EVERYTHING that Germany did during the peace negotiations showed what her subsequent acts, since the Treaty entered into effect, have overwhelmingly proved: her determination not to pay. This determination is a settled policy, it is the policy of business, Germany striving to snatch economic victory from military defeat.

This ambitious aspiration has its origin in the situation created by the war. On the one hand, victorious countries invaded, indebted and systematically ruined by the German invasion; on the other, Germany beaten but untouched, with an insignificant foreign debt, all her factories sound, her industry developed by the war itself. If victors and vanquished renew commercial competition at the same time and on equal terms, the triumph of Germany is assured. This is what the peace-makers at Versailles tried to avert: hence some of the reparations clauses; hence the general mortgages taken on the financial resources of Germany; hence certain non-reciprocal clauses concerning customs for five years; hence the obligation imposed upon the beaten foe to deliver up raw materials; hence the power of supervision given to the Reparations Commission over Germany's economic and financial life. These are the clause's which German business men, headed by Herr Hugo Stinnes, have determined to overthrow.

These captains of German industry know better than anyone that the state of German industry is not that described in their newspapers. They know that in many branches---automobiles, for example---German industry has since 1915 increased its capital by hundreds of millions

They know that in the month of March, 1920, alone, financial melons were cut to the amount of 163 million marks; that at the same time the munition factories distributed dividends of from twelve to sixteen per cent. They know that Germany is not suffering as much as France from lack of coal, either for industrial or domestic consumption, and that in Germany the production of pig iron in 1920 amounted to one-half the 1913 output, while in France it amounted to scarcely one-fourth. But they know also that if Germany does not supply France during the next few years with the amount of coal she owes under the Treaty, French industry will not recover and will be outstripped by German industry. They know that, if the damage done to persons and property is not paid for by Germany in accordance with the Treaty, the French budget, heavily overburdened, will not be able to devote to the development of our national resources the means which circumstances call for and which Germany dreads. That is why by every possible means they strive to keep for an unhampered Germany, the means of economic supremacy which the Treaty makers at Versailles have rightly handicapped.

Their aim is clear; their method simple. With tearful pathos Germany is alleged to be incapable of working and producing. To make believe a few factories are closed here and there---sometimes in so obviously an arbitrary manner that protests are elicited, even from the German Press. Out-of-employment crises are trumpetted abroad. Europe is threatened with Bolshevism. Active propaganda is conducted in foreign countries; Germany is gaining time. She is reorganizing. She is getting ready and to-morrow, if the Allies allow themselves to be duped by this camouflage, Germany, freed from supervision, mistress of her raw materials, rid on easy terms of her heavy debt, will again go forth to conquer the markets of the world with all the inestimable advantage of untouched means and hampered competitors. Meanwhile it is asserted that to pay in gold, exports are essential and that as Germany consumes more than she produces, exports are impossible.. This plea, which blossomed in 1920, was that of the German technical experts in 1919, when summoned to the Château de Villette and to Versailles. If the Allied Governments had entertained it, they would not only have betrayed the sacred interest of their respective peoples; they would have been victims of a colossal hoax.

The wealth of Germany was before the war a favourite theme of German propaganda. The reader will remember Helfferich's book in which he estimated at 10,000 million marks Germany's annual excess of production (43,000 million marks) over her consumption (33,000 million marks.) Other authors went still further. Alfred Lansburg reckoned the consumption at 40,000 or 45,000 millions. Steinmann-Bucher calculated production as amounting to 45,000 or 50,000 millions, the consumption as 35,000 millions, and the surplus at 12,000 or 15,000 millions. Figures of such magnitude are necessarily approximate only, but even with this reservation they are useful as indications and it is as such and as such only that I quote them. Now the war is over and peace is declared, what has become of the elements of these statistics! Germany like all the belligerents saw her productive capacity lessened by the war. Having been beaten she has seen it still further lessened by the Treaty of Peace. What does the reduction---to which Lord Cunliffe, as we have seen, refused to attach undue importance---amount to?

Germany lost during the war a part of her human capital: 1,800,000 killed and 4,000,000 wounded. The percentage of invalidity of the wounded is generally reckoned at between thirty-three per cent. and forty per cent., so the total loss of available labour would be equal to the work of three to three and one-half million men. But it is a matter of common knowledge that the employment of women and children has greatly increased and the military clauses of the Treaty (100,000 soldiers instead of 880,000) leave a large number of men available for agricultural and industrial work; furthermore the increment of population in Germany should also be taken into consideration. From

1895 to 1907, the yearly increment amounted to 774,000, of which the "active" population represented 500,000, or roughly sixty-five per cent. of the total. Even after deducting from future estimates the territories which Germany has lost by the Treaty of Peace, the fact remains that the decrease in her man power will not be felt to any considerable extent. No allowance need, therefore, be made on this score.

On the other hand there has been loss of territory. The German Empire, built up by might, has been reduced by right. It has lost Alsace and Lorraine, the greater portion of its Eastern Polish provinces and Schleswig,---say, in round figures, a population of eight million inhabitants, or, in other words, about one-eighth of the total population according to the census of 1910. As the lost territories, according to their contributions to public expenditure, appear to be of average wealth, it may be deduced that the territorial clauses of the Treaty of Peace have reduced the productive power of Germany to the extent roughly speaking of one-eighth, or 43,000 millions divided by eight: 5,375 millions. To purely German losses must be added German colonial losses. We shall make ample allowance for the latter by taking them to represent a yearly output loss equal to 125 millions, which would bring the total reduction of Germany's productive capacity, directly due to the territorial clauses in the Treaty of Peace, to about 5,500 millions.

German capital has, also, suffered in others ways. In the first place by the reduction of assets in foreign countries. Personal property to the amount of about 5,000 millions has been realized. Property sequestrated by the Allied and Associated Governments amounts to between 11,000 and 13,000 millions; loans in foreign countries 2,000 millions, or say a (maximum) total of 20,000 millions. Loans granted by Germany to her Allies (10,000 or 12,000 millions) should not be deducted from this loss, inasmuch as Article 261 of the Treaty transfers them to the Allies.

The reduction of capital under the head of assets in foreign countries, thus amounts to 20,000 millions. To these 20,000 millions must be added certain losses which can be readily calculated, viz.: stocks which have disappeared, 20,000 millions; damage caused by the Russian invasion in Eastern Prussia 2,000 millions; lastly, according to the terms of Article 235, Germany is to deliver to the Allies before May 19 1921, either in cash or in kind (gold, ships, liquidation of German investments in foreign countries, cattle, machinery and tool equipment, cables, etc.), 20,000 millions marks gold. These four items, added together, show a capital loss of 62,000 millions.

We now come to another item which is more difficult to estimate: capital loss by lack of maintenance. Some of this went to feeding the people---cattle, for instance---or to war manufactures-as in the case of copper. How can this loss be expressed in figures? German capital was estimated by Helfferich (whose figures I take because, as they are lower than Steinmann-Bucher's, they are less favourable to my argument) at 330,000 million marks. What does capital loss by lack of maintenance of deterioration amount to?

If we deduct urban sites (25 to 30,000 millions) which call for neither upkeep nor amortization; then the amounts of capital we have already reckoned as definitively lost, there remains a maximum of 200,000 millions on which loss owing to depreciation, etc., may be calculated; let us take this depreciation at five per cent. per annum for four years and four months, say 43,000 millions. This is a liberal estimate. For on the one hand, rural lands and house property have certainly not suffered---one need only make a trip to Germany to ascertain this---a depreciation of five per cent. per annum; and, in the second place, new industrial constructions compensate, to a great extent, the depreciation of old ones. If to such depreciation be added to other capital loss the total amounts to (62,000+43,000=) 105,000 millions. I do not think this figure can be criticized, especially as it exceeds the figures furnished by the Germans themselves---by Lansburg, for instance, who, for the first two years of war estimated the total reduction of national capital at only 28,000 millions. As the average net revenue of German capital (according to the balance sheet of industrial, agricultural and landed property) has generally been reckoned at six per cent., the yearly decrease of productive capacity, corresponding to this loss of 105,000 'millions in capital, amounts to 6,300 millions. By adding together this decrease of revenue and that chargeable to losses of territory, the total obtained is 11,800 millions, as shown in the following:

............Diminution of Productive Capacity (in millions of marks)........
From losses of territories 5,500
Revenue on capital loss of 105,000 millions as under 6,300
Assets in foreign countries 20,000
Exhausted stocks 20,000
Damage caused by war 2,000
Immediate payments 20,000
Depreciation and lack of Up-keep 43,000
Total 11,800

Based on German statistics and on the statistics most favourable to Germany, this table would indicate Germany's productive capacity as equal to 31,200 million marks, instead of 43,000 millions before the war. It is this or an approaching figure that the Germans take as a basis for their assertion that as their output will now forth be less than their consumption, 33,000 millions, they are unable to export anything and therefore cannot pay for anything in gold. But it is here that the fallacy is clearly shown. For if the war and the conditions of peace have reduced the productive capacity of Germany, they have likewise reduced its consumption, and it is precisely by German statistics that such a reduction can be proved.

Taking no account, as in the preceding chapter, of losses in men, we shall first bear in mind that losses of territories represent one-eighth of the population and, consequently, of the consumption---that is to say in round figures 33,000 millions divided by eight or 4,120 millions. But this is not the only decrease, there remains another to be considered which, though more difficult to estimate, is nevertheless certain; that caused by the reduction in standard of living.

In this connection, German economists are unanimous. Lansburg calculates this reduction at one-third of the consumption which as already stated, he reckons at 40,000 to 45,000 millions; it would therefore be something between 13,000 and 15,000 millions. On the other hand, the success of the war loans (151,000 millions) and the increase of deposits, both in savings-banks (15,000 millions) and in current accounts (13,500 millions) besides the capital increases of companies show us that the German people contrived to save 180,000 millions in four years, or say about 45,000 millions yearly. These figures are doubtless subject to certain reservations. There has been a rise in prices. There has been a considerable increase of currency circulation. The fact nevertheless remains that there has been a decrease in consumption. At what amount should it be estimated? Lansburg calculated it between 13,000 and 15,000 millions. In order to be extremely conservative, I will reckon it at 6,000 millions. These 6,000 millions, added to the 4,120 millions chargeable to loss of territories, give a minimum total of 10,120 millions, which reduces the consumption amounting to 33,000 millions before the war, to 21,880 millions, after the declaration of peace.

We are now in possession of two very important factors (both bases for calculations.) The productive capacity would seem to have been reduced, by the war and by the peace, from 43,000 millions to 31,200 millions. The consumption on the other hand would seem to have been reduced from thirty-three billions to twenty-one billions, 880 millions. The surplus which amounted to 10,000 millions before the war appears to be 8,320 millions since peace. For the sake of greater clearness, I give a synopsis of the foregoing analysis in the following table:

These figures are significant in themselves, but they do not tell the whole truth for the two following reasons. Firstly, because the foregoing calculations, based on German statistics, have been worked out in marks and the surplus amounts, which they show, represent surplus quantities of products. To reckon these surplus amounts at their real value, the increase in the price of such products in gold must therefore be added. The second reason was made remarkably clear by Lord Cunliffe, Governor of the Bank of England, in the report submitted by him in the name of the sub-commission of the Peace Conference appointed to investigate Germany's capacity to pay. Lord Cunliffe therein stated: "Germany, responsible for the destruction caused by the war, must impose upon herself restrictions in order to repair it. She must by such restrictions maintain herself as an exporting country to meet the payment of her reparation debts." What does this mean except that---for so long as her debt remains unpaid---it is but right and necessary that Germany should stint herself in order to export, or in other words, to pay? A single example. On Sundays there are more suburban trains running from Berlin than from Paris. This state of things should be entirely reversed. The quantity of coal available for export---that is to say, one means of effecting payment, ---would be thereby increased by just that much. Similar abuses---which the Reparation Commission would strictly forbid if it closely supervised the economic life of Germany---are noticeable in all directions.

Remember also that in May, 1920, the exports of Germany exceeded her imports. And then notice that on every page of the German newspapers there are signs of an industrial and commercial revival to which the advertisements, if no other proof were forthcoming, would testify. Everywhere there are advertisements for managers, department heads, travellers, engineers. Everywhere there are advertisements for goods, motors, glass, machinery, tires, trucks. The business advertising of the Frankfurter Zeitung is double what it was before the war. Business which was slack during the year that followed the Armistice, is reviving from one end of Germany to the other. The increase of output leaves no room for doubt. Restrictions are at present dependent upon the will of the consumer. Germany now has in hand and will continue to have in increasing degree the necessary means for the payment that she must make. The picture she drew of her position at the International Conferences of Spa and Brussels is a camouflage. It is the duty of the Allies to re-establish the truth.

What conclusion are we to draw? I do not profess to be a political economist. When I quote statistics, I put forward no claim to infallibility of interpretation, indeed I am the first to call attention to the co-efficient of error they may contain. I say only that when a man goes so far as to assert that Germany cannot pay in thirty years more than 2,000,000,000 pounds (50,000 million francs at par, or 120,000 million francs at the highest 1920 exchange) he oversteps the limits of permissible tomfoolery and is only making fun of Germany's victims. The war cost the Allies 1,000,000 millions. Mr. Keynes would ask Germany to pay only 50,000 millions, or one-twentieth of the total cost. Count Brockdorff offered twice as much. That alone condemns the pro-German scribe of Cambridge. As to M. Helfferich, busy in 1920 controverting the statistics he himself published in 1913, he does not deserve that one should pay attention to his contradictory denials. I do not know and nobody knows what Germany will be able to pay in each of the thirty or forty years that are to come. It is the duty of the Reparations Commission to fix the amount every year. But even now it is permissible to assert that in thirty or forty years Germany, which alone of all the European belligerents comes out of the war without any foreign debt, will be able approximately to pay enough (interest and sinking fund included) to about cover the actual amount of damages to persons and property and of pensions. This fact is the only thing that counts. The means are the work of to-morrow. The principle must even now be asserted. Germany must pay. Germany can pay. How can she be made to pay? How will what she pays be divided? These last two questions were ones which the peace-makers had to decide.


That Germany could pay had been proved by the preliminary studies I have analyzed above. That Germany would endeavour by every possible means not to pay, no one for a moment doubted and because they knew this to be so everybody was agreed that in order to get paid the Allies must adopt means of supervision and of guarantee. What kind of supervision? What kind of guarantees? Here is where the difficulty began, owing both to the nature of the problem and to differences of opinion that manifested themselves.

On February 24, 1919, the special sub-commission intrusted with this matter held its first meeting. It was presided over by the British delegate, Mr. Hughes, Prime Minister of Australia. France was represented by M. Klotz, Minister of Finance, assisted by MM. de Verneuil, de Lachaume, and Chevalier. The task was unprecedented. If former treaties had instituted for the supervision and guarantee of the financial obligations they imposed, conditions which proved efficacious, none of these precedents applied to the present case. When in 1871 Bismarck exacted 5,000 millions from us, all he had to do was to occupy for a few months a certain number of French Departments. Thiers, with an energy for which France remains ever grateful, collected in the shortest possible time the iniquitous war indemnity exacted by the aggressor and freed French territory. In 1919 the situation was entirely different. It was no longer five or ten thousand millions. For damages to persons and property and for pensions alone Germany owed more than 350,000 millions. Such a sum could only be paid in numerous annuities. So it was clear that methods employed in the past to supervise and guarantee payments which were nearly a hundred times less could not be applied here. Besides this stupendous accounting was not between two Powers, one victorious and the other vanquished. There were more than twenty victorious Powers and not less than four vanquished. For these two reasons it was absolutely necessary, the usual methods being inadequate, to seek a new solution.

The sub-commission---whose work was delayed by the necessity of awaiting the reports of two other sub-commissions, one intrusted with the evaluation of damages and the other with the estimation of means and capacity of payment---could not do more than examine suggestions, some of which, however, threw light upon the state of mind of the principal delegations. The British, American and Italian delegations were agreed in their opinion that military occupation could not be continued until the German debt had been paid in full. They had in mind a maximum occupation of two years. Mr. Hughes although fully determined to make Germany pay, for he insisted that she should be made to pay not only damages to persons and property and pensions but all the costs of the war besides, said on March 11:

"The Army of Occupation can only be a provisional expedient. It is a means of supervision which can only be counted upon for a relatively short period."

So on this point there was a fundamental disagreement between France and her Allies.(36) On the other points, however, the Commission was unanimous. It was of the opinion that taking into consideration the magnitude of the debt and the necessity of its payment by installments, the principal measures to be taken, as suggested by Mr. Hughes, were the following:

1. The creation of an International Commission whose duty it would be to receive the payments from Germany, to supervise her revenues and her expenditures, her capital, her production and her exports, and also to distribute between the various creditors the amounts received in money or in kind.

2. The emission by the German Government of a loan to cover the total amount due by it to the Allies, this to be a preferential loan taking precedence of all German war loans and to be made in successive issues.

3. Germany to be forced to restrict its consumption and its expenditures, especially on luxuries.

4. Control of all German imports so as to limit these imports to raw materials strictly necessary to her economic existence.

This was a very mild and conservative programme. Yet it is to be noted that certain delegates feared that even this degree of supervision would restrict the productive capacity of Germany necessary to the payment of her debt. Such being the starting point, what was the result?

At the time that this discussion was in progress, the ruling opinion in France was that the occupation of the left bank of the Rhine and of the bridgeheads would not only give the Allies military security, but also insure their being paid. This was the opinion expressed on May 6 at the plenary session of the Conference by Marshal Foch when he said:

To force the enemy to fulfill his undertakings there is only one military means. It is to continue the occupation of the Rhine.........When we find that we are paid and that we have sufficient guarantees, we shall only have to withdraw the troops and go away.

I have shown with what energy M. Clemenceau had to fight first to obtain and then to maintain as one of the terms of the Treaty, the occupation of the Rhine for fifteen years and the right to prolong this occupation in case of non-fulfillment of Germany's undertakings or of the inadequacy of guarantees against a new aggression; the right even to renew occupation in case after evacuation these conditions were not fulfilled. Twice in April and June this demand of the French Premier came near to breaking up the Entente of the Allies and even the Conference itself. It was impossible to go any further. Is a proof needed? Every time that we had to cope with the bad faith of Germany---in February over disarmament; in July over the article of her constitution which in violation of the Treaty prepared the way for union with Austria; a little later after the sinking of her fleet at Scapa Flow---every time that the French Government proposed to extend the occupation and to lay hands upon the Ruhr, the Allied Governments opposed an absolute refusal.

Besides this extension of occupation, even if Allied opposition had not been so uncompromising, was subject to objections put forward by the very people who advocated it, or developed by events and the very nature of things. When in February, 1919, to force Germany to disarm, M. Loucheur, on instructions from M. Clemenceau, presented a plan for the occupation of the Ruhr, it was Marshal Foch himself who pointed out that the forces necessary for such an occupation---it was thought that ten divisions would be necessary---were out of proportion with the advantages it was hoped to derive. Also people are apt to forget how difficult at that time the problem of effectives was for all the Governments. The British, the Canadians, the Australians, the South Africans were all as anxious as the Americans to return home. In France itself not a week passed in which all parties in Parliament did not demand immediate demobilization, which moreover was justified by serious economic considerations. Was it possible in these conditions to plan and carry out a policy which, every time Germany failed in her financial undertakings, would have entailed an extension of occupation? Certainly not.

Besides what would have been the good of such a policy from the financial point of view? I have quoted what Marshal Foch said on May 6 at the Peace Conference and I have said that the bulk of French opinion was with him: "Occupy the left bank and we shall be paid." But what has happened. Ever since the Armistice the left bank and the bridgeheads have been strongly held. We are in the very period to which the Commander-in-Chief of the Allied Armies referred when he said at that same meeting of May 6, "during this period the Treaty gives us complete guarantees." Has anyone noticed that Germany is more disposed to fulfil her financial undertakings any the better? In March, 1920, our Armies occupied Frankfort and the cities of the Main. Has any one noticed that this occupation, fully justified under the Treaty, brought us a single additional mark? No. In other words occupation has a defensive value, and that is why M. Clemenceau made it a sine qua non. On the contrary its financial value, notwithstanding the illusions cherished in 1919 by the military authorities and by public opinion, is relative. In order to force Germany to pay by the occupation of her territory it would be necessary to occupy the whole of her territory for more than a generation. No one would have consented to that. No one even suggested it. Something different had to be found. What?

This question has been answered by people who delight in foretelling the past. They assert that all obstacles would have been overcome if the Peace Conference had only thought to exact financial guarantees from Germany, for instance by the control and seizure of revenues from customs, mines, railways or by the collection of taxes in the occupied parts of Germany. Thus in a moment the problem of indemnity was solved. By paying one's self, one was sure to be paid. "Who knows," as Montaigne would have said. The question was carefully studied by the Conference, and its examination led it to results which forced a contrary conviction, Control public utilities? That is easy to say. But who can fail to see that in order to do it an enormous personnel would have been necessary. Under the circumstances control would have meant operation , otherwise control would have been a sham. Who can fail to see that such a method adopted because of the debtor's refusal to pay, that is to say with the ever-present possibility of conflict, would have entailed in addition to the collecting and operating personnel, a personnel of protection---which means an armed force---thus leading inevitably to that total and prolonged occupation of German territory that none of the Allies would consent to and which was out of the question because the necessary forces were not available. To hold the ports, the customs, the railways, the mines, meant supplying custom officials, station masters, engineers, etc., and called for military police everywhere. No one would have risked such an adventure without the prospect of real advantage. But what advantage would there have been? That is precisely what the peace-makers inquired into, and what those who heap retrospective criticism upon them seem to ignore.

If we take a good normal year, such as 1913, for the revenues in question, we find that the German customs produced that year 800 million marks, and that the net profit of the operation of the mines was 375 million marks and of the railways 1,000 million marks, or altogether something over 2,000 million marks. Let us suppose which is, of course, not the case,(37) that the war has not reduced any of these revenues and let us see what they give. These 2,000 millions of revenue in paper marks are equal to 300 million marks gold at the present (1920) rate of exchange,---that is to say just enough under the most favourable conditions to pay six per cent. interest on 5,000 million marks gold loan as against a reparations debt of about 350,000 million marks gold. As to the collection of taxes by the Allies in occupied territory it would have brought them an annual income of 500 million marks paper, sufficient to secure a loan of 1,600 million marks gold at six per cent. Here again the mountain gave birth to a mouse. The makers of the Treaty would have none of it.

The system of guarantees which they adopted consists ---in addition to occupation, which I will not deal with again---in the right recognized to them by Germany of supervising the economic and financial life of Germany and forcing her to make by priority either in money or kind the payments necessary to the liquidation of her debt. The Reparations Commission for this purpose is the agent of the Governments. I have already called attention to the breadth of its attributions.(38) I do not need to return to this subject. I note only that when a group of Powers has, as is here the case, in regard to another Power the right not only to supervise its revenues, its expenditures, its production, its consumption, its commerce, the right not only to be paid in priority to all interior debts, not only to claim a prior lien on all State resources but also to insist upon all legislative and administrative changes which may be deemed necessary, and the right to place in circulation interest bearing bonds representing the debt,---I note only that, when a group of victorious and formidably armed Powers has such means of pressure upon a beaten and consenting foe, it requires some audacity to assert that guarantees are lacking. And the assertion that guarantees are lacking is no excuse for never having in any manner or at any time made any effort to enforce them.

The Treaty goes even further and after having given the victors these many grips upon the financial life of the beaten foe, it gives them the right in every case of deliberate non-compliance by Germany to enforce "economic and financial prohibitions and reprisals and in general such other measures as the respective Governments may determine to be necessary." Germany further undertakes "not to regard such measures as acts of war." In other words by the Treaty itself the Allied Governments possess not only a system of financial guarantees such as no other Treaty has ever provided, but also entire freedom in the choice of military, economic or other methods of enforcement in case these guarantees are not sufficient. There is not in the whole history of diplomacy a single instance of terms so precise, so broad, and so decisive. The only thing is to make use of them. So that if in many things the Treaty of Versailles being a compromise is necessarily imperfect, it contains on the other hand, as far as guarantees and enforcements are concerned, everything that it ought to and could contain.


Besides the guarantees of payment taken directly from Germany, right and reason suggested others based upon the unity existing among the Allies. After unity in war, unity in peace. Could not sacrifices borne in common include, after the losses in lives and property, the costs of settlement---the richest helping the less rich to bear their share of the burden? A great and noble idea, the well ordered righteousness of which appealed to the French people more than to any other, not so much because of France's enormous obligations as because of her love of justice. On careful analysis of the problem which is often presented in confused form, it is seen that the financial settlement of the war entailed inescapable burdens and possible risks for the conquerors. An inescapable burden ---the cost of victory (700,000 millions), repayment of which was not demanded by the Treaty. A possible risk---the non-payment by Germany of all or part of the reparations debt (about 350,000 millions), which she was called upon to pay. It was to these two factors---the one unavoidable, the other uncertain---that the principle of unity could be applied if suitable agreement was forthcoming.

Nothing more simple, it would seem, or more just and, without reference to prejudiced criticism which counts for nothing, many impartial minds have expressed surprise that such an agreement was not reached. Hence in a recent report to the League of Nations, Professor Charles Gide wrote: "The favourable opportunity was allowed to slip by.... ; the solution would probably have been easy if the Powers had taken it up between themselves during the war. When, in May, 1918, they resolved to have only one army and only one commander-in-chief, it would have been easy to persuade them that they should have only one purse." If M. Charles Gide had gone through the unheard-of difficulties of one and the other, he might not have written the foregoing lines. Unity of command? It took forty-five months of warfare and the menace of an impending catastrophe for it to be theoretically entertained.(39) After it was once adopted, it was only by halting and laborious stages that it was put into practice, and I might quote certain instances, contemporaneous with the Armistice, to prove that, even after it had been justified by victory certain restrictions were still applied to it. If when he created it, M. Clemenceau did not think it wise to complicate the discussion by demanding unity of another kind; if, in the city hall of Doullens and during the days which followed the historic morning of March 26, 1918, he said nothing about unity of finances, it was because he knew too well, like all our war Governments, that he would thereby have irremediably compromised the demand for unity of military command upon which the issue of the battle depended. It was because he knew that, while the Allies were individualist as regards military command, they were even more so as regards financial matters and that, until the end of hostilities, the treasuries of each country should remain the impregnable castles of national individualism.

I cannot tell here the financial history of the war. At least I may, by a few facts, throw light upon my assertions.

Consider France and the United States. I have often reminded my fellow countrymen as a striking example of American brotherhood of the 15,000 million francs (50,000 millions at the 1920 rate of exchange) lent us by the Federal Treasury. What difficulties had to be overcome, however, from day to day in order to secure this generous cooperation! Recollect first of all that at no time was a fixed credit opened in advance either to ourselves or to our European Allies. An advance of 100 million dollars was granted M. Viviani at the end of April, 1917, without promise of a renewal. On my arrival in Washington, on May 15, of the same year, this was the first thing I had to take up. Thereafter at intervals of a month, sometimes of a fortnight, my colleagues and I obtained the necessary credits. On each occasion long explanations had to be furnished as to how these credits were to be expended. As far as France was concerned part of these credits were to enable us to pay for the purchases by the French Government in the United States. To this, of course, no objection was raised. But we were obliged to make over part of the credits to England for payment in dollars which she was making for our account outside of the United States and to transfer part of the credits to the order of the Bank of France to cover the difference in exchange on private purchases. Until the end of the war, these transfers aroused uneasiness and called forth the protests of the Treasury. In January, 1918, the fact that our cash balance showed a surplus brought down severe reproaches upon us. A little later I met the most serious opposition to the repayment by means of the American dollars of some of our loans raised in 1915 and 1916, to renew which would have been absolute folly. On all these occasions the Treasury impressed by the immensity of its task and anxious not to exceed the appropriations voted by the Congress, hesitated for whole weeks to authorize on behalf of the Allies, operations which were in the interests of all. We were working from hand to mouth, almost always obtaining what we needed but without being able to count upon this empiric and cordial assistance to build up a general plan.

Then came another matter---the so-called "purchase question." America had purchased from us a certain quantity of war material. In addition, her troops becoming more and more numerous in France caused her to be in need of francs (over 800 millions in May, 1918,) which were provided by the French Treasury which thereby added heavily to its circulation against payment in dollars. Our Ministry of Finance considered that the dollars derived from these two sources were our property, and that for our purchases in the United States the Federal Treasury should continue to loan to us as to the other Allies without deducting the dollars owing to us for purchases either of material or of francs. The American Secretary of the Treasury, on the other hand, contended in view of the overwhelming burden he was bearing that dollars, no matter from what source, should be applied wherever they were required without discrimination. He did not admit that France was entitled to reserve funds for future use and receive advances at one and the same time. He considered that such advances should be strictly limited to the difference between the amount of our purchases in America and the available funds representing the proceeds of sales. This disagreement gave birth to an extraordinary discussion. As in all cases where Americans were concerned we managed to effect a working compromise without ever reaching an agreement in principle. We obtained, in July, 1917, an additional credit of 200 million dollars and, in the following month of November the introduction of a bill into the American Congress authorizing certain advances for our reconstruction purchases. However, on the legal point "compensation" or "non-compensation"---both Treasuries invariably remained obdurate, each taking its stand on its own doctrines of financial autonomy, each doing its utmost to win the war, but unwilling to give up any of its cherished principles. The sincere desire on the part of the Federal Treasury, notwithstanding the splendid assistance which it kept giving to its associates, was to do nothing that might be construed either in war or in peace as a general undertaking.

Now, let us make no mistake about this. Stripped of its disguise of words and transformed into plain figures, the idea of financial unity, as regards the settlement of the cost of the war, had but one meaning---an appeal to the American Treasury with a view to its acceptance of additional liability. The facts, which I have mentioned, prove that such an appeal before the Armistice would have had no chance of being entertained; afterwards it had still less. The war had just cost America, who claimed nothing in regard to reparations, over 24,000 million dollars. Congress thought the price high and did not want to go further. After the elections in November, 1918, the policy of non-participation in the affairs of Europe was prompted both by a spontaneous desire of a part of public opinion, and to the deliberate determination to oppose the President. Moreover any financial unity, and this was a mere matter of arithmetic, would have obliged the United States to pay not only for France, but for Great Britain as well,---a thing the Americans were not disposed to do. In short, although the principle of financial unity had justice and logic in its favour, and although from an onlooker's point of view its failure is to be regretted, I venture to say without fear of being contradicted by any of those who, like myself, belonged to the Government during the struggle, that its mere enunciation would have led to a pointblank refusal which might have had disastrous consequences. Furthermore, if the confirmation of facts is desired for this opinion, the following will enlighten the reader.

From the very start of the Conference, both among its members and outside, the question of unity was carefully studied in its various aspects. I can scarcely enter here into a detailed examination of these different proposals which, as will be seen hereafter, were all destined to meet the same fate. It must also be noted that none was free from serious shortcomings. In each case, whatever method was applied to the solution of the question of financial unity, those who were called upon to pay for the others or commit themselves in their stead, maintained the doctrine of financial autonomy so jealously adhered to during the war., Every nation must meet its own liabilities-such was the principle invariably maintained. It was soon to be asserted in peremptory manner.

At the beginning of March, 1919, it was rumoured in Washington that the question of the pooling of liabilities had been approached in Paris and on the eighth I received from M. Edouard de Billy, who had succeeded me as High Commissioner of France, a cable in which he communicated a letter received by him the same day from Mr. Rathbone,. Assistant Secretary of the United States Treasury. This letter, after recalling that at a meeting of the Commission M.. Klotz had supported a suggestion to divide the whole of the war debt among the Allies, continued:

I must inform you in the clearest manner that the United States Treasury which as you know has been invested by Congress with full power in the matter of advances made by it to Foreign Governments will not consent to any discussion in the Peace Conference or elsewhere of any project or agreement having for object the liquidation, consolidation or repartition on a new basis of the obligations of Foreign Governments towards the United States.

You will also understand that the United States Treasury could not think of continuing advances to any Allied Government supporting a scheme which would result in making uncertain the payment at maturity of advances already made by the United States Treasury.

I shall be obliged if you will communicate this view of the Treasury to your Government and I await its early reply.

As the Allied Governments were all in great need of further American advances and none of them was in a position immediately to repay former credits, they could not ignore this communication. In a very plain answer I asserted on behalf of the French Government the right, after the immense sacrifices France had made, to have and to hold any opinion we thought proper. Mr. Rathbone agreed with me, and the matter rested there. I only mention it to show how easily and to what extent, both before and after the Armistice, the susceptibilities of the Treasuries were aroused whenever they feared that an international agreement might aggravate the already very heavy burdens assumed by their Parliaments. It was under these circumstances that the scheme for a financial section of the League of Nations, very properly presented by M. Klotz, was referred to the Executive Council in a somewhat vague form to which the Brussels Conference of 1920 did not succeed in giving definite shape.(40) The hour of financial unity had not struck. Any pressure designed to hasten it would have precipitated conflict instead of bringing about the desired unity. Long and prudent preparation was necessary especially with the Americans upon whom, as I have shown, success depended. Plans for this preparation occupied a goodly part of the time of President Wilson and his co-workers, who well knew our anxieties and our desires, before they left Paris.

The undertaking was difficult. When Assistant Secretary of the Treasury Rathbone, a true and devoted friend of France as he had proved by his conduct during the war, wrote the letter of March 8, which I have quoted above, he was only somewhat harshly stating an impossibility. Let there be no mistake about that. If to share the burdens of Europe, the Wilson Administration had asked the Congress elected on the fifth of November, 1919, to vote credits, it would not have voted a cent; first out of antagonism to the President, then from a feeling of Americanism, and finally because it was not possible under the circumstances. Before the war, Americans were not used to Government bonds; still less to the securities of foreign Governments. Government securities were in the hands of a very few men. In order to float the war loans tremendous advertising campaigns had been necessary. Furthermore the increase of taxation while making investors prefer tax-free securities, had depressed the market already glutted by these loans and restricted its purchasing capacity. An appeal for money to pay off European liabilities with the help of the United States would have been a dismal failure. President Wilson knew this better than anyone and that is why, anxious as he was to help his European associates, he was obliged to be extremely cautious. I have told the part he played in the discussion on the bonds to be issued by Germany.(41) There he had showed his desire to help Europe, to mobilize the German debt, and to associate his country with the financial enforcement of the peace. It was to facilitate the sale of German bonds in America that he asked that they should be issued only gradually. It was with his consent that the clause was inserted in the Treaty authorizing the allotment of these bonds to others than the Governments of countries which had suffered devastation. He had, in a word, as far as these bonds were concerned, foreseen and accepted the participation of the United States in two ways. First by discount and second by purchase. For the European Governments this was a valuable asset and it is difficult to understand why for so many mouths they never sought to avail themselves of it. In Mr. Wilson's mind, America, if properly approached, could do even more and better.

In the beginning of May one of Mr. Wilson's financial advisers, Mr. Lamont, expressed his point of view to me as follows:

"The President," he said to me, "understands perfectly that the United States must help in the economic reconstruction of Europe. It is the interest of America as well as its duty to hasten the end of the financial crisis and to help Europe, especially France and Great Britain, to pass through it.

"I have handed Mr. Wilson at his request a long memorandum on this subject, but nothing practical can be done until the problem has been thoroughly explained to the American people who have no conception of it, and as far as I can see the President is the only man who has sufficient authority to educate the country to it. But he will not be able to undertake this task until the Treaty is ratified.

"For the time being, we must have patience. If we go too fast, we shall only be giving an additional weapon to the opponents of the Treaty. The new taxes which are being introduced by M. Clemenceau's Cabinet will moreover be an indispensable factor in the campaign to be conducted in America. For they will give confidence to many Americans who when they see men like J. P. Morgan paying seventy-five per cent. of their income in taxes since the beginning of the war, are astonished that France has not increased its taxation, without understanding that the devastation of your richest provinces has made such an increase more difficult for you than for other countries."

During the month of June, I had several conversations on the same subject with Mr. House and Mr. Lamont. We knew that we could not pass from theory to practice, but we were preparing possible solutions. It is thus that we considered the advantages and feasibility of a solution of which Mr. Keynes in his overweening pride has imagined that he is the author. I refer to the cancellation of all war debts. This cancellation would have been a first step towards thoroughgoing financial unity, others would have followed. America unanimous in not demanding for the time being either the repayment of our debt of $3,000,000,000, or even the interest thereon, was quite capable of taking such a step, if its consequences had been fully explained. That is what Mr. Wilson intended to undertake immediately after his campaign for the ratification of the Treaty of Versailles. We all know what happened. The illness of the President, stricken down for ten months; the rejection of the Treaty by six votes; the triumph of an Opposition which favours American isolation. The result is that in 1920 we are further from our goal than in 1919. The Allies are partly responsible for this by having omitted for ten months to enforce upon Germany the obligation to issue the bonds in their favour as provided for in the Treaty and by the right which they recognized to Germany at Spa to issue bonds in her own favour. Between France and Great Britain the situation is the same. The French Government having neglected to issue in London the French loan of which M. Clemenceau on the eve of his retirement had obtained the promise for March, 1920, each country works for itself. The idea of unity which the peace-makers were about to realize is in eclipse. Will men be found to restore it to life and light?


No financial unity. So there remained for the greatest sufferers---that is to say for France---the resource of priority. In truth this resource had lost its importance and its chances of success the day when the Council of Four had decided to claim from Germany damages to persons and property and pensions, but not the costs of war.(42)

It had lost its importance for, with the exception of British tonnage sunk, the whole of the claims was henceforth identical with the French claims and even if sea losses were considered last---to which Great Britain would, of course, not consent---our country would have derived but little advantage. It had no chance of success because, however ready everyone was to recognize the immensity of the losses suffered by France, no Government would admit that for an indefinite number of years France alone should receive compensation, the others coming in only after she had been completely paid; because, furthermore, nations like Australia, which had suffered no devastations and could show only losses in men, would not admit that property losses should take precedence over losses of life. No matter what efforts the French delegation put forth, it was beaten in advance; for it was in a minority of one. In these circumstances it was clear that the basis of agreement would have to be percentages taking into account on a sliding scale the various degrees of losses sustained; and that even on this basis agreement would be reached only after prolonged discussions.

The discussion began in March before the Special Committee appointed to deal with financial questions and before the Council of Four. It was a painful one. Who was to have the largest share of the German payments? That really meant who had suffered most; who had worked hardest; who had contributed most to victory? This led to a discussion of respective estimates. As Mr. Lloyd George said on March 25, it was no longer a question of the coincidence but of the competition of Allied interests. Public opinion also had to be taken into account. The British Prime Minister dreaded this discussion, because he knew how imprudently the election campaign of 1918 had aroused the hopes of his countrymen. He dreaded it also because of the Dominions which had played an admirable part in the war and who, already obliged to forego the repayment of their war expenses, would never at any price have admitted that damages to property should be paid before their pensions.

"By what right" they asked, "should French chimneys be paid for before British lives?"

Finally influenced by advisers like Mr. Keynes and also by French pre-war publications put out by those very economists who had so learnedly proved that a European war could not last more than three months, Mr. Lloyd George was of opinion that the French claims were excessive.

"After all," he said, "the portion of your territory that has been devastated is very limited compared to your whole country. It contains no large towns. Lille and Valenciennes were occupied and more or less looted, but not destroyed, The total you arrive at is so large, that it nearly equals your whole national wealth, which was estimated at 250,000 millions in 1908. If the amount you claim represents the damages in so limited a portion of French territory, France must be very much richer than we believed.

"The value of all the coal mines in Great Britain was estimated before the war at 130,000,000 pounds (3,250,000,000 francs) and according to you, your mines which are of secondary importance as compared to ours need 2,000,000,000 francs for repairs.(43) How do you account for that?

"If you had to spend the money which you ask for the reconstruction of the devastated regions of the North of France, I assert that you could not manage to spend it. Besides the land is still there. Although it has been badly upheaved in parts it has not disappeared. Even if you put the Chemin des Dames up to auction, you would find buyers. What France claims is not fair to her Allies."

Refuting his opponents' arguments inch by inch M. Loucheur replied:

"France has no intention of taking a dollar more than is her due. She is ready to accept any verification of the figures she puts forward. But you are very much mistaken if you think that such verification will lead to any marked reduction.

"You produce statistics of our estimated wealth in 1908. I repudiate them. They are merely the individual opinions of economists, and are contradicted by the facts.

Just think what real estate in Paris alone is worth. Bear in mind that after most careful investigation I am convinced that the repair of our coal mines in the North will cost at least 2,000 million francs. Bear in mind that it will take ten years and a million men to rebuild what has been destroyed. Bear in mind that in the Lens-Courrières district there are 12,000 houses to rebuild which before the war were worth 5,000 francs apiece and are now worth 15,000 francs.

"You say that we exaggerate the rise in prices. That is not true. You would have us calculate reconstruction of buildings at one hundred per cent.; and yet you are well aware that certain materials cost three or four times as much in 1919 as they did in 1914. Anyhow, just take the raw material stolen or destroyed by the enemy. The wool taken by the Germans from Roubaix cannot be replaced for less than five times its 1914 value.

"France asks only the actual cost of repairs, neither more nor less.

"Reference has been made to the drawbacks of a public discussion. We do not fear it and we fear still less the comparison between our figures and those proceeding from the arbitrary estimates of more or less competent economists."

And so our fundamentally different points of view came into sharp conflict again when reduced to figures. To simplify matters Mr. Lloyd George said:

"Representing what Germany will pay by one hundred, I suggest that France receive fifty, Great Britain thirty, and the other countries twenty. This proportion will give France a very marked preference. But I cannot, in view of British public opinion, go below the proportion I mean to reserve for Great Britain."

At once M. Loucheur declared that this proposal was inacceptable. He recalled that France had already made a concession in not insisting upon priority, and after asserting that he would accept no other proportion than fifty-eight for France and twenty-five for Great Britain, he said his last word: fifty-six to twenty-five. The American experts suggested fifty-six to twenty-eight. M. Loucheur said no, and in agreement with M. Clemenceau declared:

"On my conscience I cannot agree to what is not fair. I am sorry to seem uncompromising, but I have already gone further than my instruction, and further than what I honestly believe to be just and fair."

The discussion ended without agreement. Eight months passed, during which France and Great Britain both refrained from widening this discussion, as it would necessarily have been complicated by the intervention of countries which either had not taken part in the war from the beginning, or had been at war for a portion of the time only with but one of our four enemies.

On December 12, 1919, in London, the conversation was resumed. M. Loucheur recalled its origin and on the ground of the continual rise in prices, asserted that to obtain a fair settlement, the ratio of sixty to twenty would be preferable to that of fifty-six to twenty-five, which he had been willing to admit in March. He added, "We are going to have to spend 125,000 millions in five years in order to rebuild what was the battlefield of all the Allies." M. Clemenceau also recalled that in the course of the debate on the ratification of the Treaty the French Parliament had complained of the inadequacy of the financial reparations given to France. He himself had admitted in the Senate, on October 11, that he was not satisfied and returning to his first demand he said:

"I have been told that British lives were worth more than chimneys destroyed in France. I know what your sacrifices have been, and no one respects them more than I do. But I ask you not to forget that beneath those chimneys there lived French families which the war has broken and ruined. Ten departments, the richest in France, have been completely devastated and for many years will produce nothing. That is the essential cause of our financial and economic crisis. So I demand priority, and I demand it frankly and clearly. Priority such as was given to Belgium. It will be just as fair in the case of France as it was in the case of Belgium. Priority is for us an urgent necessity. Above all you must safeguard the moral value of mutual good feeling between France and England."

Mr. Lloyd George's answer was full of dignity and of feeling. He said:

"The British Government cannot concede France's claim to priority. If it cannot, it is certainly not because the British people do not realize the unequalled sufferings of France. They know them fully. But Great Britain is beset by serious financial difficulties. Public opinion is overwrought by the burden of heavy taxes, and because it has not received a farthing from Germany. I ask the French Government to look at the matter in this light.

"France has put in a claim for 125,000 millions and Belgium for 25,000 millions. If priority for damages to persons and property is granted to France, it will have to be granted to Belgium, which amounts to saying that about 175,000 millions will be paid before the British taxpayer obtains any relief, that is for at least thirty years., I cannot accept such a thing.

"And the Australian Prime Minister will not accept it either. Australia with a population of less than four and a half million inhabitants has lost more men in the war than the United States. Australia has a heavy debt entirely due to war expenses and pensions. New Zealand, with a population of a million, had more men killed than Belgium and she also has a heavy debt. I ask you to take these brave young nations into consideration.

"In the Reparations Commission we must not have discussions between France and England on every question. France and Great Britain must hold together and act together. Our alliance must go on after having stood the test of the greatest war in history.

"To settle, we accept a proportion of fifty-five to twenty-five. We believe this proportion is too low for us. However, to assert and safeguard the cordial relations between our two countries, my colleagues and I are ready to accept it and we on the other hand ask that France do not insist upon priority.

"I ask this of you above all so that, in the case of another conflict, the feeling of unity of the Dominions be not less keen than it was last time."

It was necessary to settle and some of the English arguments were strong. M. Clemenceau accepted. To save the feelings of Allies who were not represented at the Conference at London the proportion of eleven to five was substituted in the official minutes for the percentage of fifty-five to twenty-five which remained the basis of the agreement. Twenty per cent. was to be reserved for the other creditors in accordance with Mr. Lloyd George's original suggestion. M. Clemenceau obtained in addition to this two other results from which his successors have not derived the benefit they might. First the attribution to France of the Chairmanship of the Reparation Commission (it is common knowledge that in less than six months the chairmanship of this all important Commission has been changed three times) and the issue in London in March, 1920, of a big French loan (it is common knowledge that this loan was not issued). So the financial problem as a whole was thus settled between France and Great Britain. Our country did not obtain that general priority which as the battleground of the nations it had a right to claim. But the percentage adopted assured it more than half the total of everything Germany was to pay.

The very terms of the Treaty assured it of even more. First everything in our list of damages that could be recovered in its original state (money, cattle, machinery or materials) did not enter into the reparations account and was not to be included in the percentage. Nine thousand million francs' worth of such stolen goods have been already recovered and have of course come back to us in full priority. Well conducted search would increase this amount. On the other hand the immediate payment promised to Belgium must also in part be added to the percentage allotted to France by the agreement of London, for half of the amounts loaned to our friends were loaned by us. Finally the reimbursement before any other charges of the cost of the Armies of Occupation will still further increase the amounts we shall receive, for of the costs of occupation it is not fifty-five per cent. but more than eighty per cent. that we are entitled to.

Since then at Spa the bases of the percentages have been changed. In order to increase the share of other Powers, France and Great Britain have consented to reduce their own each by three per cent., France's share falling from fifty-five per cent. to fifty-two per cent. and Great Britain's share from twenty-five per cent. to twenty-two per cent. The origins and character of this agreement make comment of mine superfluous. France, after having given up the priority which her rôle as battlefield entitled her to claim and accepted the reduction of the share allotted to her of the total German payments, is doubly bound to insist that this total must remain exactly as defined by the Treaty. A reduced share of a full total? Yes. But a reduced share of a reduced total? No. That is the whole problem. After so many others, it is an additional reason for France to refuse the onerous changes improvised and suggested in various quarters.




SINCE the signing of the Treaty strong criticism has been directed in France against the Government of Victory. "You have," it is asserted, "retaken Alsace-Lorraine. You have freed the French of the Sarre. You have occupied the left bank of the Rhine. You have imposed rigorous military and financial clauses upon Germany. That is all very well, but it is nothing. Why? Because none of these guarantees has any permanent value so long as you have allowed German unity to remain untouched." Let me add that a very distinguished American writer, Mr. W. Morton Fullerton, asked some years ago and in the same spirit that "France be permitted in the name of civilization to proceed to the vivisection of Germany, i. e., to the dismemberment of the Germanic tribes."

Before going back to the roots of the matter I must first present the answer which the French Government publicly made to this criticism in October, 1919. M. Clemenceau, attacked in the Senate by two members of the Right, presented the French view, which was the same as that of the Allies. Here is what he said:

A great quarrel has been thrust upon this assembly,---the famous question of German unity. On that I do not agree with you,---not in the least. Therefore, it is a question on which we must have a clear explanation.

On what was this disagreement? Not, of course, on the interest France has in not having at her gates sixty million people who claim German nationality and whom history has taught us to know: but on the possibility of destroying their unity by force. All Frenchmen would prefer not to be exposed to the risk of this proximity. But the proximity exists. It may be regretted. We all regret it, just as we regret that France has not the protection against Germany which the ocean affords England. But regret cannot alter a fact, and the one and only political question for Governments is whether or not this fact can be done away with. That is what the French Prime Minister proceeds to discuss, after brushing away the asinine criticism which a certain Press had levelled against him and his Cabinet of deliberately seeking to maintain German unity.

"I think you do me the honour to believe that I am no advocate of German unity, that I desire to split up the German forces ..... But, just what is it that we have to deal with?

"Consider a minute! There is a nation of sixty million people which only yesterday had seventy millions. People whose history goes back for centuries. By one of those contradictions which I am not called upon to explain, because it is the business of the Almighty, the Germans have gone from the one extreme of particularism to the other extreme of centralization. I cannot help it. It is their nature. They are built that way!

"At certain moments in history attempts have been made to force their national conscience. Napoleon, for instance, at Leipzig, had Saxons with him. It is impossible to be more divided than the Germans were then; for they were using shot and shell on other Germans.....What did the Saxons do at Leipzig? You are not without knowing! (Cheers.)

"The only true unity is that of the heart (Hear! hear!) and that no human hand can touch.

"Unity, you see, is not a matter of diplomatic protocols. Unity is in the hearts of men. Men love those they love. Men hate those they hate; and in times of danger they know on which side to stand, and in times of battle too. (Hear! hear!)

"What would you? There are there, whether we like it or not, sixty million people with whom we have to live. In olden days I don't know what would have been done with them. The Romans themselves broke their sword upon them. We are not going to throw ourselves into any such adventure.

"We want to respect their liberty, but we mean to take the necessary precautions to make them respect ours." (Cheers and applause.)

And M. Clemenceau, appealing to the past, recalled how pregnant with disappointment for France had been the theory of the "two Germanies."

"I remember when war was declared in 1870. One met journalists in the street-there are always journalists ready to say anything (laughter)---who said 'Bavaria will not join.'

"What reasons I heard given! 'The Bavarians are Celts---Their heads are not the same shape as the, Prussians---They hate the Prussians.' Two days later you know what happened.

"And in 1914, was not Bavaria precisely in the position where she would be to-day according to your theory, had she signed the Treaty? Did she hesitate to join? No.

"In peace time I used to believe that I should die without seeing the war, but I knew it was coming and I made it my duty to go every year either to Austria or to Germany. There I talked with the people. I saw those who were dissatisfied. I went to Munich and talked with the Bavarians. When I said harsh things of the Prussians they approved. They even went farther than I did. But when a break was referred to, it was quite another matter.

"And beaten do you think they are going to think differently than if they had won? Quite the contrary! (Cheers.)

"Defeat has brought their scattered forces together. Never in this respect had the situation called for such an effort."

If it be possible that some day, under the impulse of new interests and new ideas, this moral unity may disappear and give place to particularism, it is on the one condition that there be no forceful interference from without and that as in Austria-Hungary the evolution be a spontaneous evolution which we can help along but which we cannot create.

"You see, you must not believe that things will remain where the makers of the Treaty have left them.... The situation created by the Treaty will continue to develop. We shall see its results. We shall watch it. We shall take what advantage we may.

"That will depend upon the Germans---which some are trying to convert and rightly so---but it will depend upon us also. (Cheers.)

"If we hope that the Germans---I do not want to use a harsh word---will disintegrate in the political sense of the word so that they may not all be led at some future time to make war upon us, it by no means follows that we wish this disintegration for purposes of dominating them as they dreamed they were going to dominate us.

"As for going into Germany, as for conquering Germany as Napoleon conquered Spain, it is a waste of time even to think about it."

In other words take advantage of political disintegration in Germany, if it takes place spontaneously; but do, not commit the mad imprudence of imposing this disintegration by force,---such a course would merely strengthen the spiritual bonds; for "a nation," as Renan said, "is a group of individuals who will to live together" and this will cannot be broken by force. This opinion, held in common by all the Allied Governments, was sustained time and time again in the Senate by M. Clemenceau and in the Chamber by myself. It was an opinion so natural and so clear from the very facts that, as M. Clemenceau declared, in his speech of October 2, 1919: "The question was settled at the Conference almost before it had been presented."

For this point of view history---often quoted against it---affords absolute justification. Much has been said in discussing the Treaty of Versailles about the Treaties of Westphalia of 1648, which have been extolled at the expense of the former. Only one thing has been forgotten, that from 1648 to 1919, Germany continued to live and was profoundly changed in the course of those two and a half centuries. Whereas in Austria historic evolution prepared and produced the divorce of subject nationalities, in Germany on the contrary the whole process of evolution tended towards unity. Not the slightest tendency toward disintegration manifested itself during the war; and the overthrow of the dynasties has dispelled the last vestiges of constitutional particularism. While in Austria the wills of the peoples tended to diverge, in Germany they constantly tended to converge. All German history, since the seventeenth century, illustrates and emphasizes this phenomenon.

Bismarck created German unity---an achievement which gives the full measure of his genius. But Bismarck did not create it alone, and his genius does not account for all German unity. Bismarck worked not on an untouched canvas but upon one into which had been woven for more than a century a state of mind born of abject misery resulting from the seventeenth century treaties---a state of mind nurtured and trained for one hundred and fifty years by all German writers, inflamed by the Napoleonic wars, generalized by the events of 1848. Bismarck in other words utilized with marvelous ability an aspiration---a need---that existed before his time; a need that Prussia succeeded in satisfying and in exploiting; a need whence German unity even without Bismarck would sooner or later have sprung, without which Bismarck would have been unable to realize it. Destroy Bismarck's work? An easy thing to say, but a vain undertaking if what is the very soul of his work be not first destroyed. Is that destruction possible? That is the whole question. To that question two hundred and seventy years of history---too often ignored by those whose historical inquiries stop at the Treaty of Westphalia---give answer.

Germany by the end of the seventeenth century had reached the extreme limit of disintegration. More than a hundred independent States side by side led a miserable existence under powerless princes-vassals of a phantom empire. Of public spirit there was none---only moral disunion worse than material division, only economic stagnation aggravated by intellectual decadence, emphasized by boorish manners and general ignorance. Only the lower classes spoke German. This Political system had a name, the "Germanic Liberties." In order to understand what modern Germany thinks of these liberties we must remember what they stood for in the Germany of the past.

A few spirits lost in this darkness retained, by personal effort, their individuality shorn however of all national influence. To them is due the origin of the movement whence after many evolutions was one day to come the then unsuspected notion of a German Fatherland. To tell the truth this notion in its modern form was foreign to these solitary thinkers. But in their struggle for the advancement of literature and science they held the torch for future generations. Leibnitz was the first to extol intellectual activity without which, he said, "the downfall and decay of our nation will be irreparable for a long time to come." A few years later, appeared the first review published in German, to the scandal of its contemporaries. It was followed by another periodical, The Hamburg Patriot, the success of which astonished its readers and even its founders. Local awakenings of no political or national importance, but which showed the trend.

The eighteenth century sees the growth and expansion of this renaissance whose results have so far surpassed all expectations. Wolf, "the schoolmaster of the German mind," as Hegel called him later; the mediocre Gottsched ever reacting against foreign manners but stubborn and popular champion of German science; the University of Goettingen, first centre of culture for a middle class hitherto non-existent,---pave the way for Klopstock and Lessing, the earliest classical writers of Germany. Steeped in the philosophy of their century, they share its humanitarian and cosmopolitan spirit. But they write in German and for Germans, so their work is already national. The whole scene is dominated by the extraordinary figure of Frederick the Great, resourceful and unscrupulous, holding his own against Europe. Even those who do not love him are proud of this Prussian,---more Prussian than German. His victories awake echoes beyond his kingdom, all over the Holy Empire. The young generation at Frankfort worships him. Patriotic writings that borrow their titles from the past increase in number. The "Germanies" begin to discover a community of thought and feeling, they thrill with a new-born desire to foster it.

Towards the end of the century the movement gains breadth and scope. It is the moment when Herder proclaims the inward character of the German spirit and language. "Awake," he cries, "slumbering God! awake O German People." Then there come Goethe, Schiller and Kant, initiators and masters of German thought. The Fatherland of which they speak is more ideal than material. It is an intellectual community whose body politic is as yet unformed. But under the influence of the French ideas of 1789, this Fatherland begins to crystallize in men's minds and around the idea---thrilling indeed to this land of poverty and misery---of the rights of man and of the individual. The masses still remain indifferent. But the Napoleonic wars are going to awaken them. Eighteen hundred and six sees Jena. Kant had died two years before, bequeathing to his countrymen his philosophy of duty. Fichte takes hold of it and makes it the very soul of a frankly and exclusively national propaganda. He declares himself to be "German and nothing but German." He speaks for "all Germans without exception." He preaches that all their misfortunes arose from the "Germanic liberties" which made of Germany the battlefield of Europe. He denounces the princes of the Rhine Confederation as "the gilded slaves of Napoleon." His patriotism is no mere literary concept. It is a thought-power. He has a sense of national unity. He is not afraid of the word. The French Empire by its militarist policy helped to bring into the world the modern German Fatherland. And Fichte was its prophet.

And then in the Prussian Government a minister---not a Prussian by birth---Stein, appropriates this idea and translates it into action. Particularism, there is the enemy! Unity, there is the need! Napoleon has Stein expelled from Prussia, and Stein's authority grows greater as a result. Against humanitarianism and cosmopolitanism, he clamours for the rights of patriotism. "I have but one country and its name is Germany.... My motto is unity.... Away with the fatal treaties of Westphalia." His voice carries far. On the retreat from Russia, he obliges his hesitating sovereign to launch the Appeal to My People of 1813, which beyond Prussia is intended for all Germany. The second of the cards that Bismarck is to play fifty years later appears. The German idea is marching on! But besides, in 1813, it is Prussia which,---followed but little or not at all by the others,---fights for this idea, thereby gaining an unique prestige. Doubtless for many years yet, the policy of reaction expressed in the Holy Alliance is to retard evolution. Stein is in advance of his time. The princes do not support him. But he gives an impulse to the people, and his political testament is in the minds of all who think---"To be strong, Germany must be united."

Prom 1815 to 1848 the outward lines of politics remain rigid. But minds are in a ferment. The courts---even the Prussian Court draws back from the advantages that await it---repudiate unity as revolutionary. Professors and writers, however, think of nothing else. They seek its distant origin in the history of the Middle Ages. They show its present necessity by the risk Germany ran of being absorbed by Napoleon. All the élite helps. The university of Berlin becomes a centre of German patriotism. Theory is abandoned for practice. Heed is paid to frontiers. The Rhine is not enough, some demand the Meuse. The Treaties of 1815 are denounced as a spoliation, for which lack of unity is blamed. Hatred of France is already the favourite food of this raging patriotism. "Unity, Unity," cries Arndt, "unity as energetic as possible is what Germany needs; that is what is essential both to her security abroad and to her prosperity at home." And Görres anticipating Bismarck, adds: "It must be realized, if need be, by blood and the iron."

From this time with ever increasing force, the idea of unity keeps marching on. Having suffered overlong from her disintegration and proudly confident of her future, Germany is ready to make good the words of the Prussian Treitschke, "We have no German Fatherland, and the Hohenzollerns alone can give us one." In 1830, Bismarck, a Prussian junker, meets an American and makes a bet with him that before another generation unity will be an accomplished fact. The Parliament of Frankfort, under the illusion that it could realize this unity by vote, offers the crown to Frederick William, who refuses it. This is the last blunder before the battle is won. Bismarck comes into power and henceforth goes straight to his goal, which is not that of the German princes but that of the German people. All things are made to serve his purpose---the centuries of misery, the dreams of philosophers and of poets; the memories of the trials of 1906; the avidity of the middle classes of the South and West---to whom by the Zollverein he ensures larger revenues than those they get from their own customs; universal suffrage established as a menace against Austria and the princes; the war of the Duchies and the Bohemian campaign which excludes the Hapsburgs from Germany and reconciles them to this exclusion by leaving them their boundary; finally the absurdity of Napoleon III, who, by his policy of the "Three Germanies," supplies Prussia with the national pretext from which war is to come on the day of her choice.

"From the moment the Confederation of the South is formed," said Bismarck on April 10, 1867, "and Germany has but two national Parliaments, no human force can keep them from uniting, any more than the waters of the Red Sea remained apart after the crossing of the people of Israel." The end is known. Another and inexcusable error on the part of Napoleon III in connection with the Spanish question; the cynical Ems forgery; the Franco-German war; Versailles; the King of Bavaria bullied and brought to terms---and the Empire is founded. A result of opportunism which satisfies neither the Conservatives, who wanted Prussia to absorb Germany, nor the Liberals, who wanted Germany to absorb Prussia; a patchwork construction of give and take designed to overcome the resistance of the princes; without standing in international law; but the work of the past rather than the work of Bismarck; the tardy fruit of the combined efforts of poets and people whereby, for two hundred years, Germany has sought to free herself from those alleged "Liberties"---hated for more than a century---in which the pretentious verbiage of some contemporary historians seeks to find compensation for her defeat. The people---"that multitude of invisible souls" of which Bismarck speaks in one of his letters---is won over in advance to the end no matter what the means. It shows it by plunging, North and South alike, into the war against France, which is to cement its recent unity. Bismarck is the genius who directs this great adventure, but he is not its creator. Unity existed before him in the souls of the people; he set it free rather than imposed it. Sooner or later, I repeat, even without him, it would have been achieved. Fashioned by him, its principle survived him, just as its principle had preceded him.

Then for nearly half a century, this Empire, born of blood and iron, succeeded in giving unequalled satisfactions to the whole of Germany---to the Germany of thinkers as well as to the Germany of doers. For the first, it makes German thought radiate through the world. Upon the second, it lavishes the material benefits of which these people for so many centuries have been deprived. Germany establishes herself as the world's school master and commercial traveller. She flaunts the prosperity of her factories, for her goods challenge those of England in all the world-markets; of her banks, for their net-work spreads over two hemispheres; of her shipping, for the lines that furrow the seven seas. In his book of pride, The Welfare of the German People, Helfferich proclaims the results: population increased by sixty-three per cent., surplus of births over deaths as high as thirteen per thousand, deposits in banks and savings banks tripled, in twenty-five years reaching a total of 38,000 millions; wages doubled in twenty years; wealth widely distributed; capital values increased fifty per cent. in fifteen years, compared to an increase in population of only twenty-eight per cent.; average production of wheat increased more than thirty per cent. per acre; horse-power energy increased from two to eight millions; stock companies increased from 2,000 to 4,700. A prodigious wealth in which all Germans shared and which after nearly a century justified Arndt's words, "Unity, and unity alone can assure our security abroad and our prosperity at home."

We are far from the philosophers of the eighteenth century. The moral unity which they had conceived flourishes---with what strength !---but is infected by its very success with the most odious materialism. It is the German patriotism of 1914, such as I attempted to describe in the opening pages of this book, with faith only in the brutal might of the mailed fist, cloaking its greed beneath the hypocritical pretenses of a mystical mission terrorizing Alsace-Lorraine captive; a slave to the sword; gloating bestially over the ignoble violence of its soldiery at Saverne. Nothing can be baser, nothing more depressing; but again nothing could be more real. These people are no longer even capable of regretting the principles they had betrayed. Unity for them is no longer an ideal, but a source of profit. They have more to eat, they make more money than in the time of the "Germanic Liberties." For them that is enough. And because it is enough, the whole nation is ready for aggression without a qualm. Not a party hesitates, nor does a single State and this unity in crime is to last up to the end of the war. Some French writers have recently asked themselves whether Germany is really a nation. They are answered by our dead. A nation of prey, yes, but a nation which by its very crimes has proved its existence all too well.

It is true defeat has come, and hopes have been built upon it. It has been thought that perhaps Germany overwhelmed by defeat would lose her attachment to unity. Events have proved the contrary. The imperial catastrophe has broken the bonds between the share-holders in the German concern and their director. But the corporate relations among the share-holders themselves have only been strengthened as a result. Defeat has not revived the "Germanies" of the past. It has inspired united Germany with the will to find in this unity the instrument of her own revival. The downfall of the dynasties swept away by the autumn gale of 1918 laid low the last pillars of particularism. The deputies at Weimar in framing a new constitution had but one aim,---increased centralization. Does this mean that striking contrasts do not still persist in different parts of Germany? I do not say so and I shall show later the advantage to be derived therefrom. But I do say that the overwhelming majority of the German Nation, whose birth was so long and painful, is determined to live on as a nation, that force can avail nothing against this will, and that separated by the ax of the conqueror, its roots would soon have sought and joined each other for the preparation of a new life to which war would be the preface, as it was fifty years ago.


This obvious fact, on which so much discussion has been wasted since the signing of the peace, was never challenged during the war, and the disintegration of German unity was never one of the war aims of the Allies. Really it is hard to see how it could have been. Victory was late in crowning the flags of the Entente. In March, 1918, General Gough's British Army was defeated. In May came the Chemin des Dames and Paris bombarded. To have announced at that moment or earlier what has been called the "vivisection of Germany," would have been a terrible imprudence, would have been playing into the hands of German propaganda. As it was not announced, the Allied Nations were unprepared for it. Moreover to them, grouped as I have shown around the idea of nationality and of the defense of national liberties, the disintegration of a nation---even of an enemy, even of a guilty nation---would not have appealed as a war aim. Everybody wanted to destroy German domination. Nobody contemplated imitating the methods of that domination. The common sense of the people was quick to realize the existence, only too plain, of German nationality. To break up that nationality by forcibly reviving its former parts appeared to everyone impossible. In a war of peoples, which can be won only through the persistent support of the masses, certain cynical contradictions---common in the time of the old monarchies---become not only impossible but dangerous. The idea which gave heart to our soldiers, and led them to victory could not be repudiated without danger. You cannot tear up the things you stand for. The continuity of Allied war aims was, in large measure, the expression of this impossibility.

However this may be, it is a fact that at no time during the war did the Governments, the Parliaments, or even the Press demand the destruction of German unity. On December 30, 1916, and on January 10, 1917, the Powers of the Entente officially made known their views as to the conditions of a victorious peace. I have reproduced these documents above. Not a word can be found in any of them that directly or indirectly makes allusion to Germany's disintegration. One ingenious spirit has thought to discover such an allusion in the phrase, "The Allies repudiate any plan of exterminating 'the German peoples.' " But one has only to read the text over to see that this plural applies to Germany and to Austria. To this proof another even more decisive may be added. In January and February, 1917, M. Aristide Briand, the French Premier, had, in confidential letters to our Ambassadors at Petrograd and London, expressed his views on peace. These were secret documents in which the head of the Government was free to say anything---even things he might have deemed it dangerous to make public. Consult these two letters. They deal in turn, with the questions of Alsace-Lorraine, of the Sarre, of the demilitarization of the left bank of the Rhine, of its occupation, of the creation of an autonomous Rhineland---all war aims which in 1919 were upheld by M. Clemenceau at the Conference, as they were in 1916 and 1917 by M. Aristide Briand. But of Germany's disintegration they contain not a word---not a word mentioning it or in any way even suggesting it. On the contrary, all the guarantees demanded are demanded against a united Germany, because this unity is a fact and politicians have to deal with facts; because---like M. Clemenceau---M. Aristide Briand evidently held that "the only true unity is that of the heart, which no human hand can touch."

So much for the French Government. Now for Parliament. I have quoted the solemn resolutions passed on June 5 and 6, 1917.(44) They contain no word either with regard to imposing disintegration upon Germany by the terms of a Treaty, or of any interference in her internal affairs whatsoever. On the contrary, we find in them the assertion, twice repeated, that France is averse to the idea of "enslaving foreign populations," and that she remains "faithful to her ideal of independence and freedom for all peoples." Fifteen months go by and, on December 2, 1918, three weeks after the Armistice, the Commission of Foreign Affairs of the Chamber of Deputies by the unanimous vote of its members, formulates the peace clauses it deems essential to France. We find among them, as in M. Briand's letter of February 16, 1917, Alsace-Lorraine, the Sarre, the autonomous Rhineland, the reparations, but not a line, not a word about destruction of German unity, or refusal to negotiate with the Reich. And it is also against a united Germany that are directed all the guarantees demanded by Marshal Foch in his reports of November 27, 1918, January 10 and March 31, 1919, as well as in his declarations at the plenary meeting of the Conference, May 6, 1918. He refers over and over again to the "German population, naturally united by a common language and therefore by thought, as well as held together by common interest." It is against this community that he deems the occupation of the left bank of the Rhine indispensable.

It was the same with all the Allies. Great Britain is so hostile to the disintegration of Germany that twice, in November and December, 1917, her Minister for Foreign Affairs, Mr. Balfour, speaks strongly against even the very limited dismemberment which would result from the creation of an autonomous and neutral Rhineland. He declared:

It is pure fancy... Never, at any moment, has such a scheme formed part of the policy of His Majesty's Government. The Government has never been aware that any such scheme was seriously considered by any French politician.

In America, about the same time---December 14, 1917---President Wilson had said without provoking a single criticism in Europe, where his speech was published the next day:

We have no unjust designs against the German Empire. We do not wish to interfere with her internal affairs. Both courses would be absolutely contrary to our principles.

On January 8, 1918, he read a message to Congress in which he laid down the Fourteen Points, the identity of which with the European war aims I have already shown. Nothing in it about the disintegration of Germany. On the contrary, it contained this clause, which also met no objection in Europe:

We do not pretend to suggest to Germany the alteration or modification of her institutions.

From then on the only internal guarantee that the President wishes to exact of Germany in addition to the European war aims is the suppression of the military and irresponsible autocracy of the Hohenzollerns and its replacement by a representative Government. He repeats this on April 6, 1918, at Baltimore, and on July 4, at Mount Vernon, insisting upon "the necessity of not negotiating with an arbitrary Power which could independently, secretly and by its sole will disturb the peace of the world." But he speaks neither of destroying Germany's unity, nor of refusing to deal with the Reich, and no one in Europe differs with him. Finally when, on October 12, the Armistice correspondence begins, there is no question even of suppressing the Reich or of negotiating with the States composing it. Moreover, all this correspondence is published from day to day. The Parliaments are sitting. Two important additions to the bases of peace are suggested, demanded, obtained, by England and by France. And no one either in Paris or in London, in the High Command nor in the Governments, nor in the Chambers, says a single word of that disintegration which eight months later is to create a stir in the Parliaments and in the Press.

So the Armistice is reached and its terms are read in Parliament the very day it is signed. It is with the "representatives duly accredited by the German Government," that Marshal Foch was authorized to treat on November 5; it is with the "Secretary of State, Erzeberger, President of the German delegation acting in accord with the German Chancellor," that the Marshal on November 11 discussed and signed the Armistice. The Armistice itself, in Articles 9, 6, 29, 30 and 32, mentions six times, as contracting party, not the States forming the Reich, but the "German" Government, or "Germany." Remember that the Armistice is not only military---that it was discussed and reinforced at Versailles by the Governments---that it contains political and financial clauses. All this is public property, and proves conclusively that the Allies did not demand, and had no intention of demanding the destruction of German unity. Nobody protested, either in October or on November 11, even among those who a few months later were to denounce as criminal the action of the Allies in negotiating with the Reich.

The Press itself, though its irresponsibility gave it greater freedom of expression, does not blame the Chambers for accepting what the Government brings to them. It had one very legitimate preoccupation, namely that what was left of Austria-Hungary should not be allowed to unite with Germany. Article 80 of the Treaty of Versailles provided for this. But the disintegration of Germany---the forcible destruction of her unity---does not at all interest the papers. On October 28 we read:

As for imaginary solutions, such as that which consists in believing that Southern Catholic Germany could hold Protestant Prussia in check, these have precisely the same value as the theory of the Three Germanies. M. Rouher, Napoleon III's minister, also asserted that a Germany cut up into three pieces would never unite.

On October 29:

We cannot establish particularism and separatism to order in Germany.

On November 4:

Let us not be deceived. The movement of Germany unity is not yet finished. However desirable a revival of particularism might be for Europe, it is not in that direction the German States as a whole are tending.

On November 5:

The idea of a Southern Catholic Germany including Bavaria and German Austria, has not at all the attraction for us which it possesses in certain quarters. These combinations always possible on paper cannot be realized at will. We cannot knead the German dough to suit our fancy. Besides people are fooling themselves with regard to Bavaria which has only seven million inhabitants, and with regard to the attractive force of the little provincial state of Munich.

Finally, the same day, we find expressed almost word for word the contention put forward by me on September 2, 1919, in the Chamber, and by M. Clemenceau, on October 11 following, in the Senate, on the subject of possible particularism and the eventual influence to be exerted in that direction.

In general, these things are either not done at all or are done badly from without. Events have a habit of presenting themselves in unexpected guises and, if we attempt to anticipate them, we run the risk of interpreting them wrongly and taking them at cross purposes.

I could give quotations of this sort indefinitely. I have chosen these in preference to others, because they cannot be suspected of democratic idealism; for they are all taken from the articles of a Royalist writer, M. Jacques Bainville, whose party has made itself in 1920, the vehement advocate of the disintegration of Germany.


Such the conditions in which the Allies were placed at the Conference. Such the reasons for which they felt that they were faced by a practical impossibility, by a moral factor which, in M. Clemenceau's own words "no human hand can touch," because, as history has shown a hundred times, military force is powerless against spiritual force.

The French Government, especially, was convinced that forcible interference with this state of affairs would be dangerous. How could we forget that the victories of Napoleon and his policy of the Confederation of the Rhine, inspired by that of Mazarin, did more to create a sentiment of unity in Germany than even the preachings of Fichte? How could we forget that Napoleon III, with his policy of the "Three Germanies," proclaimed on the morrow of Sadowa, gave Bismarck the leaven whence four years later sprang the idea of Empire? How could we refuse to recognize, with the Royalist writer I have just quoted, that such things are generally badly done from without and that by thus attempting to destroy a nation, we are certain to strengthen the bonds that hold it together?

Does this mean that there is no hope that a spontaneous awakening of the particularist spirit may some day oppose Prussian preponderance? The French Government thought otherwise and has proved it by its acts. In this respect the French Government was in accord with the views of an American writer, Mr. Baldwin: "If the German Empire broke up into separate states (which is something quite different from the vivisection of the German Empire) it would be an incalculable gain from every point of view." M. Clemenceau and his colleagues felt that it was at once impossible and dangerous to impose this disintegration by force---to employ what M. Hanotaux, an advocate of this method, calls the "compelle intrare"---but whenever at any particular point, autonomous tendencies manifested themselves spontaneously they loyally and openly tried to support them. I may add that, on such occasions, the Allied Governments always showed the greatest hesitation---sometimes even the plainest opposition.

One early instance of this is furnished by the affairs of Bavaria. Kurt Eisner had just fallen. The economic situation was critical. Relations with Berlin were strained. The French Government presents the facts and offers to send supply trains direct to Bavaria. Immediately Lord Robert Cecil, Mr. Hoover, and Mr. Lansing raise objections on the ground that arrangements have already been made to this effect, under the Armistice of November 11, with the German Government which is responsible for the payment. Mr. Lansing says:

"I have not the slightest confidence in an expedient which involves interference in the affairs of any country whatsoever."

It is decided to consult the Supreme Economic Council, which replies, "So far as the Council can judge, the proposed measures from the point of view of food supply and finance are neither desirable nor possible." So there was unanimous opposition to our proposal.

On the left bank of the Rhine it has been seen how Great Britain's unswerving refusal, soon followed by that of the United States, had closed the door to the policy of autonomy recommended by France in the only region where it might perhaps, have been immediately applicable.(45) A significant incident proved, a few weeks later, that our Allies' apprehensions had not been allayed. On Sunday, June 1, 1919, Herr Dorten, a former magistrate, without political experience or authority, put up posters proclaiming himself President of the Rhenish Republic. The same day, Mr. Wilson and Mr. Lloyd George received from the Commanders-in-Chief of the American and British forces two reports which corroborated each other and gave the impression that this "comic opera incident" had been favourably viewed by the French military authorities. It was the moment when so many people in London and elsewhere were dominated by the fear that Germany would not sign. The next day, June 2, in the afternoon, Mr. Lloyd George began his earnest attempt to make M. Clemenceau give up the occupation of the left bank of the Rhine---a hotbed of intrigues, he declared, and a menace to the peace of Europe. For two weeks M. Clemenceau had to fight step by step to prevent any change in this occupation without which the most determined advocates of the "Rhenish policy " will admit that this policy would be, to say the least, difficult. Once again, anticipation of the future had come near costing us our hold upon the realities. What happened in March, 1920, at the time of the occupation of Frankfort, throws light upon the history of the preceding year.

Even where matters of pure form were involved a similar state of mind had revealed itself. On May 2, 1919, the French Government had proposed that Bavaria and those of the German States which had signed the Treaty of Frankfort, should be called upon to sign the Treaty of Versailles. On the fourth, the Committee to which this proposal had been referred, rejected it; only the French representative voting in its favour. As a matter of fact, it is hard to see just how authority given to Count von Brockdorff-Rantzau to obtain the signature of the Bavarian Government could have altered the general constitution of Germany, or have lessened the German danger for France. So the refusal of the Allies was not a serious matter; but nevertheless, it threw light upon their state of mind. All that France could obtain was the insertion in the preamble to the Treaty, of a sentence which, in spite of the Constitution of Union adopted by the Assembly of Weimar, authorized the resumption of diplomatic relations between the Governments of the Entente and the self-governing States forming part of the German Empire. In accordance with this clause, a French legation was re-established at Munich in 1920.

It must be confessed moreover that, as the Conference progressed, the Allies found many additional reasons for adhering to the policy of non-interference defined in their war aims. Everywhere, from January 15 to June 28, there was anxiety that the victors might not find a German Government to sign. Was this then the moment to reject the one which had come legally into existence as a result of the general elections, and could speak in the name of the Reichstag? The financial clauses because of the enormous sums involved led to a long and difficult discussion. Was it possible without danger of giving Germany a chance to escape from the responsibilities contracted by her as a single nation, to treat, not with her, but with Bavaria, Saxony, Wurtemburg, as well as with all the smaller States composing the Reich-Hamburg, Anhalt, Saxe-Weimar and so many others besides? For the Allies to obtain payment it was necessary that Germany should again begin to produce and to export; but would this be possible, if the organization which was the source of German prosperity were shattered? And again how can force prevail against a mental attitude? What can material power do against a "unity which is of the heart."

In other words, every aspect of the war which the peace was to bring to a conclusion showed Germany united by long and complex responsibilities, and therefore it was necessary---logically, legally and practically---for the Treaty to be applied to that Germany. May I be permitted to add to the recital of past events that when one sees the extremes of indulgence which at times such or such of the Allies have for the duplicity and infractions of a Germany surviving united in all her responsibilities, one wonders what would have happened if it could have been said, if one could say to-day, that by the very terms of the Treaty and by the will of the, victors responsible, Germany has ceased to exist.

Thus the Conference went on painfully and laboriously without anything ever arising to modify the broad vision of M. Clemenceau's wisdom: "The only unity is that of the heart and that no human hand can touch." Had it been otherwise, had not this unity asserted itself as enduring, Germany---need I insist upon it?---would have suffered the same fate as Austria-Hungary. But Germany showing no desire for dissolution, the head of the French Government was determined, as were his colleagues, not to "break his sword" in a vain attempt to force it upon her, and he concluded in full agreement with Mr. Lloyd George:

"We all know very well that the best way to work for Germany's disintegration if this be possible, is to take no hand in it."

This was the truth yesterday. It is the truth to-day. It will be the truth to-morrow. Disintegration has not taken place from within. Therefore it would have been, as M. Bainville wrote in November, 1918, imprudent and useless to undertake it from without. If, under the influence of new interests, particularist movements some day arise, they will succeed all the better if their Prussian adversaries cannot point to foreign complicity. They will succeed only on that condition. For, in the matter of nationality, it is as impossible to create by force, as it is to destroy by force. Alsace-Lorraine, Poland and Bohemia have risen from their graves because their souls had never died. The Allies did not wish by the use of violence against a nationality simply to build a fragile edifice upon sand, and so expose themselves to the tragic turn that has overwhelmed the Hapsburg Empire.

The peace did not break Germany into bits, not only because an attempt to do this, which never had any place in the Allied war aims, would have been the negation of all their principles, but also and above all because it would have been impossible. France would far rather not have at her very doors and bound together by a common will and consciousness of unity a people from which she has so often suffered. But the danger of this proximity residing precisely in the unity of these consciences and of these wills, the Peace Conference was powerless against it. If it had agreed to attempt to break it, it would have only strengthened it. If France had attempted this alone, and in spite of her Allies, there would have been no Peace Treaty. We all hope some improvement may be looked for in the future, but it is on the one condition that neither force nor intrigue be brought to bear from without. As Marshal Foch wrote, speaking of the possibility of an evolution of the German mind, in his Memorandum of January 10, 1919: "We shall see such an evolution only in time---a very long time, no doubt--determined as we are not to hasten persuasion by force nor to interfere in the settlement of Germany's internal affairs."

This policy, the only one that can give results, will find its justification in the future. To reduce Germany and Prussia, the Allies preferred practical means to an artificial disintegration of a conscious and accepted unity---a disintegration pregnant with present hatreds and future revenge. They forbade that union of Germany and Austria which the Socialists of both countries wore preparing to carry out by sleight of hand and which a third only of the Reichsrath voted for in 1920. They took from her Poznan---the cradle of. the junkers---which Bismarck described as the backbone of the Prussian body. They took from her the ore of Lorraine, which was the basis of her war industry ---in all, 84,000 square kilometers, and 8,000,000 inhabitants. They deemed this solution more thoroughgoing than one which, violating their principles, would have given them the illusion of destroying German unity, while sacrificing to this illusion for the sole benefit of separate States, the whole or a part of our military and financial guarantees.

Chapter XII

Table of Contents