New-York tribune. [volume], November 26, 1920, Page 3, Image 3

About New-York tribune. [volume] (New York [N.Y.]) 1866-1924

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R. W. Boiling
To Be Called in
Ship Inquiry
President's Brother - in - Law
and Head of Downey Ship?
building Corporation to
Answer Sands's Charges
Contractors Deny Bribes
Letters to Walsh Committee
Say Contract Was Signed
BeforeDowneyMetBanker
* __________
When the Congressional committee
.nvestigating the affairs of the Ship?
ping Board resumes its sessions in the
Federal Building, in this city, this
morning it will have on the lift of
witnesses expected to testify before
it R. W. Boiling, President Wilson's
brother-in-law, and Wallace Downey,
president of the Downey Shipbuilding
Corporation. Both were mentioned
last week in testimony before the
committee by Tucker K. Sands, who
alleged that they had been involved
with h'.m in graft connected with the
granting of a contract by the Shipping
Board.
Mr. Downey and Mr. Boiling both
?e expressed their readiness and
??es.re to eo before the committee and
tell their side of the story, which is in
"ut contradiction with that of Mr.
.-and3, according to statements made
public by Mr. Boiling in Washington
and b> Mr. Downey in New York.
Another witness expected to be
eard by the committee is William H.
Denman, former president of the
Kir.ergency Fleet Corporation, who left
?at post following a controversy with
ral Goethals over the construction
of wooden ships. Mr. Denman has
requested to be heard before his re
urn home to the Pacific coast, and
.- assured by Congressman Joseph
Walsh, chairman of the committee,
?hat he would be given an opportunity
to testify when the committee rccon
?. enes.
Downey Firm Denies Charges
The Downey Shipbuilding Corpora?
tion yesterday made public* corre?
spondence with the Walsh committee
in which the corporation and the
Providence Engineering Corporation
answered the charges of bribery made
r. Sands. Mr. Sands testified that
the Downey Shipbuilding Corporation
had paid $40,000 to him, Mr. Boiling
o officials, of the Emergency
Corporation to obtain a con
t.
The Downey corporation denies thai
- aided it to obtain a shipbuilding
- tract and denies also that it paid
? ? y to Sands or any official of the
Emergency Fleet Corporation.
The Btatement asserts that the con?
tract the Downey Shipbuilding Cor?
poration obtained from the govern
to build ten ships was signed
months before Wallace Downey met
Sands.
Providence Corporation Paid $40.000
Mr. Downey, speaking for the Provi
Eng neering Corporation, of
. he is the head, also sent a letter
? e Walsh committee. In this com
:ation the Providence corporation
u ed that it did pay $40,000 to Mr.
The circumstances under which
? ayment was made arc narrated as
f i 11 o w s :
"Many months after the Downey
Shipbuilding Corporation had obtained
its contracts the Providence Engineer?
ing ( orporation put in a bid to the
goveri The bid proved to
be the lowest, but tbo Shipping Board
requested ;. guaranty of the respon?
sibility of thi successful bidder. At
this point Mr. Sands was brought for?
ward as vice president of the Com
X.:' ? al Bank of Washington.
He agreed that for 540,000 his bank
ke a thorough investigation
- ? responsibility of the Provi
? ' ng Corporation. Mr.
ey paid the money to Mr. Sands
h< a representative of a bank and for
? y knowledge
what oever that Mr. Sands was to pay?
ing to Mr. Boiling or anybody
In its communication to the
Wa ? :\ committee, signed by Wallace
Downey, president; A. A. Cannon, sec?
retary-treasurer, and Henry C. Hunter,
counsel, of the Downey Shipbuilding
n, the corporation declared,
in part:
"\\ e deny that Tucker K. Sands aided
the Downey Shipbuilding Corporation
?n any way or manner to procure a
g contract from the Emer
Fleet Corporation. We deny
that we paid money to Tucker K. Sands
or to any officia! of the Emergency
Fleet Corporation to procure such a
cor. tract.
Contract Signed July 3, 1917
"The Downey Shipbuilding Corpora?
tion had only one shipbuilding contract
th? Emergency Fleet Corporation.
This contract, dated July 3, 1917, was
for the construction of ten steel ships,
<md is known as contract No. HO S. C.
Wallace Downey, founder and presi
manager of the Downey Ship
. rig Corporation, negotiated all of
. ial stages of the contract ex?
clusively with General Goethals, then
the vice-president and genera! manager
of the Emergency Elect. Corporaliori,
and Mr. Theodore* E. Ferris, its naval
architect. Negotiations started about
May, 1917, and after General Goethals.
Mr. Ferris and Wallace Downey had
agreed upon the fundamental details of
the contract, such as price for mate?
rials and labor, technical designs, plans,
specifications, etc., Wallace Downey
completed negotiations with Joseph P.
Cotton, then counsel for the Emer?
gency Fleet Corporation. The contract
was ftnallv signe,-! by William H. Den
man, president of the Emergency Fleet
''orporation, acting on its behalf and
Wallace Downey for the Downey Ship?
building Corporation.
"Prior to i.nd during the negotia?
tions for this contract and for a long
period thereafter, Wallace Downey had
never seen nor heard of Tucker K.
Sands or of any one of the other per?
sons mentioned by the witnesses before
you on November 20. Neither Tucker
K. Sands nor any other party or par?
ties, except authorized officials and
attorneys of the Emergency Fleet Cor?
poration and Downey Shipbuilding Cor?
poration, had anything whatever to do,
('irectly or indirectly, with negotiating
or closing said shipbuilding contract.
Downey Shipbuilding Corporation or
Wallace Downey did not agree to nor did
they pay, directly or indirectly, any
commissions or gratuities of any kind
or amount to Tucker K. Sands or any
other person in connection with nego?
tiating or procuring said contract."
Senate Opposes Idea
Of Armenian Mediation
V' ilson May Act if the Invitation
Comes to Him Personally
and His Health Permits it
From The Tribune's Washington Bureau
WASHINGTON, Nov. 25.?If the
[ League of Nations invitation to Presi
I dent 'Wilson seeks the services of the
United States jrovernment as mediator
between the Turkish Nationalists and
the Armenians the Senate will with?
hold approval of the scheme, leaders
of the upper house indicated to-night.
If the request is directed to t+ie
President personally to serve in the
capacity of mediator, the proposition
l may be accepted by Mr. Wilson if Dr.
! Cary T. Grayson, the White House
i physician, will permit, it is believed
1 here.
An indication of the reception the
1 proposal that the United States gov
I ernment serve as mediator in Armenia
j will receive was given here during the
! last session when President Wilson's
' request that his nation become the
! mandatory power over Armenia was
i promptly rejected. While the Ameri
i can Senate entertains the greatest
sympathy toward the Armenians, the
: upper house was disinclined to author
; ize the employment of thousands oi
American soldiers who would be re?
quired for police duty in Armenia
i should the United States become the
: mandate power there.
In the caso of Mr. Wilson serving as
? a mediator, however, the Senate woulc
! have no voice, but the President's ill
] ness may operate against his assum
: ing any such arduous task. The Presi
; dent's duties have been reduced to th?
j minimum by the White House ph-?si
i eian because of his illness, arid al
though steady improvement in his con
dition has been reported, the proposa
that he give personal attention to th?
task of ending the. strife in Armepiar
territory mav enfail too much of i
strain upon him.
The President is known to entertain
the greatest desire to continue as an
international figure, and to serve the
League of Nations in any capacity that
may be suggested.
Has 7c. Fare, Wants 10c.
Jersey Trolley Company, After I
Two Years, Asks Second Raise '
TRENTON, N. J., Nov. 25.?The Tren- I
ton and Mercer County Traction Cor- ;
potation, which obtained permission ;
two years ago to increase its 5-cent j
fare to 7 cents and charge an extra
cent for a transfer, has applied to the
Public Utilities Commission for per?
mission to charge a 10-cent fare, with
free transfers.
Mayor Frederick W. Donnelly, who ?
is chairman of the New Jersey State :
League of Municipalities, said to-night.|
that he had heard a report that the
Public Service Railway Company,
which operates most of the trolley
lines in northern New Jersey, intended
to apply for a 10-cent fare on all its ;
lines and would support the application
of the local company.
He announced that he would consult
with the authorities of all the commu- '
nities affected and retain counsel to
fight the move for higher fares. Next ;
week, he said, he would ask the City
Council to authorize franchis'**- fi r ,.
bus system to parallel the trolley
tracks here and charge a 7-cer.t fare.
U. S. Guards Jews at Piagu
Flag Raised to Protect Emi?
grants From Mobs
VIENNA,Nov. 25 (Jewish TeleirraDhic
Agency).?In an effort to protect Jew?
ish emigrants against attacks by anti
Semitic Bohemian crowds, the Ameri?
can Consul at Prague has permitted the
American flag to be raised over the
building of tho Jewish Community in
that city, according to reports received
here to-day.
Prague is filled with hundreds of
Jewish emigrants from Poland and
Ukrainia who are makine their wav to
America. These gathei daily in front
of the Jewish Community building try?
ing to get information about their de?
parture. Bohemian mobs attacked these
waiting emigrants and destroyed the
passports of many. A. special dele
gati ': cal led ai 4t- American ' on
sulate an?! obtained permission to hoist
the American flap. The American
Consul also obtained the protection
of the police for the buiidintr.
Yale Closes Dining Hall
_?
NEW HAVEN', Conn., Nov. 25.?Com?
mons, "where Yale eats," is definitely
closed for the college year, according
!" an announcement to-night by George
Parmley Day, treasurer of Yale Uni
I versity. The big dining hall was closed
recently because of lack of patronage.
It was said that the university was
| losing money on the eating place be?
cause only 700 undergraduates took
: their meals threre, while it could ac
! comodate twice that number without
| increase in the overhead expense.
It. was planned to re-open Commons
! next Monday under private manage
; ment if 1,000 students could be listed as
regular boarders. Mr. Day said that it
i had been found impossible to sign up
1 that number of undergraduates.
i _ _
London Times Praises Sims
LONDON, Nov. 2fl.?The Times, in an
! editorial to-day, pays high tribute to
; tho cooperation of the United States
navy with the British navy in the World
War, especially to Rear Admiral
| William S. Sims, commander of the
American nasal forces in the war zone.
which the newspaper says it would have
been indiscreet to say "during the con
1 troversies" of the election period.
"It is history with the many heroes,
for every man in that joint fleet was a
hero, but the American sailor who is
, tlm symbol to us all of that wonderful
' tune of common effort and of common
victory is Admiral Sims," it says.
AV /C&V "Thm Ormntoat
W^Wl^ilvl Tr?a."iur? Ho???
J*? ig^--''^ Of" ?.inane
A?*. Trod* A/ar*
TS there a more attractive gift for the
?*" appreciative girl than McCutcheon's
Pure Linen Handkerchiefs? Bewitch
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sport clothes, or daintily white for her
evening gowns.
James McCutcheon & Co.
Fifth Avenue, 34th and 33d Streets
U. S. Demands
Equal Rights
In Mandates
(Cantli-iued from ?an en?*'_
cation of the principle of equality of
treatment to the territories of the
Near East to be placed under man?
dates, and specifically to the petro?
leum resources of those territories as
affected by that principle.
"Before considering: the observa?
tions of his majesty's government
on the general principies advocated
by the 1'nited States and agreed to by
the Allied powers for application to
the mandates over former Turkish
territory, as outlined in the notes
of May 12 and July 28, addressed to
you on behalf of this government. I
think it will clarify the discussion
to indicate certain of vour state?
ments and assurances which this
government has been pleased to re?
ceive. Thus, I note that the assicn
ment to Great Britain of the mandate
for Mesopotamia was made and ac?
cepted subject to no friendly arrange?
ment whatever with any third gov?
ernment regarding economic rights,
which, of course, would have been
wholly at variance with the purpose
and contemplation of any mandate.
"It is also gratifying to learn thafc
his majesty's government is in full
sympathy with the several proposi?
tions formulated in the note of Mav
12, above referred to. which embodv
or illustrate the principles which this
government believes should be ar>
plied in the mandated regions and
which are essential to the practical
realization of equality of treatment.
British Good Faith Admitted
"The statements of your note, to
the effect that the British govern?
ment has refrained from exploiting
the petroleum resources of the man?
dated territories in question, that the
operations referred to have beer
conducted for purely military pur
poses under the immediate super
vision of the army authorities and a
army expense, and that no privatt
interests whatever are in any way in
volved, are accepted with a full sens?
of the good faith of the British gov?
ernment.
"The government of the Unitei
States notes that his majesty's gov?
ernment has found it necessary t?
suspend, during the period of occupa
tion, the grant of facilities and op
portunities to British as well as t
other private interests to invostigat
the natural resources of the countrv
either for the purpose of acquirin
new claims or strengthening ol
ones, and that there is no reason fo
assuming that the administrado
either of Mesopotamia or of Pales
tine has at any time failed to carr
out the assurances of his majesty'
government.
"This government welcomes you
pledges to the effect that the natun
resources of Mesopotamia are to t
secured to the people of Mesopotf
mia and to the future Arab state t
be established in that region, an
that it is the purpose of the Britis
government, fully alive to its obligi
tion as a temporary occupant, m
only to secure those resources to tr
Mesopotamien state, but also its al
solute freedom of action in the coi
tro) thereof, and in particular thi
it is far from the intention of tl
mandatory power to establish ar
kind of monopoly or preferred pos
tion in its own interest.
"The government of the Unit?
States appreciates, likewise, the co:
enrrence with its view that the me
its of all claims to rights alleged '
have been acquired in the mandan
territories before the outbreak of ho
i
tilitles mast be duly established be?
fore recognition or suen claims will
be accorded. v
Mandatory Pledge Understood
"Adverting at this point to the
views of hit majesty's government
regarding the nature of the respon?
sibilities of mandatory powers under
: the League of Nations, I desire to
call to the attention of his majesty's
government tho fact that, while tho
draft mandate, Form A, was not
j adopted at Paris, it was the under
i standing of the American rcpresenta
| tives there present that the British
j government entertained and had ex
I pressed conviction favorable to said
j form and that, presumably,"its reprc
I sentatives would exercise their in?
fluence in conformity with those con
I viciions.
"I need hardly refer again to tho
fact, that the government of th<*
United States has consistently urged
that it is- of the utmost importance
to the future peace of the world that
alien territory transferred as a re?
sult of the war with tho Central
powers should be held and adminis?
tered in such a way as to assura
equal treatment to the commerce and
to the citizens of all nations. In?
deed it was in reliance upon an un
? derstanding to this effect, and ex?
pressly in contemplation thereof,
that the United States was persuaded
that the acquisition under mandate
of certain enemy territory by the
victorious powers should be consist?
ent with the best interests of the
worlil.
"It, is assumed, accordingly, that
your statements with reference to
Mandate A, together with the state
I ment that the draft mandates foi
| Mesopotamia and Palestine havi
been prepared with a view to secure
equality of treatment for the com
merce and citizens of ail states whicl
are members of the League of Na
tions, do not indicate a suppositior
on your part that the United State;
can be excluded from the benefits o
nSe principle of equality of treat
ment.
Right of Voice Initiated On
"This government is pleased to fini
that his majesty's government is it
full sympathy with the principle:
formulated in its communications o
.May 12 nnd July 28. But it is un
able to concur in the view, containei
in paragraph 15 of your note, tha
the terms of the mandates can prop
erly be discussed only in the Counci
of the League of Nations and by th
signatories of the covenant. Sue
powers as the Allied and associate
nations may enjoy or wield, in th
determination of the governments
status of the mandated areas, ac
crued to them as a direct result c
the war against the Central powei
The United States, as a participan
in that conflict and as a contributo
to its successful issue, cannot cor
sider any of the associated power
the smallest not less than itself, d<
barred from the discussion of any (
its consequences, or from participi
tion in the rig'-ts and privileges si
f cured under the mandates provide
I for in the treaties of peace.
"This government notes with il
j terest your statement that the dra
I mandates for Mesopotamia and f?
Palestine, which have been prepare
with a view to secure equality ?
, treatment and opportunity for tl
j commerce, citizens and subjects ?
I all states which are members of tl
: League of Nations will, when a]
! proved by the interested Allied po\
! ers, be communicated to the Counc
of the League of Nations. Tl
: United States is, undoubtedly, one i
I the powers directly interested in tt
I terms of the mandates, and I ther
fore request tha: the draft manda
i forms be communicate?! to this go
: ernment for its consideration befo
i their submission to the Council
I the league. It is believed that h
majesty's government will be ti?
mor? ready to acquiesce in this r
Pershing Chuckles as
Soldier Trounces Gob
The army added a fistic tri?
umph to the aerial victory over
the navy at Mitchel Field yester?
day. It occurred just as General |
Pershing was bantering Secre- ;
tary Daniels. At this minute a j
gob happened, either by accident
or design, to jostle a doughboy
detailed to guard the sacred en?
trance to the wooden stand.
The incident resulted in imme?
diate complications, and a few
seconds later the army emerged
a winner, while General Pershing
showed his appreciation by pleas?
antly nudging the Secretary of
the Navy with his elbow.
quest, in view of your assurance that
his majesty's government is in full
sympathy with the various principles
I contained in the two previous notes
1 of this government upon this subject.
"The establishment of the man?
date principle, a new principle in in
; ternational relations and one in which
tke public opinion of the world is
! taking a special interest, would seem
: to require the frankest discussion
I from all pertinent points of view.
I It would seem essential that suitable
I publicity should be given to the
drafts of mandates which it is the
intention to submit to the Council,
I in order that the fullest opportunity
? may be afforded to consider their
j terms in relation to the obligations
assumed by the mandatory power and
the respective interests of all gov?
ernments, which are or deem them?
selves concerned or affected.
Resources a Potential Irritation
"The fact cannot be Ignored that
the reported resources of Mesopo?
tamia have interested public opinion
of the United States, Great Britain
and other countries as a potential
i subject of economic strife. Because
I of that fact they become an outstand?
ing illustration of the kind of e?o
l r.omic question with reference to
which the mandate principle was es?
pecially designed and, indeed, a
peculiarly critical test of the good
faith of the nations which have
given their adherence to the prin?
ciple. This principle was accepted
in the hope of obviating in the fu?
ture those international differences
that grow out of a desire for the
exclusive control of the resources
i and markets of annexed territories.
To cite a single example: Because of
the shortage of petroleum, its con?
stantly increasing commercial im
i portance and the continuing neces?
sity of replenishing the world's sup
! ply by drawing upon the latent re
', sources of undeveloped regions, it
is of the highest importance to apply
to the petroleum industry the most
! enlightened principles recognized by
! nations as appropriate for the peace?
ful ordering of their economic rela?
tions.
"This government finds difficulty
in reconciling the special arrange?
ment referred to in Paragiaphs 18
and 19 of your note, and set forth
in the so-called San Remo petroleum
agreement, with your statement that
the petroleum resources of Mesopo?
tamia and freedom of action in re?
gard thereto, will be secured to the
future Arab state, as yet unorgan?
ized. Furthermore, it is difficult to
harmonize that special arrangement
with your statement that concession?
ary claims relating to those re?
sources still remain in their pre?
war position and have yet to receive,
' with the establishment of the Arab
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State, the equitable consideration
promised by his majesty's govern?
ment.
Turkish Claims Questioned
Whis government has noted in
this connection a public statement
of his majesty's minister in charge
of petroleum affairs to the effect
that the San Remo agreement was
based on the principle that the con?
cessions granted by the former
Turkish government must be hon?
ored. It would be reluctant to as?
sume that his majesty's government
has already undertaken to pass judg?
ment upon the validity of conces?
sionary claims in the regions con?
cerned, and to concede validity to
certain of those claims which cover,
I apparently, the entire Mesopotamian
| area. Indeed, this government un?
derstands your note to deny having
j taken, and to deny the intention to
l take, any such ex parte and prema?
ture action.
"In this connection, I might ob?
serve tha,t such information as this
; government has received indicates
that, prior to the war, the Turkish
Petroleum Company, to make specific
reference, possessed in Mesopotamia
no rights to petroleum concessions
i or to the exploitation of oil; and
in view of your assurance that it
is not the intention of the mamia
tory power to establish on its own
behalf any kind of monopoly, I am
at some loss to understand how to
construe the provision of the San
Remo agreement that any private
petroleum company which may de?
velop the Mesopotamian oil fields
'shall be under permanent British
control.'
"Your lordship contrasts the pres?
ent production of petroleum in the
United States with that of Great
Britain, and some allusion is made to
American supremacy in the petroleum
industry. I should regret any as?
sumption by his majesty's govern?
ment or any other friendly power
that the views of this government as
to the true character of a mandate
are dictated in any degree by con?
siderations of the domestic need of
production of petroleum or any
other commodity.
U. S. Oil a World Commodity
"I may be permitted to say, how?
ever, for the purpose of correcting
a misapprehension which your note
i reflects, that the United States pos?
sesses only one-twelfth approximately
of the petroleum resources of th<
world. The oil resources of no othe*.
nation have been so largely draw
upon for foreign needs, and youi
lordship's statement that any proph?
ecies as to the oil-bearing resourci
of unexplored and undeveloped coun
i tries must be accepted with reserve
hardly disposes of the scientific cal
' culation upon which, despite their
problematical elements, the policies
of states and the anticipations of
i world production are apparently pro?
ceeding. The government of the
| United States assumes that there is
i a general recognition of the fact
i that the requirements for petroleum
are in excess of production, and it
believes that opportunity to explore
and develop the petroleum resource:
of the world wherever founi should
without discrimination be freely ex?
tended, as only by the unhampered
development of such resources can
the needs of the world be met.
"But it is not these aspects of oil
production and supply, in so far as
they are of domestic interest to the
United States, with which I am con
! cerned in this discussion. I have
I alluded to them in order to correct
confusing inferences, liable to arise
! lrom certain departures, which I
believe I discern in your lordship's
! communication, from the underlying
'< principles of a mandate, as evolved
? and sought to be applied by the Al
I lied and Associated powers to the
territories brought under their tern
porary dominion by their joint strug- |
gle and common victory. This do?
minion will be wholly misconceived,
not to say abused, if there is even
the slightest deviation from the
spirit and the exclusive purpose of
a trusteeship as strict as it is com?
prehensive.
"Accept, my lord, the assurances
of my most distinguished considera?
tion. BAINBRIDGE COLBY,
"Secretary of State of the United
States of America."
Lloyd George Believe*
Russian Deals Exaggerated
LONDON, Nov. 20. Premier Lloyd
George was asked in the House >?f
Commons to-day if he had seen reports
that Americans had obtained contracts
from Soviet Russia to the extent of
?600,000,000 for locomotives and all
kinds of rolling stock. To the question
the Premier replied:
"I did see that, but it left on my
mind an impression of exaggeration
This statement of the Prime M?i
ister was received with laughter.
Neither do
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Velvet Jackets
?jLj.2.j ? including
?**??* tax
Made by Lloyd, Attree & Smith,(
of London, England, in fine quality
velvet, bound with flat silk* braid
and finished with double silk frogs.
Colors: brown, black, navy blue,
and green.