File No. 763.72/7284

The Chargé in Switzerland ( Wilson ) to the Secretary of State

No. 1481

Sir: At the request of Mr. James C. McNally, Vice Consul in charge of the Consulate General at Zürich, I have the honor to transmit herewith enclosed a report which Mr. McNally has drawn up on the conditions in Germany.

While I can not, of course, subscribe to all the conclusions which Mr. McNally has drawn in his report (no two men can think exactly alike on questions of such magnitude), the report is packed with information of great value.

I have [etc.]

Hugh R. Wilson
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[Enclosure]

Report by the Vice Consul at Zürich ( McNally )

During the winter of 1916–17, the German military authorities, in anticipation of the Allied announced spring offensive on the Somme, had drawn extensively on their reserve supplies of all kinds to meet this drive, the nature and extent of which had been carefully estimated in advance. In taxing this reserve supply, particularly in stocks of ammunition, explosives, field guns, gun metals, and materials and motor parts for airships, they had considered well the exact waste necessary to protect their strategic retreat already planned as early as December, 1916. This backward movement of an enormous army, the uprooting from concrete bases of hundreds of heavy field guns and their transportation back with munitions, wagons and supplies, out of possible range of the enemy’s artillery fire, proved a stupendous undertaking and its success depended upon the secrecy in which it could be accomplished; for had the Allied forces advanced with their usual dash in the midst of this moving, a terrible and possibly a final blow would have been delivered to the flower of the German Army.

This is particularly demonstrated by the damage inflicted by the heavy British artillery fire, directed against what they considered the German positions, upon the remnant of the army detailed to cover the main German retreat, which was well under way before the Allies opened their great artillery fire. These losses covered men, munitions and field guns, and I am reliably informed that the nature and extent of the Allied artillery fire came as a huge surprise to the German Army, as did the speedy advance following this record artillery attack in which the dash and daring of the Allied forces took the Germans particularly off their feet. Therefore the expected successful strategic retreat, so carefully arranged, was more or less disrupted by the force and general character of the enemy’s energetic maneuver. I am informed that the German losses during this drive and the stupendous artillery bombardment of the Allies numbered over 100,000 men in killed and wounded, many field guns and munitions.

The order regarding field guns is to save as many as possible, even though disabled, for use in moulding other guns. This is due to the growing shortage of gun-making materials. During the months of April, May and June of the present year, the growing scarcity of steel became alarming, but extra supplies from Sweden have replenished their stocks so that work on ersatz cruisers as well as new battleships has been renewed.

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In the early part of the present year, the German military authorities submitted to the various government plants, engaged in the manufacture of war munitions and raw materials, a careful estimate of requirements for different periods of the year, and directed that in the interest of economy they should adhere strictly to the program as laid down, with the hope that they could so systematize the output as to cover the 1917 and much of the 1918 requirements if necessary. It was thought, in thus operating under a system, that in the matter of army requirements the war could be continued at least through 1918; but the aggressiveness of the Allied attacks as above, and the sporadic awakening of the Russian Army, forced them to change these estimates and to draw on reserve supplies. In many instances supplies intended to carry through 1917 were exhausted before August 1 of the present year.

There is an apparent shortage in hand grenades, motors for airships and submarines, heavy guns, field mortars and howitzers; besides, many of the field guns now in use have lost their effectiveness through rough and constant usage and are now only in commission because others are not available.

Many of the guns in use at Flanders have been taken from the fleet, which, being mined in and no further sea fight expected, can well spare them. This fact is particularly emphasized by the many accidents to the smaller German war craft that proceed to and from the North Sea entrance to Wilhelmshaven.

The fierce Allied offensive in Flanders, and the compelling necessity for German defensive action, caused another drain on their ever-decreasing supplies, a condition that is becoming a source of great worriment to German military authorities, who are living in the hope of a substantial lull in the enemy activity to afford them an opportunity to replenish their reserve stocks in munitions, made low through an extravagant expenditure of supplies.

In my judgment, the Germans are running short of munitions. Not to such an extent as to forecast immediate danger, but to make them wary of a lavish use. Raw materials are becoming scarcer and while they have on hand apparently enough to meet their present requirements in explosives and all inflammable substances, they are being drawn upon beyond the defined measure.

A constant and unceasing drive on the part of the Allies, followed by a dash that would scarcely permit them to get well set; a continuous maneuver that would force them to expend continually their munitions and use their field guns of all sorts, would, I believe, go far at this time towards a lesser resistance on their part, and while this might involve the loss of many men it would certainly hasten the end.

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I have been reliably informed that the German Military are extremely worried about their decreasing stocks of raw materials, and they are endeavoring in every way to provide against it. The great scarcity of wool in Germany is being seriously felt, while cotton and certain raw materials used in its manufacture utilized in the manufacture of war munitions are almost exhausted. The German scientists are working overtime to create something of an ersatz nature that will tide them over this want.

The German military authorities are extracting glycerine and other substances from the carcasses of dead horses and other animals. There is no truth in the report that human bodies are used for that purpose.

Up to the time of the recent demoralization of the Russian Army and the German advance in Galicia, the spirit of depression and discontent was noticeable throughout Germany. The workmen particularly, suffering from insufficient nourishment, were readily influenced by certain Russian propagandists, which, with the announcement that the United States had entered the war against them, had for a time a demoralizing effect on the people. The great Russian setback and the German advance towards Russian granaries proved a great uplift and stimulated to activity those who had apparently abandoned hope of success, so that to-day, fed up as they are by the authorities with promises of immediate food relief, the German people are for the present at least united in the determination to fight to the end.

In May and June of the present year about 10,000 workmen in Kiel engaged in naval vocations made a demonstration against the German governor there, Admiral Bachmann, crying for potatoes. They claimed that, while the officers and men on the ships were liberally supplied, they and their families were in want. The nature of the demonstration was such as to intimidate the authorities, for they promised to comply with the wishes of the workmen, and to do so the officers and men of the fleet were forced to give over their potato supply for two weeks.

This class of workmen, thoroughly imbued with socialistic ideas, knowing their own present value in the building and repairing of warships, submarines and torpedo boats and employed in other naval marine vocations, are a living menace to the German Government which presents an opportunity if availed of which might prove a basis on which to build up a revolt against ruling conditions in Germany.

The German people are led to believe that a victory for the Allies would compass their disgrace and degradation and cause their financial ruin; that the British would annihilate and force them into abject slavery in retaliation for the losses inflicted on them through [Page 241] the Zeppelin raids and submarine warfare; and that under these circumstances it is better to die fighting for the Fatherland than to be shot down like dogs. This false statement, strengthened by the excessive peace terms promulgated by Lloyd George, which lost nothing in their severity by German publication, not only gave the German pacifists nothing to stand on, but served to cause them to join with the Government in a fight to the end.

I am reliably informed that when the German Chancellor in December, 1916, sent his peace feeler to the world, it was because of the growing strength of the peace advocates both in the Reichstag and among the people, which was being felt in Berlin Government circles. He attached no peace terms to his insincere overtures, made only to draw from the Allies the nature of their peace terms in case Germany should express a desire for peace. The declaration of Lloyd George proved the death knell to the peace party in Germany and was given out by the Chancellor as a reply to the German peace party, who stood aghast at the extreme severity of the terms. From that time they agreed to forego all peace overtures and to join the Government in the prosecution of the war. My informant is certain that, had Lloyd George merely made representations that would create a basis for discussion, the peace party in Germany would probably have forced the Government to sue for peace. At this writing, there is no peace party of any strength in Germany. The leaders of the workmen’s demonstrations are singly withdrawn from their vocations and sent to the front. This quiet transportation is made to avoid suspicion and not to indicate [sic] the wrath of the labor party. Nevertheless, all the leaders of such demonstrations sooner or later get their notice to go into the trenches. The Germans have learned well the lessons that brought on the Russian revolution and are profiting by that country’s woeful experience.

In several parts of Germany incipient food riots have been started but they were suppressed without trouble. In Kiel only was the demonstration considered serious and the fact that none of the known leaders were openly punished shows to what a degree of patience the German authorities have come in the appreciation of conditions. In this Kiel uprising the authorities gave out the statement that it had been fostered by British gold and that the Russian propagandists, who bore German names, were hired by the British to scatter this gold and create discontent among the workmen.

From an inside knowledge of exact conditions I make the same declaration that I did in the ealy part of 1916 even with a failing crop against it, that the Germans cannot be forced to their knees through the starvation process. The present crop is better than those of former years; the people have in their winter coal, and bakeries [Page 242] that have been closed for a year or more are doing business again and the supply of bread has increased one-third over last year. A revolution, in the face of the unaltered peace terms of Lloyd George, edited to infuriate the German people, is out of the question. To cause a division in Germany some terms should be promulgated that cannot be interpreted as stripping them of all they possess and making them vassals of England. Their minds must be disabused of the idea that should the Allies dictate peace terms they would include a demand for the confiscation of life, liberty and property. If they could realize that the defeat of German militarism would not deprive them of all earthly hopes it would go far to stimulate them to a degree of independence that might develop into a force sufficient to bring the war party to its true sense of duty, circumstances considered.

I believe that, if a publication propaganda could be organized to enlighten the German people as to the exact aim and intention of the Allies; if the words of President Wilson, as spoken in his address delivered at Washington, Flag Day, June 14, 1917: “We are not the enemies of the German people and they are not our enemies,” etc., could be brought to their attention as expressed, it would have a great effect in determining their future attitude. To this end I have taken up with the Legation the matter of cooperating with the British in a publication propaganda through the medium of the Swiss press, of which probably fifty thousand or more copies filter through to Germany daily, the matter to be written here by persons employed for that purpose and having the Swiss coloring. In this enterprise the British would share the cost.

With the people open to conviction, the drain of German war supplies through repeated offensives and ruses that would cause them to expend them, with the excessive work their field guns would be forced to do, will certainly wear down their defensive strength sooner or later and bring us closer to the goal of victory.

For some peculiar reason the German military and naval authorities will not bring themselves to believe that the United States is seriously in this war. They credit us with a scare-head demonstration that lacks a substantial force and that beyond the massing of some forces in France to buoy up the waning hopes of the French people, and a demonstration at home to meet the British demands, we are peaceably inclined and will not enter into the war as an aggressive field or naval factor.

A story has recently come to me concerning the sinking of the Lusitania that may be of interest. A son of Schumann-Heink, the great singer in the United States, is now a petty officer on the German submarine UC–52. He has confessed to his commander that before [Page 243] the Lusitania sailed he had been employed by Captain Boy-Ed, the German naval attaché at Washington, to place among the cargo of the Lusitania bombs or infernal machines timed to explode after the ship had reached its dock in Liverpool, the idea being to not only destroy the ship but the Liverpool docks as well; that it was on account of this knowledge, and fearful lest the explosion might take place before the time set, that Count Bernstorff warned the people booked for passage on that ship to cancel; that the miscarrying of Boy-Ed’s plans was the cause of his great rage at the interference of Captain Lieutenant Schweiger, who torpedoed the ship.

This story would seem to agree with Schweiger’s repeated declaration to friends that when he torpedoed the Lusitania he had no knowledge of the name of the ship other than it was British; that after firing one torpedo he submerged and came up to periscope observation later, only to note the name of the ship from the rear before the Lusitania sank; that he had no special orders to shoot down that particular ship but was prepared to take the initiative and torpedo any British ship that came within reach of his torpedo. He further stated that the ship so maneuvered as to give him a broadside, while reducing its speed from 24 to about 18 knots; that the ship, which could only evade the deadly contact of a torpedo by speed and steering a zigzag course, slowed down at a point where they knew, if a torpedo was to be launched against them, the submarine would be in that vicinity if anywhere; that he was there the day before and caught the British wireless messages showing that they had knowledge of his being there, and yet they did not send out convoys or instruct the captain of the Lusitania to proceed in the only way that could defeat the aim and object of a torpedo; that when his torpedo struck the ship and exploded, the smoke therefrom was entirely different in color from that of an explosion that occurred a minute later in another part of the ship.

This is the substance of the report on the sinking of the Lusitania made by Kapitänleutnant Schweiger to the German Admiralty immediately after he had accomplished his dastardly work. He was not decorated for some time after the sinking of the Lusitania, and when he was, it was not with the high order of the “Pour Le Merite” as reported, but with the lesser order of the “Household” or the “Hohenzollern” decoration. While his atrocious deed is not envied by his fellow officers in general, he is, in some circles in Germany, considered a hero. I am informed that in reply to an inquiry of a fellow submarine commander as to how he felt when he saw the scores of his women and children victims struggling in the water for life, he said that “It had no more effect on him than if they were a lot of sheep.” I cannot vouch for the truth of this [Page 244] statement but it comes from what I deem a reliable source. He is now operating, and with success, from the Zeebrugge base in Flanders.

I know of one submarine commander who declared, in the presence of four other naval officers, that if he was forced to sink an American vessel with a loss of life, he would consider himself a murderer. This sentiment is shared in spots in the German Navy.

The crystallization of the sentiment that compassed the downfall of Bethmann-Hollweg and others of the Government was due mostly to the failure of the Government to carry out their promise to the people that England would, through the unrestricted submarine warfare, be forced to sue for peace before August 1 last, as reported by me when the declaration was made in January, 1917. While the German people were more or less depressed because of the failure of their submarines to bring England to her knees on schedule time, as promised by the chief of the Admiralty staff, Admiral von Holtzendorff, and vouched for by Von Hindenberg and the German Admiralty, the Navy are thoroughly convinced that they can inevitably bring about what they failed to do on or before August 1, 1917, as promised. The young commanders as well as those who have been operating with submarines since the war opened are enthusiastic in their work, and, working under the expectation of high decorations, they have developed a daring heretofore unknown in submarine warfare.

The greatest registered successes so far come from the work of the smaller type of submarine, such as the 300-ton. These boats ordinarily carry 2 torpedoes and a crew of 12 men. They are armed with small 3–inch guns and operate with one small motor seemingly but little larger than those of the automobile type. They are, on account of their smallness, better able to escape mines and to maneuver about through the meshes of nets laid in the zones of their operations. Their size and motor power are a fatal disadvantage if they are once netted, for their strength and motor power are such that they cannot work through the nets, while the larger boats can.

It is certain that the military and naval authorities hope to win the war with their submarines. The commanders have been secretly advised to prosecute this work to the limit and to take every risk to compass the purpose for which this mode of warfare was introduced, and that, if they can continue to work as well as they have done thus far, victory will soon be theirs, and they, the submarine commanders, will have contributed much to that end. They are especially urged to energetic action before winter sets in and the consequent stormy weather that might limit their usefulness, although they are rapidly providing against this in the reservation [Page 245] of the larger types and in the rapid building of the submarine cruisers, regarding which I have already reported.

The German Admiralty have seemingly mapped out a program of activity against the United States if they are forced to resort to defensive measures. These larger types can remain at sea under their own fuel for about two months, while the next in size can, if not constantly steaming, remain out almost the same time. They would, according to information received, string these boats along the Atlantic in pairs, and waylay our ships and transports. They bank on the stormy seas to hide their periscopes and give them a better opportunity to work.

The Admiralty has informed the submarine commanders that the published stocks in foodstuffs and other supplies in England are a huge bluff and that with their sinkings of about 800,000 a month, which they state is accurate, they have gotten England to the anxious stage. I can confidently state that not only do these submarine commanders believe the above, but are as certain of being able to win the war as that night follows day. They leave the Kiel Harbor with flags flying and flower-bedecked, while the bands and the people give them a hearty send-off. Many of them realize that their chances of returning are small, but they manifest no anxiety and it is a matter of do or die with them. The noted submarine commanders, Hersing, Steinbrink, Arnault de la Perrière, Steuter and others, are now working from the Zeebrugge base in Flanders. While the submarines are commanded by Oberleutnants and Kapitänleutnants, the submarine cruisers are under the command of Korvetten-Captains or three-striped officers. Four of these boats already completed have made successful trial trips but have not, up to the middle of the present month, been at sea. They are being reserved for future operations.

The smaller boats, that are being used principally for work against freight-carrying steamers, carry two torpedoes, as above mentioned. The time set for their being at sea is three weeks, after which they must report to their base, unless their torpedoes are exhausted, when they can come in for a further supply.

A new squadron, the fourth, has been formed, and comprises the Kaiser, Kaiserin, Friedrich der Grosse and two others of that type. The Kaiser is the flagship and the squadron is commanded by Admiral Mauve.

The Baden is the flagship of the Grand Fleet, the Commander in Chief being Admiral Scheer. The Hindenburg is the flagship of the battle-cruiser squadron with Admiral Hipper in command. The latter ship has a complement of 800 men, and is armed with 30-centimeter guns.

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The Baden, Bayern, Markgraf, Kronprinz, Grosser Kurfürst and others of the larger ships now have 38-centimeter guns in place of the 30-centimeter guns with which they were armed during the battle off Jutland.

My latest information is that the German Army is well equipped with uniforms, boots, etc., and is provided against the winter weather with warm underclothing.

I am also reliably informed that the sinkings thus far since the opening of the submarine warfare on the first of February last, based on individual submarine commanders’ reports, average close to 800,000 tons a month. As a commander’s worth is based on the number of tons destroyed, and upon this showing depends the nature of his decorations, the commander is obliged to prove by four of his crew that the reported sinkings did take place, and I am told that one commander reported falsely, saying that his watch officer was ill and that his men being below could not see the effect of the torpedo; that he alone being at the periscope saw the effect of the torpedo. It was afterwards ascertained that the ship reported sunk was not sunk, and the commander was demoted to a mine-laying submarine, his case to be taken up after the war. This leniency was manifested because he had performed good services.

The old Deutschland, the freight-carrying submarine, is now a mine-laying submarine, as are the three others that were built for commercial purposes. They have been converted into mine layers, but carry guns and torpedoes like the others. Paul Konig, however, the commander of the Deutschland during her voyage to the United States with freight, is no longer with her, and has been appointed to some civil employment in Bremen.

The confidence of the German people is based on what they declare to be an exact knowledge of the condition of the French and British Army. They, of course, do not reckon the United States in their conclusions. They have, however, openly declared that without the assistance and encouragement of the United States their task could be completed this winter. They also declare that if we are seriously in the war we will have to win it for the Allies. They do not regard us as a very forceful factor in the struggle and say that a few months at the front will demonstrate that we are not prepared for the pace set in the present awful struggle.

The German system has operated effectively because unhampered by outside influences. It is a one-man affair in both branches, the Army and the Navy, and they are not hampered or molested in their operations by committees or legislative bodies. The work of the Reichstag is to vote credits, seemingly, and their influence does not in the least tend to military or naval things. Every branch [Page 247] and department has its recognized head and he is to all appearances responsible only to the Kaiser or the powers representing the Kaiser. Prince Adalbert, the Kaiser’s sailor son, is captain of the cruiser Danzig.

The fleets are keeping up their night and day practice with the submarine and torpedo-boat maneuvers as the leading feature.

A strict watch is being kept on Denmark and the Germans have placed their men and armament in position to invade that country and bombard should they manifest any special degree of friendship for the Allies.

The Germans claim that the recent offensive in Flanders was stopped after the Allies had suffered severely and that the reports in British newspapers as to German losses are as usual greatly exaggerated.

From the most reliable information I can say that the morale of the German Army and Navy is the same as in the early part of the war. They are fighting strong and their different divisions are fully equipped for the present. They fully believe they are winning the war and under that impression they are content to go right on. The submarine commanders express themselves to fellow officers of other branches of the Navy to the effect that they will force England to the starvation point, when, they contend, the people will rise up and demand peace.

Referring again to the battle cruiser Hindenburg , just put into commission, I have been informed that on her trial trip she developed such defects in machinery and construction that many internal improvements were made; that the officers on board feel that these defects have not been substantially remedied; and express the belief that, with the small caliber of her heaviest guns (30 centimeters), size of ship considered, she will not do the work expected of her in a sea fight. I learn that in a recent report made by a submarine commander who was operating on either the coast of Ireland or Scotland, he stated that upon coming to a periscope observation he found himself between two American destroyers, both of which he could have torpedoed without trouble had he been permitted to do so.

The Germans are fighting under the belief that France is practically all in, that they are merely holding their men in the trenches under the promise that the American soldiers will soon take their places and permit the French to return to their homes. They boast that Russia will offer no substantial resistance to their onward march, which confidence in Russian military disruption is manifested through the good work of their agents and the extravagant outlay of money among the various parties there.

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A revolution in Germany, from present information, is a very remote possibility. She cannot be starved into submission, nor can the people, in their present frame of mind, be led to believe that the nations are fighting for her political emancipation. They must in some way be weaned away from their present erroneous belief that the world is seemingly united to compass their ultimate ruin and deprive them of all earthly hopes. They must be beaten in the field and on the sea. They must suffer a complete collapse due to the exhaustion of armament and supplies, a shortage of munitions, and on this latter possibility we should not only build our hopes but, with our Allies, force an expenditure that will eventually bring on that condition.

James C. McNally