best to make them now, when the most fantastic descriptions of the
all-absorbing desire of conquest on the part of Germany have circulated
in the press of the entire world.
Among other absurdities it has been declared that Germany intends to
claim a fourth of France, making this dismembered country a vassal
State, bound to the triumphal car of the conqueror by the very heaviest
chains. It is incredible, but true, that such a statement has been made
in the press by a Frenchman, formerly President of the Council.
In direct opposition to the fictitious demands of the Germans, I can
advance a proposition which may sound paradoxical, viz., that the
leading men in Germany, the Emperor and his advisers, after bringing the
war to a victorious issue, will seriously seek expedients to _avoid_
conquests, so far as this is compatible with the indispensable demands
of order and stability for Europe.
First, as regards France. The entire world, as also the Germans, are
moved to pity by her fate. Germany has never entertained any other wish
than to be at peace with her western frontier. A considerable portion of
France is now laid waste, and in a few weeks millions of soldiers will
have been poured into still wider portions of this beautiful country. On
what are the inhabitants of these French provinces to exist when the
German and French armies have requisitioned everything eatable? Germany
cannot feed the inhabitants of the French provinces occupied, nor can
the Belgians do so, I imagine, for the provisions of Germany are simply
sufficient for their own needs, England preventing any new supply on any
large scale.
This is a totally new state of things in comparison with 1870, when
Germany was still an agrarian country and had, moreover, a free supply
on all her frontiers.
Can the French Government allow a considerable portion of their own
population actually to starve, or be obliged to emigrate to other parts
of France, there to live the life of nomads at the expense of England,
while the deserted provinces are given over to desolation?
The idea prevails here that the French will compel their Government to
enter on and conclude a separate treaty of peace when the fatal
consequences of the war begin to assume this awful guise. England does
not appear to have considered that this would be the result of her
system of blockade.
The German conditions of peace as regards France will be governed by two
principal factors with respect to their chief issues.
The first is the complete unanimity of the Emperor and the Chancellor
that _no population, not speaking German, will be incorporated in the
German Empire, or obtain representation in the Diet_. Germany already
has sufficient trouble with the foreign element now present in the Diet.
Consequently there can be no question of any considerable acquisition of
territory from France, but the demands of Germany simply extend to the
_iron-ore fields of Lorraine_, which are certainly of considerable
value. For France these mining fields are of far less consideration
than for Germany, whose immense iron trade is far more in need of the
iron mines.
The second factor is that the Germans, owing to the strong public
opinion, _will never consent to Belgium regaining her liberty_. The
Chancellor of the Empire has, as long as it was possible, been opposed
to the annexation of Belgium, having preferred, even during hostilities,
to have re-established the Belgian Kingdom. It is significant that the
military authorities have prohibited the German press from discussing
the question of the future of Belgium. It is evident that there has
prevailed a wish to leave the question open in order to insure a
solution offering various possibilities. But subsequent to the discovery
of the Anglo-Belgian plot, as previously stated, all idea of reinstating
Belgium has been discarded.
The annexation of Belgium, however, makes it possible to grant France
less stringent conditions. So long as Belgium--under some form of
self-government--is under German sway there is no hope of revenge of
France, and the conviction prevails here that after this war France will
abstain from her dreams of aggrandizement and become pacific. Germany
can then make reductions in the burdens laid on her people for military
service by land.
To arrange the position of Belgium in relation to Germany will be a very
interesting problem for German policy.
It is obvious that the annexation of Belgium cannot be defended from the
point of view of the principle of nationality. The Belgians--half of
them French, half of them Flemish--undoubtedly deem themselves but one
nation. As a mitigating circumstance in favor of the annexation it is
urged--above and beyond the intrigues carried on by Belgium with the
English--that Belgium, in days of yore, for a long time formed a portion
of the German Empire, and that the inhabitants of the little country, to
a considerable degree, gain their livelihood by its being a land of
transit for German products. Nationally, the annexation is not to be
defended, but geographically, economically, and from a military point
of view it is comprehensible.
At the east front of the central powers very different conditions
prevail. _Austria has no desire to make the conquest of any territory_;
indeed, just the contrary, would probably be willing to cede a portion
of Galicia in favor of new States. _Germany has not the slightest
inclination to incorporate new portions of Slav or Lettish regions._
Both Germans and Austrians wish to establish free _buffer States_
between themselves and the great Russian Empire.
Not even the Baltic provinces, where Germans hold almost the same
position as the Swedes in Finland, form an object for the German desire
of conquest, but her wish is to make them, as also _Finland_, an
independent State. Furthermore, the Kingdom of _Poland_ and a Kingdom of
_Ukraine_ would be the outcome of decisive victories for the central
powers.
What Germany would demand of these new States, whose very existence was
the outcome of her success at arms, would simply be an _economical
organization in common with the German Empire_, an enormous central
European "Zollverein" ("Customs Union") with Germany at its heart. It is
only such a union, in the opinion of leading German statesmen, which
could hold the United States of North America at bay, and after this
present war, moreover, the world would only have to take into account
_two_ first-class powers, viz., Germany and the United States of
America.
A commencement of this new economical connection is being made by the
negotiations entered on by representatives of _Austria-Hungary_ and
_Germany_ concerning the proposed formation of a _Customs Union_. Since
this union would include 120,000,000 individuals, it must be evident
what an immense attraction it must exert on the surrounding smaller
nations. _Switzerland_ and _Holland_ can scarcely escape this
attraction, and the _Scandinavian countries_, it is said, would probably
find it to their advantage, together with a liberated _Finland_, to
form a _Northern Customs Union_, which later, on an independent basis,
could _enter in close union with the vast "Zollverein" of Central
Europe_.
This "Zollverein" would then include about 175,000,000 individuals. The
adhesion of _Italy_ to the vast union would not be inconceivable, and
then the combination of the United States of Europe, founded on a
voluntary commercial union, would be approaching its realization.
Such a commercial union, embracing various peoples, could only lead to
moderation in foreign politics, and would be the best guarantee for the
peace of the universe. A brisk interchange of commodities, a fruitful
interchange of cultural ideas would result from such a union, connecting
the polar seas with the Mediterranean, and the Netherlands with the
Steppes of Southern Russia.
All States participating in this union would gain thereby. But one
European country would be the loser, _Great Britain, the land of promise
for the middleman_; that, according to German comprehension, at present
gains a living by skimming the cream from the trade industry of other
nations by facilitating the exchange of goods, and making profits by
being the banking centre of the world.
The Germans declare that there is no reason for such a middleman's
existence in our day. The banking system is now so developed in all
civilized lands that, for example Sweden can remit direct to Australia
or the Argentine for goods obtained thence, instead of making payment
via London and there rate, by raising the exchange for sovereigns to an
unnatural height, so that, as matter of fact, England levies a tax on
all international interchange of commodities.
In opposition to this glorious vision of the days to come, which the
Germans wish to realize by their victories in war, there is the alluring
prospect of the Allies that by their victory they will deal a deathblow
to _German militarism_. While the English, with their 200,000 troops,
are good enough to promise no conquest of German territory--what says
Russia to this?--at the close of the war, in the opinion of the Britons,
there would still remain 65,000,000 Germans right in the centre of
Europe, organized as a kingdom burdened with a war indemnity to a couple
of tens of milliards in marks.
This nation, however, strengthened by 15,000,000 Germans in Austria,
would be the greatest bearers of culture in the wide world--the nation
with the best technical equipment of all others, glowing with ambition,
with military training second to none, and gifted with an immense rate
of increase as regards population. This nation would be forced to lay
down her arms, lying as it does between the overbearing gigantic realm
in the east and the warlike French to the west. The idea is
incomprehensible. The universe would behold a competition in armaments
such as it had never seen.
A victorious Germany, on the other hand, would become less and less
military, since she _would not need_ to arm herself to such an extent as
now. She is already chiefly an industrial country. Her desire is to be
wealthy, and wealth invariably smothers military instincts. Germany has
set up far greater ideals as regards social developments than other
countries, and all she asks is to be left in peace calmly to carry out
these plans in the future. _German militarism can only be conquered by
the victory being on her side, since she has no thought of military
supremacy, but simply of founding a new economical organization in
Europe._
GUSTAF SIOESTEEN.
ADDRESS TO KING ALBERT OF BELGIUM
By EMIL VERHAEREN.
Translation by Florence Simmonds.
[From King Albert's Book.]
Sire: This request to pay my respectful homage to you has given me the
first real pleasure I have been permitted to feel since the good days of
Liège. At this moment you are the one King in the world whose subjects,
without exception, unite in loving and admiring him with all the
strength of their souls. This unique fate is yours, Sire. No leader of
men on earth has had it in the same degree as you.
In spite of the immensity of the sorrow surrounding you, I think you
have a right to rejoice, and the more so as your consort, her Majesty
the Queen, shares this rare privilege with you.
Sire, your name will be great throughout the ages to come. You are in
such perfect sympathy with your people that you will always be their
symbol. Their courage, their tenacity, their stifled grief, their pride,
their future greatness, their immortality all live in you. Our hearts
are yours to their very depths. Being yourself, you are all of us. And
this you will remain.
Later on, when you return to your recaptured and glorious Belgium, you
will only have to say the word, Sire, and all disputes will lose their
bitterness and all antagonisms fade away. After being our strength and
defender, you will become our peacemaker and reconciler. With deepest
respect,
EMIL VERHAEREN.
Foreshadowing a New Phase of War
Financing the Allies and Small Nations Preparing for War
By Lloyd George, British Chancellor of the Exchequer
That there are "also other States preparing for war," and that
financial arrangements had been made for their participation
against Germany by the allied Governments of Great Britain,
France, and Russia; moreover, that Russia would be enabled
within a few months to export considerable quantities of her
grain and do her own financing--this statement preceded the
bombardment of the forts in the Dardanelles, probably to clear
the way for Russia's commerce--are the outstanding features of
the speech by Lloyd George presented below, foreshadowing a
new phase in the war. The speech was made in the House of
Commons on Feb. 15, 1915, to explain the results of the
financial conference between the allied powers to unite their
monetary resources, held in Paris during the week of Feb. 1.
It may be regarded as one of the most momentous utterances of
the war.
PARLIAMENTARY REPORT.
_The Chancellor of the Exchequer, (Mr. Lloyd George,)_ who was called
upon by the Speaker, said: I shall do my best to conform to the
announcement of the Prime Minister that the statement I have to make
about the financial conference in Paris shall be a brief one, but I am
afraid my right honorable friend assumed that we are all endowed with
the extraordinary gift of compression which he himself possesses.
[Laughter.] The arrangements that were made between the three Ministers
for recommendation to their respective Governments commit us to heavy
engagements, and it is, therefore, important I should report them in
detail to the House, and find some reason why we should undertake such
liabilities.
This is the most expensive war which has ever been waged in material, in
men, and in money. The conference in Paris was mostly concerned with
money. For the year ending Dec. 31 next the aggregate expenditure of the
Allies will not be far short of £2,000,000,000. The British Empire will
be spending considerably more than either of our two great
allies--probably up to £100,000,000 to £150,000,000 more than the
highest figure to be spent by the other two great allies. We have
created a new army; we have to maintain a huge navy. We are paying
liberal separation allowances. We have to bring troops from the ends of
the earth; we have to wage war not merely in Europe, but in Asia, in
North, East, and South Africa. I must say just a few words as to the
relative position of the three great countries which led us to make the
arrangements on financial matters which we recommend to our respective
Governments. Britain and France are two of the richest countries in the
world. In fact, they are the great bankers of the world. We could pay
for our huge expenditure on the war for five years, allowing a
substantial sum for depreciation, out of the proceeds of our investments
abroad. France could carry on the war for two or three years at least
out of the proceeds of her investments abroad, and both countries would
still have something to spare to advance to their allies. This is a most
important consideration, for at the present moment the Allies are
fighting the whole of the mobilized strength of Germany, with perhaps
less than one-third of their own strength. The problem of the war to the
Allies is to bring the remaining two-thirds of their resources and
strength into the fighting line at the earliest possible moment. This is
largely, though by no means entirely, a question of finance.
Russia is in a different position from either Britain or France. She is
a prodigiously rich country in natural resources--about the richest
country in the world in natural resources. Food, raw material--she
produces practically every commodity. She has a great and growing
population, a virile and industrious people. Her resources are
overflowing and she has labor to develop them in abundance. By a stroke
of the pen Russia has since the war began enormously increased her
resources by suppressing the sale of all alcoholic liquors. [Cheers.] It
can hardly be realized that by that means alone she has increased the
productivity of her labor by something between 30 and 50 per cent., just
as if she had added millions of laborers to the labor reserves of Russia
without even increasing the expense of maintaining them, and whatever
the devastation of the country may be Russia has more than anticipated
its wastage by that great act of national heroism and sacrifice.
[Cheers.] The great difficulty with Russia is that, although she has
great natural resources, she has not yet been able to command the
capital within her own dominions to develop those resources even during
the times of peace. In time of war she has additional difficulties. She
cannot sell her commodities for several reasons. One is that a good deal
of what she depends upon for raising capital abroad will be absorbed by
the exigencies of the war in her own country. Beyond that the yield of
her minerals will not be quite as great, because the labor will be
absorbed in her armies.
There is not the same access to her markets. She has difficulty in
exporting her goods, and in addition to that her purchases abroad are
enormously increased in consequence of the war. Russia, therefore, has
special difficulty in the matter of financing outside purchases for the
war. Those are some of the difficulties with which we were confronted.
France has also special difficulties. I am not sure that we quite
realize the strain put upon that gallant country [cheers] up to the
present moment. For the moment she bears far and away the greatest
strain of the war in proportion to her resources. She has the largest
proportion of her men under arms. The enemy are in occupation of parts
of her richest territory. They are within fifty-five miles of her
capital, exactly as if we had a huge German army at Oxford. It is only a
few months since the bankers of Paris could hear the sound of the
enemy's guns from their counting houses, and they can hear the same
sound now, some of them, from their country houses. In those
circumstances the money markets of a country are not at their very best.
That has been one of the difficulties with which France has been
confronted in raising vast sums of money to carry on the war and helping
to finance the allied States.
There is a wonderful confidence, notwithstanding these facts, possessing
the whole nation. [Cheers.] Nothing strikes the visitor to Paris more
than that. There is a calm, a serene confidence, which is supposed to be
incompatible with the temperament of the Celt by those who do do not
know it. [Laughter.] There is a general assurance that the Germans have
lost their tide, and that now the German armies have as remote a chance
of crushing France as they have of overrunning the planet Mars.
[Cheers.] That is the feeling which pervades every class of the
community, and that is reflected in the money market there. The
difficulties of France in that respect are passing away, and the
arrangement that has now been made in France for the purpose of raising
sums of money to promote their military purposes will, I have not the
faintest doubt, be crowned with the completest success. [Cheers.]
But we have a number of small States which are compelled to look to the
greater countries in alliance for financial support. There is Belgium,
which until recently was a very rich country, devastated, desolate, and
almost entirely in the hands of the enemy, with an army and a civil
government to maintain, but with no revenue. We have to see that she
does not suffer [cheers] until the period of restoration comes to her,
and compensation. [Cheers.] Then there is Serbia, with the population of
Ireland--a people of peasants maintaining an army of 500,000 and
fighting her third great war within two years, and fighting that with
great resource, great courage, and bravery. [Cheers.] But she had no
reserve of wealth, and now no exports with which she can purchase
munitions of war outside, and she has hardly any manufactures of her
own. That is the position as far as the smaller States are concerned.
_There are also other States preparing for war, and it is obviously our
interest that they should be well equipped for that task._ They can only
borrow in the French and English markets.
But we had our own special difficulties, and I think I ought to mention
those. Two-thirds of our food supplies are purchased abroad. The
enormous quantities of raw materials for our manufactures and our
industries are largely absorbed in war equipment, and our ships in war
transport. We cannot pay as usual in exports, freights, and services;
our savings for the moment are not what they would be in the case of
peace. We cannot, therefore, pay for our imports in that way. We have to
purchase abroad. We have to increase our purchases abroad for war
purposes. In addition to that we have to create enormous credits to
enable other countries to do the same thing. The balance is, therefore,
heavily against us for the first time. There is no danger, but in a
conference of the kind we had at Paris I could not overlook the fact
that it was necessary for us to exercise great vigilance in regard to
our gold.
These were the complex problems we had to discuss and adjust, and we had
to determine how we could most effectually mobilize the financial
resources of the Allies so as to be of the greatest help to the common
cause. For the moment undoubtedly ours is still the best market in the
world. An alliance in a great war to be effective needs that each
country must bring all its resources, whatever they are, into the common
stock. An alliance for war cannot be conducted on limited liability
principles. If one country in the alliance has more trained and armed
men ready with guns, rifles, and ammunition than another she must bring
them all up against the common enemy, without regard to the fact that
the others cannot for the moment make a similar contribution. But it is
equally true that the same principle applies to the country with the
larger navy or the country with the greater resources in capital and
credit. They must be made available to the utmost for the purpose of the
alliance, whether the other countries make a similar contribution or
not. That is the principle upon which the conference determined to
recommend to their respective Governments a mobilization of our
financial resources for the war.
The first practical suggestion we had to consider was the suggestion
that has been debated very considerably in the press--the suggestion of
a joint loan. We discussed that very fully and we came to the conclusion
that it was the very worst way of utilizing our resources. It would have
frightened every Bourse and attracted none. It would have made the worst
of every national credit and the best of none. Would the interest paid
have been the interest upon which we could raise money, the rate at
which France could have raised money, or the rate at which Russia could
raise money? If we paid a high rate of interest we could never raise
more money at low rates. If instead of raising £350,000,000 a few weeks
ago for our own purposes we had floated a great joint loan of
£1,000,000,000, the House can very well imagine what the result would
have been. We decided after a good deal of discussion and reflection
that each country should raise money for its own needs within its own
markets in so far as their conditions allowed, but that if help were
needed by any country for outside purchases then those who could best
afford to render assistance for the time being should do so.