PART I ORGANIZING THE FORCE AND EMERGENCY METHODS (continued 3)
Reading edition
The last report of the Department of Bills and Demands dated March 16, 1907, gives the following figures:
TABLE 27.—DISPOSAL OF CLAIMS ACTED UPON BY THE DEPARTMENT OF BILLS AND DEMANDS, TO MARCH 16, 1907
Disposal of claims CLAIMS PRESENTED
Number Amount claimed
Claims rejected as a whole 1,164 $451,369.59
Claims cancelled, withdrawn, etc. 101 13,269.54
Claims donated 18 10,528.20
Claims approved in whole or in part 9,669 2,242,003.00
Total 10,952 $2,717,170.33
TABLE 28.—PAYMENTS UPON CLAIMS ACTED UPON BY THE DEPARTMENT OF BILLS AND DEMANDS, TO MARCH 16, 1907
Disposal of claims CLAIMS PRESENTED PAYMENTS MADE
Number Amount claimed Amount Per cent of amount claimed
Claims approved in whole or in part 9,669 $2,242,003.00 $1,501,781.52 67.0
All claims 10,952 2,717,170.33 1,501,781.52 55.3
After March 16, 1907, a few long pending and new claims were paid. Some law suits had been settled, and a few were still pending against the Corporation when this report was prepared.
It thus appears that the trustees of the relief funds paid over a million and a half dollars for expenditures, many of which they had not authorized and were unable to control. They tried to pay only such part of the claims as represented supplies and service used in relief work. Just claims were cut down as a rule, so that a comparatively small number of claims were paid in full.
In deciding the merits of claims the supervising and judicial committees appointed sub-committees of experienced men to supplement their own technical knowledge. Many claims for liquor destroyed by soldiers and citizens were presented, but the Finance Committee decided to pay no liquor claims. The enormous disbursements for automobile service and for transportation of supplies were made chiefly in payment of emergency claims. Claims of various sorts were paid by the War Department out of the Congressional appropriation of $2,500,000. Other claims were paid by the state. As the Relief Corporation could get no information about such claims it is possible that there were duplicate payments.
2. SYSTEM OF ACCOUNTING—A NOTE
The accounting system of the Relief and Red Cross Funds has been criticized because it did not readily yield information as to the amounts expended for various purposes, and because it was complicated. The first seems a fair criticism, for contributors to funds and the public in general are more interested in the cost of various forms of relief than in the state of the appropriations. The system of appropriations to the departments for different purposes was based on carefully prepared budgets. It was good for controlling expenditures and for keeping a check on departments and bureaus. For those not directly connected with the work, additional information in simple form might easily have been given. The intricacy of the accounting, however, seems justified by the results. It was devised to make the handling of the money as secure as possible. So far as the local auditors and the auditor of the War Department have been able to discover there was only one transaction that looked like misappropriation of money. About $1,000 received by a camp employe from certain authorized sales was for a short time kept back. The apparent shortage, easily detected by the accounting department, was made good.
Considering the extraordinary conditions under which the work was organized, such a showing is remarkable. When men undertake the thankless task of handling a large relief fund, if they have a keen sense of responsibility and a realization of the difficulties ahead they will wish to disburse the fund through a system which is as safe as possible. It is worth while for them not only to prevent misappropriation but even the appearance of it. The employes of such a committee will find satisfaction, when accused of graft and stealing,—an accusation suffered many times by the San Francisco workers,—in showing their accusers just how the money is guarded and that it is impossible for them to steal. A system that insures such security is worth the extra cost.
3. THE CONTROL OF DONATIONS
As a result, primarily, of the publication of sensational stories in the press of the country, the plans of the Corporation were at times seriously embarrassed by the withholding of funds by eastern committees and by the possible danger of those funds being dispensed by independent agencies.
The studies in rehabilitation show that the suspension of grants on August 20, 1906, the period of arrested progress, had a serious effect upon the rehabilitation work. It caused a change of relief policy so that families given grants in one period were treated differently from those in another. It meant for many families a long wait from August 20 to the middle of October when the embargo was lifted. The Corporation had worked out a wise, comprehensive program on the basis of estimated income and then suddenly had to question whether the income might not be $3,000,000 less. Inevitably every department suffered from uncertainty and hesitation. The results of such an intolerable condition were more clearly perceived in rehabilitation than in the other work, but what the withholding of funds meant in reduced efficiency would be hard to estimate.
The two most important funds, those of Massachusetts and the New York Chamber of Commerce,[94] were eventually transferred, the latter with the restriction that it be used for business rehabilitation. Only a number of small funds were permanently held, but the harm was done. The warning should be heeded in future disasters. It is possible for a relief committee, when its work is hardest, to be tied up because of a few newspaper stories which may or may not have foundation in fact.
The investigator sent by the Massachusetts committee because of the newspaper stories, after investigation cordially endorsed the work of the Relief Corporation and made but few criticisms.
What is the remedy? It cannot be too plainly stated that there must be only one relief committee or corporation.[95] There must be no division of responsibility for distribution. If there must be reform it must be within the relief corporation itself. If one of the eastern committees in command of large funds had set up its own agency in San Francisco, it would have been guilty of improper trusteeship. That much is evident. The suggestion has been made that the committees in charge of the larger funds should each have had a representative on the Finance Committee. Mr. Bicknell, for instance, came first to San Francisco as the representative of the Chicago Commercial Association and the Mayor’s committee funds. But such representation would not include the smaller fund committees. A more inclusive plan is desirable. The gradual strengthening of the American National Red Cross seems to point the way. The Red Cross should become so fully recognized as the national agency for all disaster funds that it should eventually, in any given case, receive all funds not sent directly to a local committee. Its relation to local committees will be strengthened and it can be relied upon to suggest and whenever necessary push changes in relief measures. In San Francisco and each subsequent disaster of any proportions, the American National Red Cross has been represented by its expert agents. Its strength has been materially increased by the appointment of a permanent director. The withholding of funds once subscribed for a particular disaster should become an impossibility as the status of the national agent is recognized.
We have alluded to one form of restriction, that of requiring that a specified fund be used for a specified form of rehabilitation. Such restriction must of course be accepted after an effort has been made, and has failed, to persuade the forwarding committee to lift the restriction. But restrictions upon relief in kind are doubly dangerous and ill-advised. In the San Francisco disaster the “flour” episode gives an apt illustration. Certain forms of food were donated in quantities in excess of the needs. These were flour, potatoes, and condensed milk, all three of them valuable forms of food in an emergency. The potatoes, as it was the end of the season, did not keep well in large masses and the refugees, living in tents or in basements or attics, had little room for storage. Besides, the universal practice in San Francisco and the vicinity where fresh vegetables can be bought the year round, is to buy in small quantities from day to day or week to week and not store in the fall for winter use. The Finance Committee, unable to dispose of the potatoes to refugees, decided to sell the surplus stock. The sale does not appear to have been made, perhaps because they were unsaleable. At any rate large quantities spoiled and had to be thrown away.
It was natural to think that condensed and evaporated milk would be necessities of prime importance. They were valuable, but on account of local conditions were not needed in great quantities. The supply of milk from the ranches outside the city was not much diminished by the earthquake. By confiscation and by arrangement with dealers an abundant supply of fresh milk was secured for distribution to the refugees.
Many committees throughout the country sent flour as the most useful form of food. It came so fast that for lack of warehouses in which to store it (practically all city warehouses having been burned) part of it was put aboard three transports and in the army warehouses, and finally a vast quantity was stacked up in the open air. The transports were not adapted to preserving flour in good condition so they could not long be used as storehouses. The Finance Committee, confronted by the problem of finding storage for the vast supply received, and knowing that it was several times as much as could be reasonably distributed, decided on May 17 to sell 4,000,000 pounds. This was vigorously objected to by the Minneapolis committee which had sent 15 per cent of the 16,000,000 pounds received. It insisted that its flour should be distributed,—the very flour sent, not flour purchased later with cash from the sale of Minneapolis flour. This episode led to newspaper publicity and protests. The lesson is, that restrictions upon relief in kind are unsatisfactory and embarrassing and should always be placed upon a discretionary basis. The Minneapolis committee claimed that title to its flour had been transferred to the destitute of San Francisco, not to the Red Cross or to the Finance Committee, who were apparently to be considered solely as the servants of distribution. The position is an impossible one in which to place a self-respecting committee.
Many donors of money gave specific directions as to the use to which they wished it put. There was the man who sent $1.00 with a request to hand it to some worthy sufferer and let him report to the donor; and there was the refugee who, after he had found employment elsewhere, sent a small sum, more than enough to pay for the three days’ rations he had received in the bread line, with the request that the balance be given to a soldier who had been kind to him. Jewelers sent money for jewelers, artists for artists, teachers for teachers, physicians for physicians, the people of one town for their fellow townsmen in San Francisco.
Money was also sent to individuals connected with the relief funds to be applied to specific purposes. Fortunately, there were enough unrestricted funds available to assist all classes and carry out the intent of all donors. It was not necessary to open a special account for each of these trusts.
No actual restriction as to the purpose of expenditure, imposed either by donors directly or by the custodians of large funds, was in itself onerous to the relief authorities, but the circumstances attendant upon the remittance of restricted funds caused more or less embarrassment during nearly the whole period of the relief work.