University of Virginia Library

1. The Revision of the Treaty

Are any constitutional means open to us for altering the treaty? President Wilson and General Smuts, who believe that to have secured the covenant of the League of Nations outweighs much evil in the rest of the treaty, have indicated that we must look to the League for the gradual evolution of a more tolerable life for Europe. 'There are territorial settlements', General Smuts wrote in his statement on signing the peace treaty, 'which will need revision. There are guarantees laid down which we all hope will soon be found out of harmony with the new peaceful temper and unarmed state of our former enemies. There are punishments foreshadowed over most of which a calmer mood may yet prefer to pass the sponge of oblivion. There are indemnities stipulated which cannot be enacted without grave injury to the industrial revival of Europe, and which it will be in the interests of all to render more tolerable and moderate... I am confident that the League of Nations will yet prove the path of escape for Europe out of the ruin brought about by this war.' Without the League, President Wilson informed the Senate when he presented the treaty to them early in July 1919, '... long-continued supervision of the task of reparation which Germany was to undertake to complete within the next generation might entirely break down;[2] the reconsideration and revision of administrative arrangements and restrictions which the treaty prescribed, but which it recognised might not provide lasting advantage or be entirely fair if too long enforced, would be impracticable.'

Can we look forward with fair hopes to securing from the operation of the League those benefits which two of its principal begetters thus encourage us to expect from it? The relevant passage is to be found in article XIX of the covenant, which runs as follows:

But alas! Article V provides that 'Except where otherwise expressly provided in this covenant or by the terms of the present treaty, decisions at any meeting of the assembly or of the council shall require the agreement of all the members of the League represented at the meeting.' Does not this provision reduce the League, so far as concerns an early reconsideration of any of the terms of the peace treaty, into a body merely for wasting time? If all the parties to the treaty are unanimously of opinion that it requires alteration in a particular sense, it does not need a League and a covenant to put the business through. Even when the assembly of the League is unanimous it can only 'advise' reconsideration by the members specially affected. But the League will operate, say its supporters, by its influence on the public opinion of the world, and the view of the majority will carry decisive weight in practice, even though constitutionally it is of no effect. Let us pray that this be so. Yet the League in the hands of the trained European diplomatist may become an unequalled instrument for obstruction and delay. The revision of treaties is entrusted primarily, not to the council, which meets frequently, but to the assembly, which will meet more rarely and must become, as any one with an experience of large inter-Ally conferences must know, an unwieldy polyglot debating society in which the greatest resolution and the best management may fail altogether to bring issues to a head against an opposition in favour of the status quo. There are indeed two disastrous blots on the covenant--article V, which prescribes unanimity, and the much-criticised article X, by which 'The members of the League undertake to respect and preserve as against external aggression the territorial integrity and existing political independence of all members of the League.' These two articles together go some way to destroy the conception of the League as an instrument of progress, and to equip it from the outset with an almost fatal bias towards the status quo. It is these articles which have reconciled to the League some of its original opponents, who now hope to make of it another Holy Alliance for the perpetuation of the economic ruin of their enemies and the balance of power in their own interests which they believe themselves to have established by the peace. But while it would be wrong and foolish to conceal from ourselves in the interests of 'idealism' the real difficulties of the position in the special matter of revising treaties, that is no reason for any of us to decry the League, which the wisdom of the world may yet transform into a powerful instrument of peace, and which in articles XI-XVII[3] has already accomplished a great and beneficent achievement. I agree, therefore, that our first efforts for the revision of the treaty must be made through the League rather than in any other way, in the hope that the force of general opinion, and if necessary, the use of financial pressure and financial inducements, may be enough to prevent a recalcitrant minority from exercising their right of veto. We must trust the new governments, whose existence I premise in the principal Allied countries, to show a profounder wisdom and a greater magnanimity than their predecessors.

We have seen in chapters 4 and 5 that there are numerous particulars in which the treaty is objectionable. I do not intend to enter here into details, or to attempt a revision of the treaty clause by clause. I limit myself to three great changes which are necessary for the economic life of Europe, relating to reparation, to coal and iron, and to tariffs.

Reparation. If the sum demanded for reparation is less than what the Allies are entitled to on a strict interpretation of their engagements, it is unnecessary to particularise the items it represents or to hear arguments about its compilation. I suggest, therefore, the following settlement:

(1) The amount of the payment to be made by Germany in respect of reparation and the costs of the armies of occupation might be fixed at £2,000 million.

(2) The surrender of merchant ships and submarine cables under the treaty, of war material under the armistice, of state property in ceded territory, of claims against such territory in respect of public debt, and of Germany's claims against her former Allies, should be reckoned as worth the lump sum of £500 million, without any attempt being made to evaluate them item by item.

(3) The balance of £1,500 million should not carry interest pending its repayment, and should be paid by Germany in thirty annual instalments of £50 million, beginning in 1923.

(4) The reparation commission should be dissolved or, if any duties remain for it to perform, it should become an appanage of the League of Nations and should include representatives of Germany and of the neutral states.

(5) Germany would be left to meet the annual instalments in such manner as she might see fit, any complaint against her for non-fulfilment of her obligations being lodged with the League of Nations. That is to say, there would be no further expropriation of German private property abroad, except so far as is required to meet private German obligations out of the proceeds of such property already liquidated or in the hands of public trustees and enemy-property custodians in the Allied countries and in the United States; and, in particular, article 260 (which provides for the expropriation of German interests in public utility enterprises) would be abrogated.

(6) No attempt should be made to extract reparation payments from Austria.

Coal and Iron.--(1) The Allies' options on coal under annex V should be abandoned, but Germany's obligation to make good France's loss of coal through the destruction of her mines should remain. That is to say, Germany should undertake 'to deliver to France annually for a period not exceeding ten years an amount of coal equal to the difference between the annual production before the war of the coal-mines of the Nord and Pas de Calais, destroyed as a result of the war, and the production of the mines of the same area during the years in question; such delivery not to exceed 20 million tons in any one year of the first five years, and 8 million tons in any one year of the succeeding five years.' This obligation should lapse, nevertheless, in the event of the coal districts of Upper Silesia being taken from Germany in the final settlement consequent on the plebiscite.

(2) The arrangement as to the Saar should hold good, except that, on the one hand, Germany should receive no credit for the mines, and, on the other, should receive back both the mines and the territory without payment and unconditionally after ten years. But this should be conditional on France's entering into an agreement for the same period to supply Germany from Lorraine with at least 50% of the iron ore which was carried from Lorraine into Germany proper before the war, in return for an undertaking from Germany to supply Lorraine with an amount of coal equal to the whole amount formerly sent to Lorraine from Germany proper, after allowing for the output of the Saar.

(3) The arrangement as to Upper Silesia should hold good. That is to say, a plebiscite should be held, and in coming to a final decision 'regard will be paid (by the principal Allied and Associated Powers) to the wishes of the inhabitants as shown by the vote, and to the geographical and economic conditions of the locality'. But the Allies should declare that in their judgment 'economic conditions' require the inclusion of the coal districts in Germany unless the wishes of the inhabitants are decidedly to the contrary.

(4) The coal commission already established by the Allies should become an appanage of the League of Nations, and should be enlarged to include representatives of Germany and the other states of Central and Eastern Europe, of the northern neutrals, and of Switzerland. Its authority should be advisory only, but should extend over the distribution of the coal supplies of Germany, Poland, and the constituent parts of the former Austro-Hungarian empire, and of the exportable surplus of the United Kingdom. All the states represented on the commission should undertake to furnish it with the fullest information, and to be guided by its advice so far as their sovereignty and their vital interests permit.

Tariffs. A free trade union should be established under the auspices of the League of Nations of countries undertaking to impose no protectionist tariffs[4] whatever against the produce of other members of the union. Germany, Poland, the new states which formerly composed the Austro-Hungarian and Turkish empires, and the mandated states should be compelled to adhere to this union for ten years, after which time adherence would be voluntary. The adherence of other states would be voluntary from the outset. But it is to be hoped that the United Kingdom, at any rate, would become an original member.

By fixing the reparation payments well within Germany's capacity to pay, we make possible the renewal of hope and enterprise within her territory, we avoid the perpetual friction and opportunity of improper pressure arising out of treaty clauses which are impossible of fulfilment, and we render unnecessary the intolerable powers of the reparation commission. By a moderation of the clauses relating directly or indirectly to coal, and by the exchange of iron ore, we permit the continuance of Germany's industrial life, and put limits on the loss of productivity which would be brought about otherwise by the interference of political frontiers with the natural localisation of the iron and steel industry.

By the proposed free trade union some part of the loss of organisation and economic efficiency may be retrieved which must otherwise result from the innumerable new political frontiers now created between greedy, jealous, immature, and economically incomplete, nationalist states. Economic frontiers were tolerable so long as an immense territory was included in a few great empires; but they will not be tolerable when the empires of Germany, Austria-Hungary, Russia, and Turkey have been partitioned between some twenty independent authorities. A free trade union, comprising the whole of Central, Eastern, and south-Eastern Europe, Siberia, Turkey, and (I should hope) the United Kingdom, Egypt, and India, might do as much for the peace and prosperity of the world as the League of Nations itself. Belgium, Holland, Scandinavia, and Switzerland might be expected to adhere to it shortly. And it would be greatly to be desired by their friends that France and Italy also should see their way to adhesion.

It would be objected, I suppose, by some critics that such an arrangement might go some way in effect towards realising the former German dream of Mittel-Europa. If other countries were so foolish as to remain outside the union and to leave to Germany all its advantages, there might be some truth in this. But an economic system, to which everyone had the opportunity of belonging and which gave special privilege to none, is surely absolutely free from the objections of a privileged and avowedly imperialistic scheme of exclusion and discrimination. Our attitude to these criticisms must be determined by our whole moral and emotional reaction to the future of international relations and the peace of the world. If we take the view that for at least a generation to come Germany cannot be trusted with even a modicum of prosperity, that while all our recent allies are angels of light, all our recent enemies, Germans, Austrians, Hungarians, and the rest, are children of the devil, that year by year Germany must be kept impoverished and her children starved and crippled, and that she must be ringed round by enemies; then we shall reject all the proposals of this chapter, and particularly those which may assist Germany to regain a part of her former material prosperity and find a means of livelihood for the industrial population of her towns. But if this view of nations and of their relation to one another is adopted by the democracies of Western Europe, and is financed by the United States, heaven help us all. If we aim deliberately at the impoverishment of Central Europe, vengeance, I dare predict, will not limp. Nothing can then delay for very long that final civil war between the forces of reaction and the despairing convulsions of revolution, before which the horrors of the late German war will fade into nothing, and which will destroy, whoever is victor, the civilisation and the progress of our generation. Even though the result disappoint us, must we not base our actions on better expectations, and believe that the prosperity and happiness of one country promotes that of others, that the solidarity of man is not a fiction, and that nations can still afford to treat other nations as fellow-creatures?

Such changes as I have proposed above might do something appreciable to enable the industrial populations of Europe to continue to earn a livelihood. But they would not be enough by themselves. In particular, France would be a loser on paper (on paper only, for she will never secure the actual fulfilment of her present claims), and an escape from her embarrassments must be shown her in some other direction. I proceed, therefore, to proposals, first, for the adjustment of the claims of America and the Allies amongst themselves; and second, for the provision of sufficient credit to enable Europe to re-create her stock of circulating capital.