The Caillaux Drama

by John N. Raphael

On January 15 another long article over Monsieur Calmette’s signature in the Figaro dealt severely with Monsieur Caillaux’s relations with financial men in Paris. The suggestion made was that Monsieur Caillaux, who was a member of the board of the Argentine Crédit Foncier, the Egyptian Crédit Foncier and other enterprises of international finance, was for personal and pecuniary reasons unable to resist the pressure brought to bear on him by his colleagues among the directors of these financial boards, and was obliged to do what they told him to do, irrespective of his own political convictions or of the higher interests of the country, which interests he as a Minister of the State should have considered first.

According to the Figaro, a Monsieur Arthur Spitzer, an Austrian by birth, a Frenchman by naturalization, and one of the most influential directors of the big French bank, the Société Générale, had gained his position there owing to the influence and recommendation of Sir Ernest Cassel.

“Since 1911,” said the Figaro, “the French Prime Ministers and Finance Ministers had successively expressed their opinions that Monsieur Spitzer took too large a share in every sense of the word of the big loans which were launched on the Paris market. In consequence Monsieur Spitzer’s re-election to the board of the Société Générale in 1913 was indirectly opposed by the Government. Monsieur Spitzer, in deference to the expression of this opinion which was conveyed to the Société Générale by a permanent official of the Ministry of Finance, resigned his position on the board of the Société Générale, but he remained on the board of the Crédit Foncier Argentin and on the board of the Crédit Foncier Egyptien, of which two boards of directors Monsieur Caillaux was a member. The intermediary between the Government and the Société Générale in the secret and delicate negotiations which resulted in the resignation of Monsieur Spitzer had been Monsieur Luquet, one of the principal permanent officials in the Ministry of Finance. Shortly after Monsieur Caillaux’s return to power an intimate friend of Monsieur Spitzer, Monsieur André Homberg, a director of the Société Générale, and another financial magnate whose name the Figaro does not mention, called on Monsieur Caillaux at the Ministry of Finance, and shortly afterwards Monsieur Luquet was superseded and was succeeded in his post by Monsieur Privat-Deschanel, the general secretary of the Financial office, the man in whose presence Madame Gueydan had burned her husband’s, Monsieur Caillaux, letters. In other words, Monsieur Calmette accused Monsieur Caillaux of allowing himself to be influenced by his financial friends to serve their financial needs by the removal of a useful servant of the country. On the following day, January 16, the Figaro launched another accusation against Monsieur Caillaux, that of interfering between two big shipping companies in order to please his financial friends.”

There is no need to go into the details of the quarrel between the South Atlantic Company and the Compagnie Transatlantique. Suffice it to say that the Figaro accused Monsieur Caillaux of acting in an arbitrary fashion and taking orders for his conduct from certain financial magnates, among whom was Monsieur André Homberg of the Société Générale. On January 19, Monsieur Gaston Calmette announced for the following day a series of articles describing “the nefarious part played by Monsieur Caillaux in the events which preceded the sending of a German gunboat to Agadir.” On the 20th this series of articles began. They continued without intermission till January 24. I shall refer to them more fully in another chapter of this book.

On January 26, Monsieur Gaston Calmette called Monsieur Caillaux to account in the Figaro on the question of a heavy fine of £325,000 which had been inflicted on a Paris bank (the Banque Perrier) for the non-observance of certain formalities in connexion with an emission of two million pounds sterling of Ottoman bonds. Monsieur Gaston Calmette returned the next day to the question, twitting Monsieur Caillaux somewhat cruelly with his inability to give a satisfactory reply. On Wednesday, January 28, he returned to the charge again and at some length on the front page of the Figaro, dropping it on the 29th for an article of two columns and a half on Monsieur Caillaux’s connexion with the Crédit Foncier Egyptien and the Crédit Foncier Argentin.

In this article Monsieur Calmette deliberately accused Monsieur Caillaux of allowing quantities of South American bonds and shares an official quotation on the Paris Bourse because Monsieur Spitzer, Monsieur Ullmann and others of his financial friends were interested in placing these bonds in France. Monsieur Calmette declared that during the six months of Monsieur Caillaux’s tenure of office as Finance Minister in 1911, that is to say from February to June of that year, South American bonds and shares to the amount of forty million pounds sterling received an official quotation on the Paris Bourse, and he drew up and published a Table showing the prices at which the quotations had been given, and the depreciation of these stocks and shares during the three years which followed. The depreciation is about twenty-five per cent. In other words, according to the Figaro, Monsieur Caillaux’s admission of these enormous blocks of South American bonds on the Paris Bourse resulted in a loss to French investors of ten millions sterling.

Naturally enough Monsieur Caillaux replied through the official Havas agency, and in reply to his communiqué Monsieur Calmette on January 30 returned to the charge, emphasising his original accusations.

On the first of February Monsieur Caillaux visited his constituency of Mamers. The Figaro on that day published a long and bitter article describing the misdeeds of the Minister of Finance since his entry into politics. On the 2nd it published two columns more containing a sarcastic appreciation of Monsieur Caillaux’s visit to Mamers. On February 5, Monsieur Caillaux was accused in the Figaro of postponing the French loan and so inducing French investors to place their money elsewhere, notably in Italy. On February 7 the Figaro accuses Monsieur Caillaux, of “continuing to earn the gratitude of the Triple Alliance.” After adjourning the French loan and so facilitating the success of one Prussian loan, and the preparation of a second, “Monsieur Caillaux,” he is told by the Figaro, “has enabled the Hungarian Government to contract a loan of twenty millions sterling.” “When all our enemies have filled their Treasuries,” says the Figaro of February 7, “perhaps Monsieur Caillaux will make up his mind to reveal the great plans and schemes to which he has subordinated the eventual issue of a French loan.“ On Sunday February 8 the Figaro contented itself with publishing a photograph of Monsieur Caillaux, and making fun of it, but day by day no number of the paper appeared without an attack on him of one kind or another. On February 11, announcing the Finance Minister’s resignation from the board of the Crédit Foncier Argentin, Monsieur Calmette comments on it in these words: “Monsieur Henri Poirier, an intimate friend of Monsieur Spitzer, has taken his, Monsieur Caillaux’s, place provisionally. When Monsieur Caillaux wishes to return to the board there is no doubt that Monsieur Poirier will make way for him.” On February 19, commenting on the statement in the Senate of Monsieur Caillaux, two days before, that he had never said in 1901 that a Minister of Finance would never consent to interfere with all the taxes, the Figaro gives him the lie direct, quotes the speech he made on July 4, 1901, and declares that it is a complete condemnation of his whole fiscal policy at the present time. On the 20th Monsieur Calmette returns to the charge, compares several speeches of Monsieur Caillaux made at different dates, and comments on them in these words: “Monsieur Caillaux modifies his declarations and his financial programme according to whether he is a Minister in power or anxious to become one, according to whether he is speaking so as to remain in office or speaking against the Ministry so as to overthrow it.” On February 25 Monsieur Gaston Calmette returns to “the secret combinations of Monsieur Caillaux,” and the big fine of £325,000, “which was imposed but never collected,” and ends his article by the accusation that Monsieur Caillaux, for private reasons, authorized a loan issued by a South American bank after the authorization had been refused three times by his predecessor Monsieur Pichon. On Thursday, February 26, the Figaro returns to the attack on the same subject. On March 2, 1914, Monsieur Calmette published a letter written on December 19, 1908, by Monsieur Caillaux, who was then Minister of Finance, to Monsieur Clemenceau, who was then Prime Minister and Minister of the Interior. In this letter Monsieur Caillaux protests against the publication in the Journal Officiel of advertisements of foreign lottery bonds. “Six months after the date of this letter,” says Monsieur Calmette, “the Clemenceau Cabinet fell, and Monsieur Caillaux in the following autumn became President of the board of the Crédit Foncier Egyptien. He remained President of that board till January 1914, even while he was a member of the Cabinet again from March 2, 1911, till January 10, 1912. In December 1908 while Monsieur Caillaux was Minister of Finance and was not yet on the board of the Crédit Foncier Egyptien he had refused the introduction on the Paris market of 800,000 lottery bonds. In 1912 he authorized their introduction.” “Our plutocratic demagogue,” writes Monsieur Calmette, “had found in the interval between 1908 and 1912, 100,000 good reasons for suppressing his refusal of 1908 to give these bonds a market.”

This article is of course a deliberate accusation of financial and political dishonesty. On March 3, Monsieur Calmette returns to the question of the South Atlantic Shipping Company. On the 4th, Monsieur Calmette warns the public against a loan which is to be issued by this company, and suggests that Monsieur Caillaux’s reasons for encouraging it are reasons of party policy, and anything but straightforward. On March 5 the Figaro, over the signature of Monsieur Gaston Calmette, accuses Monsieur Caillaux publicly of facilitating a Stock Exchange coup by enabling his friends to gamble, with a certainty of success, in the price of French Rentes on the Paris Bourse.

This accusation needs a few words of explanation. The budget proposals contained one item of supreme interest to French investors. This was the taxation of stocks. On March 4 at five o’clock it became “known” in the lobbies of the Chamber and in the newspaper offices of Paris that Monsieur Caillaux intended to omit French Rentes from his scheme of taxation. Naturally this expected immunity of French Rentes from taxation was the reason of a rise of French Rentes. On the Thursday, March 5, Monsieur Caillaux contradicted the rumour of the afternoon before, and declared that he intended to propose the taxation of French Rentes. At twenty minutes to twelve on that morning, when the sworn brokers of the Paris Bourse fixed the opening price, the official contradiction had not reached them. At twelve o’clock, when the opening price was published on the Bourse, Rentes were up to 88.80, the highest price which had been reached since the declaration of war in the Balkans. A large amount of stock changed hands at this high price. Seven minutes later Monsieur Caillaux’s communiqué was generally known, and Rentes fell forty centimes in a few minutes, entailing heavy losses.