T

HE formulation of the League of Nations covenant was described in the March issue of CURRENT HISTORY. With the League problem temporarily out of the way, the Peace Conference at Paris was able to proceed to the readjustment of the financial and economic relations disrupted by more than four years of war.

The creation of three new organizations was announced on Feb. 15-a Supreme Economic Council, an Economic Drafting Commission, and a Financial Drafting Commission. The first body, which included in its membership some of the ablest financial and siness minds of America and Europe, was charged with handling such pressing questions as the distribution of shipping, the abatement of the blockade, the distribution of raw materials, and urgent financial matters. The other two commissions were composed of financiers from all the Entente countries. The report of the Economic Commission, dealing with the removal of all economic barriers and the establishment of an equality of trade conditions among all nations associated for the maintenance of peace, was already before the Conference at the date mentioned. The Financial Drafting Commission was dealing with the insistent demand of some European nations for the pooling of all the credit debts and resources of the nations, and had undertaken the task of obtaining information as to the financial resources, I ent and prospective, of the enemy countries, to enable the Commission on Reparation to complete its work.

WAR REPARATION

The question of reparation to be solved by the Conference proved serious. On Feb. 19 the representatives of the allied European powers joined in a statement

to President Wilson which embodied their claims that Germany and her partners should be made to pay the entire cost of the war. When the subject had come before the Supreme Council the President had opposed this proposal, taking the ground that it was impossible to pay such a sum, and that the terms of the armistice made reparation collectible only for actual damage done. The Allies contended that this was a wrong interpretation of the armistice conditions, and, in the statement sent, called on President Wilson in effect to settle the question. The American position was that the amount which Germany and her allies were able to pay within ten or fifteen years should be assessed.

By Feb. 26 the subject of war reparation had been sufficiently discussed to develop the fact that there were three theories:

The British view was that as in civil law all damages must be paid by the aggressor, so Germany should be compelled to pay the whole cost of the war, including the expense to the Allies of raising, equipping, transporting, and maintaining their armies as well as reparation for wanton damage.

The French view was that reparation should include all England would demand, but the French, unlike the English, would fix the sequence of payment, requiring Germany first to settle bills for destruction in violation of international law and pay the other bills later if she could.

The American theory was that reparation to be demanded from Germany should cover only such damage as was done by her in wanton destruction and violation of the laws of war and of nations.

Under the American proposal England would be a creditor of Germany on rep

aration account only to the extent of her merchant shipping losses and damage caused by airplane and Zeppelin raids on English territory. The bills of the United States and British colonies would be confined to such merchant ship losses as were inflicted on them by submarines. So the chief creditors would be Belgium, Serbia, and Rumania, to which countries the bulk of wanton damage was confined.

ATTACK ON CLEMENCEAU

The session of the Conference to be held on Feb. 20 was deferred in consequence of a dramatic attempt upon the life of Premier Clemenceau on Feb. 19, details of which are given elsewhere. M. Clemenceau was stricken at the moment when he was starting for a meeting that was to arrange plans for the transition from war conditions to a state of peace, and to take in hand the construction of the actual peace treaty.

In an effort to speed up the work of making peace, the Supreme Council and various commissions were busily engaged at the session of Feb. 25. Marshal Foch appeared and gave his views concerning the Polish situation. French territorial claims were referred by the council to a special commission. The most interesting feature of these was the contention that France should have permanent control of German territory on the west bank of the Rhine.

One interesting development was the proposal that the German cables cut by the British early in the war should not be returned to Germany. The French and British held that these cables should remain under allied control as a reprisal of war. The American representatives did not assent to this, but the reasons for their position were not made public.

GERMAN WARSHIPS

The question of the disposition of the German warships continued to be one beset with difficulties. Speaking for the British Government, the Earl of Lytton, Parliamentary Secretary of the Admiralty, made an official statement in the House of Lords, in which he declared that the British policy opposed the ships forming any part of the armament of the world. The alternative of sinking

was a question for the Peace Conference to decide.

In an Associated Press dispatch of Feb. 24, it was said that, though the Supreme Council had not discussed the disposition of surrendered German warships, the naval experts of the council had studied the subject, and that the British and American officers had agreed that the proper solution of the question would be to sink the ships in deep water; the French and Italian officers, however, did not share this view.

The French attitude was stated by Stephane Lauzanne in the Matin on Feb. 27. The French delegation to the Peace Conference, he said, would energetically oppose the general sinking of the German fleet; France was firmly determined to take the share of these ships that would fall to her. She had lost 15 per cent. of her naval tonnage, and had come out of the war with a weakened navy; she needed a navy to police the seas and protect her colonial empire, the second largest in the world. The article pointed to the new naval program drawn up by the United States, one of the most pacific nations in the world.

ARGUMENTS FOR DESTRUCTION

President Wilson on March 15 took up the subject of the destruction of the warships surrendered by Germany. Although an adverse judgment had been attributed to him, this was the first time he had examined the matter, and he called for data from American naval experts. It was understood that his advisers in Paris favored the policy of destruction.

In addition to destroyers and submarines, there were involved twenty-one German and Austrian battleships, six battle cruisers, and nineteen light cruisers. The arguments brought to bear for their destruction may be summed up as follows:

1. In the face of the covenant committal to decreased armament, distribution would make an immediate increase of 30 per cent. in allied European armaments.

2. As matters stand the American ability to put through a building program creates the possibility of inducing Great Britain to join her in the alternative of scaling down to the lowest point the num

ber of ships consistent with self-protection and maintaining the League, whereas distribution will make new standards to be built up to.

3. Distribution will vastly and unnecessarily increase the burden of taxation.

4. World interests would be subserved by no one power controlling the seas against all comers.

5. The morale of the world requires a dramatic heralding of better days. Distribution is a step in the opposite direction.

6. Destruction preserves entire our moral position with respect to Germany.

7. American interests compel the acceptance of a joint naval burden with Great Britain. Distribution will make that burden too great for America to carry.

8. Finally if the German fleet is thrown among the Allies to be contended for as a prize, it will prove a veritable apple of discord that may make its surrender profit Germany more than if she had risked her ships in a final battle. The division of naval spoils would be a negation of the principle of co-operation which is the foundation stone of the League.

ARMENIA'S CLAIMS

At the meeting of the Supreme Council on Feb. 26 the claims of Armenia were presented. These claims embodied the following proposals:

First-Liberation from the Turkish yoke. Second-Formation of a new Armenian State to be made up of the six Armenian provinces of Turkey and the territories of the Armenian Republic in the Caucasus, and also the Port of Alexandretta, which is claimed by Syria.

Third-Protection for twenty years by a great power under a mandate from the League of Nations.

The Conference Commission to examine into the problems of the new nation of Czechoslovakia held its first meeting on Feb. 27, and completed the study of the question of Germans in Bohemia, after which it took up the question of Silesia. The commission organized by electing Jules Cambon as President.

CLEMENCEAU RETURNS

The meeting of the Conference on Feb. 27 was attended by Premier Clemenceau; this was the first time he had met the Conference since the attempt upon his life a week before. At this meeting, on motion of the American delegates, it was decided to organize a central commission for territorial questions.

Afterward the Zionist case was presented by Dr. Weismann and M. Sokolow, representing the Zionist organization; Professor Sylvain Levi of the College of France, and a member of the Palestine Committee; M. André Spire, representing the French Zionist organization, and Mr. Szsyahkin, representing the Jews of Russia.

The Zionist claims varied. The minimum comprised establishment of Zionist communities in Palestine and the guarantee of special rights and sovereignty for these communities. The maximum claims called for the erection of a Jewish State in order that the Jews might have a national home where they could live in peace.

FINANCIAL PROBLEMS

The Supreme Council began consideration of financial and economic problems, both as affecting the treaty of peace and the permanent conditions after the war, at the session of March 1. This farreaching subject was taken up after weeks given to hearings on territorial questions.

Financial and economic subjects were presented to the council in two reports, one from the Financial Commission, of which Louis Klotz, French Minister of Finance, is Chairman, and Albert Strauss and Norman Davis are the American members, and the other from the Economic Commission, of which Albert Clementel of France is Chairman, and Bernard M. Baruch, Vance McCormick, and Dr. A. A. Davis are the American members.

The report of the Financial Commission was a brief document, giving the main headings of the vast financial reorganization required. The report did not cover reparations and indemnities for the war, which had been the theme of a separate commission. Most of the headings were presented without recommendations, which were left to the council and the plenary conference, since the problem as a whole had been presented.

One of the main headings concerned war debts and debts made before the war in enemy countries, and whether they were to be paid or repudiated, the manner of payment, if paid, and the

priority of payment. Another heading dealt with State property in territory taken over, such as State mines and State railways.

ECONOMIC ISSUES

The economic report presented to the council was similarly comprehensive, covering the vast economic readjustment following the war.

It proposed an extensive inquiry with respect to raw materials, their surplus and shortage in various countries, with a view to stabilizing exports and imports according to the world's needs.

The most important subject mentioned related to equality of trade opportunities. This did not affect tariffs or customs among the nations, but sought to end trade discrimination, unjust State monopolies, dumping methods, and favored nation treatment.

To expedite the work of the Peace Conference in defining the approximate future frontiers of enemy countries, the Supreme Council decided to appoint a committee, comprising one member each from the United States, Great Britain, France, Italy, and Japan, to outline the frontiers on the basis of the recommendation of the territorial commissions already appointed or still to be created and submit the delimitations to the Conference.

MILITARY TERMS

Marshal Foch presented on March 1 to the council of the great powers the military terms to be incorporated in the peace treaty.

The military terms provided for the destruction of all German submarines, forbade the use of submarines hereafter by any nation, ordered the destruction of the German main fleet, directed the reduction of the German Army to fifteen infantry and five cavalry divisions, (about 200,000 men,) called for the retention of the German cables by the Allies, and compelled the destruction of the fortifications of Heligoland and the Kiel Canal.

Severe restrictions were placed on the manufacture of all classes of war materials and the military and commercial

use of the airplane was limited to the minimum.

The naval terms already before the council provided not only for the complete suppression of Germany's submarine equipment, but also for the termination of all submarine warfare by all nations throughout the world, thus ending the use of the submarine in naval warfare.

The provision for dismantling the fortifications of Heligoland and the Kiel Canal was made the subject of reservation by Admiral Benson, representing the United States; he held that this should not be a precedent applicable to American canal and harbor defenses, such as Hell Gate, Cape Cod Canal, and others.

AMOUNT OF REPARATION

The Supreme Council of the great powers considered on March 3 the military, naval, and aerial terms for the disarmament of the enemy. The main new point was that enemy airplane restrictions would be rigid.

The Conference Committee on Reparation estimated $120,000,000,000 as the amount which the enemy countries ought to pay the allied and associated powers.

France, the statement added, demanded immediate payment by the enemy of $5,000,000,000, part in gold, part in materials, and part in foreign securities, recommending that the remainder be payable in twenty-five to thirty-five years.

The question of indemnities continued for many days to be one of the most troublesome before the Conference. The chief issue was not what Germany should pay, but what she could pay. It was stated on March 20 that Messrs. Wilson, Clemenceau, and Lloyd George had been holding a series of meetings on the subject, and that the commissions which had studied the situation in Germany had gradually reduced the allied claims to a total of $40,000,000,000.

INTERNATIONAL LABOR CODE

The main proposals of the British draft, adopted with minor alterations by the International Legislation Commission

in Paris as the new international charter of labor, were published on March 4 as follows:

The provisions of this draft forbid the employment of children under 15 years of age in industrial occupations, and of children between 15 and 18 for more than six hours daily. At least two hours each day must be devoted by these young workers to technical or regular educational classes, and they will not be permitted to work at night or on Sundays or holidays.

A Saturday half holiday will be introduced into all countries, and workers must have a continuous weekly rest of at least thirty-six hours, while the hours of work shall not exceed eight daily or forty-eight weekly, and shall be even fewer than this in dangerous trades.

Women shall not be employed at night, and employers shall not give women work to do at home after their regular day's work. Women shall not be employed in especially dangerous trades, which it is impossible to make healthy, nor in mining, above or below ground. Women shall not be allowed to work for four weeks before and six weeks after childbirth.

In every country a system of maternity insurance shall be introduced, providing for compensation at least equal to sickness insurance benefit payable in the country concerned.

Women shall receive the same pay as men for the same work.

The use of poisonous materials shall be prohibited in all cases where it is possible to procure substitutes for them.

Workers shall have the right of free combination and association in all countries. A system of unemployment insurance shall be set up in every country. All workers shall be insured by the State against industrial accidents.

A special code of laws for the protection of seamen shall be established.

Regarding immigration, which shall not be prohibited in a general way, the charter, according to the correspondent, recognizes the right of any State to restrict immigration temporarily in a period of economic depression or for the protection of public health, and recognizes the right of a State to require a certain standard of education from immigrants.

The final reading of the British draft convention for the establishment of a permanent organization for international labor legislation was completed, and the draft convention as amended was adopted by the commission for submission to the Peace Conference on March 19.

The American contention that each country should settle its internal labor

problems without invoking the power of the League of Nations prevailed.

MONTENEGRO'S CLAIMS

The council of the great powers on March 5 heard the case of King Nicholas of Montenegro, which was presented by General Grosdenovich, the Montenegrin Minister at Washington. It was a protest by the venerable monarch against losing his throne and having his country absorbed by the new Jugoslav State.

Incidentally the protest involved the issue between Italy and Jugoslavia. King Nicholas is the father of the Queen of Italy, so that Montenegro's position had not been clearly defined on the issue between Italy and the proposed new State, which seeks to embrace Montenegro.

The council also considered food relief for Bohemia and other sections of Southeastern Europe, to which the warring factions still made it difficult to forward supplies.

TERRITORIAL QUESTIONS

The Central Commission on Territorial Questions at its first meeting on March 5 elected Captain André Tardieu of the French peace delegation President. The task of the commission was to co-ordinate all decisions of the special territorial commissions.

In particular it was to fix the lines between the different frontiers traced by the various commissions. It also would discuss questions not reserved for special consideration by the Council of Ten.

The Peace Conference Commission dealing with the Belgian-Dutch boundary issue decided to bring the principals to the dispute directly together to adjust by mutual agreement the questions that have arisen.

The commission held that the Peace Conference had no jurisdiction in this issue and no authority to dispose of the territory of neutral States.

The Interallied Commission on Ports, Waterways, and Railways on March 5 had, according to an official statement issued, considered the draft of the convention for the international control of rivers as submitted by a sub-committee.

After discussion the articles dealing