The Men at the Front—The Recruiting—English Losses—Horses andShips—War Supplies—Barring the Germans.
I really admire the English censorship and the manner in which it can withhold information from the English people, and I see the usefulness of much of the withholdings. You are some days in England before you realize that there are now no weather reports—not even for Channel crossings. Nobody really cared for them in London. Everybody there knew what the weather was, and nobody could tell what it was to be. If reports were printed, they would fool only the German Zeppelins; but cable reports might be quite another thing. So you can't cable your family: "Weather fine, come over."
Of course Germany should not be allowed to know the English forces, their exact number and distribution. I was told over and over again in good newspaper quarters in London that the English had only 100,000 men at the front, and did not propose to have any more until Kitchener led his army of a million men or more to the Continent next spring.
I, of course, said nothing, but I knew a great deal better, both fromWar-Office sources and from contact with the English officers in France.
It would not be right, although information was not given me in confidence, to attempt to name the exact number and position of troops Kitchener had on the Continent toward the close of December. But I may tell what anybody was free to pick up on French soil. I asked an English officer of good rank how many men the English had at the front and he responded promptly 220,000 at the front, and 50,000 on the lines of communication. He was right for that date in early December, but later more troops were sent over. Indeed, they were quietly going and coming all the time across the Channel, and, notwithstanding losses, the number at the front was being steadily augmented. There were also troops in training on French soil, and 550,000 in condition for shipment from England.
Kitchener is one of the greatest reserve-supply men in the world. He is a natural-born banker; he keeps his eye on his reserves fully as much as on his activities, and perhaps more so.
When he called for 100,000 troops the British public became weary and demanded to know how long before he would get them. This gave an impression throughout the world that English recruiting was very slow; but when forced to show down his hand, Kitchener had to admit that under the call for 100,000 men he had accepted many more and was still accepting.
Then they raised the call to a million, and in December Kitchener had more than 1,000,000 men under that call, but I was particular to ascertain that he had not made a call for a second million. It was all under the call for 1,000,000 men to arm.
But I did learn from authoritative sources that a house-to-house canvass, and millions of circulars sent out, had received responses that showed the War Office where the number of recruits, or men in training, could be quickly put above 2,000,000 the moment there was need or room for them.
When England sent her first expeditionary force of 100,000 men to theContinent there was no public report of how steadily it was augmented.The official announcement was simply that the line should not bediminished and that all losses should be made good.
An American acquaintance of mine, whom I found in France fighting in the uniform of the English, had made the declaration from his quick perception of the situation at the outset that if before January 1 the English should have sent over only another 100,000 men, they would have only 100,000 left there at the end of the year.
I found his estimate of losses correct. The English casualties at the end of 1914 were over 100,000,—killed, wounded, prisoners, and missing,—or fully the number of the first Expeditionary Force.
Yet every week and every month the forces of the English grew larger and never smaller. The filling in of the gaps and the augmentation of the English forces and their maintenance, munitions, and supplies was but the smaller part of the work of the War Office.
The great problem was to compass the situation as a worldwide war and summon and put into an effective fighting machine the resources of the Empire.
"Not alone the men but the machinery," said Kitchener, "must win this war."
England had to put into operation machinery, financial and diplomatic, machinery of men, guns, and transportation, belting the whole world and bringing the whole forward as a complete organization, yielding here and pressing forward there, but always firmly pressing to the one desired end—the crushing, crumpling and destroying of the war machinery of Germany. At the beginning England could not turn out 10,000 rifles a week; and a rifle can shoot well for only about 1000 rounds. Yet in December a single contractor in England was turning out 40,000 a week, and every possible contractor there and elsewhere had his hands full.
Kitchener must compass every detail from the rifle to the supply base; from the seasoned wood for that rifle right down to the number of troops he must have on the Continent when it comes to a settlement; for, says Kitchener, "You cannot draw unless you hold cards."
The broad sweep of the English preparations may be indicated by this: that when war broke out England not only commandeered horses in every city, village, and highway of England, taking them from carriages and from under the saddle, but started buying them over the seas. Of English shipping she gathered into her war-fold such a number of boats as I do not dare to repeat. She gathered in under the admiralty flag so many steamships from the mercantile marine that those which were found most expensive to operate were soon turned back into the channels of trade. With the many hundred steamers that she commandeered she set about transporting everything needed, including horses, from over the ocean.
The French bought their horses by the thousand in Texas and contracted at good prices for their shipment to Bordeaux. Steamship rates became almost prohibitive, and the horses arrived from their long journey in poor condition. England inspected the horses in America, paid for them, and then put them in charge of her own men on her own ships, and landed them by the shortest routes in England and on the Continent, in prime condition.
Although Germany had been buying liberally of horses in Ireland as early as March, when the long arm of Great Britain reached out there was no failure in her mounts for the cannon and cavalry divisions. For good horses at home and abroad she did not hesitate to pay as high as $350.
Americans should not forget that this war has brought about the greatest contraction in ocean tonnage that has ever been seen. I estimate that about one fourth of the world's oversea tonnage has been commandeered, interned, or put out of service. Before the war the Germans had nearly one eighth of the world's mercantile tonnage. That is now interned, destroyed, or tied up, outside the trade on the Baltic. As much more has been taken by the Allies from the mercantile to the war marine. It must also be figured that the Baltic and other seas hold locked-in ships, and the bottom of the sea likewise holds some more.
Considering the sudden demand upon the world's mercantile tonnage and its sudden curtailment, it is surprising that ocean commerce has not been more interfered with or made to pay even higher rates than the abnormal ones now existing.
Of war-tonnage, besides three superdreadnoughts purchased and four finished before the end of 1914, the British have under construction to be finished in 1915 ten battleships of from 25,500 to 27,500 tons, armed with 15-inch guns. The French have finished four of 23,000 tons, with 13 1/2-inch guns, and are finishing three more. The Russians are at work upon six of 23,000 tons, with 12-inch guns. The Japanese are building one superdreadnought of 30,000 tons, with 14-inch guns, and three battle-cruisers of 27,500 tons and 27-knot speed, with 14-inch guns.
Churchill, it will be remembered, figured that England could lose one battleship each month and still maintain her full strength. While the building of war-tonnage seems to be well in hand, there is no corresponding replacement of mercantile tonnage.
I have the highest authority for the statement that the world possesses no machinery at the present time to manufacture war-material at the rate at which the nations of Europe have been using it during the first hundred days of the war.
At one time the German armies were exploding 120,000 shells a day in France and Belgium. The response from the French alone was 80,000 shells a day, and General Joffre made a request that his supply be put up to 100,000 per day. This is for shells of all sizes, and the estimate to me was of an average cost of two pounds, or ten dollars, per shell. Some of the big German shells cost as high as $500 each. In some kinds of shrapnel, holding 300 bullets, there are more than thirty pieces of mechanism.
Within forty-eight hours after England declared war she had engaged the total output of an American manufacturer, whose machinery was an important part of the shell-making business. An American factory in Connecticut received orders for $25,000,000 worth of cartridges which would mean, at five cents a cartridge, 500,000,000 rounds of ammunition. I know of a single order to America from England for 10,000,000 horseshoes.
Through a single agency in America more than $150,000,000 worth of war-supplies was placed several weeks ago. I do not know whether this included a single order, of which I have knowledge, for 3,000,000 American rifles, delivered over three years at $30 a rifle, or $90,000,000. The company receiving this order had to work so quickly to install new machinery that old buildings were dynamited to clear the land.
Such orders to America are bound to tell upon our exports, and, combined with the advance in food-stuffs, the loss in cotton values by the outbreak of the war is offset more than twice over.
America must feel the effect of these orders when the goods go forward in increasing quantities. They are paid for as promptly as shipped. Many an American factory has been put on three eight-hour shifts for the day's work on these orders.
A Southern manufacturer received an order for 5000 dozen pairs of socks to be shipped weekly for six months. The price was under $1.00 per dozen, with ten per cent of wool in them. He complained that he was making only twenty cents per dozen profit, while if he had not been so anxious for the order, he might just as well have got a price that would have shown more than twice this profit.
In boots and shoes, England, instead of giving orders to this country, has been buying leather in America, and filling all her own factories. It is the policy of England to fill every workshop in her tight little island before she permits business to overflow.
To-day there are no unemployed in Great Britain, except in the cotton districts dependent upon German trade. Wage advances and overtime are the rule rather than the exception. The one country that the warring world must turn to for supplies is the United States, and that in increasing measure. Orders for $300,000,000 of war goods already received must be duplicated several times.
Every American automobile manufacturer able to deliver motor-trucks in lots of one hundred, has received his orders for shipments to the Allies.
Germany has now no base from which to get many important supplies. In a long contest the Allies will supply motor-cars, shells, guns, and ammunition to a far greater extent than Germany can manufacture them. Factories for this work are expanding in both Russia and America. The English do not speak against the Germans as a people. They believe them seriously misled by Prussian militarism, which they declare must be crushed absolutely.
Where formerly England was an open door to Germans and suspicions against German spies were laughed at, the bars are now sharply up. Most of the golfing clubs have voted to suspend the activities of members with German antecedents.
At the clubs in Pall Mall, notices have been posted requesting members not to introduce during the war Germans or those of German descent.
Membership on the Stock Exchange is not continuous as in this country, and at the March elections in 1915 there will be a dropping out of German names.
Protecting Trade and the Trader—How German Banks Paid—The EnglishLoan—England's Wealth—The Income Tax—More Taxes.
A giant Atlas bearing the civilized world on its financial shoulders has arisen between the North and the Irish seas. That is the picture that stands at the opening of 1915, where before Germany had endeavored to stamp the label "Perfidious and degraded nation of shopkeepers."
Only the pencil of a Doré could sketch this giant and put him in figures of proper relief as, aroused from his pastime of trade and the acquisition of shillings, he summons with one hand the resources of the empire and with the other passes them out to needy warring nations, taking care all the while that the necessary dealing of exchange and commerce have the least possible disturbance.
Kitchener says the war may last for two years, but he is making preparations for three years, and must do this job so thoroughly that no repetition will be required.
If it is war for three years, then this mighty financial Atlas of England is preparing to write its name on promises to pay more gold than all the money-gold on the surface of the earth today. And England won't hesitate to do it if necessary—not for one moment.
How can she advance money to Russia, Belgium, France, and other countries at war or just going into the war, and ask no foreign assistance, no overseas help,—except to be let alone,—expand her home trade and wages, pay with a lavish hand, and still pile up real gold both at home and over the ocean?
The first answer is because she does expand trade; because she does pay and pay promptly; and because she does protect her own trade.
The United States does not protect its trade or its citizens anywhere in the world to-day. It shivers in war-time, and borrows of everybody else when it has a panic of its own.
There is only one way to make trade, and that is to pay and protect. England, through centuries of fighting to protect both trade and the trader, has learned the way to the highest freedom in both trade and finance.
Therefore, before this most Audacious War was set afoot England had a very small stock of coin gold but a very large stock of gold credit-bills.
For years England has held in her cash box from $1,800,000,000 to $2,500,000,000 of the commercial credits of the world. With goods and trade-honor behind these promises to pay gold, she had no need of the metal but only of command of the seas, that her gold might come in when needed. When the war broke out, $600,000,000 of these gold promises to pay were of German and Austrian origin. The big London bankers who had their names on the back of such acceptances could not in honor underwrite any more commercial bills. They knew their capital was involved in collection of those already out.
But Britain said the commerce of England must go on as well as the war. The people who held these acceptances were promptly invited to turn them into the Bank of England, which held the guaranty of Great Britain behind it, and receive the money therefor; the discount rate after maturity to have 2 per cent added thereto, 1 per cent to go to the Bank for expenses and 1 per cent to the government for reserve fund to cover any losses. Of such bills $600,000,000 were promptly discounted.
I hear that two banks, the London City & Midland with its $525,000,000 of deposits, and Lloyds' Bank, both refused to rediscount. They believed the investments in commercial paper they had made were perfectly good, and that they were as well able as the Bank to wait for payment until one year after the war if necessary.
But to date more than half of these rediscounted bills have been paid.
It may be of financial interest to narrate how payments could be accomplished when by the King's orders there could not be any "dealings with the enemy" and payment to either side was forbidden by both. Yet the Dresdner Bank and other big German and Austrian banks have to date met fully one half their London obligations.
They were enabled to do this because their London branches were independent institutions whose independence was recognized by the British government. The London branches were thus liquidated, collecting in and meeting their obligations at maturity, so far as possible.
Liquidation in acceptances is one of the keys to the success of the English loan. While England had the ability before the war to discount $2,500,000,000 of acceptances, and with the present expanded base of the Bank would, without war, have the ability to discount $3,000,000,000, or three times our national debt, there is now no large business offering. The discount credits can therefore be measurably turned to the war-loan account. One of the biggest acceptance houses in London told me that the post-moratorium bills, or the new acceptances made after the moratorium, could not amount to more than 80,000,000 pounds, or $400,000,000.
With the liquidation on account of pre-moratorium bills and the absence of new business I should estimate that the London money market was able to take care of the 350,000,000 pounds loan put forth in November by the government without much regard to the investing community.
With expanding trade and confidence, English investment interests can absorb the major part of this huge loan before next summer, when another loan of about equal size must be put forth, according to present calculations. This second loan will probably be for three or four hundred millions pounds sterling, bear 4 per cent, and issue at par. The November loan was issued at 95 per cent and it was announced in Parliament that the Bank of England would loan the issue price at one per cent under the Bank rate.
That the loan was fully subscribed is not contradicted by the small fraction of discount soon quoted on the full-paid loan. One could fully pay the loan, taking the discounts on undue maturities and sell at a fraction under 95 and still make a profit.
I believe the estimate of an annual English surplus for investment of $2,000,000,000 per annum is far too low. This figure is upon the basis that only about 20 per cent of the river of interest, dividends, and profits flowing annually to British pocket-books is available for reinvestment.
In the present war stress and with economy practised to-day more by the capitalist classes than the laboring classes, the amount of money for reinvestment should be far greater than this.
English finance will cut its cloth according to the pattern. If there is only $2,000,000,000 per annum of surplus earnings to put into the war, that money will be spent; and if England has 50 or 100 per cent more, that money likewise will be spent, but spent so judiciously that the largest possible sum from it is kept in channels of English trade. The British Empire will work and finance the fight thus within a circle, and right on its own base.
The surprising thing is that it can be called upon to extend financial help to its allies. But everybody except Germany was caught absolutely unprepared. The war was early on French soil, tying up the resources of some of the richest provinces of France. Russia had so little thought of war that, as I have previously explained, she had deposited from her great gold reserve so that it had been loaned out on time and therefore was not available for the start of the war. Hence we have the spectacle of Russia gathering up 8,000,000 pounds sterling in gold and sending it to the Bank of England and, on this basis, borrowing of the Bank 20,000,000 pounds sterling.
Of course, this is good banking and good business and a good alliance. The Allies are bunching their war orders and credits, and England is entitled to hold the bag since she is carrying the financial burden.
England's war finance is not wholly measured in her expenses or loans to other countries. In a single issue of a London paper you can count daily reports of more than a dozen charitable funds connected with the war-work. These funds range all the way from "Aid to the Mine-Sweepers," "Gloves for the Soldiers," and the "Servian Relief and Montenegrin Red Cross Funds" up to the "Prince of Wales's Fund."
This last was over $20,000,000 before Christmas. The suddenness of this war may be illustrated by this fact: A friend of mine, who is managing director of a big English concern, has assumed the responsibility for seven years past of keeping in England one year's supply of everything that his company was likely to require from the Continent. This was at a cost to his company of many thousands of dollars. With dogged determination he stuck to the same policy for 1914, although in January of that year it was clear to him that Germany could not afford to go to war. While he was happy over his judgment, he admitted in conversation with me in December, 1914, that in January, 1914, the outlook was less indicative of a general European war than it had been for many years.
Thirty per cent of the workmen of his factory had gone to the war and his company was providing 250,000 pounds sterling a year to maintain the wages of the workmen at war up to the same amount as they would receive if they had stayed at home. He said that in one of his offices, of 80 men eligible for the work, 78 had enlisted, and, what was wonderful, the women were glad to take up the heavy work abandoned by the men,—something they would have refused to do in all ordinary times. On the whole, the output of this concern and its efficiency were materially increased, not diminished, by the war.
It is figured that troops at the front mean an expenditure of one pound per man per day, and that English troops in training mean an expenditure of not less than ten shillings per man per day.
The war expenses of Great Britain must thus be above one million pounds per day and steadily increasing. Indeed, the best economic estimate I have of the cost of the war to England is 500,000,000 pounds the first year.
While the English declare that they are fighting for their children and their grandchildren, they are not willing to leave to them the full load of the war-cost, and gladly do they assume all possible burdens in the present time.
The income tax, which began in 1842 at two pence in the pound, has now been doubled from one shilling and three pence to two shillings and six pence in the pound. This is on the average, and takes nearly one eighth of a man's income. There are very great variations in this tax. The rate I have given is the rate on dividends. Upon wages and salaries the tax is somewhat less.
The income tax is also apportioned over a three years' average. The supertax raises the contribution of the wealthy to one fourth of their incomes, although on the average it is figured to take only an eighth.
It is expected that the income tax may be further increased, possibly doubled, next year. I was not surprised therefore to find American millionaires with houses in London returning to New York and making sure of their American citizenship.
Every penny in the pound in the tax rate produces 2,500,000 pounds sterling, or $12,500,000, nearly one half the national income tax of the United States for 1913. Indeed, the English income tax for the year ending March 31,1915, is estimated to produce 75,000,000 pounds sterling, or about twelve times the income tax of the United States and from less than half the number of people. In other words, the income tax of Great Britain per capita is this year twenty-five times that of the United States.
But still the United States is really in no need either of income tax or of war-machinery. It is too late for the United States to prepare for any contest with the one nation that goes to war over tariffs—Germany.
After this war and a settlement of the Mexican situation, warships will be for sale at fifty cents on the dollar. Germany will have no navy of consequence, and England will reduce her present navy by at least one half, since her expansion of late years has been forced entirely by Germany.
The Food-Supply—War Expenses—The Copper Supply—The Call for Gold—NoOutside Resources—The Human Sacrifice.
Counting Montenegro and Servia as two nations, there are now seven countries at war against Germany, Austria, and Turkey, and two more, possibly three, may join in within a few weeks. If Greece enters the battle-line, it will be ten nations against three. When Roumania and Italy join the Allies, as is now being diplomatically arranged, Germany will be completely surrounded, with Switzerland, Holland, and Denmark in a measure locked in and powerless to give aid or assistance to the Germans. Indeed, these three smaller countries and Scandinavia are practically locked in now, with the North Sea placed in the war zone, and Italy as well as Denmark and Holland shutting out all contraband goods for reëxport to Germany and Austria.
Thus we have the spectacle of two nations of more than 115,000,000 people actually surrounded and besieged. Jointly these two nations in occupation of their entire territory could feed themselves from their own soil. They cannot be starved out, as in a besieged city, for lack of bread, meat, or drink. But the siege at the present time is not against the people of Germany and Austria: it is against the war-machine of Germany. This war-machine can be starved out when cut off from gold, copper, rubber, and oils. If these cannot be cut off, then her men must be cut down.
Germany has raised by war-loan $1,100,000,000. She has spent this and $500,000,000 more besides. The financial strain is shown in her paper and exchanges at discounts outside her own border. Within her own realm she is piling up a gold reserve in her great bank, to sustain her expanded paper issues and her strained credit; but how is she securing the gold?
Calling a mark a shilling, or 25 cents, let us speak for a moment of Germany's finances in marks. After the war of 1870 she planted 125,000,000 marks in gold from the French indemnity in her war-tower at Spandau. In June, 1913, the Reichstag voted to double this to 250,000,000 marks in gold, the addition to be known also as the Spandau tower reserve, but to be placed in the Reichsbank and not counted in the bank reserves. There was also to be coined 125,000,000 marks in silver.
The whole was simply a stirrup-cup to enable Germany quickly to bound into the war-saddle with purchase of horses, food, and the light or perishable munitions of war which must be had at the outset and at a time when war panic first seizes the currency and supplies of a community.
The basis of German finance was 1,200,000,000 marks in specie, mostly gold, in the vaults of the Reichsbank at Berlin—the central bank of issue and bankers' deposits—with its 485 branches.
Before the war this metal reserve had been brought up to 1,400,000,000 marks. At the outbreak of the war, of course, the Spandau tower reserve in specie must have gone into the bank, and every metal reserve that the government could lay its hands upon likewise went into the bank. Germany then boasted a gold reserve approaching 2,000,000,000 marks. In this month of February the bank gold reserve was put well above 2,000,000,000.
Bank-paper issues meanwhile expanded by the billion.
The great contest in Germany is to maintain this bank metal reserve, and it is the task of Sisyphus and of herculean proportions. Outside of the United States, Germany has probably little, if any, credit to-day. She must pay in gold for what she buys from without, and from without she must get copper and oil. Lubricating oils are troubling her now quite as much as diminishing supplies of gasolene.
To get copper for munitions of war she can produce within her own borders 90,000,000 pounds. Of late years she has been importing from America 300,000,000 pounds per annum, so that electrification has been going on for many years all over Germany, and copper wires in telegraph-postoffice work scintillate in the skyline of the German cities. These can come down and be replaced with iron or aluminum. Of course, the first wires to come down will be the power-transmission wires. They can readily be replaced with aluminum, of which Germany is the parent producer. A very fair telephone service can be maintained with iron wires. Those who are looking for the exhaustion of Germany on a copper basis are reckoning without knowledge of German resources.
For petrol she can substitute benzol and alcohol, with some inconvenience. Germany is likewise the home and center of industrial alcohol, which it manufactures from surplus products. But when it comes to gold, there is the rub. Germany fixes a price of 20 cents a pound for copper within her own borders, but the government will pay 30 cents a pound to anybody who will deliver it to her from the outside. Indeed, I have heard of one lot of copper in Sweden for which 40 cents a pound was bid if the parties could ship it out across the Baltic.
I have a friend who was bid $5 a gallon for gasolene if he would land it within Germany, but such bids are not necessarily convincing. They may be made to fool the enemy. There are also stories of great underground storage-tanks of petroleum, owned by the government and concealed in the Black Forest, that have never yet been touched. It is inconceivable that Germany should plunge into a great war without having resources of copper and petroleum. But for all that is bought from without she must pay gold. No financiers know better the value of gold as the underpinning in finance than do the Germans.
Germany was very lavish with her gold at the start, and the French believed that it was an assistance in her military strategy. At the battle of Charleroi 50,000 German cavalry screened an unsuspected infantry force of 300,000 men and the French had to retreat; but that Maubeuge surrendered 40,000 men, without more fighting, gives rise in the French mind to suspicions of German gold. The anathemas of the French against their commander at Maubeuge make it much safer for him to remain a prisoner in Germany. The French caught one German wearing a French uniform but having upon his person one million francs. Of course, they shot him as a spy, but they were more incensed by the bribes he carried than by his uniform.
Everybody in Germany is called upon to lend a hand in maintaining the supply of gold for the government. The patriotism of the people was first appealed to. Then laws were passed. People are "requested" to give up their jewelry, to make a patriotic sacrifice of it for the Fatherland. Cards are printed in the newspapers urging the people for the sake of the Fatherland to bring all their gold into the Reichsbank.
So fine is the search for gold that wedding rings are given from the fingers of the women, and iron rings are substituted as badges of patriotism.
While every other nation on earth since 1900 has been accumulating gold in bank reserve, England alone has stood aloof and accumulated credit instead of gold. English financiers laugh at gold except as it can be made useful. They prefer to hold interest-bearing promises to pay gold. To-day England holds the keys to the world's gold outside of Germany, and I have a suspicion that she is not averse to American cotton going into Germany if it takes out the gold in return.
Germany is young as a banking, trading, and industrial nation. England insists that both men and gold must be at work. In Germany the gold reserve must be maintained and, with foreign trade cut off, men must be idle. In England both the gold and the men are at work. Labor was never better employed in England than to-day. The English policy in this wartime is to fill every idle hand with productive industry; to work the machinery day and night; and to keep the gold in England so far as is necessary and to keep it circulating in England. The national loss begins when you lose either the golden days of labor, the gold of the sunshine that makes the harvest of the valleys or the gold of finance and commerce.
When the Germans fought the French in 1870, 60 per cent of her people lived on the land. Now, forty-four years later, she is fighting the whole world, but only 30 per cent of her people live by the fruit of the soil.
That is the simple answer as to why Germany, a country besieged, cannot win against the world.
Germany has no sea-expansive ability, no foreign credit, no international reserves to carry out an offensive warfare. Her only possibility of success lay in a sudden and decisive march over the rich territory of France, the possession of Paris, and a huge indemnity tax levy as in 1871. The rest might have been easy. Hence the supreme military necessity for a quick drive through Belgium, the only open road to Paris. The size of the crime in Belgium has shown the supreme financial necessity. There was no military necessity for the outrage against the free Belgian people—only the economic necessity.
There is nothing left for Germany but a defensive warfare, a warfare now conducted upon foreign soil just over her own borders—the burden upon the enemy, the supply base near at hand.
Germany must reduce and conserve her shell-fire. The Krupp works have no ability to turn out daily the number of shells that Germany was exploding, and the United States in its own arsenals could not in a year make a week's supply of shells at the rate at which they were being exploded from Switzerland to the English Channel.
Greater than progress in the arts of peace is progress in the art of war. We have read in the American papers of a most wonderful new French shell that in bursting paralyzes and destroys life so instantly that all the living things within so many yards are, in a flash, set rigid in position as though manufactured for Jarley's Wax Works, the officer standing in position with uplifted arm, yet dead, the soldier by the window with a cigar in his fingers, a smile on his face, stone dead.
I was informed that the effectiveness of this shell was not due to its poisonous gases but to the fact that, instead of being filled with bullets, it was charged with a wonderful new explosive.
For the development of the science of war twelve months in the line of battle is worth in new inventions ten years of peaceful military study. A three years' warfare for which the English are planning is likely to put Germany's thirty years of "peaceful" war preparation quite in the shade, so far as practical results are concerned.
I hear of new and more powerful mortars and cannon, wonderful new rifles, now being manufactured by the million from secret plans, and new guns to bring down Zeppelins, that it is not useful to discuss here.
In the first six months of this war, the German casualties must be well up toward 2,000,000. A million of the injured may go back to the firing line.
But in killed, seriously wounded, missing, and prisoners, Germany must be losing at the rate of 2,000,000 men a year, and the forces of destruction against her will increase rather than diminish. That she can lose at this rate for three years and have anything left worth consideration as a military power is beyond reason.
Nevertheless, when I spoke with a very prominent American, now in a responsible position abroad, he said: "The Germans have food and supplies, and they have an idea; and the only way to overcome that idea is by their destruction. The South had no resources for a three-year or four-year war, but it had an institution, an idea, and a determination. If you will recall it, at the close of the war there were practically no men left in the South. This war will be over when the fighting men of Germany have been killed off."
I have so much respect for the business, mathematical, and scientific mind of Germany, that I cannot believe she will prefer the destruction of the German people, individually or collectively, to the destruction of the German war-machine which set on this war.
I make the following estimate of the casualties—killed, wounded, missing, and prisoners—of the warring powers, omitting Turkey and Japan, up to February 1, 1915:—
German…….. 1,800,000French…….. 1,200,000Russian……. 1,600,000Austrian…… 1,300,000Belgian……. 200,000Servian……. 150,000Montenegrin… 20,000English……. 110,000Total……. 6,280,000
Not in a hundred years, or since the Napoleonic wars of 1793 to 1815, has there been any war approaching these casualties now reaching in six months to six millions.
A remarkable statistical fact concerning the war, which I ran across in London, was a computation that the deaths in the navy were substantially equal to those in the army, from the beginning of the war up into November. Of casualties in the army, only about 10 per cent are deaths. There are few wounded to be returned home from a naval disaster. When the English army had suffered about 60,000 casualties, making about 6000 men killed, at the same time from the naval service 6000 boys in blue had gone down to watery graves.
German Socialism—German Unity—A Reverse Political System—BusinessMen without Political Influence—A Voice from the People—The GermanWar Lord.
In America there is no greater conflict of opinion than over the question of the relations of the German people to the present war. There are those who declare most emphatically that when the German people once understand this war there will be revolution in Germany, uprising of the socialists, and the sure overthrow of the Hohenzollern dynasty.
Such opinions are not well based, and their authors do not understand the German temperament, the principles of German government, German organization, or German Socialism.
Socialism in Germany is neither of the destructive order of that in Russia, nor of the wild varieties found in America; nor has it even the order of the Socialism of England. Twenty years ago the Socialism of Germany might be recorded as against the invasion of Belgium, and the bonds of Socialism existing between Belgium, France, and Germany might have interfered with the war programme.
But Socialism in Germany has passed the stage of labor-agitation. Indeed, it has been transformed in the reign of the present Kaiser from agitation against capitalism within the empire to agitation for the expansion of Germany in the territory of its neighbors throughout the world, that German labor may, through German arms, enter into and possess the land without. German Socialism is thus allied with German militarism, and it has also become the respectable party of opposition in the Reichstag. The middle classes of Germany of late years have voted for Socialistic candidates whenever they disagreed with the government. It is the party of protest and of opposition. It is a party of the empire, not of any world socialistic movement.
Germany is thoroughly knit together in support of its government and its Kaiser. The German people do not seek a constitutional government like England, or a republican form of government like France or the United States. They believe their situation and safety in the middle of Europe call for a more autocratic form of government, and one not too quickly responsive to popular sentiment.
Germany was made by Bismarck and the armies of Von Moltke supporting the Hohenzollern dynasty. This made Prussia the center of Germany industrially, financially, and as a military power, and at the heart and seat of power, in both industry and finance, sits the same dynasty. The Emperor is the center of industry, finance, and military power,—three degrees of empire, each distinct in itself, but each intertwined with the others, but so intertwined that the word of power, command and influence comes down from the military seat of power through finance and into industry. Industry does not speak back through the powers of finance to the military center. The flow of the German dispensation of power or of governmental organization runs downward from the Kaiser. No power goes up from the people or industry or finance to the war lord at the center.
The Germans know no other system of government. Outside of Prussia, in the more than thirty states of Germany, there was the local reign. Now over all is the reign of the Kaiser. The present generation has seen a united Germany become great among the nations of the earth. The English-speaking people cannot appreciate the feudalism and the fealty of the German people to their war lord. They say, "Are not the German people great thinkers; do they not know that the power of government is from the governed?" It is inconceivable to them that the Germans should have a reverse system.
My last word from Germany was with an American lady who has been more than one hundred days nursing the wounded from the battle-line, and she, singular as it may appear, assisted on both sides of that battle-line. She assisted to dress the wounds of French soldiers where the lacerations of shrapnel had broken one entire side of a human system, face, eye, ear, jaw, arm, leg; yet that soldier lived. She dressed wounds where more than twenty bullets pierced a single human frame. Yet that soldier will go back to the front. French boys in their 'teens had died in her arms at the hospital,—the hospital where thousands of wounded pass through every month,—and she had taken back to the parents in Paris the dying message. She had been in the German and the French trenches on the line of battle. She had crossed the lines and been under arrest. She had seen the horrible picture of freight-loads of German corpses on German railroads,—corpses unhelmeted, with uncovered faces, but in boots and uniform, tied like cordwood in bunches of three and standing upright on their way to the lime-kilns. She had nursed the wounded German soldier in his delirium, crying in German, which she well understood, over the horrors which still pursued him as he remembered the face of the wife and saw the agony of the children as he stood in line and by direction of his superior officer shot the husband dead. He moaned in his delirium over the picture. The faces of the wife and children haunted him, but he cried out that his superior officer had ordered him to do it; and she said, "No, these people are not responsible; the dogs of war have driven them as sheep into the slaughter-pens. They are beaten, but fight for the Fatherland. It is their duty and they obey."
And how has it all come about? Simply thus: The Saxon was a Saxon, theBavarian was a Bavarian; each suddenly found himself a German and partof a world-power. Bismarck and Von Moltke had a policy for theHohenzollerns; it was a united Germany, and they left it a defensiveGermany.
There was not in the brain of Bismarck or of Von Moltke, or of the Emperor under whom they prosecuted the wars against Austria, Denmark, and France, any idea of Germany as the Conqueror of the world.
"Never be at enmity with the Russian Bear," was the saying at the time of Bismarck and before. "Always contrive that yours shall be a defensive war; let the other party attack," was the declaration of Bismarck.
The policy of Bismarck was: "If you have an enemy, make friends with all the other powers, so that your enemy be isolated diplomatically and politically."
The present Kaiser has reversed every one of the great policies ofBismarck and of his ancestors that made a united and great Germany.
There is not a language in the world to-day outside the Teutonic that speaks the praise of Germany. Defensive German alliances are broken because the present Kaiser insisted that offensive and defensive are one and the same. In offensive action the Triple Alliance breaks; while the Triple Entente becomes, for defense, nine nations instead of three.
The German people are not responsible for this situation. Their form of government has not yet permitted full, free, and effective expression of opinion; nor does the German seek full political expression. He loves his fireside and his family, and prefers his home ease and philosophy. He has confidence in his Kaiser and his government; and his whole training for a generation has been to make him an obedient part of a military power.
It is gratifying to find that not the German people, but the German Kaiser, is responsible for this war; and it is also gratifying to find that there are doubts as to his full mental responsibility.
I have had closer associations with the German people than with the French, and have liked them better as a people: they are so industrious, efficient, and ambitious in the world's work. I know the German country better than the country of France or England. I think I understand something of the over-self-sufficiency of the English, and I have no prejudice against the Germans, or even their form of government, which may be better adapted to their needs than a broader democracy. But of the German modern war-philosophy the world outside can hold but one opinion. It might have been supported as a purely tentative or speculative philosophy, but it could have been promoted in practice only by a crazy ruler. I was not therefore surprised to find circulated in Paris an article by an American physician which I had permitted to be published in America at the outbreak of the war, showing the mental weaknesses and hereditary taints of Germany's war lord.
I recall him from memory of bygone years, and as I saw him in Berlin when his grandfather was still on the throne—a young man of about twenty, returning from the races and dashing through the Tiergarten holding the reins of six coal-black horses.
I said to myself: "That young man will cut a dash yet." And I still see, in higher light than before, those six coal-black horses—the horses of death.
Recently I read pages of his writings, speeches, and declarations, and there is not for the world an uplifting or new thought within them all. What appears to be new is the echo of an age that was supposed to be long past—when might was rule and valor was religion.
"There is but one will, and that is mine," said the Kaiser, addressing his soldiers; but it has been the keynote to his diplomacy wherever it has appeared, either in pushing a commercial treaty on Russia in her hour of distress, forcing Italy into the Triple Alliance, or dictating the terms of the Austrian ultimatum to Servia, so that it would be impossible of fulfilment.
What is there of world-progress in the declaration of the presentGerman Emperor, celebrating the two hundredth anniversary of theKingdom of Prussia,—
"In this world nothing must be settled without the intervention ofGermany and of the German Emperor."
An Aggressive Germany—The Logic of It—The War Party Supreme—A War forBusiness—What Confronts Germany—Her Finish.
A mighty nation surrounded and besieged, yet still fighting on foreign soil, is the position of Germany to-day. Her triumph would mean, not alone a European conquest, but a world-conquest. Her defeat within a reasonable time does not mean her destruction or dismemberment. It means only the destruction of Prussian militarism and that theory of national existence into which the German people have been led under the present emperor, that theory which teaches:—
"War and courage have done more great things than Charity."
"What is good? All that increases the feeling of power; the will to power."
"The weak and debauched must perish, and should be helped to perish."
This is the philosophy, the teaching and the language of Nietzsche and on it Treitschke and Bernhardi founded their war propaganda.
When Emperor William II ascended the throne and became the "All Highest War Lord," he found himself at the head of two great Germanys: a military Germany arising from the Prussian conquest of France in 1870, by which more than thirty states had been welded into a compact unity of military order, commercial tariffs, railroad transportation, and national finance; and an industrial Germany forging ahead in the commercialism of the earth at a pace exceeded by no other nation.
Bismarck and Von Moltke had made a Germany for defense. The railways did not flow to the ocean for the interchange of commerce. They ran primarily east and west to the Russian and French frontiers for military reasons; but never for attack, always for defense. It was expected that France would revive and again seek to try issues with Germany. In this she might possibly be assisted by Russia. Hence the German plans were for defense against these two countries.
As Germany developed in industry, the military caste receded relatively. Bankers, merchants, shippers, and traders came to the front. Railways bent the traffic of the country to the sea, and harbors and ports of commerce grew with rapid strides.
"What a wonderful business man is the German Emperor!" said the world. "He advertises Germany all over the earth by the spiked helmet and the rattle of his sword, but never war seeks he." The world must now revise this opinion.
German unity gave rise to German efficiency and German thoroughness, and to a demand for a larger German unity. The whole German-speaking race must be put together and bound together. Germany must expand over the seas, in colonial empire, and by tariffs of her own making. This meant that the Germans must have dominion on sea as well as land. Alliances must first be cemented with Austria and her neighboring states. Italy must be dragged into a triple alliance; and the small Balkan States must be tied up with Austria, that through an alliance with Turkey, Germany might reach not only the Mediterranean but the waters of the Pacific. This must happen before the great try-out for the mastery of the seas.
Now, the central point in the study of Germany under the present Kaiser is the naval programme for over-seas conquest, which was originated entirely by the present Kaiser. It was he and no other who aimed to turn defensive Germany into aggressive Germany. He has been the author from the beginning of the entire naval programme.
Such a plan must take cunning and strategy covering years. It must proclaim peace to the world but rouse all the fighting blood of the German-speaking race. The spirit for world-conquest must be stimulated in all literature and art, in education, and commerce; with the individual and the family. The danger of Germany must be pointed out. The greatness and rightfulness of her ambitions in the world must be brought forward and educated into the blood of every growing German.
While to the outside world steadily proclaiming peace, the Kaiser was as steadily inculcating war and the principles of war into every avenue of German thought and philosophy.
The Germans are nothing if not logical and scientific. They must therefore find a reason in philosophy and in the facts of history for their national programme. Those who found these reasons and logically set them forth were hailed as the great philosophers and educators of Germany. The logic was simple. It was that all history and all progress had been made by war; that peace-loving races decayed, and finally perished, and their places were rightfully taken by the younger, braver, sturdier, and hardier fighting races.
"Let your superiority be an acceptance of hardship." "Die at the right time." "Be hard." "What is happiness? The feeling that power increases, that resistance is being overcome." Nietzsche thus talked the principles of this philosophy; a something entirely apart from the principles of the Christian religion, but an absolutely philosophical, modern paganism; a worship of power, the assertions of one's individual and national self—"The Will to Power."
Treitschke taught it to the youth of Germany as applied to war,—not the necessity for defense but the justice and the righteousness of aggressive warfare. The Emperor and his court hailed these teachings with great acclaim. Chamberlain, an Englishman, printed a book to show that all good things were German; that the great Italian art-workers were German; that Christ himself was of German origin.
The teachings of Christ were repudiated by Germany, but His greatness in world leadership must be claimed for Germany. Had not all the poets given Him the German countenance and complexion, even light hair and blue eyes? The German Emperor bought presentation copies of this book by the thousand.
If you think the picture is over-drawn, get a copy of Chamberlain's"Foundations of the Nineteenth-Century Civilization."
There are those who acclaim that all these teachings were never meant for war; that the Germans, outside of Prussia, being a phlegmatic, home-loving, non-military people, needed to have their patriotism stimulated with "war talk" and national ambitions.
Now there are those who see that it was all part of a cunning propaganda for a world-conquest; that Germany was cultivated industrially and financially to give base for military operations.
But most carefully have the business men of Germany been excluded from the war councils. I asked one of the best-informed men in the diplomatic cycles of Europe, whose business all his life has been to travel from country to country studying the languages, thought, and customs of all people, west of Asia and north of Africa: "Are the German bankers and business men to have no say in Berlin as to peace and war or the military policy of the empire?" His response was emphatic: "Not one word; they would no more be allowed expression of opinion in the inner councils of military Germany than would a rank foreigner from the farthest part of the earth. Still in Germany is the business of trade apart from the business of government."
The world may now see that the business of Germany was war from the beginning under Kaiser Wilhelm II, and that Germany was to be made great on land and sea by the sword of war hacking the way for German commerce, German tariffs, and German commercialism. The old feudal idea of trade expanded and supported by a war lord has been the idea of Germany since the pilot, Bismarck, was dropped by the young Emperor from the ship of state. War for aggression, war for business, war for German expansion, has been the scheme. That these plans were interrupted and the war precipitated sooner than expected was most fortunate for American civilization and all civilization, west of Germany.
It was the Kaiser who changed the terms of Austria's ultimatum to Servia, making them impossible of fulfillment, and then cunningly slipped away on a water-trip with the fastest German cruiser behind him, that he might come rushing back and cry, "Peace, peace!" while he fenced off every peace proposal from effectively reaching Austria. Servia was willing to agree to every demand of Austria except that which involved a change in her constitutional government, with which she could not comply in the allotted time; but even this she was willing to discuss. The Kaiser gave Russia twelve hours to demobilize, and then declared war on her five days before Russia even withdrew her minister from Vienna.
While the Germans have gone to war to possess the land and dominate the business of their neighbors, they have not gone to war as savage tribes, seeking blood and human sacrifice as an end in itself.
I have not dealt with German atrocities in Belgium or France. War is atrocious, and you cannot move millions of men to the slaughter of their fellow men without revealing a certain percentage of crimes kindred to murder.
In due time, all the atrocities of this war may be shown up in photographs which have been taken. The Carnegie Peace Foundation is circulating photographs showing the atrocities in the Bulgarian wars. It might be much more timely for them to circulate photographs showing the horrors and atrocities of human sacrifice in this most audacious war.
Previous chapters have shown how German diplomacy slipped, how the German secret service had gathered the facts of the military, financial, and political weaknesses of Russia, Great Britain, and France, yet with no ability to value properly the spirit of the peoples behind this military unpreparedness. Germany has been described as "System without Soul." It remains only to show the relative weaknesses of Germany, and why she cannot win this war.
The Allies can reach round the world for men, war-supplies, and financial assistance. Germany can get no more men, no more gold, no more outside war-supplies. She must manufacture and be self-sustaining.
In the first six months of the war Germany has raised a loan of 4,400,000,000 marks, or about 1,100,000,000 dollars, promptly and patriotically taken by her people.
But international bankers inform me that every dollar of this and fifty percent more was gone before January 1, 1915. This is also indicated by the expansion of her paper money and her efforts to maintain the gold basis under that paper.
As this is regarded as a life-and-death struggle for Germany, the jewelry in the Empire must go into the melting-pot.
I can well credit the reports of copper household utensils and building materials going into the melting-pot for the copper of war.
And of rubber, for which there is no substitute, I hear that above three dollars a pound is being bid in Germany, or about four times the price in the United States.
Still, the scarcity of gold, copper, gasolene, or rubber, or all combined, might not force Germany to sue for peace.
What I give a final verdict on is the tremendous human sacrifice that is exhausting both Austria and Germany. I do say from good sources that in the first twenty weeks of the war the German casualties—wounded, prisoners, missing, and killed—were above 1,700,000, while Austrian casualties are now approaching a million and a half.
In the first six months of the year Germany and Austria will have suffered not less than three million casualties. Of course, more than half these people are wounded, who may go back to the firing line. But the three hundred thousand and more dead will never go back; and many vitally wounded and many cripples will be hereafter useless in peace or war; and the prisoners that are exchanged with France through Geneva are under pledge and mutual government agreement not to take up arms again.
I have also more confidence in the Russian position, numbers, supplies, and strategy than is generally possessed in America.
We hear in the press reports of generals at the head of the armies in Russia and France. We do not hear of the wonderful younger generals that war is developing, and who are coming forward more rapidly there than from any similar developments under the bureaucracy of Germany.
The two greatest military strategists the war has developed are not in Germany or England. They are in Russia and France, and their names have not yet crossed the Atlantic in the press reports.
However long Germany may fight on, offensively or defensively, her retreat must begin this year. Then the world will be increasingly interested in the terms of peace.
Balfour, the English statesman, says privately, "I know the people look for the dismemberment of Germany, and some look for her destruction, but this is not the intelligent opinion or intelligent desire. Germany is an indispensable part of the world's industrial, commercial, financial, and political organization. To destroy Germany would be a world loss." The opinion of eminent political and financial people in England is that Germany can never repair the total damage she may inflict. So far as England is concerned, next after the destruction of Germany's war-power, giving insurance of a European peace, comes first the indemnification of every financial loss that Belgium suffers. This is now estimated at from $1,500,000,000 to $2,500,000,000.
What there will be left over in the way of Germany's ability to pay, aside from the Kiel Canal, Alsace and Lorraine, and German Poland, is problematical.
To have Germany able to pay even a part of the damage she is inflicting upon the world, she must be put back upon her industrial feet. Therefore, I have declared, when asked about this matter, that in the end England would be found the best friend of Germany. But conquered and destroyed must be the Prussian war-machine of aggression, or crumbles the art and industry of republican France and the democracy of English speech, thought, and government.