shipment to interior points, where flour exhausted. Please advise what vessels en route Archangel with supplies. FRANCIS File No. 861.77/500 The Ambassador in Russia (Francis) to the Secretary of State [Telegram] ARCHANGEL, September 22, 1918. 419. Russian engineer Sakharov presents following cable from Goryashkovski through Russian Embassy, Washington: " Boots for amount $400,000 shipped for Murman Railroad and Murmanstroika and employees." Sakharov is member Murmanstroika, organization of civil engineers and railroad workmen, but knows nothing about boots. Please ask Russian Embassy and report as think boots possibly shipment mentioned my No. 413.1 FRANCIS File No. 861.801/32 The Secretary of State to the British Ambassador (Reading) MEMORANDUM The Secretary of State has the honor to acknowledge the receipt. of the memorandum of his excellency, the Ambassador of Great Britain, dated July 31, 1918,2 relative to the steps considered necessary by the British Government to control traffic by sea to and from north Russian ports, especially the trade between these ports and Norway. Due note has been taken of the intention of the British Government to notify the neutrals concerned that they still regard as prohibited area the Russian Arctic coast from the Norwegian frontier to Kara Straits, which area was closed by action of the Russian Government in April 1916; and that unless the authorities of the United States have any objections to the proposal, the British Government proposes to put in force the regulation that vessels may only proceed within this area if in possession of a permit to do so issued by the British Admiralty. The information contained in the memorandum under acknowledgment has been communicated to the interested departments of this Government, which perceive no reason why, as far as practicable, adherence should not be continued to the decree of the Russian Gov 1Not found in the files. 'Ante, p. 137. ernment aforementioned which prescribes the conditions under which permits to shipping might be issued. WASHINGTON, September 27, 1918. File No. 861.00/2776 The Secretary of State to the Ambassador in Russia (Francis) [Telegram] WASHINGTON, September 27, 1918, 2 p. m. 275. Your 416, September 21, 5 p. m. Four steamers cleared this month for Archangel with supplies. This includes Red Cross ship reported already arrived Murmansk. LANSING File No. 861.61323/10 The Secretary of State to the Consul at Archangel (Cole) [Telegram] WASHINGTON, October 1, 1918, 6 p. m. From War Trade Board [Woolley]: Your cable, August 23, 5 p. m.,1 from Murmansk regarding flax. London Embassy actively discussing whole flax situation and cable sent them yesterday setting forth situation in this country. Suggest you send all communications through London Embassy regarding flax. LANSING File No. 811.142/5855 The Chargé in Great Britain (Laughlin) to the Secretary of State [Telegram] LONDON, October 3, 1918, 6 p. m. 2458. [From Endicott to] American Red Cross: 1802. British Government tell us shipments brought from America already arranged for should be sufficient for needs civil population Archangel district eight months and are unwilling we should ship an additional amount except with assent British General, Archangel. We are to-day asking if this consent can be obtained; if so, by cooperation Navy for cash, we can probably arrange shipment approximating 1,000 tons bully beef, dried beans and other rough foods, but clothing practically unobtainable. If General's consent received, will 'Ante, p. 140. ship all possible and advise you. Tonnage would be arranged by Navy in cooperation Admiralty. LAUGHLIN Establishment of the War Trade Board of the United States Russian Bureau, Inc., November 5, 1918-Refusal of Sanction for Relief in Cooperation with Soviet Authorities-Accomplishments of the "Goods Exchange" (Tovaro-Obmien) File No. 861.00/3054c The Acting Secretary of State to the Diplomatic Representatives of Great Britain, France, Italy, Japan, Russia, and China1 AIDE-MÉMOIRE In its aide-mémoire dated July 17, 1918,2 handed to the Allied Ambassadors at Washington and in the announcement of the Acting Secretary of State to the press under date of August 3, 1918,3 the United States Government stated that it was its hope and purpose to take advantage of the earliest opportunity to relieve in some measure the immediate economic necessities of the people of Russia but that the execution of its plans in this respect would follow and would not be permitted to embarrass the military assistance to be rendered in the rear of the forces of the Czecho-Slovaks in Siberia and in the districts around Murman and Archangel in northern Russia. The United States Government further expressed the hope and expectation that its associates in the war would lend their active aid in the execution of such plan as it found itself able to propose. United States military forces having now arrived at Vladivostok and at Archangel, the United States Government is prepared to communicate to its associates in the war a frank and definite statement of the plan which it finds itself able to adopt in order to relieve in some measure the immediate economic necessities of the Russian people. The Government of the United States trusts that the action it proposes to take will commend itself in principle to its associates so that they will be prepared to lend their cooperation in the execution thereof. 1 1 Substance sent Oct. 11 by the Acting Secretary of State to the diplomatic representatives in Great Britain (No. 1953), France (No. 5885), Italy (No. 1760), Japan, for repetition to Peking and Vladivostok, and Archangel (No. 301). This information was intended for the War Trade Board representatives as well as for the Ambassadors. 2 Printed in part, ante, p. 134; in full, vol. II, p. 287. 3 Vol. II, p. 328. 117328-32-13 The result to be accomplished is to serve Russia and not to make use of her. The economic problem presented may at this time be geographically divided into two parts: (1) Economic assistance to the Russian population of northern Russia through the ports of Murman and Archangel; (2) Economic assistance to the Russian population via the TransSiberian Railroad. The Government of the United States considers it desirable that any plan adopted to relieve the economic necessities of northern Russia should be fundamentally similar to that adopted for the same purpose in Siberia so that the system established may, if and when communication between these two regions, now separated, is established, fit into each other and lend themselves easily to adoption by any stable Russian government. The importance of this consideration is most apparent in connection with the establishment of a medium of exchange hereafter referred to. In the judgment of the United States Government economic relief to Russia should be directed so that the Russian people may be assisted while in their present unfortunate condition against selfish aggressive trade practices. It cannot be left wholly to the discretion of private merchants to determine what commodities shall be shipped to Russia and what shall be the priority of shipment. Neither can the distribution in Russia of commodities received from abroad be entirely uncontrolled. Methods which will make possible the fair exchange of such commodities as are sent to Russia from abroad for commodities available in Russia and required abroad cannot be formulated and put into operation except under the guidance of some agency other than those afforded by private enterprise. The United States Government accordingly proposes to permit its merchants to trade with Russia only under such direction on its part as will insure to the Russian people absolute fair dealing and complete protection against exploitation and profiteering. The United States Government proposes to control the economic relief it offers the Russian people through the instrumentality of the War Trade Board. The War Trade Board charged as it now is with the control of exports from and imports to the United States is peculiarly equipped to take charge of and direct the activities of the United States in this connection. Its representatives in the Allied countries and in the neutral countries of Europe have for many months past been cooperating closely and harmoniously with the representatives of our associates respecting the many questions arising by reason of the control of exports and imports generally. In the very near future the War Trade Board proposes to make a public announcement to the effect that it is prepared to receive from merchants in the United States applications for licenses for shipments to Russia and that licenses will be granted only under regulations designed to control shipments in conformity with the policy of the United States Government as set forth above. So as to provide the Russian people in certain localities with commodities, which on account of the nature thereof or the risks connected with distribution, or for some other reason, will not be purchased or shipped by private merchants, the President has made available to the War Trade Board the sum of $5,000,000 for utilization as a revolving fund. For the convenient handling of this fund and to promote the accomplishment of the other purposes herein set forth, the War Trade Board proposes to organize a corporation the entire capital of which shall be owned by the United States. The corporation may participate in any plan which may be adopted for the establishment of a medium of exchange to facilitate such sales or purchases. The views of the United States Government with reference to the establishment of a medium of exchange or currency in Russia necessary for the development of plans for economic relief may be summarized as follows: The problem in connection with Russian currency both in north Russia and in Siberia is practically identical. In each case it is a question of creating a circulating medium that will be accepted by the people. Probably no circulating medium will generally be accepted at its nominal value unless backed by commodities on the spot so that the purchasing power of the new medium may be demonstrated. It will be an advantage if any new circulating medium should be such as can ultimately be adopted or taken over by a stable Russian government. The ruble originally had a gold value of about 50 cents. It is now selling at from 10 to 15 cents. If a new and distinctive issue of a currency denominated rubles is now put out on the market at what the old rubles are selling, it would probably be necessary, in order to avoid charges of bad faith, ultimately to redeem that ruble at a face value of about 50 cents which would involve considerable and unnecessary losses. The problem, therefore, is to put out a new and international ruble backed by commodities and to put the ruble into circulation at approximately 50 cents. These rubles would by their terms provide for redemption in commodities with proper and elastic provision for conversion, under circumstances and at rates from time to time, into credits in New York, London, Paris, and such other points as may be determined. This can, probably, be done if, as stated above, the international ruble is backed by commodities so that its purchasing power may be at once demonstrated. The United States Government suggests that if its associates find themselves able to agree in principle with its views as set forth |