Paris Peace Conf. 184.011102/30
Mr. Albert Halstead to the Commission to Negotiate Peace
[Received June 19.]
Sirs: I have the honor to remind the Commission that the telegrams from this office4 indicated the danger of an attempt to overthrow the existing government on Sunday, June 15th and to refer to my telegraphic report of yesterday giving details of the rioting with serious loss of life and great injury to many. This attempt failed because of the loyalty of the police and because the authorities had sufficient courage and wisdom to arrest about one hundred and forty of the leaders on Saturday so as to prevent them from directing the communistic activities.
It would appear that a careful plan was formed, with the assistance of Hungarian money and Hungarian advice, to use the proposed reduction in the Volkswehr as an excuse for a protest which was to be turned into an effort to establish a Soviet Government. The withdrawal of the proposal to reduce the Volkswehr temporarily changed the outlook but the leaders were still determined to proceed with the demonstration and to carry out their plans for a coup d’état. The arrest of the leaders changed the character of the demonstration into an attempt to storm the jail. The resistance to the effort to break through the police and the firing on the mob after they had first shot destroyed the plan temporarily. The city has naturally been shocked by the sacrifices entailed and as it must be admitted that the strong action of the government was to many a surprise.
The situation is improved but the loyalty on the part of the Volkswehr, which had been reported to have been permeated with communism [Page 533] and to be in large part unreliable, has caused a greater feeling of confidence. The situation, it must be admitted, is still uncertain and the fact that the government has not as yet shown the disposition to be less firm is very satisfactory. The attitude of the Workmens’ Party has throughout been in every sense correct and its disapproval of communism has been a source of strength of the greatest value.
It is the habit of those who, while apparently supporting the government are at heart opposed to Socialistic doctrine to charge that such leaders as Doctor Bauer and Secretary Deutsch of the War Department are really communists. These statements are manifestly, to a very considerable degree, based upon unfriendly views of Dr. Bauer’s idealism but the fact that he while in Russia as a prisoner, knew Lenin and Trotsky furnishes some ground for the lack of confidence in this official. As far as I have been able to judge Dr. Bauer has, in all his expressions of opinion shown his disagreement with communism and in the talks that I had with him there was no sign of even a theoretical sympathy with communism. There had been indications, however, that he might have indirect relations with communism which would be advantageous to him in the event of the communists coming into power. It seems that, for the present at least, he should be accepted for his apparent face value.
Though the situation appears improved and though the communists have been defeated it does not follow that the danger of another attempt has disappeared. Some of those who are accustomed to study situations are of the opinion that the present is regarded as an unfavorable moment to renew the attempt at the overthrow of the government and that those who are not extreme communists but who are sympathetic with communism see that the movement had better be delayed until all the food supplies that are available have been obtained from the entente and until the harvest is in.
Only one newspaper, Der Abend, has shown any criticism of the Government’s attitude and that paper in its issue yesterday declared that it was those who ordered the arrest of the leaders [who] were responsible for the outbreak. The bright weather, and improved food conditions which are, however, far from ideal have their natural influence in favor of good order but the critical industrial conditions of the country and the real apprehension that the peace terms as dictated by the Paris Conference are destructive to the future of German Austria are seriously interfering with any certainty of continued order. The proposed demand of the railway employees for higher wages to be followed by a similar demand from the small public officials are discouraging incidents. I am told by a person who should be well advised but who is not in the least sympathetic with the Socialistic policy [Page 534] of the government though he is associated with the government, that State Socialism is impossible and that despite the certainty that there will be a levy on wealth on a graduated scale the proof that socialization of industry cannot be carried through is apt to weaken the existing government.
If the Germans do not sign the peace treaty it seems probable that the demand for a union with Germany will be strengthened, a union which, if carried out will seriously menace the security of Czecho Slovakia and increase the probability of a future war. In conclusion it may be said that the outlook is better, that the permanency of good order is not assured and that the future must depend upon the fate of the Hungarian Soviet Government and the real moral strength of the present government of German Austria.
I have [etc.]
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