Paris Peace Conf.184.01102/160
Lieutenant Hugo G. Campagnoli to Professor A. C. Coolidge 13
Subject: Interview with Bernhard von Popper, head director of the Wiener Bank Verein, and Alfred Hernsheimer, director of the Wiener Bank Verein.
Financial Reports.
The two greatest problems at present in German Austria are the stamping of the bank notes and the proposed union with Germany.
German-Austria is forced against its will to stamp the bank notes of the Austrian-Hungarian Bank. It has to do this to protect itself from being swamped with the millions of bank notes held by countries [Page 263] outside of the old dual monarchy. German-Austria is perfectly willing to do its share and exchange the bank notes in these countries, namely it is willing to accept 30% of the whole amount. However, if German-Austria did not stamp the notes it would be forced to take the entire 100% as it would then be the only state of the former empire which did not stamp its bank notes.
In the course of my interview with the above mentioned directors they stated that they were at a loss to understand why Bohemia had to stamp its bank notes, and they do not agree with the Czechs that in time their rate of exchange will be better than that of German-Austria. They state that it was not at all necessary to stamp the bank notes and that it shows the character of the men in authority. They added that everyone knows that the Czechs themselves could never have made Bohemia what she is today and that it was Vienna and the financiers of Vienna who interested themselves in building up both the commerce and industry of the new republic. Herr von Popper believes that Bohemia in the end will prefer to do business through Vienna, the door to the near East and the Balkans.
There are now about seven billion kronens of Austrian-Hungarian Bank notes circulating in German-Austria besides there are approximately four billions of Kassenscheine notes, so that altogether there is a currency of over eleven billions. Considering the immense amount of bank notes circulating and the inert condition of commerce and industry, German-Austria is in a very bad financial situation, and will continue to be so until some help comes from the outside. German-Austria is hoping for an early peace so that it can demand and obtain foreign credits. The foreign country she is hoping to interest is the United States.
Union with Germany.
The second problem is also very important and in some respects disagreeable. It has not been decided whether German-Austria is to combine with Germany politically only, or both politically and financially. It would be to the detriment of German-Austria if the second case was put into effect. The industrial and financial men are not greatly interested in a union with Germany as they see in it a great mistake and loss for the country’s business. The only party interested in a full union with Germany is the Social Democratic party. Germany is now a socialist country, and if German-Austria is taken into the union it will strengthen the socialists in German-Austria. It is the belief of these two directors that it would be to the best interest of the country if German-Austria would be left as a neutral state like Switzerland.
- Transmitted to the Commission by Professor Coolidge under covering letter No. 114, February 27; received March 3.↩