SIGNAL SUPPLIES
Signal corps contracts on the day of the armistice were 1,244 in number. They contemplated a production of supplies worth upwards of $45,000,000. Telephones, telegraph equipment, radio, field glasses, photographic cameras, pigeons, wrist watches—these were the sorts of things the Signal Corps procured.
The termination of this industry was guided almost solely by industrial conditions. With most signaling supplies it was impracticable to build up large war reserves. There is perhaps no branch of modern mechanical development to which applied science pays more attention than it does to perfecting the means of communication. Progress is rapid, and therefore any large reserves of supplies set aside by the Signal Corps were likely to become obsolete and without value after a few years. Moreover, although the war industry of the Signal Corps scored its greatest production records with such common things as telephone and telegraph instruments and wire, all this equipment was of special design unknown in ordinary commercial use and therefore without value to it. Consequently there was not the usual good business reason to continue production under the well-advanced signal corps contracts—namely, that a greater cash recovery could be obtained from the sale of finished products than from the junk sale of semi-finished materials. Finally, many of the signal corps supplies—and this applies particularly to radio—were heavily protected by valid patents. These patents the Government made free with during the war, but the existence of the patents virtually precluded the Government from selling its excess radio equipment after the war. For these and other reasons the signal corps war business was terminated at precisely the rate at which the manufacturing equipment and its operatives could be diverted to other work.
Unlike the Ordnance Department and the Air Service, the Signal Corps was not organized before the armistice by manufacturing districts, but conducted all its business from the central office in Washington. The Washington headquarters, however, maintained intimate contact with the contractors through its so-called flying squadron, an organization of officers who visited the war factories, inspected their work, and coöperated with the producers in the solution of their shop problems. This same organization after the armistice conducted the field work of the industrial liquidation, acting under the direction of the Signal Corps Board of Contract Termination, which, in turn, was subsidiary to the War Department Claims Board.
The new and unused materials acquired before the industry could be terminated were disposed of in various ways. Adequate war reserves of supplies were placed in safe storage. During the war the Signal Corps had built up a large training school at Camp Alfred Vail in New Jersey. This camp has been retained as a permanent adjunct to the Signal Corps. To the warehouses of Camp Vail were sent large quantities of surplus signal corps supplies, both finished articles and partially manufactured apparatus, there to be studied and developed in the laboratories of the camp. The Post Office Department took a certain amount of radio telephone and telegraph apparatus for use on its mail planes. The Forest Service took radio and also some of the homing pigeons for use in its fire-protection service in the national forests. Other supplies were sold to the public.
The Signal Corps, as one of its duties, created and compiled a photographic history of America’s participation in the World War, both in motion pictures and in “still” views. The hundreds of thousands of negatives in this history were collected in Washington after the armistice and stored in a specially constructed building which is not only fireproof, but which provides air of uniform temperature and dryness, to prevent rapid deterioration of the negatives. A complete catalogue of views was prepared, and the sale of duplicates to the public was authorized. Many of the illustrations in these volumes are taken from that collection.
The disposal of surplus A. E. F. signaling equipment was notable in that it included a large sale to the French Government of equipment not embraced by the general bulk sale of 1919. When the armistice came the A. E. F. was provided with hundreds of miles of main-line telephone and telegraph cables, hooking up a complete net of branch lines, wires, and exchanges, all of it American-made and American-operated. The question was whether to rip it all out, after which it would be represented by some thousands of tons of junk, or to sell it intact as it was; and there was but one possible customer, the French Government, which monopolizes telegraph and telephone communication in France. Signal corps officers in France took up with the French Government, directly after the armistice, the question of the sale of these installations to France, and the negotiations were so well advanced in the spring of 1919, when the United States Liquidation Commission (which conducted the blanket sale) arrived, that the signal corps sale was specifically exempted from the bulk sale. France paid $6,400,000 for the installations. France and England jointly paid $130,000 for the American cross-Channel cable, laid with great difficulty (and at an approximate cost of $238,000) between Cackmere, England, and Cap d’Antifer, France.[13] Negotiations were also under way for the purchase by the French Government of a large quantity of American wire-system construction material, but this was finally included in the supplies delivered under the terms of the bulk sale. Sales to other governments and to individuals were small.
MOTOR VEHICLES
All of the A. E. F.’s surplus motor vehicles (a classification including bicycles and trailers as well as trucks, automobiles, motorcycles, and sidecars), as this surplus existed in August, 1919, went to the French Government under the terms of the bulk sale. The sale value of these vehicles was estimated by our appraisers at $100,000,000, an estimate arrived at as follows: the original purchase cost had been $310,000,000. Wear and tear, however, had reduced the usable value to the Army to $220,000,000. A second-hand machine, however, must be sold at a second-hand price, which will not represent the value of the machine to the owner disposing of it. A fair second-hand sale value of this equipment (assuming that the vehicles would be sold to private purchasers) was estimated at $132,000,000. But sale in bulk to the French Government relieved the United States of the cost of disposing of the vehicles in various sized lots to private purchasers. It was estimated that the overhead expense of selling the vehicles to individuals would be approximately $32,000,000. As one item in this sales expense, it would require the services of 3,000 troops for one year to take care of the unsold vehicles. In that interval there would be a further depreciation in the value of the vehicles. Therefore, the A. E. F. was willing to throw off $32,000,000 and make to the French Government a flat price of $100,000,000 for the equipment.
Before this sale, however, there had been sales to others, both governments and speculators. The Poles and some of the new Slavic nations bought nearly 3,000 vehicles from the A. E. F. American motor vehicles in England (they were not many) were sold at auction. The Italian Government bought about 200 trucks, ambulances, and motorcycles. As our troops were demobilized from the Army of Occupation in Germany, they left a surplus of over 14,000 motor vehicles. These were sold to a British syndicate for $25,000,000. Over 1,200 trucks of German make, acquired by the A. E. F. under the armistice terms, were sold to a German dealer.
Photo from Engineer Department
AIR VIEW OF A. E. F. ORDNANCE DOCKS
Photo by Air Service
A GAS DEMONSTRATION
The war orders for motor vehicles (including bicycles and trailers) of all sorts from American factories called for the production of 434,000 of them. Of this number approximately 110,000 were bicycles and trailers, the rest being motor vehicles proper. The war industry had produced great numbers of these vehicles before the armistice, 118,000 having been shipped to the A. E. F., while thousands of others were either in use by the Army within the United States or were awaiting shipment overseas on the day of the armistice. By the fourth day of the armistice, termination requests had stopped the production of 178,000 vehicles under the war orders. The rest were allowed to go through to completion. Adding to the reserves on hand at the signing of the armistice the production after the armistice, we find that the results of the war industry were to provide the Army in this country with 138,000 motor vehicles, none of which had crossed the ocean.
Photo by Signal Corps
MOTOR TRANSPORT IN FRANCE
Photo by Signal Corps
PART OF A. E. F.’S SURPLUS MOTOR EQUIPMENT
The continuation of production after the armistice was allowed for numerous reasons. A motor truck is an article readily salable at a good price. Its fabricated parts, however, have little value other than that of scrap metal. Moreover, to permit the completion of contracts saved the Government from the payment of cancellation charges. For example, as a result of these business considerations one order for 8,000 Standard B trucks, under which order production had started about November 1, 1918, was allowed to go through to completion. The Standard B truck was an assemblage of standard parts. Many factories made the parts, and a few, under contract with the Government, assembled the parts and turned out the completed chassis. To have terminated the contracts would have left on the Government’s hands a mass of parts of doubtful sales value and an obligation to pay heavy cancellation charges besides. The completed trucks could be sold for nearly all, if not all, the money the Government had put into them. The same was true of some of the other standardized trucks.
Production was continued in some instances to place in the Army’s hands certain sorts of trucks of which the Army was short even after the great production ending with the armistice. Finally, many of the truck factories were working exclusively on government contracts, and to have ended this work forthwith would have thrown tens of thousands of men out of work. It is notable, however, that two of the largest contractors, the Ford Motor Company and the Dodge Motor Company, both of Detroit, agreed to accept termination of all work uncompleted on November 16, 1918, at no cost to the Government except the cost of uncompleted materials which they would be unable to use in their commercial enterprises.
The whole vast war business of building motor vehicles for the Army was terminated at a cost of $12,300,000 to the Government. As an offset to this cost, the Government took in materials worth $4,100,000, making the net cost of termination about $8,200,000.