The discussion opened with the delegations, other than the American, claiming that we had not committed ourselves to anything which precluded our demanding from Germany all the loss and damage, direct and indirect, which had resulted from the war. “One of the Allies,” says Mr. Baruch, “went even further, and made claim for loss and damage resulting from the fact that the Armistice was concluded so unexpectedly that the termination of hostilities involved it in financial losses.”
Various arguments were employed in the early stages, the British delegates to the Reparation Committee of the Peace Conference, namely, Mr. Hughes, Lord Sumner and Lord Cunliffe, supporting the demand for complete war costs and not merely reparation for damage. They urged (1) that one of the principles enunciated by President Wilson was that each item of the Treaty should be just, and that it was in accordance with the general principles of justice to throw on Germany the whole costs of the war; and (2) that Great Britainʼs war costs had resulted from Germanyʼs breach of the Treaty of Neutrality of Belgium, and that therefore Great Britain (but not necessarily, on this argument, all the other Allies) was entitled to complete repayment in accordance with the general principles of International law. These general arguments were, I think, overwhelmed by the speeches made on behalf of the American delegates by Mr. John Foster Dulles. The following are extracts from what he said: “If it is in accordance with our sentiment that the principles of reparation be severe, and in accord with our material interest that these principles be all inclusive, why, in defiance of these motives, have we proposed reparation in certain limited ways only? It is because, gentlemen, we do not regard ourselves as free. We are not here to consider as a novel proposal what reparation the enemy should in justice pay; we have not before us a blank page upon which we are free to write what we will. We have before us a page, it is true; but one which is already filled with writing, and at the bottom are the signatures of Mr. Wilson, of Mr. Orlando, of M. Clemenceau, and of Mr. Lloyd George. You are all aware, I am sure, of the writing to which I refer: it is the agreed basis of peace with Germany.” Mr. Dulles then recapitulated the relevant passages and continued: “Can there be any question that this agreement does constitute a limitation? It is perfectly obvious that it was recognized at the time of the negotiations in October and November 1918 that the reparation then specified for would limit the Associated Governments as to the reparation which they could demand of the enemy as a condition of peace. The whole purpose of Germany was to ascertain the maximum which would be demanded of her in the terms of peace, and the action of the Allies in especially stipulating at that time, for an enlargement of the original proposal respecting reparation is explicable only on the theory that it was understood that once an agreement was concluded they would no longer be free to specify the reparation which Germany must make. We have thus agreed that we would give Germany peace if she would do certain specified things. Is it now open to us to say, ‘Yes, but before you get peace you must do other and further things’? We have said to Germany, ‘You may have peace if among other things you perform certain acts of reparation which will cost you, say, ten million dollars.’ Are we not now clearly precluded from saying, ‘You can have peace provided you perform other acts of reparation which will bring your total liability to many times that which was originally stipulated’? No; irrespective of the justice of the enemy making the latter reparation, it is now too late. Our bargain has been struck for better or for worse; it remains only to give it a fair construction and practical application.”
It is a shameful memory that the British delegates never withdrew their full demands, to which they were still adhering when, in March 1921, the question was taken out of their hands by the Supreme Council. The American Delegation cabled to the President, who was then at sea, for support in maintaining their position, to which he replied that the American Delegation should dissent, and if necessary dissent publicly, from a procedure which “is clearly inconsistent with what we deliberately led the enemy to expect and cannot now honorably alter simply because we have the power.”[105]
After this the discussions entered on a new phase. The British and French Prime Ministers abandoned the contentions of their delegates, admitted the binding force of the words contained in their Note of November 5, 1918, and settled down to extract some meaning from these words which would compose their differences and satisfy their constituents. What constituted “damage done to the civilian population”? Could not this be made to cover military pensions and the separation allowances which had been made to the civilian dependents of soldiers? If so, the bill against Germany could be raised to a high enough figure to satisfy nearly every one. It was pointed out, however, as Mr. Baruch records, “that financial loss resulting from the absence of a wage–earner did not cause any more ‘damage to the civilian population’ than did an equal financial loss involved in the payment of taxes to provide military equipment and like war costs.” In fact, a separation allowance or a pension was simply one of many general charges on the Exchequer arising out of the costs of the war. If such charges were to be admitted as civilian damage, it was a very short step back to the claim for the entire costs of the war, on the ground that these costs must fall on the taxpayer who, generally speaking, was a civilian. The sophistry of the argument became exposed by pushing it to its logical conclusion. Nor was it clear how pensions and allowances could be covered by words which were themselves an interpretation of the phrase, “restoration of invaded territory.” And the Presidentʼs conscience, though very desirous by now to be converted (for he had on hand other controversies with his colleagues which interested him more than this one) remained unconvinced.
The American delegates have recorded that the final argument which overbore the last scruples of the President was contained in a Memorandum prepared by General Smuts[106] on March 31, 1919. Briefly, this argument was, that a soldier becomes a civilian again after his discharge, and that, therefore, a wound, the effects of which persist after he has left the Army, is damage done to a civilian.[107] This is the argument by which “damage done to the civilian population” came to include damage done to soldiers. This is the argument on which, in the end, our case was based! For at this straw the Presidentʼs conscience clutched, and the matter was settled.
It had been settled in the privacy of the Four. I will give the final scene in the words of Mr. Lamont, one of the American delegates:[108]
“I well remember the day upon which President Wilson determined to support the inclusion of pensions in the Reparation Bill. Some of us were gathered in his library in the Place des États Unis, having been summoned by him to discuss this particular question of pensions. We explained to him that we couldnʼt find a single lawyer in the American Delegation that would give an opinion in favor of including pensions. All the logic was against it. ‘Logic! logic!’ exclaimed the President, ‘I donʼt care a damn for logic. I am going to include pensions!’”[109]
Well! perhaps I was too near these things at the time and have become touched in the emotions, but I cannot “more or less shrug my shoulders.” Whether or not that is the appropriate gesture, I have here set forth, for the inspection of Englishmen and our Allies, the moral basis on which two–thirds of our claims against Germany rest.