Mr. HOUGHTON. May I ask you one question, Mr. Carr? Following up Mr. Rogers's question, the $2,500,000 salary and the $600,000 that was appropriated last for post allowances, give a total of $3,100,000; you are asking for $200,000 more, which is only 6 per cent; that, really, is the increase that you are asking for. My question is, is that adequate?

Mr. CARR. No; it is not.

Mr. HOUGHTON. What would be?

Mr. CARR. I can not tell you offhand, Mr. Houghton, just what would be, but roughly I should say we ought to have about $1,400,000 instead of $200,000, thus making a total post allowance of $2,000,000, or an increase of 80 per cent.

Mr. HOUGHTON. Presumably you had some reason for asking for $200,000.

Mr. CARR. Mr. Lay suggests that is the department's calculation of the absolute minimum. I will say very frankly that the department was led to limit the amount to $800,000 because of the experience of the last two years in getting even as much as $600,000 or $700,000.

Mr. HOUGHTON. May I ask one further question. Provided you get this $200,000, provided an increase only of 61 per cent is asked, can you then hold your force?

Mr. CARR. I can not say whether we can or not, but we will try to hold it, and we are utilizing for that purpose the small increase for salary which you gave us last year. In other words, a man who last year got a post allowance from $2,500 to $4,000, namely, $1,500, will in all probability, when the settlement is made and it is found that he was advanced from $2,500 to $3,500, get an allowance of the difference between $3,500 and $4,000. It is not fair at all to deny to ambassadors and ministers a post allowance. It is much less fair to deny a post allowance to consuls general merely because they have a higher salary, and it is not fair to give a man a promotion and then take it away by reducing his post allowance. That is what we have been forced to do, because we have been unable to get enough money in the post allowance appropriation to do anything else.

The CHAIRMAN. Do the secretaries receive this allowance?

Mr. CARR. The secretaries in the Diplomatic Service?

The CHAIRMAN. Yes.

Mr. CARR. Yes. It was from two of the secretaries that we received the reports I was just reading.

Mr. CONNALLY. Prior to the war did we have post allowances just as we have now?

Mr. CARR. No; we did not, for the simple reason that conditions all over the world were more or less stable and had been more or less stable for years past. It was only after the war began that there began to be these great advances in cost of living in different places and salaries began to mean practically nothing in the way of covering living expenses. I went before the Appropriations Committee two years ago with a telegram in my pocket from the inspector in China saying that unless immediate action was taken to provide post allowances we should have to face resignations of all of the officers in China, and I had in my pocket a telegram from the consul general in Chile transmitting the resignations of himself and all the consuls

in Chile because the department had been unable to convince Congress that an adequate post allowance ought to be made for Chile. The men found that they could not meet their expenses, and their only remedy was to send in their resignations. That is how serious this question is, and that is why I say that without a liberal allowance for post allowances we shall most certainly have to face the disintegration of the service, and particularly so with respect to all our best

men.

Mr. HOUGHTON. A liberal allowance, you say.

Mr. CARR. Well, as liberal as we have had the courage to request. Mr. ROGERS. Mr. Carr, may I ask a question. I think it would be of value if you had indicated to the committee some degree at least of the geographical apportionment of both the current $600,000 and the proposed $800,000, and also the considerations which lead you to grant perhaps 100 per cent post allowances at one point and no post allowances at another point. Now, for example, I take it that for Spain you can give a much lower post allowance than you can in China.

Mr. CARR. In China we give no post allowance, considered from exactly the standpoint that we give a post allowance in France, let us say. In China all we have done thus far has been to try to place the officer on the basis that he was in respect to the amount of China's currency which he could get in 1914. The formula in China is that the officers shall draw such an amount as will give them the same amount in China's silver coin which they could get for the same amount in gold salary in 1914.

Mr. SMITH of Illinois. Is that applied to all territories?

Mr. CARR. That is applied only to China, because the situation is peculiar. We can not make any post allowance in China for cost of living alone, as distinguished from the question of exchange.

Mr. TEMPLE. That is, if I understand, those in China are given post allowances sufficient to enable them to buy with the salary and the post allowance the same amount of China's money they could buy with the salary alone in 1914?

Mr. CARR. Quite so; yes.

Mr. TEMPLE. So that the actual increase in price of living, as measured in China's money, we do not help those men to bear at all?

Mr. CARR. No; we have so far taken no account of their increased price of commodities. We have taken into account only the getting into those men's hands of the amount of currency which they were accustomed to have in 1914. We have been driven to that by the mere fact that we could not keep our service in any other way, and that all the commercial concerns in China were making to their men far more liberal allowances than we were making to ours.

Mr. ACKERMAN. Mr. Carr, does that post allowance not apply to other countries similarly situated to China, like the Straits Settlements and Japan, where the price of silver has risen?

Mr. CARR. It does not apply in the same way to Japan, nor, I think, to the Straits Settlements. There we have covered the matter in the same way that we attempt to cover it in other countries. We have not given the same treatment as we have given in China because the conditions were a little different. In China, as I say, we are driven to that.

Mr. ACKERMAN. Has the yen in Japan risen in almost the same ratio as the trade dollar in China?

Mr. CARR. I do not think it has risen in the same ratio. risen; yes.

Mr. HOUGHTON. Japan is on a gold basis?

It has

Mr. CARR. Yes. To all the gold-standard countries we have applied the same rule, namely, the rule of living cost, duly checked, minus the salary we were paying; then such a proportion of that as the appropriation would stand we have given as a post allowance, differing in various places according to special conditions, so far as we could ascertain them in a rough way. I do not mean to say that we have been precise, because it has been physically impossible in the last couple of years to be precise about a matter of that kind.

Mr. ROGERS. You give the post allowance on the basis, the percentage of the individual salary, do you not?

Mr. CARR. Post allowance on the basis of the difference between the individual's salary and the approved cost of living for the individual. A married man, for example, would receive a larger allowance than an unmarried man.

Mr. ROGERS. Does a low-salaried man get a larger percentage of his salary than a high-salaried man in the same city?

Mr. CARR. The working out of the arrangement by reason of the small appropriation which we had has led to a practice which is unfair to the high-salaried man, since, if we find the cost of living, for instance, for an $8,000 officer is $7,000, the $8,000 officer would get no post allowance whereas if the cost of living for a $2,500 officer were $5,000 the $2,500 officer would get such a proportion of that difference between the salary and cost of living as the appropriation would stand.

Mr. TEMPLE. Modified in some cases, I understood you to say, by considerations based on differences of exchange.

Mr. CARR. That is what we are trying to do this year. Last year we did not do that. But we are forced to do that this year, and I think it will be found in the ultimate result that it will be justified.

Mr. ROGERS. I remember that a year ago it was testified that Mr. Madden Summers, who was our consul at Moscow, and who died there as a result of his efforts for the service and the country, received a salary of $5,000, as I recall it, and a post allowance of $4,500, or vice versa-I do not remember just what the figures were, but the post allowance was substantially equal in amount to the salary. Is that quite generally found?

Mr. CARR. Yes; there are a good many cases of that sort.

Mr. ROGERS. Are there any cases where a man receives any post allowance more than his salary?

Mr. CARR. Not many. I would say, offhand, that there are not any, but I think it may be found that for special reasons, due to special conditions, there may be a few cases. Russia at that time presented a very unique situation.

Mr. ROGERS. Have you any figures there which give us in very general terms the apportionment by countries of the fund that you are now operating under?

161477-20-11

Mr. CARR. I do not know that I can give you the apportionment of countries. I can give you actual allotments made to secretaries in the Diplomatic Service. I would be glad to put that in the record.

Mr. ROGERS. I think we ought to have it.
Mr. SABATH. Together with the salaries.

Apportionment, by countries, of allotment of post allowances to secretaries in the diplomatic service for 1919–20.

Mr. CARR. I will also put into the record, if you please, the entire allotment made to the Consular Service for officers, which was printed in the Senate hearing last year. I can not put into the record the final determination of the allowances to consular officers for the current year, because, as I say, the last year's allotments have not been modified in the matter of exchange. It is in process of being done right now. But you can count on the allotments being reduced from the total sum of $490,000 to $245,000.