“The conversation has taken place, and all the pros and many cons have been discussed. Our standpoint has been explained in great detail, and the Bill has been examined. At my suggestion, it was resolved to agree on the following basis (informal line of action):
“(1) Because of its scope and its importance, the Agreement must be concluded, and it must not be jeopardized by too many details.
“(2) Therefore, the Agreement is not to contain any reference to the size of the two fleets, to standards of ships, to constructions, etc.
“(3) The Agreement is to be purely political.
“(4) As soon as the Agreement has been published here, and as soon as the Bill has been laid before the Reichstag, I, in my character of commander-in-chief, instruct Tirpitz to make the following statement to the Committee: The third squadron will be asked for and voted, but the building of the three additional units required to complete it will not be started until 1913, and one ship each will be demanded in 1916 and 1919 respectively.
“Haldane agreed to this and expressed his satisfaction. I have made no end of concessions. But this must be the limit. He was very nice and very reasonable, and he perfectly understood my position as commander-in-chief, and that of Tirpitz, with regard to the Bill. I really think I have done all I could do.
“Please remember me to Cassel and inform him.
“Your sincere friend,
“(Signed) Wilhelm I.R.”
After Lord Haldane’s departure from Berlin there was a gap of considerable length in the negotiations which had made such a promising start, and unfortunately during that time Mr. Churchill made a speech which not only the German papers but also the Liberal Press in Great Britain described as wanting in discretion. The passage which German opinion resented most of all was the statement that, in contrast with Great Britain, for whom a big navy was an absolute necessity, to Germany such navy was merely a luxury.
For the rest, the following two letters from the Chancellor to Ballin may throw some light on the causes of the break in the negotiations: