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ready to twenty-five billion francs, have been expended in placing industrial and agricultural undertakings on a productive footing, and very little is left for rebuilding habitations in the devastated regions. Some three hundred thousand houses were totally destroyed during the war, and two hundred and sixty thousand others rendered uninhabitable. French contractors have raised a cry of alarm against the principle of permitting Germany to pay in kind for the reparation she owes, as such an arrangement deprives them of money to meet their running

expenses.

IN their annual reviews at the close of the year, the German papers generally agreed that marked progress had been made toward political stability and firmer established democratic institutions, but that as yet, there is no observable betterment in economic conditions. Public finance and currency are as unsound as ever. Economic policies are still dominated by programmes of socialization, which are kept to the front by a majority of the voters, who are loyal to Socialist theories.

REVIEWING events in Great Britain during 1920 and prospects for 1921, the London Statist says that the past year has witnessed 'the first tangible signs of a return to sounder financial methods, after five and a half years of

almost uninterrupted inflation. The year 1919 was a period of reorganization of industry after its war displacements, and 1920 was a period of an analogous reorganization in the domain of finance. Capital is beginning to be restored, production is increasing, prices are declining; at least speculation is being checked.'

IN the recent French senatorial campaign the Radicals were bitterly attacked because two of their prominent leaders, Caillaux and Malvy, are alleged to have sympathized with Germany during the war. It will be recalled that the old Radical Party in France was strongly pacifist, anti-militarist, and anti-clerical.

A DRAMATIC incident occurred at the Tours Convention of the French Socialist Party, which decided by a large majority to join the Moscow International. Clara Zetkin, a member of the German Reichstag and a leader of the extremists in that body, suddenly appeared in the Congress and spoke passionately in favor of an alliance with the Bolsheviki. Clara Zetkin lived in France for seven years and is reported by a writer of L'Humanité to speak French fluently. Apparently the French authorities have not yet discovered, or at least made public, the route by which she reached Tours and returned to Germany.

[Le Temps (Paris Semi-Official Opportunist Daily), January 14]

ON THE EVE OF THE WAR

BY MAURICE PALEOLOGUE

[This description, by the former French ambassador to Petrograd, of his personal experience in Russia on the eve of the war, is part of a longer article recently published in Revue des Deux Mondes. The ambassador reports the discussions he had with M. Briand and M. Viviani in June 1914, when he was summoned to Paris to talk over the details of President Poincaré's trip to Russia. He advised these two statesmen then that war was inevitable and imminent. His interview with M. Viviani was particularly impressive.]

'In any case,' I said, 'even if my presentiments are too pessimistic, we must strengthen our alliances as much as possible. It is of prime importance to get a firm understanding with England. We must be able to count upon the immediate help of its fleet and army.'

When I finished my account of the situation, Viviani again passed his hand over his eyes, and regarding me with an anxious air, asked:

'Can you suggest to me, even hypothetically, how soon you believe tension will reach the breaking point, and the tempest will be upon us?'

'It is impossible to state an exact date. However, I shall be surprised if the strain under which Europe is at present, does not reach the breaking point almost at once.'

Suddenly Viviani's attitude changed. His features were illumined with an almost mystical radiance. He braced back his shoulders:

'Well and good. If come it must, we shall do our duty. France will prove itself what it always has been, capable of any call upon its heroism and sacrifice. We shall see again the great days of 1792!'

President Poincaré's visit to Tsar Nicolas in July 1914. Shortly before the president's arrival, Nicolas II had an interview with the ambassador, in which he emphasized his desire for

peace.

After the usual interchange of courtesies, the Tsar expressed his gratification at the prospective visit of the president, saying:

'We'll have serious things to talk about. I am sure we shall be in complete accord. But there is one question which is particularly occupying my mind: our understanding with England. We must forge that into an alliance. That will be a guaranty of peace!'

'Yes, sire, the triple Entente cannot be too strong, if it is to insure peace.'

'I'm told that you are personally alarmed as to Germany's intentions?' Was he alluding to my offer to resign during my last visit at Paris? I did not know.

'Alarmed? Yes, sire, I am alarmed, although I have at present no reason to predict immediate war. But Kaiser Wilhelm and his government have fostered a state of mind in Germany which will make it impossible for that

The ambassador describes in detail country to draw back or negotiate if

any dispute arise, whether in Morocco, the Orient, or elsewhere. They must have their way at any cost. To get their way they will risk a war.'

The Tsar pondered a moment: 'I cannot believe that Kaiser Wilhelm wishes war. If you only knew him as well as I do! If you knew how much charlatanism there is in his poses!'

'Perhaps I am taking Kaiser Wilhelm too seriously in fancying that he desires, or even that he would passively accept, the consequences of his own challenging policy. But if a war were to threaten, could he prevent it? No, sire; honestly I do not think he could.'

The Tsar was silent a moment, and puffed his cigarette. Then he remarked in a firm voice:

"This makes it all the more important that we should be able to count on the English in case of a crisis. Germany would never dare to attack Russia, France, and England together, unless it had completely lost its reason.'

After President Poincaré's departure, the Tsar described his last interview with him to the French ambassador:

Asking me to sit down with him on the aft deck of his yacht, the Tsar related his conversation with Poincaré:

'I was delighted with my talk with your president. We were in perfect agreement. I am no less a pacifist than he, and he is as determined as I am to do everything possible to preserve peace. He suspects that Austria and Germany are designing something against Serbia, and believes that we must meet it by joint diplomatic action. I stand with him there. We must be both resolute and united in dealing with this question, and in discovering ways to settle it amicably. The more difficult it proves to be, the

more urgent it is for us to be united and firm.'

'Such a policy seems to me wisdom itself. I fear that we shall have to apply it very soon.'

'You continue to be alarmed?'
'Yes, sire.'

the unex

'Have you further grounds for your disquieting anticipations?' 'I have at least one pected return of my colleague Szapary (the Austro-Hungarian ambassador at Petrograd), and the cold hostile reserve he manifested the day before yesterday toward our president. Germany and Austria are preparing an explosion for us.'

'What can they want? To win a diplomatic victory at the cost of Serbia? To inflict a reverse on the triple Entente? No, no! In spite of all appearances, Kaiser Wilhelm is too prudent to embark his country in such a mad adventure. And the Emperor FrancisJoseph only wants to die in peace.'

The ambassador reports several interviews which he had with Sassonoff, at that time Russian Minister of Foreign Affairs. Under the date of July 24, he writes:

At half-past twelve, Sassonoff and Buchanan (the British ambassador), met at my house to talk over the situation. Our discussion was interrupted by luncheon, but was resumed immediately after that. Basing my arguments upon the toasts exchanged by the Tsar and the president, upon the reciprocal declarations of the Ministers of Foreign Affairs of the two countries, and last of all upon yesterday's communiquée to the Havas agency, I advocated unhesitatingly a firmer policy.

'But if that policy should involve us in war?' said Sassonoff.

'It will not involve us in war unless the Germanic powers have already made up their mind to employ force

to assert their supremacy in southeastern Europe. Firmness does not exclude conciliation. Still, our adversary must be willing to negotiate and to give and take. You know my personal ideas as to Germany's designs. The Austrian ultimatum seems to me to precipitate the dangerous crisis which I have foreseen for a considerable period. From now on, we shall have to assume that war may break out at any moment. That possibility must be kept in view in every diplomatic move we make.'

Buchanan suggested the possibility that his government would remain neutral. He feared in that case, that France and Russia might be crushed by the Triple Alliance.

Sassonoff objected:

'As matters stand now, England's neutrality would be equivalent to suicide.'

'You do not understand our present government's leaders,' replied Sir George sadly. 'Ah! if the conservative party were in power, I am sure that with all the evidence we now possess it would comprehend what our national interests dictate.'

I emphasized the decisive part England might play in cooling off Germany's belligerent ardor. I cited the opinion that the Tsar expressed to me four days previously: 'Germany would never dare to attack Russia, France, and England together, unless it had completely lost its reason.' Therefore, it was urgent that the British government should formally identify itself with our cause, which was the cause of peace. Sassonoff spoke warmly in support of my position.

A little later, M. Paléologue had a conversation with Sassonoff, just after the latter had concluded a very lively interview with Count Pourtalès, the German ambassador.

'Do you know what he had the pre

sumption to say to me?' said Sassonoff. 'He blamed me and all us Russians for not loving Austria, and for troubling without scruple the last years of its venerable emperor. I replied: "Of course we don't love Austria. Why should we love it? It has never done anything but injure us. As to its venerable emperor, he owes the fact that he still wears his crown to us. Please bear in mind the way he thanked us for that in 1855, in 1878, and in 1908! To blame us for not loving Austria is, I must say, a little too much!"'

"That is unfortunate, my dear Minister. If negotiations between Petrograd and Berlin continue on that basis, they will not last very long. We shall soon see Kaiser Wilhelm donning his "shining armor." Please be calm. Leave no means for a peaceful settlement untried. Remember that my government is a government of public opinion, and that we cannot do anything without public opinion behind us. Last of all, bear in mind also English opinion.'

'I will do everything possible to avoid war. But, like you, I am very much disturbed by the turn things have taken.'

'May I assure my government that you have not ordered any military measures?'

'None, I assure you. We have merely decided to withdraw quietly eighty million rubles which we had on deposit in German banks.'

Next comes the account of a conversation on July 28, 1914, almost at the hour of the crisis, between our ambassador and Pourtalès, the German ambassador.

At three o'clock that afternoon I went to the Foreign Office. Buchanan was in conference with Sassonoff.

The German ambassador was wait

ing his turn to be received. I addressed him frankly:

'Well, have you decided to calm. down your ally? You alone are in a position to make Austria listen to prudent counsel.'

He protested in a jerky voice:

'Here is where the calming should be done. You should stop exciting Serbia.'

'I pledge you my word of honor that the Russian government is perfectly calm and is ready to agree on a conciliatory programme. But don't ask it to let Serbia be annihilated. That would be asking an impossibility.'

trembled; his eyes were filled with tears. Shaking with repressed anger he repeated:

'We cannot abandon, we shall not abandon our ally. No, we shall not abandon her!'

Just at this moment the British ambassador came out of Sassonoff's office. Pourtalès rushed in, his face suffused with anger, without even shaking Buchanan's hand as they passed.

Sir George paused to say: 'What a state he is in! The situation is worse than ever. I do not doubt but what Russia will go to the limit. She is thoroughly in earnest. I have just ap

He replied drily: 'We cannot aban- pealed to Sassonoff not to permit any don our ally.'

'My dear colleague, let me speak frankly. It is a serious moment, and I think we have sufficient regard for each other personally to entitle me to be very frank. Unless the controversy between Austria and Serbia is pacified in a day or two, we shall have war. It will be a world war; such a catastrophe as the world has perhaps never seen. Such a calamity can still be avoided, since the Russian government desires peace, the British government desires peace, and your government also claims to desire peace.'

At these words Pourtalès burst out: 'Yes indeed, I call God to witness! Germany wants peace! For forty-three years we have been safeguarding European peace. For forty-three years it has been a point of honor with us not to abuse our strength! And yet people accuse us to-day of wishing to unchain the dogs of war! History will prove that right is on our side, and that our conscience is free from blame.'

'Have you already reached the point where you must appeal to the judgment of history? Is n't there then any chance of safety left?'

Pourtalès was so choked by emotion that he could not speak. His hands

military act which Germany might interpret as a provocation. We must throw on Germany the whole responsibility for initiating any attack. English public opinion will never consent to war, unless Germany is clearly the aggressor. Please emphasize this to Sassonoff.'

'I will do precisely what you suggest.'

At this moment the Austrian ambassador arrived. He was very pale. His stiff attitude toward us was in marked contrast with his ordinary engaging and courteous affability. Buchanan and I tried to get him to talk.

I asked, 'Have you received better news from Vienna? Can you tell us something reassuring?'

'No, I know nothing new. The mill is grinding.' Without attempting to explain further, he repeated his apocalyptic metaphor: "The mill is grinding.'

Finally, on July 29, Russia took its first military measures.

At eleven o'clock that night, Nicolas Alexandrovich Basily, Vice-Director of the Chancery of the Russian Foreign Office, presented himself at my em

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