Yet all of these troubles and others such as the bottling up of wheat exports by the closing of the Baltic and Dardanelles, the disorganization of transport and labour, the original loss of the large German trade, could have been met and would have been met under the stable system which the moderate revolutionists had partially built up. In fact credit was returning and in October Japan gave the Provisional Government a credit of $33,000,000, while the United States advanced, a few weeks later, $31,000,000 more out of its Russian credits. The coming of the Bolsheviki stopped all this; what the Germans may have done in their peace parleys in the way of financially helping the Soviet or its leaders was not known at this time. The economic resources of Russia were tremendous and if the German Government, commercial leaders and industrial masters once got control-even partiallyof the vast timber and pulp supplies, the food and raw materials of the great central plains, the enormous coal fields of Siberia, the great Baku oil-bearing lands and other large mineral resources, it would be an obvious economic victory of the first importance. At the close of 1917 the financial situation, as well as other things, was chaotic, and anything might happen.

With the overthrow of the Czar had gone the link which held together the great regions and divergent populations of Russia, and at the close of the year Finland was an independent republic under German patronage, Siberia was separated and in active hostility to the Bolsheviki, the Ukraine was a republic threatened by Germany in numerous forms, Russian Poland was in German hands, Bessarabia was a separate republic for the moment, there was also a republic in the Caucasus and one amongst the Don Cossacks while Courland and Lithuania were practically German provinces. While all this turmoil and trouble were developing, the Allies of Russia had not been idle. Early in the year Lord Milner had been at Petrograd and Moscow in conference with the Czar's ministers, together with special representatives of France and Italy. Arthur Henderson of the British War Cabinet was there in June as was M. Albert Thomas, French Minister of Munitions.

At this time, according to the London Times, (June 15) the British Government replied to a Russian Note with (1) acceptance of the policy of no domination of other peoples or forcible occupation of foreign territory; (2) declaration of its war objects as being defence of one's country, enforcement of international engagements, liberation of oppressed populations, such as Poland, agreement with President Wilson's war message to Congress; (3) the statement that "the British Government believe that broadly speaking the agreements which they have from time to time made with their Allies are conformable to these standards. But if the Russian Government so desire they are quite ready with their Allies to examine, and, if need be, to revise, these agreements.' Neither Great Britain nor her Allies, however, would recognize the Bolsheviki nor would they share in the farcical negotiations of Brest-Litovsk. The American Commission of Mr. Root was in Russia for some time during June and Mr. Root returned, with a more optimistic impression than succeeding events warranted.

The first formal Peace parley with the Teutons was held on Dec. 1st between Ensign Krylenko and Gen. Von Hoffmeister; negotiations followed at Brest-Ltovsk on Dec. 2 with Kameneff, Sokolnikoff, Bithenko and Mstislasky-a peasant, a sailor, a soldier and a workman-as the Russian delegates; for the Germans Prince Leopold of Bavaria was in charge but General Von Hoffman was the actual negotiator and the Turks, Austrians and Bulgarians also were represented; a ten days' suspension of hostilities followed to enable settlement of Armistice conditions and, on Dec. 7, Roumania was compelled to associate herself with the negotiations. To Russia's nominal Allies M. Trotzky then presented an arrogant demand for definition of their attitude toward his negotiations and the statement that "in case of refusal, they must declare clearly and definitely before all mankind the aims for which the peoples of Europe may be called to shed their blood during the fourth year of the War."

Negotiations of this kind must have been rather humiliating to the War-lords of the Central Powers but they had a big game to play with little men and they played it well-the statesman at Berlin throwing up clouds of dust such as the following comment of Dr. Von Kühlmann in the Reichstag on Nov. 30: "The principles hitherto announced to the world by the present rulers in Petrograd appear to be entirely acceptable as a basis for re-organization of affairs in the East-a re-organization which, while fully taking into account the right of nations to determine their own destinies, is calculated permanently to safeguard the essential interests of Germany and Russia." On Dec. 16 the Armistice was signed to last from Dec. 17 to Jan. 4, 1918, to cover all fronts, naval as well as military, and to give the privilege of fraternization and intercourse between soldiers. It was "for the purpose of achieving a lasting and honourable peace between both parties" and no troops were to be moved during the duration of the agreement. Peace negotiations were to continue and "cultural and economic relations" to be at once re-established.

On Dec. 22 a formal Peace Conference met at Brest-Ltovsk with Germany represented by its Foreign Secretary Dr. Von Kühlmann and other diplomats; Austria-Hungary by Count Czernin, its Prime Minister, Field Marshal Von Chisceries and others; Bulgaria and Turkey by more or less able political and diplomatic leaders; Russia by nine men of whom the majority were uneducated and utterly inexperienced theorists of good Socialist standing but very uncertain patriotism and honesty, and as diplomats mere infants in arms to those they were dealing with. They asked nominally and with a confidence which was either superb or silly for many of the things which the Allied Powers, backed by 20,000,000 men in arms, were desperately fighting for. They were stated as demands in the following terms:

1. No compulsory annexation of territory taken during the War and speedy evacuation of such territory.

2. That political independence be restored to all nations deprived of independ ence by the fortunes of war.

3. That national groups not independent before the War shall decide by a referendum whether they shall become independent or give their allegiance to some Power. 4. Where mixed nationalities occupy any territory the rights of the minority shall be defended by a separate law.

5. No belligerent country shall be required to pay indemnities and private persons shall be compensated for losses incurred through the War from a special fund contributed by all the belligerents on a proportional basis.

For the moment the Central Powers appeared to accept some of these clauses and Count Czernin stated to the Congress on Dec. 25, in words which preceding and after events made interesting: "The delegations of the Quadruple Alliance are agreed immediately to conclude a general peace without forcible annexations and indemnities. They share the view of the Russian delegation which condemns the continuation of the War purely for aims of conquest. The statesmen of the Allied (Teutonic) Governments, in programmes and statements, have emphasized time and again that for the sake of conquest they will not prolong the War a single day." Some of the clauses were answered evasively or left for consideration by a General Conference. The following German statements were official and explicit:

1. It is not the intention of the Allies (German) to deprive of political independence those nations which lost it during the War.

2. The Allied Powers have frequently emphasized the possibility that both sides might renounce not only indemnities for war costs, but also for war damages.

3. The return of Colonial territories forcibly seized during the War constitutes an essential part of German demands, which Germany cannot renounce under any circumstances. Likewise, the Russian demand for immediate evacuation of territories occupied by an adversary conforms to German intentions.

By the close of the year the negotiations centred around this latter point. Germany asked Russia to take cognizance of the proclaimed independence of Poland, Lithuania, Courland and portions of Esthonia and Livonia, and that general elections be held in those districts to determine their future status before evacuation took place. It was obvious that under military occupation elections would be a farce, but the Russians eventually acceded to the terms. Peace by Dec. 31 was assumed as certain, so proclaimed by the Bolsheviki, and rejoiced over in Petrograd, in Berlin and in Vienna, but no Treaty had been actually signed and the Congress had adjourned.

The Struggles

in 1917.

The French people, during this year, still had and Successes to endure the loss in resources and production from of France its richest industrial section; it faced and overcame difficulties from the internal treachery of Boloism and the machinations of disloyal of disloyal Socialists and political leaders like Caillaux; it was struck a heavy blow by its longtime ally and friend, Russia, in the threatened withdrawal of army support and repudiation of the Russian bonds so largely held by French peasants. Yet the country stood four-square to these and other storms of war and proved once more the wonderful endurance of its people. As President Poincaré put it in an inter

view (Jan. 19): "We are condemned to continue the War until we our gallant Allies and ourselves can obtain the reparation and guarantees rendered indispensable by the aggressions of which we have been the victims, by the sacrifices to which we have subjected ourselves, and by the losses which we have suffered." The restoration of Alsace-Lorraine was declared an essential of peace. On Mar. 20 M. Briand resigned the Premiership as the result of Gen. Lyautey's retirement from the Ministry of War because of public discontent with aviation and other war conditions; Alexandre Ribot formed a new Government in which M. Viviani was Minister of Justice, M. Painlevé, of War, M. Thomas, of Munitions, Admiral Lacaze, Minister of Marine. All sections of opinion were represented and, on May 22, the Premier announced a re-organization of the Army command. In reading a telegram from the Russian revolutionary Government, which declared that Russia would "never forget the elation with which France entered the War on our side," he deprecated dangerous Peace sophisms as to no indemnities or annexations, and declared that indemnities for the ravages of France and Belgium were a requirement of both law and equity and that "the same reparation should be required for all small nations that have been crushed."

During these early months the Pacifists, pro-Germans and extreme Socialists were very active in France with M. Joseph Caillaux

a cold, brilliant, sinister figure in French politics as the pivot upon which national trouble seemed to turn. A pro-German peace policy was promulgated by Le Bonnet Rouge, a Parisian Socialist journal, which was prosperous without apparent basis, and was the alleged organ of M. Malvy, Minister of the Interior, and M. Caillaux. It told the soldiers that in the end neither German nor French victory mattered; M. Malvy, while a Minister, encouraged the anarchists by failing to make arrests when strikes were deliberately organized with a view to hampering military action and munition manufacture; pamphlets were largely circulated along lines of Russian anti-war advocacy and Generals Pétain and Nivelle had to protest vigorously to the Government against similar propaganda carried on in the Army; finally, Almeryda of Le Bonnet Rouge, who was a confessed anarchist as well as a suspected German spy, died mysteriously in prison and M. Duval, Manager of that paper, was found with $30,000 in his possession after a visit to Switzerland.

Then came the discovery of Bolo Pasha's intrigues, involving the expenditure of $1,680,000 of German money received via New York for the purchase of Le Journal of Paris, from Senator Humbert, and other purposes; the proven association of Bolo with M. Caillaux, an ex-Premier of France, on the one hand, and with Von Bernstorff at Washington on the other; the alleged connection of Bolo, Caillaux et al with the plots of May and June, 1917, which almost paralyzed the French Army and promised, for a brief space, to anticipate the Italian débâcle of later months. There was also the alleged receipt of large sums of German money by M. Turmel of the Chamber of Deputies and the charge that Leymarie, head

of the French Secret Service under M. Malvy, had received moneys and exacted blackmail in connection with German propaganda plots. Léon Daudet of L'Action Française charged M. Malvy, who, as Minister of the Interior, had since 1914 been in charge of the Secret Service and the Press Censorship, with having betrayed to the Germans plans for the costly June attack upon the Chemin-des-Dames position and on Oct. 15 he wrote in his paper

that:

There was something rotten somewhere which delayed the victory of the Allies. This something was German money employed within the Allied countries. There was the Bolo Pasha fund for corruption of the press, the Von Bülow fund for diplomatic intrigues, and the Hohenlöhe fund for promoting crimes and sedition. The last-named fund, in my opinion, was by far the most important. It was employed to promote the plot, carefully prepared for months, which broke out in both the Army zone and the rear formation in May and June of this year. This plot nearly attained the results hoped for by the German Governments.

A little later (Nov. 24) Gustave Hervé in La Victoire boldly charged M. Caillaux with being the centre of a campaign for a dishonourable and ruinous peace; with consorting, during a recent visit to Italy, with notorious "defeatist" and neutrality leaders there; with being a devoted friend and protector of Bolo Pasha and of Almeryda, the late Editor of Le Bonnet Rouge: "You said, sir, that when you found the man who brought against you something besides insinuations and twaddling gossip, who dared accuse you outright, you would prosecute him at the Assizes as a slanderer. I am your man, sir, prosecute me. I will produce my proofs and witnesses before a jury." In the Chamber of Deputies on Dec. 11 General Dubail, Military Governor of Paris, asked authorization for proceedings against M. Caillaux for (1) an attempt against the safety of the State by acts of a nature tending to compromise the alliances concluded between France and foreign Powers; (2) for treasonable relations with the enemy, and (3) for conducting an unpatriotic and treasonable peace propaganda.

In a letter to the Premier General Dubail stated that during recent investigations "it has been discovered that in possession of nearly all the accused were a great number of letters emanating from Joseph Caillaux, which do not leave any doubt upon the relations existing between him and the persons accused." Much of this correspondence was with Bolo Pasha and was written after that person had been charged with high treason. Current discussion and the trials of Bolo and Caillaux which followed revealed a perfect web of intrigue and sedition which included Malvy and reached out to General Sarrail and the Eastern Army. Malvy had to retire, General Sarrail was recalled and the Ribot Government on Sept. 7 was compelled to resign, partly, also, because of refusal to allow French Socialists to attend the Stockholm Conference. For a time M. Painlevé was Premier and Minister of War, with a policy thus stated on Sept. 18; "The re-acquisition of AlsaceLorraine, reparation for the damage and ruin wrought by the enemy, and a peace which shall not be a peace of constraint or violence.'