The reasons of domestic politics which prevented the Imperial Government from naming our peace conditions were not understood in America. When Secretary of State Lansing discussed with me the German Note of 26th December he said that he did not understand why we refused to name our conditions. If both the belligerent parties communicated their conditions a compromise would eventually be reached. To my objection that our demands were so moderate that they would be interpreted as weakness he replied that we ought to ask for more, indeed, ask for anything at all so long as we said something that would provide a starting-point from which negotiations could be opened and settled.
This conversation had no immediate practical results, as Colonel House asked me on the same day to call on him in New York With regard to the result of our conversation I telegraphed to Berlin as follows:
Cipher Telegram No. 192
"Washington, 29th December, 1916.
"House told me it is Wilson's opinion that a conference will not come about without previous confidential negotiations, for our enemies, as things are at present, would refuse the invitation or make their consent dependent on conditions. These words of Colonel House were accompanied by an invitation to strictly confidential negotiations, of which only he and Mr. Wilson should know. Under these circumstances complete discretion was assured, as Wilson and House, unlike most Americans, are both fairly clever at keeping secrets.
"I beg for early instructions as to whether I should reject such negotiations, or whether your Excellency wishes to authorize me to accept and will furnish me with instructions accordingly. As I have always reported, Wilson lays comparatively little importance on the territorial side of the peace conditions. I am still of the opinion that the chief emphasis should be laid on what are here called the guarantees for the future. If we could give Wilson these as fully as possible he thinks he could bring about a conference, for with that the chief argument of our enemies would be disposed of. The latter maintain that we would like to make peace now in order to begin the war when a more favorable opportunity occurs, while our enemies are obliged to hold together the coalition that has been formed against us in order to attain a lasting peace. Wilson's ideas about such guarantees are known to Your Excellency. They consist, in the first place, of disarmament by land and sea (freedom of the seas), provisions for arbitration and a peace league. I think, from Your Excellency's speech in the Reichstag, that the Imperial Government would give such guarantees on condition that peace was restored.
"With House I adopted chiefly a listening attitude in order not to compromise Your Excellency in any way. However, I agree with Colonel House's view that a peace conference cannot be brought about without the help of the United States. Our enemies will try to put us in the wrong by saying that we did, indeed, propose a conference but would not breathe a word about our conditions or guarantees. I can, of course, only judge from the American standpoint. We have, by our peace offer, brought about a great change in public opinion over here. This advantage we shall lose entirely if the idea spread by our enemies that we have only made a deliberately theatrical peace gesture for the benefit of German public opinion is confirmed. What steps Wilson will take should Your Excellency empower me to enter upon such negotiations is not yet certain and depends entirely on Your Excellency's instructions. House had an idea of travelling to England in person. The more detailed the information Your Excellency can give me as to our conditions and readiness to give guarantees the better from my point of view. However, I do not know whether Your Excellency may not perhaps prefer to let the negotiations break down rather than accept American help. In my opinion it is not necessary that the United States should take part in all the negotiations. All that is necessary would be for us to pledge ourselves to the guarantees, which would be settled in detail at a general conference, after a conference of the belligerents had concluded a preliminary peace.
"I submit to Your Excellency the above proposal because I am convinced that our enemies will not consent to negotiations unless strong pressure is brought to bear. This, however, will, in my opinion, occur if Your Excellency thinks it possible to accept American intervention. With the exception of the Belgian question the American Government ought to bring us more advantage than disadvantage, as the Americans have only just come to realize what England's mastery of the seas means."
This telegram I consider the most important of the entire negotiations, inasmuch as it reached Berlin on the 3rd January, therefore six days before the decision in favor of unrestricted submarine war. When I re-read my telegrams to-day, I still—even after the evidence given before the Commission of the National Assembly—have the same impression as at that time, that Mr. Wilson agreed with our wishes and regarded it as his principal task to bring about a conference of the belligerent parties. I cannot, therefore, understand how it was possible to regard this American offer as anything but an offer of peace mediation, and how the Foreign Office could declare to G. H. Q. that there had never been any question of peace mediation by Mr. Wilson. On the other hand, I quite understand that Bethmann-Hollweg, as he stated before the Commission of the National Assembly, was very sceptical with regard to the President's policy. Nevertheless, an offer of mediation was made which had to be accepted or refused. In the first case it was necessary to bring forward the submarine war as little as possible; in the other we should have to create a clear diplomatic situation in Washington, if we were to avoid the reproach of having negotiated with Wilson on the subject of peace while at the same time planning the submarine campaign, which was bound to bring about a rupture with the United States.
When I spoke with Colonel House at that time I assumed that the principal aim of the German Note of the 26th December was to lay particular emphasis on our old point of view, already known to Mr. Wilson, according to which the regulation of territory was to be dealt with by the belligerent Powers, and the League of Nations question in a world conference under the American presidency. At the time Colonel House himself always spoke of two conferences which the President hoped to bring together at the Hague. The one was to consist only of the belligerent Powers and settle the territorial questions, the other was to be a world conference to found the League of Nations. Mr. Wilson did not wish to invite the conference to Washington because of the great distance from Europe and the peculiar position of the American Press.