Paris Peace Conf. 180.03401/22½

CF–22A

Notes of a Meeting Held at President Wilson’s House in the Place des Etats-Unis, Paris, on Wednesday, May 21, 1919, at 6:15 p.m.

  • Present
    • United States of America
      • President Wilson.
    • British Empire
      • The Rt. Hon. D. Lloyd George, M. P.
    • France
      • M. Clemenceau.
      • Secretary—Sir Maurice Hankey, K. C. B.
      • Interpreter—Professor P. J. Mantoux.

President Wilson read the draft of a reply to the German Note on the Economic Effect of the Treaty of Peace which had been prepared at the request of the Council by Lord Curzon: (Appendix I.)

1. Reply to the German Note on the Economic Effect of the Treaty of Peace Subject to a few alterations in detail, the Note was approved.

Sir Maurice Hankey was instructed to forward it to the Secretary-General for translation into French for the signature of M. Clemenceau.

It was agreed that the letter should be published after it had been signed and despatched.1

2. Verbal Discussions with the Germans President Wilson said he would like to intimate to the Germans that the Experts of the Allied and Associated Powers were now ready to discuss with their Experts in regard to Financial and Economic Conditions.

M. Clemenceau thought it would weaken the Allied and Associated Powers.

President Wilson said that his object was to demonstrate to Europe that nothing had been left undone which might have induced the Germans to have signed. If they did not sign it would involve sending troops into the heart of Germany and their retention there for a long period. Germany could not pay the costs of this occupation which would pile up the expenses to people who were already protesting against the burden of occupation. People would ask if there was anything reasonable left undone which might have averted this. There would be no loss of dignity by carrying out this plan. The experts of the Allied and Associated Powers would merely explain the meaning of some parts of the Treaty of Peace which, in his view, the Germans [Page 801]had failed to understand. If our Experts could show that no heavier burden had been laid on the German people than justice required, it might make it easier for the German Delegates to explain to their own people.

M. Clemenceau thought that this would serve the objects of the Germans. He agreed that they would probably leave without signing, but when troops began to move, they would sign soon enough. They wanted some excuse with their own people to make them sign.

Mr. Lloyd George thought that sufficient excuse would be given if some concession could be gained. He had nothing particular in mind but there might be some concession which did not matter very much which could be made. The question would not be decided until the German answer to our proposals was available. He had in his mind that they would make proposals perhaps about coal.

M. Clemenceau said we had a very strong answer on this. He had seen some extraordinary effective figures of M. Loucheur’s.

Mr. Lloyd George thought they might also make proposals about restoration. He thought before deciding this question, it would be better to await the German reply and to keep an open mind on the subject.

President Wilson said that the letter which had just been considered gave a conclusive reply to the German letter but provided no ray of hope. It merely said that the Treaty was right and nothing more. He had understood that the experts who had discussed with the German Financial Experts at Villette found Herr Melchior a very sensible man. Melchior was now one of the German Delegates, and he was a representative of the kind of people in Germany who wanted to get their industries going again, and he wanted to avoid the chaos and confiscations of property and looting which had occurred elsewhere. These people wanted to get their country started again, and they would listen to what our experts had to say. The United States Experts had, all along, said that the present scheme of reparation would not yield much. This was Mr. Norman Davis’ view, and Mr. Keynes, the British expert, shared it. He himself wanted the Allies to get reparation. He feared they would get very little. If it could be shown to Melchior that the Reparation Commission was allowed to consider the condition of Germany and to adjust the arrangements accordingly from time to time, it might enable him to persuade the German people.

M. Clemenceau said that President Wilson was right, but he did not want to be placed in the position of a man who was begging a favour. He preferred Mr. Lloyd George’s idea, of waiting until the German comprehensive reply was received. This would be our “mor-ceau de resistance”.

[Page 802]

President Wilson said he was afraid ten years hence we should find that nothing had been got out of the Treaty of Peace, and this would cause a reaction in Germany’s favour.

3. Prisoners of War: The Reply to Brockdorff-Rantzau’s letter M. Clemenceau informed his colleagues that he had postponed signing the reply to Brockdorff-Rantzau’s letter on the subject of Prisoners of War1a because he wished to attach to it an admirable report he had received showing the equipment of German Prisoners of War. He hoped to have this on the following day.

4. Telegram to General Pilsudski The attached telegram to General Pilsudski, was approved. (Appendix II.)

(Sir Maurice Hankey was instructed to forward it to the Secretary-General with instructions to translate it into French; to despatch it to General Pilsudski; and to arrange for a copy to be to General sent to the French Liaison Officer, or any other Officer on the Staff of General Haller, for the information of General Haller.)

Villa Majestic, Paris, 21 May, 1919.

Appendix I to CF–22A

Suggested Reply to German Note on the Economic Effect of the Peace Treaty

M.166

Redraft by Lord Curzon

1. The Allied Powers have received and have given careful attention to the report of the Commission appointed by the German Government to examine the economic conditions of the Treaty of Peace.2

This Report appears to them to contain a very inadequate presentation of the facts of the case, to be marked in parts by great exaggeration, and to ignore the fundamental considerations arising both out of the incidence and the results of the war, which explain and justify the terms that it is sought to impose.

2. The German Note opens with the statement that the industrial resources of Germany were inadequate before the war for the nourishment of a population of 67 millions, and it argues as though this were the total for which with diminished resources she will still be called upon to provide. This is not the case. The total population of Germany will be reduced by not less than six million persons in the non-German territories which it is proposed to transfer. It is the needs of this smaller aggregate that we are called upon to consider.

[Page 803]

3. Complaint is made in the German Note that Germany is required to surrender her merchant tonnage, existing or in course of construction, and that a prior claim is made upon her shipbuilding capacity for a limited term of years. No mention, however, is made of the fact that a considerable portion of the smaller tonnage of Germany is left to her unimpaired; and it seems to have entirely escaped the notice of her spokesmen that the sacrifice of her larger shipping is the inevitable and necessary penalty imposed upon her for the ruthless campaign which, in defiance of all law and precedent, she waged during the last two years of the war upon the mercantile shipping of the world. As a partial offset against the 12¾ million tons of shipping sunk, it is proposed to transfer 4 million tons of German shipping. In other words, the shipping which it is proposed to take from Germany constitutes less than one-third of that which was thus wantonly destroyed. The universal shortage of merchant shipping is the result, not of the terms of peace, but of the action of Germany, and no surprise can reasonably be felt if she is called upon to bear her share—and it is a very moderate share—of a loss for which her own criminal deeds have been responsible.

4. Great stress is laid upon the proposal that on the Eastern side Germany shall be deprived of the Regions specially concentrated to the production of wheat and potatoes. This is true. But the Note fails altogether to observe that there is nothing in the Peace Treaty to prevent either the continued production of these commodities in the areas in question, or their importation into Germany. On the contrary the free admission of the products of the Eastern districts is provided for during a period of five years. Moreover, it is fortunate for Germany that these Regions have lost none of their productivity owing to the ravages of war. They have escaped the shocking fate which was dealt out by the German armies to the corresponding territories in Belgium and France on the West, and Poland, Russia, Roumania and Serbia in the East. There appears to be no reason why their produce should not continue to find a market on German soil.

5. Stress is laid upon the proposed restriction in the import of Phosphates. It is, however, forgotten, that Germany has never produced but has always imported the Phosphates of which she stands in need. Nor is there anything in the terms of peace which will prevent or hinder the importation of phosphates into Germany in the future. Other countries, which do not produce phosphates, are also compelled to import them in common with many other products from the outside; and the only difference in the two situations will arise from the relative degree of wealth or impoverishment in the countries concerned.

[Page 804]

6. The German Note makes special complaint of the deprivation of coal, and asserts that nearly one-third of the production of the existing German coal mines will be lost. But it omits to notice that one-fourth of the pre-war consumption of German coal was in the territories which it is now proposed to transfer. Further it fails to take into account the production of Lignite, 80 million tons of which were produced annually in Germany before the war, and none of which is derived from the transferred territories. Neither is any reference made to the fact that the output of coal in the non-transferred districts was rapidly increasing before the war, and that there is no reason to doubt that under proper management there will be a continuing increase in the future.

7. But should not the coal situation be viewed from a different and wider standpoint? It cannot be forgotten that among the most wanton acts of devastation perpetrated by the German armies during the war was the almost complete destruction by her of the coal supplies of Northern France. An entire industry was obliterated with a calculation and a savagery which it will take many years to repair. The result has been a grave and prolonged shortage of coal in Western Europe. There can be no reason in equity why the effect of this shortage should be borne exclusively by the Allied nations who were its victims, or why Germany who deliberately made herself responsible for the deficiency should not to the full limit of her capacity make it good.

8. Stress is also laid upon the hardships alleged to be inflicted upon Germany by the necessity of importing in future iron ores and zinc. It is not understood why Germany should be supposed to suffer from conditions to which other countries contentedly submit. It would appear to be a fundamental fallacy that the political control of a country is essential in order to procure a reasonable share of its products. Such a proposal finds no foundation in economic law or in history.

9. The Allied Powers cannot accept the speculative estimate presented to them in the German Note of the future conditions of German industry as a whole. This estimate appears to them to be characterised and vitiated by palpable exaggerations. No note is taken of the fact that the economic disaster produced by the war is widespread, and, indeed, universal. Every country is called upon to suffer. There is no reason why Germany, which was responsible for the war, should not suffer also. She must for this reason realise that her economic, in common with her political and military existence, must be conducted henceforward on a reduced and lower plane. The German note tabulates and aggravates every contemplated deprivation of material, and endeavours to paint a picture of unrelieved gloom. But [Page 805]it fails, as already mentioned, to make any allowance for the fact that the present population of Germany will be diminished by 6,000,000 and that there will consequently be that less number of people to provide for, to feed and to clothe.

10. Similarly, as regards the population of the future, no reliance can be placed on the data which are contained in the German Note. On the one hand, it is sought to prove that emigration from Germany will be necessary, but that few countries will receive the intending emigrants. On the other hand, it is sought to show that there will be a flood of Germans returning [to] their native land to live under the conditions which have already been described as intolerable. It would be unwise to attach too much weight to either speculation.

11. Finally, the German Note rashly asserts that the Peace Conditions will “logically bring about the destruction of several millions of persons in Germany”, in addition to those who have perished in the war or who are alleged to have lost their lives in consequence of the blockade. Against the war losses of Germany might very fairly be placed the far greater losses which her initiative and conduct of the war have inflicted upon the Allied countries, and which have left an ineffaceable mark upon the manhood of Europe. On the other hand, the figures and the losses alleged to have been caused by the blockade are purely hypothetical. The German estimate of future losses, which, though it is described as logical, appears to be no less fantastic, could be accepted only if the premises upon which it is presumed to rest are accepted also. But they are entirely fallacious. There is not the slightest reason to believe that a population is destined to be permanently disabled because it will be called upon in future to trade across its frontiers instead of producing what it requires from within. A country can both become and can continue to be a great manufacturing country without producing the raw materials of its main industries. Such is the case, for instance, with Great Britain, which imports at least one-half of her food supplies and the great preponderance of her raw materials from abroad. There is no reason whatever why Germany under the new conditions should not build up for herself a position both of stability and prosperity in the European world. Her territories have suffered less than those of any other Continental belligerent state during the war. Indeed, so far as pillage or devastation is concerned, they have not suffered at all. Their remaining and untouched resources, supplemented by the volume of import trade, should be adequate for recovery and development on a modest but sufficient scale.

12. The German reply also ignores the immense relief that will be caused to her people in the struggle for recovery by the enforced reduction of her military armaments in future. Hundreds of thousands [Page 806]of her inhabitants, who have hitherto been engaged either in training for armies or in producing instruments of destruction, will henceforward be available for peaceful avocations and for increasing the industrial productiveness of the nation. For no boon should Germany be more grateful.

13. But the first condition of any such recuperation would appear to be that Germany should recognise the facts of the present state of the world, which she has been mainly instrumental in creating, and realise that she cannot escape unscathed. The share which she is being called upon to bear of the enormous calamity that has befallen the world has been apportioned by the victorious Powers, not to her deserts, but solely to her ability to bear it. All the nations of Europe are now bearing burdens and suffering from losses which are almost more than they can carry. These burdens and losses have been forced upon them by the aggression of Germany. It is right that Germany, which was responsible for the origin of these calamities, should make them good to the utmost of her capacity. Her hardships will arise not from the conditions of peace, but from the acts of those who provoked and prolonged the war. Those who were responsible for the war cannot escape its just consequences.

Appendix II to CF–22A

Telegram From the President of the Peace Conference to General Pilsudski, Warsaw

(Approved by the Council of the Principal Allied and Associated Powers on 21st May, 1919)

The Council of the Principal Allied and Associated Powers have heard rumours from several sources to the effect that troops of General Haller’s Army have recently taken part in operations against the Ukrainian forces in Eastern Galicia, in the region of Belz or elsewhere.

The Council would be glad to receive early information from the Polish Government with regard to these reports, which the Council is reluctant to believe, since definite engagements were undertaken by General Haller not to take part in the operations against the Ukrainians.

  1. The note was dated May 22.
  2. For the text of the proposed reply, see appendix IV to CF–20, p. 749.
  3. Appendix IA to CF–20, p. 738.