BRIEF SUBMITTED BY MR. CARL SCHREINER, 225 WEST THIRM. FOURTH STREET, NEW YORK, N. Y., REPRESENTING CERTAIN GILMAN INSURANCE COMPANIES THE MORAL AND PRACTICAL ASPECTS OF THE QUESTION There are two sides to this question and its solution. One may be cal moral; the other is strictly practical. The moral aspect involves the question: Shall German property owners wh invested their means in the United States be held responsible for what. witla the meaning of the treaty of Versailles, was an act of their Government; and i so held responsible, shall the Government of the United States, not a party i this treaty, violate private property that passed under its jurisdiction and vi control during the years when the United States was a debtor Nation 24 invited foreign capital to assist in the development of American natur resources? While foreign capital did see opportunity in the United States, and found it i is equally true that such capital saw in prospect not the possibility of confiss tion but those guaranties which American socio-political practices extend. native capital. The understanding was that in return for complying wil American law such investors would be coequal with American investors a what concerned the safety of their property. THE NATURE OF GERMAN PROPERTY IN THE UNITED STATES In speaking of German property in the United States, one can not overba the Winslow Act and the misconception it has led to. Under that act propery up to $10,000 has been returned, and this includes interest in the same amout Superficially viewed, then, the impression can be gained that the proper: now held is that mostly of large corporations and wealthy individuals. The view is both erroneous and unfair. German corporations, like all others, & composites of bond and share holders—large and small private investors wh have not benefited under the Winslow Act because their holdings or claims are corporate instead of individual. To give such investors, many of them pourer than those who have found relief in the Winslow Act, a different treatment is manifestly unfair. The only difference between these classes is that the Alien Property Custodian deals in the one case with a large trust, while! the other he dealt with many small trusts. The small estate of he widow and orphan, represented in this matter by shares in a corporation, is as desering as the small individual claim settled under the Winslow Act. The Winslow Act was proof, of course, that the United States did not intend to confiscate German property, so that to-day it is a question merely of cari for the claims of American claimants. These claims are amply protected by the residue of German property in the hands of the Alien Property Custodia and it has been suggested that the best method of disposing of this matter would be to pay the claims of American nationals and then hand over to the German property owners what is left. Simple as this must appear, the fact is that this would constitute confisc tion. German property owners whose holdings became involved in the trea of Versailles are being paid by their Government 2 per mille; that is to s for every $1,000 the German Government compensates them with $2, and there is no reason to think that owners of German property in the United States would fare better. The compensation was fixed by law of the German Rei Parliament, and that body can not be expected to favor German investments in the United States above such investments in the British Empire, France Italy, Belgium, etc. Writing off German claims against American claims would have that result, of course. To the extent in which German propeπ would be converted into payment to American claimants a confiscatie less 2 per mille would seem inevitable. What, under the treaty of Versailles was written over to reparations would in this case be written over to America claims the same thing and method even if nomenclature differs. THE PRACTICAL SIDE What the German Government does with the claims of its nationals can be of no concern to the United States, of course. But the matter does not rest there. Germany signed the treaty of Versailles under duress. That treat oses terms which only the vanquished will accept. Though its terms do place the confiscation of private property among the tenets of internaal law, the fact is that in effect such confiscation is carried through. With United States now a creditor nation to the extent of at least $20,000,000,000, Government and investing classes can no longer remain indifferent to the edent created at Versailles. hat precedent is most vicious in so far as it adds a most potent incentive var to a list already long. Remaining unchallenged, this precedent will e a premium on war for the purpose of striking out financial obligations may become burdensome. A declaration of war obliterates ipso facto obligations between governments and their nationals, with the fortune of deciding finally which of them are to be resumed, denied, or admitted. e moral merit does not inevitably triumph over force of arms in any 'e conference, plays no rôle in fact, any creditor nation to-day faces attack the sole purpose of cancellation of debt and confiscation of private property. is the part of wisdom and self-interest, then, to do whatever is possible mprove upon this deplorable state of affairs, and it will, and in the nature he circumstances must, evolve upon the United States to take the lead in Before it can do so, it must remain outside the circle of nations that e written the spirit of confiscation of private property into the treaty of sailles, even though the letter has been avoided. The United States can do : only by assuming that toward the owner of German property within its sdiction it, and not the German Government, is responsible. Following any er course will lead to confiscation to the extent of two per mille, or as nearly plete as possible without justifying the claim that confiscation had been lute. Certainly, a compensation of $2 for every $1,000 is a jest rather than iness method. . A FEASIBLE SOLUTION n view of the fact that the United States has obligations toward its own ionals, considering also that engagements made between the United States 1 German Governments suggest simultaneous solution of both classes of ms, the following plan of action appears to have some merit: The objects to be achieved are: (a) Returning the German property now in hands of the Alien Property Custodian; (b) meeting the claims of American ionals as determined by the Mixed Claims Commission; (c) making comsation for German property seized by Executive order. The amount inved under (a) is in excess of $250,000,000. The amount involved under (b) about $150,000,000. Returning this property and paying American claims ld be satisfactorily done in the following manner: 1) The American claims to be paid in cash. 2) This cash to be made available through the sale or conversion of 50,000,000 worth of the German property in the hands of the Alien Property stodian. (3) German property thus applied to be replaced by United States Treasury ds issued to the owners of such German property, who would see in them good investment. 4) Such bonds to be redeemed as to interest and capital from the payments de by Germany under the Dawes Plan. The obvious advantages of this plan are these a) The American claims are settled at once. (b) German property is returned and the inviolability of private property in se of war is given a valuable precedent that would serve toward rendering cure American credits and investments abroad. (c) The American Government and taxpayers are not saddled with a debt. Respectfully submitted. WASHINGTON, D. C., November 24, 1926. CARL SCHREINER. American War Claimants Association, statements on behalf of 164, 168, 173, 623 Trust property on hand and total value of claims. Armstrong, William C., New York City, statement of ......... Army of Occupation cost receipts (table). Arnold, Dr. Ernst H., New Haven, Conn., statement of. Arnold, Henry Newton, New York City, statement of Letter from representative of.... 97, 128 30 93 250 348 175 146 130 229 266 152 Betts, George Whitefield, jr., Englewood, N. J., statement of 164 592 524 Bonynge, Hon. Robert W., American agent, Mixed Claims Commission: 363 Letter from, to Secretary of State, reclaims filed after date of limi- 372 Statement of. 356 238 Blymyer, William H., New York City, statement of Buckleton, Capt. E. E., Liverpool, England, statement of.. C Castle, Hon. William R., State Department, correspondence in re pay- Confiscation: 411 Brief by Colonel McMullen on 58 Power to confiscate in time of peace, brief by Messrs. Clark and Martin. F Fraser, Leon, New York City, statement of.. G P 2112. German Bankers Association, statement in behalf of ____ . Correspondence in re payment for property of its nationals confis- Taxation of property seized and later returned. German insurance companies, brief on behalf of.. German "mark" debts, Supreme Court decision on.. German ships seized during war, list of and data on. Germany's indebtedness, amount of, statement of revaluation commission Hamburg-American Line.. H Hirshfeld, Dr. jur Georg, Bremen, Germany, statement of....... Houston, Oscar R., statement of.. Hunt, Edgar W., Trenton, N. J., statement of....... Insurance companies: I 126, 236, 495, 559, 622 Alabama claims (Geneva awards, Civil War) memorandum on.. 243, 250 K Katz & Sommerich, New York City, letter from.... Kellogg, Hon. Frank B., Secretary of State, letter from, in re unallocated (See also State Department.) Koppel Industrial Car & Equipment Co., Koppel, Pa., statement on L Lafferty, Hon. A. W., New York City, statement of--- Mc McGee, William H., New York City, statement of__ McGowan, Lewis A.; statements of 332. 10% 570, 620, 36, 519,53 Traditional policy of United States re enemy private property, brief.... Maier, David, New York City, brief.. M Merckens, August, Buffalo, N. Y., statement of.. Miller, David Hunter, New York City, statement of.. |