threat of war, and, if the other members of the concert refused this dictation, by war itself, instantly declared." Moreover, as to Ger

many:

"It supported the rejection, without consideration, of the extraor dinary concessions made by Serbia in response to the insolent and intolerable demands of the Austro-Hungarian Government. It supported the mobilization of the Austro-Hungarian Army and the initiation of hostilities, and steadily rejected every proposal for conference, conciliation, or mediation, altho it knew that once mobilization and military action were undertaken by any of the Great Powers it inevitably compelled a response from all the rest, and so hourly reduced the chances.

"The German Government would now throw the blame for the failure of the attempts to procure peace on the mobilization of the Russian Army. They ignore that this was the immediate and necessary consequence of the mobilization of the Austrian Army and the declaration of war on Serbia-both authorized by Germany. These were the fatal acts by which the decision was taken out of the hands of statesmen and control transferred to the military. It is on the German statesmen that equally rests the responsibility for the hasty declaration of war on Russia when Austria herself was apparently hesitating, and for the declaration of war on France.

"So great was the haste of the German Government that when no plausible reason could be found allegations were invented, the complete falsity of which had long ago been demonstrated. The German delegation now admits that the German Government 'did not take the trouble to verify' reported facts which they published as justifying them in a declaration of war. After receiving what the German delegation has to say in self-defense, the Allied and Associated Powers are satisfied that the series of events which caused the outbreak of the war was deliberately plotted and executed by those who wielded supreme power in Vienna, Budapest and Berlin.

"The history of the critical days of July, 1914, however, is not the sole ground upon which the Allied and Associated Powers consider that the responsibility of Germany for the war must be tried. The outbreak of the war was no sudden decision taken in a difficult crisis; it was the logical outcome of a policy which had been pursued for decades by Germany under the inspiration of the Prussian system.

"It is said that Germany developed her armaments in order to save herself from Russian aggression. Yet it is a significant fact that no sooner was Russia defeated by Japan in the Far East than the German Government immediately redoubled its attempts to increase its armaments and to domineer over its neighbors under the threat of war. To them the collapse of Russia was not an occasion to try to reduce armaments and bring peace to the world in concert with the Western powers. It was an opportunity to extend their own power."

The changes finally made by the Entente delegates in the treaty were numerous, tho not radical, and included: A plebiscite for

Upper Silesia, with guaranties of coal from that region; frontier rectifications in West Prussia; the omission of the third zone from the Schleswig plebiscite; a temporary increase of the permitted strength of the German army from 100,000 to 200,000; a declaration of intention to submit within a month of the treaty's signature a list of those accused of violation of the laws and customs of war; an offer to cooperate with a German Commission on Reparations and to receive suggestions for discharging the obligation; certain detailed modifications in the financial, economic, and ports and waterways clauses, including the abolition of the proposed Kiel Canal Commission; assurance to Germany of membership in the League of Nations in the early future if she fulfils her obligations.

Berlin newspapers reappeared after the final Entente reply was made public with such headlines as "The Death Sentence" and "The Entente's Ultimatum" in their largest type, and extending across first pages. One paper called it "the blackest day in the history of the world." Count zu Reventlow, in the Deutsche Tageszeitung called Clémenceau's letter "a document of shameless lies." The German people should never forget this "most infamous example of refined lying and robbing." Next day the Berlin Vorwärts declared that "extortionate pressure renders signature of the peace treaty worthless. We must never forget it is only a scrap of paper. Treaties based on violence can keep their validity only so long as force exists. Do not lose hope. The resurrection day comes."

News on June 20 of the retirement of Scheidemann as Chancellor and of the reforming of a coalition German Government came as no surprize in Peace Conference circles, as it had been known for some time that Scheidemann, Brockdorff-Rantzau, and several other Cabinet members had become so thoroughly committed by past utterances to refusal to sign the treaty that a new Cabinet would have to be installed before the treaty could be signed and new delegates sent to Versailles, unless the treaty were modified again materially. On June 22 the German Government formally communicated to Versailles its intention to sign the treaty unconditionally in a note written by Haniel von Haimhausen, who said:

"It appears to the government of the German Republic, in consternation at the last communication of the Allied and Associated Governments, that these Governments have decided to wrest from Germany by force acceptance of the peace conditions, even those, which, without presenting any material significance, aim at divesting the German people of their honor. No act of violence can touch the honor of the German people. The German people, after frightful suffering in these last years, have no means of defending themselves by external action. Yielding to superior force, and without renouncing in the meantime its own

view of the unheard-of injustice of the peace conditions, the government of the German Republic declares that it is ready to accept and sign the peace conditions imposed.''

Contemporary with this declaration of acceptance of the terms and willingness to sign the treaty was the sinking of the German warships interned at Scapa Flow, an act accepted as an illustration of one of the problems which the Allied Powers would have to face in the execution of the treaty. That problem was the German mind. The incident imprest one less as an act of open treachery or piracy than as an example of the extraordinary mingling of stupidity and super-subtlety, and exaggerated legalism, of "rights" and "necessities" with which the world had had to deal since Bethmann-Hollweg's speech at the beginning of the war. If the Germans had sunk their warships before the armistice, or before the supreme humiliation of surrender, the act would have been human and understandable. But to have waited until the "expiration" of the armistice, as the German rear-admiral, and then to sink the ships during a sort of constructive recess, when there was no armistice and there was yet no peace, and therefore when the ships had presumably reverted to their former owners-that act was German. Such incidents would recur; and it would be for the Allies to decide in each case whether Germany was violating the treaty with forethought, or whether she was only fulfilling the treaty according to the laws of German thought.

Soon the Entente Powers had another example of the difficulties that awaited them in dealing with the Germans. On June 24 a delegation of officers from the cavalry of the guard, "gentlemen" representing the best families of Prussia, seized French flags captured by Germans in the war of 1870 and since kept in a museum in Berlin, but which by the treaty Germans now had said they would sign were to be restored to France, and had already been packed for shipment. These German "gentlemen" took the flags to a place before the statue of Frederick the Great, in Berlin, soaked them in gasoline, and burned them while a crowd stood by cheering wildly. The burning of the flags was the result of a scheme matured a week before, and the act was openly executed under the eyes of police guards, and almost within the shadow of the imperial palace.

The Allied and Associated Powers declared to Germany that they had taken note of these signal acts of bad faith, and that when the investigations into all the circumstances had been completed, they would exact the necessary reparation. Any repetition of acts like those would "have a very unfortunate effect upon the future operation of the treaty which the Germans are about to sign." They had complained that Germany's admission to the League of Nations might

be too long deferred, but "how could Germany put forward such claims if she encourages or permits deliberate violations of her written engagements?"

While the world had been waiting somewhat wearily for the Germans to sign the treaty in spite of their protests and the various notes received from her delegates in Versailles, Secretary Glass of the United States Treasury on May 26 announced that approximately 12,000,000 persons had bought Victory Loan bonds our fifth great loan. Subscriptions to the loan amounted to $5,249,908,300, which was an oversubscription of $749,908,300. Nearly 60 per cent. of the loan, or $2,663,154,850, had been taken by those who subscribed for not in excess of $10,000 each. Subscriptions by districts, after allowing for allocation of credit from one district to another, were as follows:

The actual figures of the subscription fittingly completed a very remarkable chapter in American finance. Within two years, the Government had asked for $18,500,000,000 in its war loans; a sum exceeding all the borrowings of the British or German Governments since August, 1914, and three times as large as the war loans of any European belligerent in any two-year period. As against this aggregate of $18,500,000,000 asked for by our own Government, our people had offered us no less than $24,068,000,000. Our earlier war loans, for which two and three billion dollars had been asked by the Treasury, were oversubscribed in amounts ranging from 38 per cent. in the Third Loan to 5134 per cent. in the First. With the very much larger applications of the Fourth Loan and the Fifth, it was natural that the ratio of oversubscription should be smaller. Yet the six-billion-dollar loan of October, 1918, was oversubscribed