CHAPTER V

THE LEGALITY OF THE CLAIM FOR PENSIONS

“The application of morals to international politics is more a thing

to be desired than a thing which has been in operation. Also, when

I am made a participant in crime along with many millions of other

people, I more or less shrug my shoulders.”—Letter from a friendly

critic to the author of _The Economic Consequences of the Peace_.

We have seen in the preceding chapter that the claim for Pensions and

Allowances is nearly double that for Devastation, so that its inclusion

in the Allies’ demands nearly trebles the bill. It makes the difference

between a demand which can be met and a demand which cannot be met.

Therefore it is important.

In _The Economic Consequences of the Peace_ I gave reasons for the

opinion that this claim was contrary to our engagements and an act

of international immorality. A good deal has been written about it

since then, but I cannot admit that my conclusion has been seriously

disputed. Most American writers accept it; most French writers ignore

it; and most English writers try to show, not that the _balance_ of

evidence is against me, but that there are a few just plausible, or

just not–negligible, observations to be made on the other side. Their

contention is that of the Jesuit professors of Probabilism in the

seventeenth century, namely that the Allies are justified unless it is

absolutely certain that they are wrong, and that any probability in

their favor, however small, is enough to save them from mortal sin.

But most people in the countries of Germany’s former enemies are not

ready to excite themselves very much, even if my view is accepted.

The passage at the head of this chapter describes a common attitude.

International politics is a scoundrel’s game and always has been, and

the private citizen can scarcely feel himself personally responsible.

If our enemy breaks the rules, his action may furnish us with an

appropriate opportunity for expressing our feelings; but this must not

be taken to commit us to a cool opinion that such things have never

happened before and must never happen again. Sensitive and honorable

patriots do not like it, but they “more or less shrug” their shoulders.

There is some common sense in this. I cannot deny it. International

morality, interpreted as a crude legalism, might be very injurious to

the world. It is at least as true of these vast–scale transactions,

as of private affairs, that we judge wrongly if we do not take into

account _everything_. And it is superficial to appeal, the other way

round, to the principles which do duty when Propaganda is blistering

herd emotion with its brew of passion, sentiment, self–interest, and

moral fiddlesticks.

But whilst I see that nothing rare has happened and that men’s motives

are much as usual, I do still think that this particular act was an

exceptionally mean one, made worse by hypocritical professions of moral

purpose. My object in returning to it is partly historical and partly

practical. New material of high interest is available to instruct us

about the course of events. And if for practical reasons we can agree

to drop this claim, we shall make a settlement easier.

* * * * *

Those who think that it was contrary to the Allies’ engagements to

charge pensions against the enemy base this opinion on the terms

notified to the German Government by President Wilson, with the

authority of the Allies, on November 5, 1918, subject to which Germany

accepted the Armistice conditions.[93] The contrary opinion that the

Allies were fully entitled to charge pensions if they considered

it expedient to do so, has been supported by two distinct lines of

argument: first that the Armistice conditions of November 11, 1918,

were not _subject_ to President Wilson’s notification of November 5,

1918, but _superseded_ it, more particularly regarding Reparation;

and alternatively that the wording of President Wilson’s notification

properly understood does not exclude Pensions.

The first line of argument was adopted by M. Klotz and the French

Government during the Peace Conference, and has been approved more

recently by M. Tardieu.[94] It was repudiated by the whole of the

American Delegation at Paris, and never definitely supported by the

British Government. Responsible writers about the Treaty, other than

French, have not admitted it.[95] It was also explicitly abandoned by

the Peace Conference itself in its reply to the German observations on

the first draft of the Treaty. The second line of argument was that

of the British Government during the Peace Conference, and it was an

argument on these lines which finally converted President Wilson. I

will deal with the two arguments in turn.

1. Various persons have published particulars, formerly confidential,

which allow us to reconstruct the course of the discussions about the

Armistice. These begin with the examination of the Armistice Terms by

the Allied Council of War on November 1, 1918.[96]

The first point which emerges is that the reply of the Allied

Governments to President Wilson (which afterwards furnished the text of

his notification of Nov. 5, 1918, addressed to Germany), defining their

interpretation of the references to Reparation in the Fourteen Points,

was drawn up and approved at the _same_ session of the Supreme Council

(that of November 1, 2) which drew up the relevant clauses of the

Armistice Terms; and that the Allies did not finally approve the reply

to President Wilson until _after_ that they had approved that very

draft of the Armistice Terms which, according to the French contention,

superseded and negatived the terms outlined in the reply to President

Wilson.[97]

The record of the proceedings of the Supreme Council (as now disclosed)

lends no support to the existence in their minds of the duplicity

which the French contention attributes to them. On the other hand,

it makes it clear that the Council did not intend the references to

Reparation in the Armistice Terms to modify in any way their reply to

the President.

The record, in so far as it is relevant to this point, may be

summarized as follows:[98] M. Clemenceau called attention to the

absence of any reference in the first draft of the Armistice Terms to

the restitution of stolen property or to reparation. Mr. Lloyd George

replied that there ought to be some reference to restitution, but that

reparation was a Peace condition rather than an Armistice condition.

M. Hymans agreed with Mr. Lloyd George. MM. Sonnino and Orlando went

further and thought that neither had any place in the Armistice

Terms but were ready to accept the Lloyd George–Hymans compromise of

including Restitution but not Reparation. The discussion was postponed

for M. Hymans to draft a formula. On its resumption next day, it was

M. Clemenceau who produced a formula consisting of the three words

_Réparation des dommages_. M. Hymans, M. Sonnino, and Mr. Bonar Law

all expressed doubt whether this was in place in the Armistice Terms.

M. Clemenceau replied that he only wanted to mention the principle,

and that French public opinion would be surprised if there was no

reference to it. Mr. Bonar Law objected: “It is already mentioned in

our letter to President Wilson which he is about to communicate to

Germany. It is useless to repeat it.”[99] This observation met with no

contradiction, but it was agreed on sentimental grounds and for the

satisfaction of public opinion to add M. Clemenceau’s three words.

The Council then passed on to other topics. At the last moment, as

they were about to disperse, M. Klotz slipped in the words: “It would

be prudent to put at the head of the financial questions a clause

reserving the future claims of the Allies, and I propose to you the

wording ‘without prejudice to any subsequent claims and demands on the

part of the Allies.’”[100] It does not seem to have occurred to any of

those present that this text could be deemed of material importance or

otherwise than as protecting the Allies from the risk of being held

to have surrendered any existing claims through failure to mention

them in this document; and it was accepted without discussion. M.

Klotz afterwards boasted that by this little device he had abolished

the Fourteen Points, so far as they affected Reparation and Finance

(although the very same meeting of the Allies had despatched a Note to

President Wilson accepting them), and had secured to the Allies the

right to demand from Germany the whole cost of the War. But I think

the world will decide that the Supreme Council was right in attaching

to these words no particular importance. Personal pride in so smart a

trick has led M. Klotz, and his colleague M. Tardieu, to persist too

long with a contention which decent persons have now abandoned.

There was an episode which has lately come to light connected with

this passage which may be recounted as illustrating the pitfalls

of the world. As M. Klotz only introduced his form of words as the

Council was breaking up, it is likely that no undue attention was

concentrated on it. But ill–fortune may dog any one, and the same state

of affairs seems to have led to one of the scribes getting the words

down wrong. Instead of _revendication_ which means _demand_, the word

_renonciation_ which means _concession_ got written in the text handed

to the Germans for signature.[101] This word was not so suitable. But

M. Klotz suffered less inconvenience from this mistake than might have

been expected; since at the Peace Conference no one noticed that the

French text of the Armistice Agreement as officially circulated, which

M. Klotz used in arguing before the Reparation Committee, agreed in its

wording with what he had intended it to be and not with the text which

Germany had actually signed. Nevertheless it is the word _renonciation_

which is still to be found in the official texts of the British and

German Governments.[102]

2. The other line of argument raises more subtle intellectual issues

and is not a mere matter of prestidigitation. If it be granted that

our rights are governed by the terms of the Note addressed to Germany

by President Wilson in the name of the Allies on November 5, 1918, the

question depends on the interpretation of these terms. As Mr. Baruch

and M. Tardieu have now published between them the greater part of

the official reports (including very secret documents) bearing on the

discussion of this problem during the Peace Conference, we are in a

better position than before to assess the value of the Allies’ case.

The pronouncements by the President which were to form the basis of

Peace provided that there should be “no contributions” and “no punitive

damages,” but the invaded territories of Belgium, France, Rumania,

Serbia, and Montenegro were to be restored. This did not cover losses

from submarines or from air raids. Accordingly the Allied Governments,

when they accepted the President’s formulas, embodied a reservation,

on the point as to what “restoration” covered, in the following

sentence: “By _it_ (_i.e._, restoration of invaded territory) they

understand that compensation will be made by Germany for all damage

done to the civilian population of the Allies and to their property by

the aggression of Germany by land, by sea, and from the air.”

The natural meaning and object of these words, which, the reader

must remember, are introduced as an interpretation of the phrase

“restoration of invaded territory,” is to assimilate submarine and

cruiser aggression by sea and aeroplane and airship aggression by air

to military aggression by land, which, in all the circumstances, was

a reasonable extension of the phrase, provided it was duly notified

beforehand. The Allies rightly apprehended that, if they accepted the

phrase as it stood, “restoration of invaded territory” might be limited

to damage resulting from military aggression by land.

This interpretation of the reservation of the Allied Governments,

namely that it assimilated offensive action by sea or air to offensive

action by land, but that “restoration of invaded territory” could not

possibly include pensions and separation allowances, was adopted by the

American Delegation at Paris. They construed the German liability to be

in respect of the “direct physical damage to property of non–military

character and direct physical injury to civilians”[103] caused by such

aggression; the only further liability which they admitted being under

a different part of the President’s pronouncements, namely, those

relating to breaches of International law, such as the breach of the

Treaty of Neutrality in favor of Belgium, and the illegal treatment of

prisoners of war.

I doubt if any one would ever have challenged this interpretation

if the British Prime Minister had not won a General Election by

promises to extract from Germany more than this interpretation could

justify,[104] and if the French Government also had not raised

unjustifiable expectations. These promises were made recklessly. But it

was not easy for their authors to admit, so soon after they had been

given, that they were contrary to our engagements.

The discussion opened with the delegations, other than the American,

claiming that we had not committed ourselves to anything which

precluded our demanding from Germany all the loss and damage, direct

and indirect, which had resulted from the war. “One of the Allies,”

says Mr. Baruch, “went even further, and made claim for loss and

damage resulting from the fact that the Armistice was concluded so

unexpectedly that the termination of hostilities involved it in

financial losses.”

Various arguments were employed in the early stages, the British

delegates to the Reparation Committee of the Peace Conference, namely,

Mr. Hughes, Lord Sumner and Lord Cunliffe, supporting the demand for

complete war costs and not merely reparation for damage. They urged

(1) that one of the principles enunciated by President Wilson was that

each item of the Treaty should be just, and that it was in accordance

with the general principles of justice to throw on Germany the whole

costs of the war; and (2) that Great Britain’s war costs had resulted

from Germany’s breach of the Treaty of Neutrality of Belgium, and that

therefore Great Britain (but not necessarily, on this argument, all the

other Allies) was entitled to complete repayment in accordance with the

general principles of International law. These general arguments were,

I think, overwhelmed by the speeches made on behalf of the American

delegates by Mr. John Foster Dulles. The following are extracts from

what he said: “If it is in accordance with our sentiment that the

principles of reparation be severe, and in accord with our material

interest that these principles be all inclusive, why, in defiance of

these motives, have we proposed reparation in certain limited ways

only? It is because, gentlemen, we do not regard ourselves as free. We

are not here to consider as a novel proposal what reparation the enemy

should in justice pay; we have not before us a blank page upon which

we are free to write what we will. We have before us a page, it is

true; but one which is already filled with writing, and at the bottom

are the signatures of Mr. Wilson, of Mr. Orlando, of M. Clemenceau,

and of Mr. Lloyd George. You are all aware, I am sure, of the writing

to which I refer: it is the agreed basis of peace with Germany.”

Mr. Dulles then recapitulated the relevant passages and continued:

“Can there be any question that this agreement does constitute a

limitation? It is perfectly obvious that it was recognized at the time

of the negotiations in October and November 1918 that the reparation

then specified for would limit the Associated Governments as to the

reparation which they could demand of the enemy as a condition of

peace. The whole purpose of Germany was to ascertain the maximum which

would be demanded of her in the terms of peace, and the action of the

Allies in especially stipulating at that time, for an enlargement of

the original proposal respecting reparation is explicable only on the

theory that it was understood that once an agreement was concluded

they would no longer be free to specify the reparation which Germany

must make. We have thus agreed that we would give Germany peace if

she would do certain specified things. Is it now open to us to say,

‘Yes, but before you get peace you must do other and further things’?

We have said to Germany, ‘You may have peace if among other things

you perform certain acts of reparation which will cost you, say, ten

million dollars.’ Are we not now clearly precluded from saying, ‘You

can have peace provided you perform other acts of reparation which will

bring your total liability to many times that which was originally

stipulated’? No; irrespective of the justice of the enemy making the

latter reparation, it is now too late. Our bargain has been struck for

better or for worse; it remains only to give it a fair construction and

practical application.”

It is a shameful memory that the British delegates never withdrew their

full demands, to which they were still adhering when, in March 1921,

the question was taken out of their hands by the Supreme Council. The

American Delegation cabled to the President, who was then at sea,

for support in maintaining their position, to which he replied that

the American Delegation should dissent, and if necessary dissent

publicly, from a procedure which “is clearly inconsistent with what

we deliberately led the enemy to expect and cannot now honorably alter

simply because we have the power.”[105]

After this the discussions entered on a new phase. The British and

French Prime Ministers abandoned the contentions of their delegates,

admitted the binding force of the words contained in their Note of

November 5, 1918, and settled down to extract some meaning from

these words which would compose their differences and satisfy

their constituents. What constituted “damage done to the civilian

population”? Could not this be made to cover military pensions and the

separation allowances which had been made to the civilian dependents

of soldiers? If so, the bill against Germany could be raised to a

high enough figure to satisfy nearly every one. It was pointed out,

however, as Mr. Baruch records, “that financial loss resulting from the

absence of a wage–earner did not cause any more ‘damage to the civilian

population’ than did an equal financial loss involved in the payment

of taxes to provide military equipment and like war costs.” In fact,

a separation allowance or a pension was simply one of many general

charges on the Exchequer arising out of the costs of the war. If such

charges were to be admitted as civilian damage, it was a very short

step back to the claim for the entire costs of the war, on the ground

that these costs must fall on the taxpayer who, generally speaking, was

a civilian. The sophistry of the argument became exposed by pushing it

to its logical conclusion. Nor was it clear how pensions and allowances

could be covered by words which were themselves an interpretation of

the phrase, “restoration of invaded territory.” And the President’s

conscience, though very desirous by now to be converted (for he had on

hand other controversies with his colleagues which interested him more

than this one) remained unconvinced.

The American delegates have recorded that the final argument which

overbore the last scruples of the President was contained in a

Memorandum prepared by General Smuts[106] on March 31, 1919. Briefly,

this argument was, that a soldier becomes a civilian again after his

discharge, and that, therefore, a wound, the effects of which persist

after he has left the Army, is damage done to a civilian.[107] This is

the argument by which “damage done to the civilian population” came to

include damage done to soldiers. This is the argument on which, in the

end, our case was based! For at this straw the President’s conscience

clutched, and the matter was settled.

It had been settled in the privacy of the Four. I will give the final

scene in the words of Mr. Lamont, one of the American delegates:[108]

“I well remember the day upon which President Wilson determined to

support the inclusion of pensions in the Reparation Bill. Some of us

were gathered in his library in the Place des États Unis, having been

summoned by him to discuss this particular question of pensions. We

explained to him that we couldn’t find a single lawyer in the American

Delegation that would give an opinion in favor of including pensions.

All the logic was against it. ‘Logic! logic!’ exclaimed the President,

‘I don’t care a damn for logic. I am going to include pensions!’”[109]

Well! perhaps I was too near these things at the time and have

become touched in the emotions, but I cannot “more or less shrug my

shoulders.” Whether or not that is the appropriate gesture, I have here

set forth, for the inspection of Englishmen and our Allies, the moral

basis on which two–thirds of our claims against Germany rest.

FOOTNOTES:

[93] I have given the exact text of the relevant passages in _The

Economic Consequences of the Peace_, chapter v.

[94] _The Truth about the Treaty_, p. 208.

[95] _E.g._, _The History of the Peace Conference of Paris_, published

under the auspices of the Institute of International Affairs delivers

judgment as follows (vol. ii., p. 43): “It is this statement then

(_i.e._, President Wilson’s notification of Nov. 5, 1918) which must be

taken as the ruling document in any discussion as to what the Allies

were entitled to claim by way of reparation in the Treaty of Peace,

and it is difficult to interpret it otherwise than as a deliberate

limitation of their undoubted right to recover the whole of their war

costs.”

[96] The following particulars are taken from _Les Négociations

Secrètes et les Quatre Armistices avec pièces justificatives_ by

“Mermeix,” published at Paris by Ollendorff, 1921. This remarkable

volume has not received the attention it deserves. The greater part of

it consists of a verbatim transcript of the secret _Procès Verbaux_

of those meetings of the Supreme Council of the Allies which were

concerned with the Armistice Terms. On the face of it this disclosure

is authentic and is corroborated in part by M. Tardieu. There are many

passages of extraordinary interest on points not connected with my

present topic, as for example the discussion of the question whether

the Allies should insist on the surrender of the German fleet if the

Germans made trouble about it. Marshal Foch emerges from this record

very honorably, as determined that nothing unnecessary should be

demanded of the enemy, and that no blood should be spilt for a vain or

trifling object. Sir Douglas Haig was of the same opinion. In reply to

Col. House, Foch spoke thus: “If they accept the terms of the Armistice

we are imposing on them, it is a capitulation. Such a capitulation

gives us everything we could get from the greatest victory. In such

circumstances I cannot admit that I have the right to risk the life of

a single man more.” And again on October 31: “If our conditions are

accepted we can wish for nothing better. We make war only to attain

our ends, and we do not want to prolong it uselessly.” In reply to

a proposal by Mr. Balfour that the Germans in evacuating the East

should leave one–third of their arms behind them, Foch observed: “The

intrusion of all these clauses makes our document chimerical, since

the greater part of the conditions are incapable of being executed.

We should do well to be sparing with these unrealizable injunctions.”

Towards Austria also he was humane and feared the prolongation of the

blockade which the politicians were proposing. “I intervene,” he said

on October 31, 1918, “in a matter which is not a military one strictly

speaking. We are to maintain the blockade until Peace, that is to say

until we have made a new Austria. That may take a long time; which

means a country condemned to famine and perhaps impelled to anarchy.”

[97] This is corroborated by M. Tardieu, _op. cit._, p. 71.

[98] See Mermeix, _op. cit._, pp. 226–250.

[99] This very important remark by Mr. Bonar Law is also quoted by M.

Tardieu (_op. cit._, p. 70) and is therefore of undoubted authenticity.

[100] “Il serait prudent de mettre en tête des questions financières

une clause réservant les revendications futures des Alliés et je vous

propose le texte suivant: ‘Sous réserve de toutes revendications et

réclamations ultérieures de la part des Alliés.’”

[101] That is to say, this text ran, “Sous réserve de toute

renonciation et réclamation ultérieure,” instead of “Sous réserve de

toutes revendications et réclamations ultérieures.”

[102] I record this episode as an historical curiosity. In my opinion

it makes no material difference to the argument whether the text runs

“revendications et réclamations” or “renonciation et réclamation”;

for I regard either form of words as merely a protective phrase. But

the plausibility of M. Klotz’s position is decidedly weakened (if

so weak a case is capable of further weakening) if it is the latter

phrase which is authentic. The Editor of the Institute of International

Affairs’ _History of the Peace Conference of Paris_, who was the first

to discover and publish the discrepancy in question (vol. v., pp.

370–372), takes the view that the question of which text is used makes

a material difference to the value of M. Klotz’s argument.

[103] Baruch, _op. cit._, p. 19.

[104] As Mr. Baruch puts it (_op. cit._, p. 4): “At an election held

_after the Armistice and agreement as to the basic terms of peace_, the

English people, by an overwhelming majority, returned to power their

Prime Minister _on the basis of an increase in the severity of these

terms of the peace_, especially those of reparation.” (The italics are

mine.)

[105] Baruch, _op. cit._, p. 25.

[106] This Memorandum, which has been published _in extenso_ by Mr.

Baruch (_op. cit._, p. 29 _seq._), belonged to the category of most

secret documents. It has been given to the world by itself without the

accompanying circumstances which, without justifying its arguments

(on which indeed no further light could be thrown beyond what we

already have in the narrative of Mr. Baruch), might yet throw light on

individual motives. I agree with the comment made by _The Economist_

(Oct. 22, 1921) in reviewing Vol. IV. of the _History of the Peace

Conference of Paris_ (published under the auspices of the Institute

of International Affairs), which has reprinted this Memorandum, that

“a very serious injustice will be done to the reputation of General

Smuts if this document continues to be reproduced and circulated

without any explanation of the circumstances in which it was prepared.”

Nevertheless it is well that the world should have this document, and

it must take its place in a story which is more important to the world

than the motives and reputations of individual actors in it.

[107] The following is the salient passage of the Memorandum: “After

the soldier’s discharge as unfit he rejoins the civilian population,

and as for the future he cannot (in whole or in part) earn his own

livelihood, he is suffering damage as a member of the civilian

population, for which the German Government are again liable to make

compensation. In other words, the pension for disablement which he

draws from the French Government is really a liability of the German

Government, which they must under the above reservation make good to

the French Government. It could not be argued that as he was disabled

while a soldier he does not suffer damage as a civilian after his

discharge if he is unfit to do his ordinary work. He does literally

suffer as civilian after his discharge, and his pension is intended

to make good this damage, and is therefore a liability of the German

Government.”

[108] _What Really Happened at Paris_, p. 272.

[109] Mr. Lamont adds that “it was not a contempt of logic, but

simply an impatience of technicality; a determination to brush aside

verbiage and get at the root of things. There was not one of us in the

room whose heart did not beat with a like feeling.” These words not

merely reflect a little naïvely the modern opportunist’s impatience

of legality and respect for the _fait accompli_, but also recall the

atmosphere of exhaustion and the longing of everyone to be finished,

somehow, with this dreadful controversy, which for months had outraged

at the same time the intellects and the consciences of most of the

participators. Yet, even so, to their lasting credit, the American

Delegation had stood firm for the law, and it was the President, and he

alone, who capitulated to the lying exigencies of politics.

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