 3 issue of Time, were
sent by writers who protested both the subject matter
and the possible deduction of the cost of the adver-
tisement from the income tax returns of the company
sponsoring it.
White House correspondence was also small in number
and uninteresting in content. During March we received
345 pieces and handled 144 in the Correspondence Division.
291
General Comments
Henry J. Abrahams, Omaha, Nebraska. Inclosed herein
indorsed to you, please find Treasury checks #1,749,319,
dated January 1, 1944, in the amount of $6.25, and
#2,082,291, dated February 1, 1944, in the amount of
$12.50. Every loyal American is today fully aware of
the heroic struggle and terrific sacrifice in which
our fighting men around Cassino find themselves. On
their part, they are willing to do their utmost to
preserve our democratic way of life, and on our part,
we should be happy to give them assistance and the
wherewithal to continue their work. With this thought
in mind I will ask that you kindly use the proceeds
of the inclosed checks in the purchase of whatever war
material can be bought for our fighters.
Senator Owen Brewster (Maine) transmits letter he has
received from Rev. Edwin C. Field, of Bridgton, Maine,
which reads as follows: I want to express my moral
indignation at the suggestion of Secretary Morgenthau
that the Government give the liquor people alcohol at
a time when sugar and grain are at a premium. This
expresses the views of my congregation, the rural work
committee of the Maine Congregational Christian Con-
ference, and the rural committee of the Maine Council
of Churches. I speak as chairman of the last two com-
mittees. We on the homefront are sick of Washington
Dictatorship and will welcome a return of the Govern-
ment to the people -- and to democratic action through
its chosen Congressional leaders. We are patriotic
Americans and want to do nothing to prolong the war.
There are, however, limits to our patience. A rationed
people and a starving world need food and clothing --
not liquor as a substitute. We do not argue for or
against prohibition. We fight for the rights of human
beings.
292
- 2 -
Anonymous initials L.J.A., and mailed in San Pedro,
California. On one occasion through the newspaper
stamp of America, called Free Press, they accused you
of being an "International Banker". Thank God we
know, Mr. Morgenthau, where our meney is today; but we
never knew where it was before the Roosevelt Administra-
tion. Mr. Morgenthau, the disturbed minds of these
people have no understanding.
Edward F. Beale, III, 1st Lt., Corps of Engineers,
Ft. Belvoir, Va. I have attached a check for $100
which I wish to present as a gift to the U. S. Trea-
sury. I feel strongly that in wartime, certain fi-
nancial sacrifices should be made by every individual
who has a genuine stake in this country. Present tax
rates are, in my opinion, much too low, thus forcing
the nation to rely on money obtained largely by in-
curring future indebtedness. In my opinion, it is not
sensible to pay $18.75 in 1944, so that in 1954 I can
pay $25.00 in taxes, and receive $25.00 by cashing a
bond. Please have this donation used in any manner
you see fit.
293
- 3 -
Favorable Comments on Bonds
Letter and War Bond scroll addressed to the President
by the civilian employees of the Yuma Army Air Field,
Yuma, Arizona, and forwarded to the Treasury for
handling. The following is quoted from the letter:
"We, the undersigned War Department Employees of
Yuma Army Air Field wish it to be known that we are
Backing the Attack through the Class "A" Pay Reserva-
tion. One hundred percent participation and an
overall average of twenty-two and five-tenths percent
of all our earnings, including overtime, are going
right back into the War effort through the purchase
of War Savings Bonds by payroll deductions. We real-
ize that by so doing, we are not only speeding the
day of Victory, but at the same time halting the
dangerous inroads of inflation. Here in the great
Yuma desert where food prices are high, housing con-
gested, and summer heat abnormal, we have managed to
establish this record. We are in some measure trying
to compensate for the hardships and sacrifices that
our Armed Forces are undergoing daily in our fight for
the principles of Freedom.
Walter S. McLucas, Chairman, National Bank of Detroit,
Detroit, Mich. Permit me to say that I deeply appreci-
ate your telegram concerning the Bond Drive just
closed. I think you are greatly helping the cause in
thus expressing yourself to those participating and it
would be highly desirable if the whole group of active
leaders could hear from you. I think Frank Isbey and
the whole organization did the best job on the Third
War Loan Drive that has yet been done. It was 8.
serious, hard-hitting, continuing effort and most of
the spectacular, sensational sales effort was eliminated.
I believe you are entitled to appreciative congratula-
tions upon the part of all the citizens for the
handling of the Government's financial requirements in
the bond campaigns. ***
294
- 4 -
Unfavorable Comments on Bonds
Judith Eiken, Teacher of Social Science, Department
of Education, St. Paul, Minn. The enclosed pamphlet
has just been received by me. I assume that every
other teacher in the country has also received one
like it. There is scarcely a week when we do not
receive these bulky, colorful, expensive pamphlets
or posters. According to Government propaganda there
is an acute paper shortage, and we are asked to con-
serve paper. Why, then, does our Government waste
paper on so gigantic 8. scale? For your enlightenment
I can tell you that nearly all of your voluminous
literature finds its way into waste paper baskets.
We would lose our minds if we tried to make use of all
of it! A great many loyal citizens are getting awfully
weary of Government waste and extravagance.
Joseph Mueller, Philadelphia, Pa. Insofar as I put
my entire salary last year in War Bonds, I feel free
to speak. In the last World War, War Bonds were
oversubscribed frequently the day they were issued.
This was because the Government gave the public a
good investment for their money. In World War II,
you started in with the E Bond theory which is prov-
ing more ridiculous every day. Thousands are cashing
them in about sa fast as they are high-pressured into
taking them. This class of people won't hold on to a
piece of paper for ten years in order to get 8. little
interest. Many war workers where I am connected use
them as 8. means to save for Christmas presents. Others
use them as 8. means to accumulate money for taxes and
others just cash them and spend. *** If the Treasury
would bring out a bond, coupon bearing 3% interest,
tax-free up to $10,000, but could not be cashed for
ten years, except on the death of the owner, then the
small investor would feel the Government was giving
him a break. # # # This type of bond would bring out
the hoarded hundreds of millions in safe deposit boxes,
and you wouldn't need a Bond Drive. ***
295
- 5 -
Willard W. Allen, Chief Executive Officer, Inter-
racial Section, War Staff, U. S. Treasury, Washington
Building. This letter comes to convey to you my deep
appreciation for having had the privilege of working
with the Treasury Department for practically a year
in connection with the War Bond program, under the
direction of Mr. James L. Houghteling, National Organ-
izations Division, Interracial Section. He is perform-
ing a very creditable service with the work among the
Negro group throughout the country. During my con-
nection with the Section, I have detected no semblance
of race prejudice. ** # Again I express my apprecia-
tion for the splendid assistance which I received from
the staff members, including Mr. Fred Smith, your
right-hand man. Under your capable leadership, I pray
that God will give you strength to see this eventful.
period through to the dedication of peace and freedom
for all peoples of the earth.
296
- 6 -
Favorable Comments on Taxation
Lester C. Weisse, Attorney at Law, Sheboygan Falls,
Wis. After having written you letters begging for a
change in the penalties in the estimates of incomes,
and also for clarifications, I am delighted with
the changes and instructions now furnished for the
1944 estimates. I want to compliment you for I know
it was through your influence that the provisions are
set that if we estimate on the 1944 incomes and
correct as of March 15, 1945, there will be no pen-
alty imposed. The old law was absolutely inhuman for
it was impossible to guess on your year's income.
I might tell you that as an individual very actively
interested in the Federal taxes, I was very much re-
lieved when I received an interdepartmental communica-
tion that penalties would not be imposed last year
unless for an outstanding reason. In assisting people
in the preparation of their tax returns I was then in
a position where if we found the estimate was below or
way over, we merely adjusted it, and paid the proper
tax or asked for a refund. One lesson I learned is
that a man in a small business certainly does not know
from one month to the next what his income is going to
be, and any individual in Washington who got the idea
that these small businesses operated on an even keel
is absolutely misinformed. ***
297
TREASURY DEPARTMENT
INTER OFFICE COMMUNICATION
MA
DATE
TO
Secretary Morgenthau
Mr. Pehle
FROM
APR 7 1944
I am attaching herewith a copy of the
report of the War Refugee Board for March 27
to April 1, 1944.
Attachment.
298
Developments during the week of
March 27 - April 1, 1944
1. STATEMENT ON AXIS ATROCITIES
The British Government has issued a statement expressing
its unqualified approval of the President's statement.
We have transmitted a letter to State expressing the view
that approval of the President's statement or the issuance
of a similar statement by the Russian Government 1s most
important particularly in view of the military situation
in the Balkans, since such action would have considerable
influence on the leaders and people in Rumania, Bulgaria,
and Hungary. Accordingly, we have suggested that, if no
action has been taken toward this end, immediate steps
should be taken to have Russia take such action. We
have also suggested to State that it consider the matter
of obtaining similar action by all of the United Nations.
We have received reports from our Missions in Bern, Lisbon
and Cairo, concerning the publicity which is being given
to the President's statement. Harrison has reported
that the statement will probably be carried by over 200
Swiss papers and that leading Swiss editorial writers and
radio commentators will be asked to give the statement
favorable comment. He also proposes to request indirectly
the official Swiss radio to broadcast the announcement in
German and French and has advised that clandestine tracts
will be printed and distributed across the border.
Our Mission in Portugal has reported that the President's
statement was prominently published in Lisbon and Oporto
newspapers. Minister Norweb is also endeavoring to obtain
editorial and radio comment on the statement.
Our Mission at Cairo has advised that the Greek Prime
Minister has expressed the willingness of his government
to issue a supporting declaration as it is in complete
accord with the President's statement. The Office of War
Information in Cairo 1s arranging to publicize the Presi-
dent's declaration locally and to include it in radio
broadcasts in the Balkan languages and to publicize sim-
ilarly the Greek Prime Minister's statement when it 1s
issued.
Regraded Unclassified
299
- 2 -
2. APPROACH TO THE SATELLITES
In view of the German occupation of Hungary, B. cable has
been despatched to the International Red Cross at Geneva,
requesting that it send effective representation to Hun-
gary to protect the well-being of those now facing perse-
cution in that country.
3. COOPERATION WITH OTHER GOVERNMENTS
(a) Russia
Harriman has advised us that he delivered to Vyshinski
a memorandum setting forth this government's policy as
contained in the circular airgram of January 26th and that
he had orally informed Vyshinski that he wished to explore
the manner in which the United States and Soviet Govern-
ments might work together on this question, after the
memorandum had been studied. In his conversation with
Vyshinski, Harriman also referred to the parallel action
which both nations had taken and could take in trying to
impress on Germany and the satellite countries that they
would be held accountable for their inhuman actions against
the Jews and other similar groups. It was pointed out by
Harriman that such pressure on the satellite countries
might aid in the evacuation of refugees from Hungary, Ru-
mania and Bulgaria. According to Harriman, Vyshinski
seemed to be sympathetic and stated that he would discuss
the question further after he had had the opportunity of
studying the memorandum.
(b) Other United Nations
(1) Canada
We have been advised by our Mission at Ottawa
of the substance of a conversation had with Mr. R. A.
Robertson of the Canadian Department of External Affairs.
Mr. Robertson said that in 1940 approximately 4,000 refugees
were admitted to Canada from the United Kingdom, many of
these being classified as dangerous. About 1,000 of these
have since left Canada and about 2,000 have been interned,
leaving only approximately 900 who are at liberty in
Canada. Only a trickle of refugees reached Canada in 1941
and 1942. Robertson stated that last October Canada sent
an Immigration Agent to Lisbon with authority to admit an
initial group of 200 families. The agent subsequently
reported that there seemed to be only 600 or so refugees
in the Iberian Peninsula who desire to leave and it was
therefore doubtful whether Canada would be able "to find
as many as 200 families.
Regraded Unclassified
300
- 3 -
Mr. Robertson also indicated that Canada very
recently renewed its offer to the Intergovernmental Com-
mittee to take 1,000 Jewish children from Europe.
We have also been advised by Ottawa that it is
anticipated that a statement will be made in the Canadian
House of Commone on the entire refugee question, probably
within the next six weeks.
(11) New Zealand
We have received a report from our Mission at
Wellington in response to the circular airgram of January 26th
which sets forth a note received from the Prime Minister and
the Minister of External Affairs as a result of the approach
made to the New Zealand Government to obtain its coopera-
tion with this government's policy concerning war refugees.
The note stated that the policy of the New Zealand Govern-
ment has been and continues to be one of affording to
refugees the "maximum possible assistance consistent with
the resources and the security of the Dominion." Since 1941
immigration permits to New Zealand have been affected by
the spread of the war to the Pacific. However, within
recent months the New Zealand Government has agreed to
receive and provide accommodation for up to 700 Polish refu-
gee children from the Middle East.
(111) French North Africa
We have been advised by Chapin that the French
Committee of National Liberation has indicated that it is
pleased to associate itself with the relief and rescue work
with which the War Refugee Board is concerned. However,
the French pointed out that the chief preoccupation of the
Committee is with the problem of refugees from France and
the general displacement of French nationals. A report
on the refugee situation in North Africa prepared by the
military attache of the Embassy indicates that the Com-
mittee has neither encouraged nor discouraged the entrance
of refugees but rather has put the whole cause on on ind1-
vidual case basis, the real decisions being made by Amer-
1can, French and British security officers. Chapin has
also advised that in order to encourage the Committee to
allow refugees to enter North Africa more freely, some
assurances should be made concerning the ultimate destina-
tion of the refugees.
Chapin has been assured by the Committee that
sympathetic consideration will be given his suggestions
that the Committee issue a declaration of policy similar
301
- 4 -
to that made by the President at the time of the establish-
ment of the War Refugee Board and that the Commissariat for
Foreign Affairs issue appropriate instructions to its
representatives abroad.
(1v) The Netherlands
Schoenfeld has advised us of the substance of a.
conversation he had with Dr. W. Huender, Head of the Bureau
of Post-War Problems in the Netherlands Ministry of Foreign
Affairs. Dr. Huender is reported to have indicated that
Dutch authorities are in agreement with the policy of the
President's Executive Order and will be glad to support
any action which may be originated by the Board. It was
stated that, of the 180,000 Jews originally living in
Holland, about 140,000 had been deported to Poland. Only
about 8,000 Jews, recognized as such, are still left in
Holland. The remaining 32,000 have just dropped out of
sight. It 1s thought that some may have found refuge in
France or made their way to Switzerland, but most of them
are probably still living in Holland in concealment with
the help of the non-Jewish population.
With reference to Jewish victims, Dr. Huender
said that those Jews in Holland who had been provided with
Palestine certificates are in a relatively better position
than other Jews, since the possession of such a certificate
may assist the holder to avoid being sent to a concentra-
tion camp. He thought therefore that it would be helpful
if it were possible to provide more of these certificates.
Likewise, it would assist in keeping some Jews out of con-
centration camps if more passports to South American coun-
tries could be provided.
(v) Belgium
We have also received a report from Schoenfeld
setting forth the substance of his conversation and corres-
pondence with Monsier A. Delierneux, Chief of Cabinet in
the Belgian Ministry of Labor and Social Welfare. M. Del-
ierneux stated that although it was in general very diffi-
cult for refugees to escape from Belgium, nevertheless,
every few weeks a small number of people do manage to get
through to England, France, and Spain. The situation of
the Jews in Belgium 1s reported to be similar to that pre-
vailing in the Netherlands.
Regraded Unclassified
302
- 5 -
As to possible opportunities for special action
by the government to facilitate the rescue of Nazi victims,
M. Delierneux referred to the lack of cooperation from
local Spanish authorities on the Franco-Spanish frontier
and suggested that as far as Belgian refugees are concerned,
intervention with the Spanish Government to try to bring
about some change in this situation would be of value.
(c) Neutrals
(1) Spain
The Joint Distribution Committee has cabled its
representative in Lisbon to proceed to Madrid and contact
the Embassy there with respect to the program which we
approved for the rescue of refugee children from France.
We have requested this representative to endeavor to work
out arrangements with Hayes (who has raised certain ques-
tions regarding this program) whereby the project may be
initiated without further delay.
According to a recent report, there are not more
than 2,000 refugees at present in Spain, exclusive of
French nationals who are being constantly evacuated. About
775 of this group will probably be moved to Camp Lyautey
very shortly.
(11) Turkey
We have been advised by Hirschmann that the Tur-
kish authorities have agreed to charter the "Tari" for
175,000 Turkish pounds (approximately $97,200) for the
contemplated evacuation voyage. Eight days are to be
allowed for embarkation and debarkation under the arrange-
ment and we will be required to pay approximately $3,245
per day for each day in excess of eight. Hirschmann has
warned that delays in embarkation are probable and that the
voyage can only be completed within two months under the
most favorable circumstances. The representative in Turkey
of the War Shipping Administration, who participated in all
the negotiations for the "Tari," regards the price agreed
upon as reasonable under existing conditions. The Turkish
Government, Hirschmann has indicated, requires a guarantee
that the "Tari" will be replaced in case of loss by com-
parable passenger vessel and they will not accept a guarantee
of replacement covering a cargo vessel. In view of the
fact that the "Tari" will be prepared to sail within a week,
Regraded Unclassified
303
- 6 -
Hirschmann has stressed the necessity of expediting the
German safe-conduct. Continuing our efforts to furnish
the Turkish Government with a substitute vessel for the
"Tari" so that the latter may make more than one evacua-
tion trip, we have despatched a cable to Winant asking
him to obtain British assistance in the endeavor to pro-
cure a ship in the Mediterranean area, which might be
chartered to the Turks.
There is also a good possibility of obtaining
a Portuguese ship for evacuating refugees from Constanza.
However, Hirschmann is of the opinion that negotiations
for this ship should be held in abeyance until the "Tari"
matter has been settled and evacuation possibilities have
been further explored.
We have cabled our Embassy at Ankara to take
all possible steps to solve the problem created by the
reported refusal of Rumania and Bulgaria to permit Jewish
refugees to leave these countries unless they have Palestine
entrance certificates, which certificates are not allotted
to persons while in enemy controlled areas.
A conference similar in its purpose to that
which he recently held with the Rumanian Minister was had
between Hirschmann and the Bulgarian Minister to Turkey.
The latter was apprised of this government's attitude
concerning Bulgarian treatment of Jews and other minorities
with the view of inducing Bulgaria to halt further perse-
cution and to permit refugees to leave Bulgarian territory.
The Minister stated that he would communicate this approach
to his government.
(111) Switzerland
Special instructions have been transmitted by
State to our Mission at Bern, authorizing our consular
offices in Switzerland to issue during the present quota
year up to 4,000 immigration visas to refugee children from
France who arrive in Switzerland on or after January 1
and before July 1 of this year. Replace visas are to be
issued to children covered by the instructions, who are
still under sixteen years of age at the date such replace
visa 1s issued. Such replace visas are to be issued to
these children each year until at least six months after
the termination of hostilities between Germany and the
United States so that they will continue to hold American
visas until transportation is available to the United States.
The Swiss authorities are being advised of these instructions
Regraded Unclassified
304
- 7 -
and it is to be indicated to them that it 1s hoped that
they will take such action as will facilitate the movement
of children to Switzerland from France. The Government of
Switzerland is also being informed that the War Refugee
Board will undertake to arrange for any financing that
may be needed to provide maintenance for refugees arriving
in that country. Private relief agencies working in
Switzerland have been advised of the availability of these
American visas for the refugee children. Our Consulate
at Zurich which has been authorized to supervise the
issuance of these visas, has advised that the necessary
steps are being taken to have all Consulates in Switzerland
issue such visas.
We have prepared a cable to Bern which is pending
at State, asking Harrison to inquire of the Swiss author-
ities whether they feel their negotiations with Vichy
regarding exit permits for refugee children would be aided
if similar approaches were made by Eire and Portugal. If
the Swiss believed approaches by these governments might
have some beneficial effect, we propose to ask these govern-
ments to take such action.
(1v) Portugal
Our Minister at Lisbon has reported the sub-
stance of a conversation he has had with the Secretary-
General of the Foreign Office in an effort to obtain the
cooperation of Portugal with this government's policy
concerning refugees. The Portuguese official indicated
that since his country was not contiguous to German-
occupied territory, the refugee problem in Portugal was
largely 8. question of permitting the transit of refugees
who might be coming out of occupied Europe and to provide
refuge for a limited number to an extent which would not
interfere with the economy of the country. He assured
our Minister that Portugal would cooperate with this
country along the lines of its established refugee policy,
which, he stated, has been liberal and humanitarian. Mem-
oranda prepared by four relief organizations working in
Portugal, containing suggestions as to what this government
and the government of Portugal might do to effectuate the
war refugee policy of the United States, have been sub-
mitted by our Minister and are now being studied.
(d) Latin American Countries
Reports have been received from our Missions in Chile,
El Salvador, Ecuador, Colombia. and Venezuela.
Regraded Unclassified
305
- 8 -
(1) Chile
The Mission in Chile reports that, since late
in 1939, rigid rules have been in force regarding immigra-
tion to that country and that there have been charges of
discrimination in their application, particularly with
respect to Jews. In the Ambassador's opinion the principal
obstacle to large-scale immigration to Chile, especially to
Jewish immigration, 1s the fear that such immigrants will
become concentrated in the urban centers.
(11) El Salvador
We have been advised that the immigration policy
of El Salvador which was formulated at a meeting held some
years ago, generally restricts European immigration,
except that of technicians. However, on humanitarian
grounds, some Jewish immigrants are being admitted. A
Cabinet meeting is to be held shortly on the subject of
the admission of Jews and other refugees, as a result of
our Mission's approach to the El Salvador Government,
following its receipt of the circular airgram.
(111) Eouador
Our Mission in Ecuador has advised that there
are no special restrictions in that country against the
entry of Jews on racial or religious grounds, although
they, like other immigrants, are admitted only if they
will engage in certain specified pursuits. The Ecuadorian
Government believes that the entry of further Jewish refu-
gees who would probably settle in the two principal cities
of the country would lead to a strong anti-Semitic feeling.
Our Mission believes that this might be true and has
recommended the establishment of temporary camps in Ecuador
for such refugees for the duration of the war. It 1s the
Mission's belief, however, that non-Jewish refugees who
are fit for agricultural labor would be welcome in Ecuador.
(iv) Colombia
Our Mission in Colombia has reported that while
the Colombian Government is prepared to cooperate in a
general way in extending humanitarian assistance to refu-
gees, at the same time it will adjust its policy and action
to its national immigration policy with the object of pro-
tecting Colombia against "any uncontrolled influx of un-
desirable refugees."
306
- 9 -
(v) Venezuela
The Venezuela Government has expressed its
sympathy with the principles which inspired the formation
of the War Refugee Board and has advised our Mission that
appropriate officials are now studying the possibility of
giving concrete form to the cooperation Venezuela could
render in the task assigned to the Board.
4. COOPERATION WITH THE INTERGOVERNMENTAL COMMITTEE
Sir Herbert Emerson has submitted a memorandum through the
London Embassy in which he suggests that the United States
might relax in certain respects the procedure now being
followed with regard to the issuance of visas to refugees.
The question arises out of the case of refugees detained
on the Island of Mauritius but it is stated that there
are other refugees likewise affected by this government's
policy. That policy, according to the memorandum, appears
to be that visas will not be issued if any would-be immi-
grant is under any restriction in excess of that imposed
on persons of neutral nationality and that if such person
has been at any time in internment, his release must be
unconditional. It 1s suggested that, in the case of
Mauritius, this government should scrutinize the individual
cases of refugees for security purposes and decide them on
the merits, rather than to continue to insist that release
from detention is a condition precedent to consideration
of an application for a visa. Sir Herbert Emerson has
asked that this subject to given consideration by the State
Department and by the War Refugee Board.
We have been advised that Lord Winterton, Chairman of the
Executive Committee of the Intergovernmental Committee, has
requested an opportunity to discuss with Winant subjects
growing out of Deputy-Director Kullman's recent visit to
Switzerland and has sent certain memoranda on these subjects
to the London Embassy. Further communications are expected
from London after Lord Winterton's call takes place.
5. ESTABLISHMENT OF HAVENS OF REFUGE
(a) Virgin Islands
We have received a memorandum from the World Jewish
Congress urging that European refugees be admitted with a
minimum of formality to the Virgin Islands, upon the under-
standing that such admission is temporary unless in the
meantime they are able to obtain permanent immigration visas.
Regraded Unclassified
307
- 10 -
6. SPECIAL PROJECTS
(a) Internees in Enemy-Occupied Europe Holding Latin
American Passports
Cables to our Missions in various South American
countries have been despatched by State asking them to
request the governments to which they are accredited
to take no action until after the war to revoke or cancel
passports now held by internees in Europe.
(b) International Red Cross Feeding Program
A cable has been received from Bern stating that in
view of recent developments in the Balkans, the International
Red Cross is doubtful whether it will be possible to obtain
any more foodstuffe from Hungary and that, as a consequence,
substantial changes will have to be made in its program.
We have also been advised by the International Red
Cross that, if funds are made available, they are willing
to purchase food in Portugal for the relief of Jewish
refugees, particularly those in three refugee camps in
Croatia, where food conditions are precarious. The Inter-
national Red Cross proposes to ship the food purchased
by sea from Lisbon to Marseilles and has inquired if we
will endeavor to obtain the consent of the blockade author-
ities to such shipments.
(c) Rescue of Jewish Refugees from the Balkans
The Vaad Hahatzala Emergency Committee, upon our
recommendation, has been licensed to send $25,000 to its
representative in Turkey to be used for rescue and relief
operations.
(d) Refugees on the Island of Mauritius
A memorandum has been sent to State with respect to
the wide-spread suffering existing among refugees, mainly
Jews, on the British Island of Mauritius in the Indian Ocean.
7. COOPERATION WITH OTHER GOVERNMENT DEPARTMENTS
(a) Foreign Economic Administration
Mr. Zarky has been designated as liaison officer be-
tween the Foreign Economic Administration and the War Refugee
Board. We have been advised that the Foreign Economic Admin-
istration has instructed its representatives abroad to
cooperate with the Board's foreign representatives.
Regraded Unclassified
308
EMBASSY OF THE
UNITED STATES OF AMERICA
Ottawa, April 7, 1944.
No. 928
Subject: Rescue and Relief of European Refugees.
The Honorable
The Secretary of State
Washington, D. C.
Sir:
I have the honor to refer to the Department's
circular Airgrams of January 26, 1944, 7:00 p. m.,
and February 29, 1944, 7:30 P. m, and to the
Embassy's Airgram No. A-9 dated March 11, 3:00 p. m.,
and its despatch No. 835 dated March 18, 1944, with
regard to the rescue and relief of European refugees,
The Canadian Minister of Mines and Resources,
T. 4. Crerar, informed the House of Commons on
March 30th that a party of 256 war refugees, which
had escaped to Spain and Portugal, was on its way
to Canada. During the discussion, the Prime Minister
said he expected to make a full statement on the
refugee situation later in the session.
According to the Ottawa Journal of April 7 the
party of refugees referred to already has arrived in
Philadelphia on its way to Canada.
Respectfully yours,
True copy of the
Ray Atherton
original signed by:
Copy to Mr. Parsons, European Affairs.
710/711
JEH:mej
Regraded Unclassified
AMERICAN EMRASSY
near the
309
GOVERNMENT OF GREECE
Cairo, Egypt.
April 7, 1944.
No. 90
Subject: Cooperation by the Royal Hellenic
Government with the Ver Refugee
Board.
The Honorable,
The Secretary of State,
Washington, D. C.
Sirt
With reference to my despatches nos. 81 and 86,
of March 23rd and April 3rd reporting the action
taken in response to the Department's airgram of
February 29, 7:30 p.m. (circular) and its telegram
no. 46 of March 24th, I have the honor to transmit
herewith a copy of aide memoire no. 3103, dated
April 5, 1944, from the Royal Hellenic Ministry of
Foreign Affairs referring to two similar memeranda
from the Embassy in regard to this policy of the
United States concerning European refugees and the
activities of the Var Refugee Board in that connection.
It will be noted that the Royal Hellenic Govern-
ment, welcoming the establishment of the War Refugee
Board, is willing to cooperate in every desirable
way with its endeavors in furtherance of the President's
defined policy and requests that the Board be informed
1) of the special situation of Greece in respect of
the resoue from hardship and hunger of the hundreds
of thousands of homeless Greeks, victims of German
destruction, and 2) of the fact that, owing to its
geographical position, persons in danger can escape
from Greece with relative ease.
Respectfully yours,
Lincoln MacVeegh
Enclosure:
Copy of aide memoire no. 3103, dated April 5, 1944.
File no. 848
Sent in bectograph to Dept.
WB/hem
Regraded Unclassified
310
Enclosure to Despatch No. 90
dated April 7th, 1944, from
American Embassy, Cairo, ret
Cooperation by the Royal
Hellenic Government with
the War Befuges Board.
No. 3103
Aide Memoire
Referring to the American Embassy's Aide Memotres
dated 18th and 29th of March, the Royal Hallenic Ministry
for Foreign Affairs have the honour to inform this
Embassy that the Royal Hellenic Government are in
complete agreement with the policy laid down by the
President Roosevelt aiming at the "Bescue of the victims
of enemy oppression who are in imminent danger of death
and otherwise to afford such victims all possible relief
and assistance consistent with the successful presecu-
tion of the war".
The Royal Hellenic Government believe that the War
Refuges Board established in Washington is capable of
rendering the most valuable services to mankind by the
realisation and the execution of the above mentioned
policy; the Government are willing to co-operate in
every desirable way.
The question of the refugees' relief is one of
the main problems faced by this Government. Still
more serious is the problem of rescuing from hard-
ships and hunger who hundredseof thousands of home-
less Greeks, victime of the destruction of the Greek
countryside by the Germans.
The American Embassy are already well acquainted
with both these questions and it would be desirable
if they kept the above mentioned Board infomed of
the special situation of Greece in the sphere of its
future activities.
The fact that persons in danger can escape with
relative case from Greece, and this oving to its 800-
graphical position as compared to that of other countries
should also be drawn to the attention of this same Board.
As regards the request, contained in the U. S.
Embassy's Aide Memoire dated March 29th, asking the
Royal Hellenic Government to make a declaration similar
to that made by President Roosevelt on March 24th, the
President of the Greek Government gladly agreed and nade
relative statement to the Greek people through the
Press: a a copy of the statement 10 forwarded to this
Embassy.
Hoping that this declaration is in accordance with
the aim pursued, The Royal Hellenic Ministry for Foreign
Affairs
Regraded Unclassified
311
- 2 -
Affairs seise this opportunity to renew to the U.S.
Embassy the expression of their highest consideration.
Cairo, 5th April 1944
Regraded Unclassified
312
AIRGRAM
Despatched: April 8, 1944.
From: American Embassy near
the Governments of
Greece and Tugoslavia.
CONFIDENTIAL
Cairo Ungypt.
Date PE944
Received:
3
APR 14
The Secretary of State,
Washington.
COMMUNICATIONS
AND RECORDS
A-29, April 7, 5 p.m.
For Secretary of Treasury from Mikesell:
Re Department's No. 46 Greek of March 24 requesting
report on publicity given to President Roosevelt's state-
ment on war refugees.
Upon receipt of the cable from the war Refugee Board
OWI was contacted and asked to give full publicity to the
President's statement through the various means at their
disposal. The following report was submitted by the O"I
covering the results of their efforts to date:
"on March 25 a story covering the statement was carried
by Reuters on its circuit throughout the Middle East. The
cairo and Alexandria newspapers used the story extensively,
giving it page one prominence.
"TO amplify the significance of the message, OWI issued
the full text of it in French, Arabic and English to its
newspaper and magazine lists in the Middle East on March 27.
"ONT also issued in three languages in its news service
several commentaries that were made both in cairo and abroad.
On March 26 the statements of prominent U.S. personages
were carried. A day later this was followed with editorial
comment from the New York Times. On March 30 the OWI news
report carried comment by prime Minister Emmanuel Tsouderos
of Greece.
"In addition to covering the press in this area, these
news releases went to Egyptian State Broadcasting to be
incorporated in their news and language commentary programs.
"As for actually getting the President's appeal into
the Balkan countries and Europe, OWI's psychological warfare
section W&B most successful. The full text of the statement
was
Regraded Unclassified
- 2 - Can 29
313
was provided to the Foreign Transmissions Division of
British PWE and was broadcast as a 'must' in the follow-
ing languages: Greek, German, Bulgarian, Rumanian,
Italian, Czech, Polish and Yugoslav. In addition, OWI
supplied the text to Palbase, the British PWE radio
operation in Palestine, and to PWB at Bari for broadcast
into the Balkans and Europe. On March 24 palbase carried
th. full text of the president's statement and an abbrev-
iated version was broadcast on March 25, followed by a
recapitulation on April 1 and 2. Broadcasts were in all
of the Balkan and central European languages.
"A special psychological warfare leaflet to be
dropped over Hungary now is in on the printing press for
early use. And a summary of the statement will be used
in a Greek leaflet."
The American Ambassador near the Government of Greece
called personally on the Greek prime Minister, Mr. Tsouderos,
who at once issued a declaration supporting the President's
statement. The Grand Rabbi of Egypt later called upon
Mr. Tsouderos to thank him for his declaration. OTTI gave
full publicity to this declaration, which was also trans-
mitted to Washington and London for use in further broad-
casts and news releases. The prime Minister's statement
wąs broadcast in Greek by the Greek Government in its
weekly broadcast to Greece on March 31 at three different
periods during the day. since no important Yugoslavian
officials were in Cairo at the time, no statement could
be obtained from them.
Macveagh
Mikesell:efb
314
ORIGINAL TEXT of TELEGRAM SENT
FROM:
Secretary of State, Washington
TO:
American Legation, Mabem
DATED:
April 7, 1944
NUMBER: 988
CONFIDENTIAL
From War Refugee Board to Norweb.
Reference your 932 of March 28, 1944.
Please deliver following message to Joseph Schwarts,
representative of the American Jewish Joint Distribution
Committee in Lisbon, from War Refugee Boards
"(1) Can you send us immediately estimates of
amount of foodstuffs in Spain and Portugal available for
International Red Cross feeding programs. (2) Advise
Board your personal views concerning building food stocks
in Portugal as well as in Switserland."
ee:Miss Chauncey (For the Sec'y), Abrahamson, Aksin, Bernstein,
Cohn DuBois, Friedman, Gaston, Hodel, Laughlin, Lesser, Luxford
Mann, Mannon, Marks, MeCormack, Murphy, Paul, Pehle, Pollak,
Rains, Sargoy, Smith, Standish, Stewart, Weinstein, H. D. White,
Files
Regraded Unclassified
315
RCC-840
Stockholm
This telegram must be
paraphrased before being
Dated
communicated to anyone
April 7, 1944
other than a Governmental
Rec'd
agency. (scoo)
9:50 a.m.
Secretary of State
Washington
PRIORITY
1181, April 7, 10 a.m.
FOR WAR REFUGEE BOARD.
Swedish Foreign Office states that it will be
glad to instruct Swedish Minister Berlin to support
on behalf of Swedish Red Cross request for safe conduct
of 88 TARI. Minister will be instructed to say
that request has full support of Swedish Government.
Foreign Office wishes to know whether International
Red Cross has in fact mde request for safe conduct of
Germans,
JOHNSON
WSB
Regraded Unclassified
316
ORIGINAL TEXT OF TELEGRAM SENT
FROM: Secretary of State, Washington
TO:
American Legation, Bern
DATED: April 7, 1944
NUMBER: 1181
CONFIDENTIAL
The Department has received from London Kullmann's report
of his discussions with you, the Swiss authorities, the Polish
Minister, the International Red Cross and representatives of
voluntary agencies concerning the attitude of Switzerland towards
those who assisted Poles, including Polish Jews, in France to
obtain passports issued in the names of Latin-American countries,
and the attitude of the German authorities with respect to the
persons in enemy-controlled areas holding such passports. This
Government is approaching the Latin-American Governments and is
urging them on humanitarian grounds to take no action, at least
until after the war, to revoke or cancel such passports or to
indicate that they are or may be revoked or cancelled or may be
considered ineffective or invalid. As you probably know, the
Government of Paraguay has already advised this Government and
the Intergovernmental Committee that it has not cancelled and is
not considering cancelling such passports issued in its name.
There is some hope that Poles, including Polish Jews,
holding such passports will contine to receive more favorable
treatment than persons who do not. It is this Government's view
that any section that might result in endangering their lives or
subjecting them to transportation or worsening of their condition
should be avoided. It 1s also of the view that all appropriate
action calculated to protect the lives and welfare of these
persons should be taken.
Accordingly, you are requested to approach appropriate
officials of the Swiss Government and advise them of this Govern-
ment's views. You should request appropriate efficials of the
Swise Government to approach the Germane in aneeffort to induce
them to continue to recognize the validity of Latin-American
passporte held by persons in Vittel and elsewhere unless the
Government in whose name the passport has been issued takes
affirmative action to cancel or revoke it or deny its validity.
In this connection, Kullman and others report that the Swiss
Government has taken legal action against the persons in Switzer-
land who were instrumental in securing these passports and that
the Swiss Government has also undertaken an inquiry regarding
the authority of some of the persons who have issued such pass-
ports. It 1s this Government's view, and appropriate Swiss
authorities should be so advised, that the validity of the pass
ports in question 18 not in issue and should not be put in issue
Regraded Unclassified
317
-2-
by Swiss authorities in the absence of affirmative renunciation
by the Latin-American Governments concerned. In any event, it
would seem that such action and inquiry might, on humanitarian
grounds, if no other, be postponed until after the war, and you
should 80 inform the Swiss Government.
For your information, Kullmann has reported that the Swies
authorities are definite that any approach to the Germans would
not only be ineffectual but would do more harm than good. This
Government cannot agree with that view. The Department and the
War Refugee Board have reasons to believe and are strongly of the
view that it 1s of the utmost importance and can only helpper-
sons subject to enemy persecution that German authorities be
kept continuously aware that the treatment of Jews and others
in enemy-controlled areas is being followed with the closest
attention.
Please keep the Department advised of any developments in
regard to this situation
Regraded Unclassified
318
PARAPHRASE OF TELEGRAM RECEIVED
FROM: The American Legation, Bern
TO:
The Secretary of State, Washington
DATE: April % 1944
NUMBER; 2163
SECRET
US URGENT
A summary of a message to the Union of Orthodox Babbis
from Stermbuch follows. Please refer to my number 1944 dated
March 31, 1944
1. To report on the situation a courier has been
despatched by no to Hungary. It is By suggestion that the
possibility of arranging an exchange of Jews in Hungary against
German civilians from Africa or other Allied occupied territory
be examined by you with the Government of America.
2. Aid us in obtaining Vatican certificates, number
unlimited. Lists of thousands of families in Hungary could
be telegraphed to Jerusalen by no. A certificate is useful
in occupied countries for obtaining internment against exchange
up to the present time.
3. Southern American passports for ten thousand familSes
would be another possibility for result. Through the consu-
lates of those countries in Switzerland, passports should be
handed to us confidentially. Since the receivers would know
that these passporte are valid only during war time as a means
of saving lives, they (passports) could not be misused. Only
to well known Rabbis and other reliable persons would passports
be given.
4. Regarding possibilities of res cue I an constantly
in touch with Griffel by telegram.
5. To all occupied areas I have extended rescue activi-
ties. A courier is now en route with instructions to assist
150 Rabbie and prominent persons although since occupation
contact with Lithuania has been interrupted.
The foregoing is signed Pines, Sternbuch, Rosenbaus and
Rubinfeld.
HARRISON
DCR: MPL
4/8/44
Poaradod
319
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Legation, Bern
TO:
The Secretary of State, Washington
DATE:
April 7. 1944
NUMBER: 2173
CONFIDENTIAL
Communication of the following to the Union of Orthodox
Rabbis, New York, is desired by Pines, Rosenbaum, Rubinfeld
and Sternbuch:
A report that four American citizens and two hundred and
thirty four interned South Americans who were the subject of
my telegram transmitted through the Department of State (Bern
Legation's message number 1994 dated March 31, 1944) were
evacuated from the internment camp at Vittel on March 31 to
some prison the location of which is unknown, has been received
by us, That the Swiss Minister and the Spanish Ambassador
in Berlin declined protective offices was also stated in this
report. Before it will be too lated please intervene with
Madrid and Bern,
HARRISON
DCH:MPL
4/8/44
Regraded Unclassified
320
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
American Legation, Bern
TO:
Secretary of State, Washington
DATED:
April 7, 1944
NUMBER:
2180
CONFIDENTIAL
On March 18 the Department's message of March 14,
1944, no. 838, was delivered to Field.
HARRISON
321
PARAPHRASE OF TELEGRAM RECEIVED
FROM:
The American Minister, Bern
TO:
The Secretary of State, Washington
DATE:
April 7, 1944
NUMBER:
2194
CONFIDENTIAL
In the second paragraph of my number 1958 dated
March 30 the words "veberan certificates" and also in
By number 2163 dated April 7, third paragraph, "Vatican
certificates" mean certificates of approval for the
permanent immigration to Palestine of individual Jews.
The Government of Palestine issued these certificates.
HARRISON
DCR:MPL
$/10/44
Regraded Unclassified
322
NOT 70 BE RE-TRANSMITTED
COPY NO.
11
SECRET
OPTEL No. 112
Information received up to 10 a.m., 7th April, 1944.
i. NAVAL
Examination of photographs together with reports from
dircraft crews confirm 16 hits on TIRPITZ, three of them from 1600
pound bombs and 8 probable hits. In Northeast ADRIATIC on 4th/
5th coastal forces captured two small schooners off MURTEE Island
and towed then to port. In attack on homeward convoy northeast of
AZORES yesterday two Norwegian ships totalling about 10,000 tons
were torpedoed, one sank, other is sinking. One U-boat claimed
sunk by escort.
2. MILITARY
RUSSIA. Russians have again tightened the ring around
German troops and have captured SKALA. They have broken up German
counter-attacks southwest of TARNOPOL, carried out with large tank
and infantry forces with object of relieving pressure on encircled
Germans. Russians have closed in further on ODESSA from Northwest,
North and Northeast, German garrison TARNOPOL still apparently
holding out.
BURMA. Japanese have established road block 12 miles
North-Northwest of IMPHAL on the IMPHAL-KOHIMA Road. In North
BURMA our forward troops are now 35 miles north-northeast of
MYITKYINA.
3. AIR OPERATIONS
WESTERN FRONT. 5th/6th. TOULOUSE. Total 493 tons
H.E., 108 incendiary including 17 8,000 pound bombs dropped on
aircraft factories and airfield. Marking was good and
large
fires resulted. Attack considered successful. A/A slight, no
fighters.
6th. Escorted Liberators dropped 39 tons on a military
construction in Northern FRANCE and Thunderbolts 23 tons on three,
airfields.
6th/7th. Mosquitoes despatched:
HAMBURG
35 (1 missing)
Northwest GERMANY
14
Intruders
4 (1 missing)
ITALY. On 4th and 5th 10 medium and 243 light and
fighter bombers operated over ROME and battle areas.
YUGOBLAVIA. 5th. 103 heavy bombers dropped 159 tons
on NIS Railway Centre and 60 tons on communications nt LESKOVIK,
55 miles eist-southeast VALONA. Two bombers missing.
RUMAYIA. PLOSSTI. At Tenst 53 enemy airciaft
P.O. down, 5 heavy
Regraded Unclassified