FRENCH PROPOSAL FOR MINIMUM. Cash Payment (up to May, 1921) In 1921 . 1922 1923 1924 1925 1926 From 1927-1961 inclusive (34 years) Total payments (including interest and sinking fund) STERLING £1,000,000,000 200,000,000 240,000,000 280,000,000 320,000,000 360,000,000 400,000,000 13,400,000,000 £16,400,000,000 The present worth (as of May, 1921) of this series of payments is £6,200,000,000 or $31,000,000,000 From 1927 to 1961 inclusive (34 years) annual payments of £600,000,000 each 20,400,000,000 Total payments (including interest and sinking fund) £24,400,000,000 The present worth (as of May, 1921) of this series of payments is £9,400,000,000 or $47,000,000,000 Thereafter, for a period of 33 years, annual pay ments of £600,000,000 each Total payments (including interest and sinking fund) STERLING £1,000,000,000 21,800,000,000 £22,800,000,000 The present worth (as of May, 1921) of this series of payments is £11,000,000,000 or $55,000,000,000 N. B. The British proposals are in the form of a memorandum from Lord Sumner, the text of which is not entirely clear as to the total term of payments, nor to the present worth of such payments. No minimum proposals were submitted. DOCUMENT 57. Memorandum of progress with the reparation settlement, April 1, with Anglo-American draft of Reparations Clauses (typewritten copies). April 1, 1919. British, United States, French and Italian financial representatives met yesterday morning. After preliminary discussion, the conference was adjourned, to enable Mr. Klotz to submit amendments to Mr. Lloyd George's proposals. Since then, the United States representatives and the British representatives have been in almost continuous session. It has been agreed between them that Mr. Lloyd George's plan shall be in substance adopted, that is to say: 1. That Germany shall be compelled to admit her financial liability for all damage done to the civilian population of the Allied and Associated Powers and their property by the aggression of the Enemy States by land, by sea and from the air, and also, for damage resulting from their acts in violation of formal engagements and of the Law of Nations. 2. That a commission should be established to decide: (1) The value of the claims in the categories agreed by the Allies as falling within Germany's liabilities as above. (2) The total amount which Germany was capable of paying to satisfy these claims. (3) That the commission should report by the end of 1921, but should have power to modify, from time to time, the time and mode of Germany's payments subsequent to 1921. (4) That payments should be made by an initial sum and annual instalments over a period of not more than thirty years. It was further agreed that an interpretation document should be prepared, to be handed to the Germans as an explanation of what the Allied and Associated Powers regarded as the liabilities payment for which they were in a position to enforce under the above clause, subject to Germany's capacity to pay as determined by the commission. The United States and British representatives agreed that among the categories to be included should be the cost of pensions and the cost of damage to property. It was understood that Mr. Lloyd George and Mr. Clemenceau have agreed that pensions shall be calculated on the French basis of payments. In order to avoid the challenging and putting forward of doubtful claims, we think it would be expedient to agree at once between the Allies a proportionate distribution of all payments received from Germany. We propose to meet further in order: 1. To draft the interpretation clause and to consider Mr. Klotz's amendments which are directed towards this end, and 2. To make proposals as to the proportionate distribution of receipts between the Allies. TEXT TENTATIVELY AGREED UPON BY THE BRITISH 1. The Allied and Associated Governments affirm the responsibility of the Enemy States for causing all the loss and damage to which the Allied and Associated Governments and their nationals have been subjected as a consequence of the war imposed upon them by the aggression of the enemy states. 2. The Allied and Associated Governments recognize that the financial resources of the enemy states are not unlimited and, after taking into account permanent diminutions of such resources which will result from other treaty clauses, they judge that it will be impracticable for enemy states to make complete reparation for all such loss and damage. The Allied and Associated Governments, however, require that the enemy states, to the extent of their utmost capacity, make compensation for all damage done to the civilian population of the Allied and Associated Powers and to their property by the aggression of the Enemy States by land, by sea, and from the air. (See Annex for interpretation clause 3. The amount of such damage for which compensation is to be made shall be determined by an inter-allied commission, to be constituted in such form as the Allied and Associated Governments shall forthwith determine. This commission shall examine into the claims and give to the enemy states a just opportunity to be heard. The findings of the commission as to the amount of damage defined in Article 2 shall be concluded and communicated to the enemy states on or before May 1st, 1921. The commission at the same time shall also draw up a schedule of payments up to or within the total sum thus due, which in their judgment Germany should be able to liquidate within a period of thirty years, and this schedule of payments shall then be communicated to Germany as representing the extent of her obligations. 4. The inter-allied commission shall further have discretion to modify from time to time the date and mode of the schedule of payments fixed in clause 3 and, if necessary, to extend them in part beyond thirty years, by acceptance of long period bonds or otherwise, if subsequently such modification or extension appears necessary, after giving Germany a just opportunity to be heard. Payment may be required and, with the approval of the commission, accepted in the form of properties, chattels, businesses, rights, and concessions in ceded territory; of ships, of gold and silver, of properties, chattels, businesses, rights and concessions, of bonds, shares and securities of all kinds, of foreign currencies or the cur rency of the enemy state, or of German Government bonds. 5. In order to enable the Allied and Associated Powers to proceed at once to the restoration of their industrial and economic life, pending the full determination of their claim, the enemy states shall pay in such instalments and in such manner (whether in gold, commodities, ships, securities or otherwise) as the inter-allied commission may fix, in 1919 and 1920 the equivalent of $5,000,000,000 gold towards the liquidation of the above claims, out of which the expenses of the army of occupation, subsequent to the Armistice, shall first be met, provided that such supplies of food and raw materials as may be adjudged by the Allied and Associated Governments to be essential to enable Germany to meet her obligations for reparation may, with the approval of the Allied and Associated Governments, be paid for out of the above sum. 6. The successive instalments paid over by the enemy states in satisfaction of the above claims shall be divided by the Allied and Associated Governments in proportions which have been determined upon by them in advance, on a basis of general equity, and of the rights of each. 7. The payments mentioned above do not include restitution in kind of cash taken away, seized or sequestered, nor the restitution in kind of animals, objects of every nature and securities taken away, seized or sequestered, in the cases in which it proves possible to identify them in enemy territory. If at least half the number of the animals taken by the enemy from the invaded territories cannot be identified and returned, the balance, up to a total of half the number taken, shall be delivered by Germany by way of restitution. The attention of the four Chiefs of the respective Governments is to be called to the following: (a) That necessary guarantees to insure the due collection of the sums fixed for reparation should be planned; and (b) That there are other financial clauses which this conference has not been charged to deal with. |