Mr. HOUGHTON. I mean you have a total here of $775,000 which ought to be $781,000.

Mr. ROGERS. Yes.

Mr. CONNALLY. I notice, Mr. Carr, that you have placed the ministers to Czechoslovakia and Poland in the $15,000 class; and yet I notice further down that Sweden, for instance, is only in the $12,000 class. Is that not a little out of proportion?

Mr. CARR. That was done under this theory, Mr. Connally: We took all of those ministers who were receiving salaries of $12,000 and raised them to $15,000 without making any rearrangement; and we took all of those ministers who were receiving $10,000 and raised them to $12,000 under these estimates. We did not undertake to rearrange or change the relative rank in respect to salaries.

Mr. CONNALLY. I know; that is all right; but then Czechoslovakia and Poland had no ministers. Were they classified?

Mr. CARR. Yes; they were classified; they have a salary of $12,000 each.

Mr. CONNALLY. They have? I did not know that.

Mr. CARR. Yes; it was the salary fixed by Congress.

Mr. HOUGHTON. When was it fixed?

Mr. CARR. It was fixed by Congress last year.

Mr. CONNALLY. I did not know that.

Mr. CARR. So that we did not undertake to change anything that Congress had finally passed upon, except by raising each of the salaries

Mr. HOUGHTON (interposing). Let me ask you, is there any reason why the ministers in Poland and Czechoslovakia should receive a higher rate than Sweden, or various other countries?

Mr. CARR. Personally, I do not think so. Personally, I think Sweden and Denmark ought to receive as much as Czechoslovakia; I think they ought to receive as much as Cuba, for example. Mr. HOUGHTON. Yes; one would think so.

Mr. CARR. Yes. I think there is a good deal left to be desired in the classification of those missions.

Mr. CONNALLY. That is what prompted my question.

Mr. CARR. The reclassification of the salaries of ministers, plus the appropriation of a local allowance, or post allowance, to adjust the particular salaries to the particular localities, would be the ideal way of arranging it. Then, for example, if you had a $15,000 salary in one place and you wanted to send him to another place where living expenses were, perhaps, 25 or 50 per cent more, you could send him there with ease, merely increasing the local allowance, which he would have so long as he remained in that place, to be discontinued, or, rather, readjusted as soon as he left the place. That is the simplest and most effective way of adjusting grade salaries to localities.

Mr. HOUGHTON. Is that method followed by other nations?

Mr. CARR. Yes. The Government which did that most conspicously, perhaps, was the German Government before the war. The German Government paid a very small grade salary, and the reason t paid a very small grade salary was that it had a retirement penion based upon the grade salary. So it gave all of its officials rather mall salaries, in comparison with ours, but fixed a local allowance or each post in the service, based upon the relative cost of living, or

the amount or kind of representation which it desired in that particular place the total of which was considerably in excess of the salaries paid by the United States. For instance, I have known of cases in the consular service where the salary of a consul general was, perhaps, $2,500 a year, but the local allowance might be $5,000; and again, that $2,500 man would go to New York as consul general and receive a local allowance of, perhaps, $10,000.

Mr. HOUGHTON. Yes. That means a large undistributed total at the disposition of the department, does it not?

Mr. CARR. Either at the disposition of the department or revised in detail each year by Congress.

The CHAIRMAN. Would there be any objection in your mind to the raising of Sweden, Norway, and Switzerland to the $12,000 class and putting Czechoslovakia and Poland in the $10,000 class?

Mr. CARR. I think it would be unfortunate to reduce any one of those.

Mr. ROGERS. This is not a reduction, is it, Mr. Carr?

The CHAIRMAN. It is not a reduction.

Mr. CARR. Do you mean in the revision of this?

The CHAIRMAN. I did not understand. I do not know. My idea is that Sweden and Norway, and Switzerland should have the same representation as China and Cuba.

Mr. ROGERS. How about Greece and Portugal and Denmark? they not first-rate secondary powers?

Are

Mr. CARR. Denmark certainly ought to be in the same class as Sweden.

The CHAIRMAN. Well, that is true.

Mr. TEMPLE. I would put Denmark and Sweden in a better class than Cuba.

The CHAIRMAN. Yes; it would seem so.

Mr. CARR. There is a reason for Cuba's position in the first class: At the time the minister to Cuba was given that salary I think the United States wanted to put the Cuban mission on just about as high a plane as it could, without being entirely out of proportion to the others, because of our special relation to Cuba.

Mr. TEMPLE. The American minister in Cuba is now getting $10,000, is he?

Mr. CARR. He is now getting $12,000.

Mr. TEMPLE. And the proposal is to make it $15,000?

Mr. CARR. Yes.

Mr. TEMPLE. Would there be any reason for increasing it from $12,000. Or would it be considered a humiliation if we left it at $12,000 and did not raise it?

Mr. CARR. Of course, you have a good reason for not raising it, and that is that the Government owns its legation in Cuba and does not own buildings in these other countries, except China. So there is that reason for not raising the salary of the minister to Cuba.

Mr. TEMPLE. If we just left it where it is, would that have the bad effect that it would have if we reduced the salary?

Mr. CARR. No; I think not.

Mr. ROGERS. But the fundamental point is that we are creating two classes, and the question is whether a given country is in class 1 or class 2. Now, Cuba has always been in the preferred class of ministers. However you may disguise the fact, the change which

you propose would leave it in the second class, and I think Cuba would resent that.

Mr. TEMPLE. Well, that is worth considering, of course.

Mr. DICKINSON. What is your opinion, Mr. Carr, on the elimination of Turkey from the first division?

Mr. CARR. I personally do not think-and I believe that is the view of the department-that there should be any positive action with regard to the grade of the missions to Turkey, Germany, or Austria until there is reached a definite settlement in regard to those countries. We do not know at the present time whether the wise thing will be to have an embassy in Vienna or not. We all think it will not be wise. to have an embassy or will not be necessary to have an embassy at Vienna; but if we take any positive step now we act upon the question in advance of our possession of the facts on which to take intelligent and final action. And it would be susceptible of misinterpretation. I think it would be wiser not to do anything now

Mr. LINTHICUM. Why do you doubt the wisdom of having an embassy in Vienna?

Mr. CARR. Because if the treaty should go through as it now stands Austria will be so reduced in size and importance as to make it unnecessary to have a diplomatic representative of the grade of ambassador there.

Mr. LINTHICUM. What would be the population there-about 4,000,000 or 5,000,000?

Mr. CARR. I could not tell you; it would be very small in comparison with what it was and the diplomatic mission would be reduced in importance.

Mr. LINTHICUM. You have embassies in Norway and Sweden and those countries, have you not?

Mr. CARR. No; only legations.

Mr. LINTHICUM. Just a minister?

Mr. CARR. Yes.

Mr. LINTHICUM. And that is what you think, it would be better to have it at Vienna?

Mr. CARR. Well, I think probably that will be the ultimate outcome; but I do not believe we are in a position yet to say what we ought to have.

Mr. TEMPLE. There is nothing in the bill about Hungary, is there?

Mr. CARR. Nothing at all; there has been no determination of our proper relation to that country.

The CHAIRMAN. From the standpoint of the department, there would be no objection to a rearrangement of this classification, would

there?

Mr. CARR. I do not think so.

The CHAIRMAN. Personally, I do not think Czechoslovakia

Mr. CARR (interposing). So long as you do not reduce the grade of a mission. Other countries are very quick to take offense at that sort of thing.

The CHAIRMAN. Well, my idea would not be to reduce any, but to take Czechoslovakia and Poland out of class 1 and put them in class 2.

Mr. CARR. If you increase the salaries in the bill?

161477-20-6

The CHAIRMAN. Well, whether we do or not.

Mr. CARR. This reclassification is based upon the theory that you are going to increase the salaries of class 1 from $12,000 to $15,000. Now, Czechoslovakia and Poland are in the $12,000 class. I think it would be unfortunate to reduce them to $10,000.

Mr. HOUGHTON. But you do not have to.

Mr. CARR. But I think it might not be unfortunate if you should leave them at $12,000, and raise some of the others to $15,000.

Mr. HOUGHTON. Your proposition is to raise all these second-rate ministers to $12,000?

Mr. CARR. Quite so.

Mr. HOUGHTON. Now, if Czechoslovakia and Poland were left at $12,000, they would be in a class lower than they are now. Is there any political reason why that should not be done?

Mr. CARR. I do not think so.

Mr. HOUGHTON. Then, why do you leave them in class 1 at $3,000 additional?

Mr. CARR., Merely because we did not attempt to reclassify what Congress had already classified. Congress had already placed them in class 1; so, regardless of the salary, we did not undertake to place them in another class.

Mr. HOUGHTON. Is there any political motive back of this classification, or is it based largely on the work to be done in the officeoutside of Cuba?

Mr. CARR. I think the same reasons that apply to Cuba apply, to a certain extent, with regard to China.

Mr. HOUGHTON. Well, China, of course, is a special case.

Mr. CARR. But with reference to Czechoslovakia and Poland, there was no political reason whatsoever.

Mr. HOUGHTON. And the Netherlands and Luxemburg?

Mr. CARR. As to the Netherlands and Luxemburg, I do not think at the time it was done there was any special political reason. I am inclined to think, in reference to the Netherlands, that the department would now take the view that it would be wise to keep it in the first class, because of the particular relation of the Netherlands to the various international undertakings with which it is so closely identified.

Mr. HOUGHTON. That is a good reason.

Mr. CARR. And being the seat of the Peace Palace, and so on, I think the department would probably take the position that the Netherlands ought to be in class 1.

Mr. TEMPLE. Might there not be political reasons-that is, reasons of policy-in the case of Poland?

Mr. CARR. It is very easy to believe that there might be. But I may say that at the time the salaries were estimated for I think the department had no political reason in mind for placing them in the $12,000 or the $10,000 class. It was thought that, as the ministers were all underpaid, it was better to estimate for the two new ones in the higher class than in the lower one, and thus get more salary for them.

Mr. TEMPLE. Poland is going to be a very important barrierMr. CARR (interposing). No one can say quite how important Poland is going to be. If the Government stands, as we hope it will, it is likely to be of tremendous importance.

SECRETARIES IN THE DIPLOMATIC SERVICE.

The CHAIRMAN. Mr. Rogers, you wanted to ask something about the salaries on page 4 of the bill, did you not?

Mr. ROGERS. Yes. As as a foundation for my inquiries, I should like to ask Mr. Carr to put in the record a table showing the number of secretaries in each class proposed under the new appropriation; the salaries and the totals.

Mr. CARR. Yes, sir; I shall be glad to do so. posed under the new appropriation "?

You said "pro

Mr. ROGERS. Yes; that is, break up that $486,500 appropriation so that the committee will see what use you propose to make of it. Mr. CARR. We propose to put in class 1, at $6,000, 20 secretaries; that is a total of $120,000. În class 2, at $4,000, we propose to put 27 secretaries, at a total cost of $108,000. In class 3, at $3,000, 41 secretaries, at a total cost of $123,000. In class 4, at $2,500, 47 secretaries, at a total cost of $117,500. That is, the numbers are distributed in exact accordance with the present classification, the salaries merely being raised.

Mr. ROGERS. Well, that, as I understand it, totals 135 secretaries. Mr. CARR. That totals 135 secretaries exactly.

Mr. ROGERS. In order for you to increase the number of secretaries, do you have to have a specific authorization from Congress, or do you assume that the grant of a certain sum of money constitutes the authorization?

Mr. CARR. Congress has pursued a policy for a number of years of classifying the secretaries-that is to say, of classifying salaries of secretaries and of appropriating in a lump sum, to be distributed according to that classification, but without specifying how many secretaries there should be in a given class. So that the department has pursued a policy of determining for itself, consistent with the appropriation, the number of secretaries that should be in each salary class.

Mr. ROGERS. Well, if the department desired, it would be able to appoint 75 secretaries of class 1, at $6,000, and no secretaries of classes 2, 3, and 4?

Mr. CARR. That is true, but always subject to the consent of the Senate and subsequent review by the House.

Mr. ROGERS. I mean approximately that, because 75 secretaries at $6,000 would be within the appropriation of $486,500.

I notice that in the hearings for last year, you stated in a table which appears on page 47 of those hearings, that there were then 88 secretaries, divided up as follows: 16 of class 1, 16 of class 2, 36 of class 3, and 20 of class 4. And you estimated for the ensuing period a total of 110 secretaries, divided up as follows: 16 of class 1, which was the old figure; 25 of class 2, as against 16; 44 of class 3, as against 36; and 25 of class 4, as against 20. In other words, you contemplated an increase of 22 secretaries.

Mr. CARR. Yes.

Mr. ROGERS. Now, as far as I can see, without any way for the committee to arrive at that, except by deduction and questioning, you propose to increase the number from 110 to 135; and the department has carte blanche in deciding whether you shall have 75 secretaries