Chapter X: The War (2)

"It is our duty to prepare ourselves in good time for the peace
that is to come. Does your Excellency believe it would augur well
for the future peace if Germany succeeded in inflicting a naval
victory on the British? I do not think so myself, but I rather
fancy that the opposite effect would take place.... If the British
should suffer a big naval defeat, they would be forced to fight to
the bitter end. That is inherent in the nature of things; even
those who can only argue in terms of a Continental policy must
understand it.

"Even a partial loss of her naval prestige would spell ruin to
Great Britain. It would imply the defection of the great dominions
which now form part of her world empire. The _raison d'être_ for
Great Britain's present position ceases to exist as soon as she has
lost her naval supremacy....

" ... And, please, do not lose sight of one further consideration.
We must find our compensation by annexing valuable territories
beyond the seas; but for the peaceful enjoyment of such overseas
gains we shall be dependent on the good will of Great Britain....
At present, men of German blood occupy leading positions in the
economic life of almost every British colony, and the open door has
been the means by which we have acquired a great deal of that
national wealth of ours which caused the smooth working of our
financial mobilization when the war broke out.

" ... For all these reasons I consider it a great mistake that the
press should be allowed to excite German public opinion against
Great Britain to the extent it is done. I was in Berlin during the
week, and I was alarmed when I became acquainted with the wild
schemes which are entertained not only by the people of Berlin, but
also by distinguished men from the Rhineland and Westphalia."

Apart from the peace problem there was another matter which gave Ballin grave cause for anxiety. This was the circumstance that the Kaiser, because of his long absences from Berlin, lost the necessary touch with the people, and could not, therefore, be kept properly informed of popular feeling. He expressed his fears on this account in a letter to a friend of his amongst the Kaiser's entourage in which he wrote:

"I hope you will soon be able to induce His Majesty to remove his
winter quarters to Germany. My common sense tells me that, if a war
is waged on French and Russian soil, the headquarters ought to be
situated in Germany. From the point of view of security also I
consider this very desirable, and I feel a great deal of anxiety
concerning His Majesty.... Whether it is wise to exercise the
censorship of the press to the extent it is done, is a question on
which more opinions than one are possible.... I have just had a
call from a Mr. X., a former officer, and an exceedingly reliable
and capable man. He complained bitterly of the rigid censorship,
and he thought it would be a mistake from which we should have to
suffer in days to come. It would certainly be a blessing if such a
man who is highly esteemed by the Foreign Office could be given a
chance of explaining his views at headquarters."

Among the problems of foreign policy with which Germany saw herself faced in the early part of the war, those referring to Italy and Roumania were of special interest to Ballin. The question was how to prevent these two countries from joining the ranks of Germany's enemies. Ballin did all he could to bring about the Italian mission of Prince Bülow. He not only urged the Chancellor to select Bülow for this task, but he also tried hard to induce the Prince to undertake the thankless errand involved. In addition to the political importance of the mission, he laid great stress on its bearing on the food problem.

"The question of provisioning the German people," he wrote in a
letter to the Army Headquarters, "is closely connected with the
solution of the Italian and Roumanian difficulties. No pressure is,
in my opinion, too strong in order to make it perfectly clear to
Austria that some sort of an agreement with Italy is a _sine qua
non_ for the successful termination of this war. If it were argued
that Italy would come forward with fresh demands as soon as her
original claims had been satisfied, I think the German Government
could combat this objection by insisting upon a written promise on
the part of Italy to the effect that she would not extend her
demands.

" ... Political and military considerations make it plain beyond
any question of doubt that Italy, who will be armed to the teeth in
March, will not be able to lay down her arms again unless Austria
arrives at an understanding with her. Thus our greatest danger is
the uncertainty as to what these neutrals will do, and I hope that
the ministerial changes in Austria will smooth the way for a
reasonable attitude towards this regrettable but unavoidable
necessity. Our aim should be to prevent the scattering of our
forces, for the burden imposed upon ourselves because of the
inadequacy of our allies is almost superhuman, and contains the
danger of exhaustion."

The German mission to Italy suffered through the vacillations of Austrian politics, and was therefore doomed to failure. Austrian feeling concerning a compromise with Italy was always dependent on the news from the Italian front; if this was favourable, people did not want to hear of it, and in the opposite case they would only discuss such an understanding most unwillingly. The proposed compromise was looked upon as a heavy sacrifice, and people were by no means favourably disposed towards German mediation. Prince Bülow was accused of having "presented Italy with the Trentino." Disquieting news which Ballin received from Vienna induced him to report to the Chancellor on the state of Austrian feeling, and to offer his services if he thought that his old-established relations with Vienna could be of any use. His offer was also prompted by his conviction that the German diplomatic representation in Vienna was not adapted to Austrian mentality.

Thereupon Ballin, early in March, 1915, entered upon a semi-official mission to Vienna. He first acquainted himself with the actual state of the Austrian mind by calling on his old friend, his Excellency v. Schulz, the Vice-President of the Austrian Chief Court of Audits, who was regarded as one of the best informed personages in the capital, and who was one of the regular partners of the old Emperor Francis Joseph for his daily game of tarock. This gentleman told Ballin that the people of Austria felt a good deal of resentment towards Germany, who had stepped in far too early as the "advocate of Italy," at a time when Austria was still hoping to settle Serbia all by herself. This hope, indeed, had proved an illusion; but Germany's strategy had also turned out a failure, because she had misjudged the attitude of Great Britain, and had not finished with France as rapidly as she had expected to do. Now Austria, confronted by stern necessity, would have to make concessions to Italy which every true Austrian would view with bitter grief; and, to bring about the active assistance of Roumania, Count Tisza would consider a sacrifice in the Bukovina debatable, but never one in Transylvania. Ballin told his friend that, as far as Roumania was concerned, he would have to leave it to Austria to settle that question by herself; and that his mission with regard to Italy was so difficult that he preferred not to make it more so by trying to solve the Roumanian problem as well.

Ballin's subsequent interviews with the Prime Minister, Count Stürgkh, and with the Minister v. Koerber, as well as those with other influential personages, confirmed these impressions, and he left Vienna buoyed up by the hope that the conference between German, Austrian, and Italian delegates which it was proposed to hold at Vienna would lead to a successful result. Such, however, was not the case, and it is quite probable that the possibility of arriving at an understanding with Italy had passed by that time, or, assuming the most favourable circumstances, that only immediate and far-reaching Austrian concessions could have saved the situation; but these were not forthcoming.

The next subject which caused much anxiety to Ballin was the question as to what Roumania would do, a country to whose attitude, considering her importance to Germany as a food-producing area, he attached even more value than to that of Italy. In his notes dating from that time he said:

" ... June 21st, 1915. The news which I received from X. regarding
the political situation in Roumania and Bulgaria was so serious
that I felt bound to send copies of these letters to the Chief of
the General Staff, General v. Falkenhayn, and to inform him that,
in my opinion, our Foreign Office had now done all it could
possibly do, and that nothing but some forcible military pressure
such as he and Baron Conrad could exercise on Count Tisza would
induce this obstinate gentleman to settle his differences with the
Balkan States...."

" ... On this occasion X. expressed a great deal of contempt at the
suggestion that we should draw upon the members of the old
diplomacy for additional help. On the whole, he seemed to be very
proud of the achievements of the Foreign Office, whereas I am of
opinion that this body has entirely failed, and is of no practical
use any longer. Things must be in a pretty bad state if Herr
Erzberger, of all people, is looked upon as the last hope of the
country. I suggested to the gentlemen that it would do some good if
the Chancellor were to request the more virulent of the Pan-Germans
to see him, and to ask Hindenburg to explain to them the military
situation without any camouflage. This suggestion was favourably
received, and it is to be passed on to the Chancellor....

" ... The Chancellor informed me that he was considering whether,
if Roumania remained neutral, and if the operations against the
Dardanelles terminated successfully for us, he ought to submit any
official proposals for peace to our enemies. I expressed my
admiration of the plan, but told the Chancellor of my objections to
its practical execution. The Entente, I feared, would refuse to
entertain the proposals, and the German people would regard it as a
sign of weakness. The Chancellor asked me to refrain from
pronouncing a definite opinion for the present, but to think it
over until our next meeting."

In a letter of July 31st, 1915, Ballin wrote as follows:

"I should like to express my heartfelt gratitude to you for sending
on to me the report which contains some of the finest observations
that have come to my knowledge since the outbreak of the war.

" ... The writer lays great stress on the belief prevalent in enemy
and neutral countries alike that Germany is making a bid for
universal supremacy and for supremacy on the high seas--a belief
which has spurred on the resistance of the enemy to the utmost, and
has caused a good deal of bad feeling amongst the neutrals. I
repeatedly brought this fact to the knowledge of the Chancellor and
I urgently suggested to him that in some way--e.g., by an Imperial
proclamation on the anniversary of the outbreak of war, or by some
other suitable means--we should announce to all and sundry that
such hare-brained schemes are not entertained by any responsible
person or body of persons in Germany. I sincerely trust that some
such steps will be taken at an early opportunity, because otherwise
I do not see when the war will be over. Though not a pessimist I do
not believe in taking too rosy a view of things. I envy the British
because they have the courage openly to discuss in their press and
parliament the reverses as well as the successes they have had.

" ... You see I am not taking too cheerful a view of matters. I
have nothing but the most enthusiastic admiration for the
achievements of the German people, both at the front and at home.
Although not gifted politically this people could do wonders if led
by great statesmen and by great politicians."

" ... August 10th, 1915. This morning I spent an hour with the
Chancellor, who had requested me to call on him.... We had a long
discussion as to the advisability of publishing a statement to the
effect that Germany would be ready at any moment to discuss an
honourable peace. She had achieved great successes in the field,
she was in possession of important mortgages, her armies were
occupying large tracts of the enemy's country, and she was not
carrying on a war of aggression but one of defence: therefore such
a step could not be regarded as a sign of weakness. The
Chancellor, nevertheless, was afraid that such a step might after
all be interpreted in that sense. I suggested to him that it might
be of some use if the Pope could be induced to address a peace
message to the rulers of the various countries.

"I also called the Chancellor's urgent attention to the need for
dealing with the food problem during the ensuing winter, especially
with relation to the price of meat."

" ... August 12th, 1915. The United States Ambassador, Mr. Gerard,
had expressed the desire to discuss with me the question as to the
advisability of suggesting that President Wilson should mediate
between the belligerents. I therefore called on him on Tuesday,
August 10th, and advised him to refrain from any official action in
that direction, but said that I thought he might ask the President
to sound opinion in Great Britain as to the chances of such peace
proposals."

In the early part of September, 1915, Admiral v. Holtzendorff was appointed Chief of the Admiralty Staff. This appointment gave rise to a conflict with Grand Admiral v. Tirpitz, who threatened to resign because, _inter alia_, the Kaiser had issued instructions to the effect that the Chief of the Admiralty Staff should no longer be subject to the authority of the Secretary for the Navy, but that he could communicate with the Kaiser and with the Chancellor direct. Ballin thought a possible resignation of Admiral v. Tirpitz would be fraught with serious consequences at that moment, as it would produce a bad impression on public opinion and be inimical to the position of the Kaiser. These considerations caused Ballin to intervene in person with Admiral v. Tirpitz and with the Chief of the Naval Cabinet, with the result that the Grand Admiral withdrew his intended resignation.

The following extracts are taken from Ballin's notes during the next few months:

" ... October 20th, 1915. I am annoyed at the importunity with
which some interested parties, such as the Central Association of
German Manufacturers and the representatives of agriculture, are
pushing forward their views on the peace terms. Moreover, my
alleged readiness to conclude a 'bad peace' with Great Britain is
being talked about so widely that even His Excellency Herr v.
Zimmermann has drawn my attention to the ill effects of such
calumnies. All this has prompted me to avail myself of the
opportunity presented by the annual meeting of the Association of
Hamburg Shipowners of making a speech in which I have explained my
views as to the freedom of the seas.

"Prince Bülow will be leaving for Lucerne to-day where he intends
to stay for some time, and the Prussian _chargé d'affaires_, Herr
v. Mutius--of whom it has been alleged that the Chancellor
appointed him to his post on the death of his predecessor (the
excellent Herr v. Bülow, Prussian Minister to Hamburg) for the
reason that he might have a watchful eye on Prince Bülow and
myself--has been promptly transferred to Warsaw. Evidently the
Berlin authorities now think the danger has passed, since Prince
Bülow has left."

" ... November 23rd, 1915. Hammann[4] asked me why I did not call
on the Chancellor, and I told him that I thought the Chancellor
might feel annoyed with me for my interference in favour of
Tirpitz, which, however, would not affect me in any way, because I
was convinced that I had acted in the best interests of the Kaiser,
and that it would have been unwise to remove Tirpitz from his post
so long as the war lasted."

" ... The Chancellor asked me to see him on Wednesday at 6.30 p.m.,
and I spent nearly two hours with him. I urgently advised him to
make a frank statement in the Reichstag as to our readiness for
peace, and to do so in such a form that it could not possibly be
looked upon as a sign of weakness."

" ... On January 10th, 1916, I was commanded to dine with Their
Majesties at the _Neues Palais_. The only other guests apart from
myself were the Minister of the Royal Household, Count Eulenburg,
and the Minister of Agriculture, Herr v. Schorlemer. None of the
suite were present so that the company consisted of five persons
only. The Kaiser was in high spirits and full of confidence. The
after-dinner conversation extended to such a late hour that we did
not catch the train by which we intended to return, and we were
obliged to leave by the last train that night.

"A remark of mine concerning the possibility of an extension of
submarine warfare had, as the Chancellor had been informed, caused
the Kaiser to assume that I completely shared the point of view of
Admirals v. Holtzendorff and v. Tirpitz, who now recommend a
submarine campaign against Great Britain on a large scale. I
therefore, at the Chancellor's request, addressed the following
letter to the Kaiser:

"'A few days ago I had occasion to discuss with Grand Admiral v.
Tirpitz and Admiral v. Holtzendorff the question of a resumption of
the submarine campaign.

"'I was then given confidential information as to the number of
submarines at our disposal, and I am bound to say that even if due
allowance is made for the activity of the mine-seeking auxiliaries
I regard the number of large submarines as insufficient for the
purposes of such a finally decisive measure.

"'The first attempt at submarine warfare proved unsuccessful on
account of the insufficiency of the means employed to carry it
through; and it is my humble opinion that a second attempt should
only be undertaken if its success were beyond the possibility of a
doubt. If this cannot be guaranteed the consequences of such a
measure appear to me to be out of all proportion to the risks
attached to it.

"'I therefore beg to respectfully suggest to Your Majesty that the
work of the mine-laying auxiliaries should be carried on as
hitherto, and should even be extended. I also consider that the
submarines should be made use of to the fullest extent of their
capacity, with the proviso, however, that their employment against
passenger steamers should be subject to the restrictions recently
laid down by Your Majesty.

"'When the number of the big submarines shall be sufficient
effectively to cut off the British food supply, I think the time
will have arrived for us to employ this weapon against Great
Britain without paying regard to the so-called neutrals.

"'At present about two hundred ocean steamers or more enter
British ports every day, and an equal number leave for foreign
ports. If we sink a daily average of 30 or 40 we can, indeed,
greatly inconvenience England, but we shall assuredly not be able
to compel her to sue for peace.

"'I humbly apologize to Your Majesty for thus stating my views on
this matter; but I am of opinion that the extreme importance of the
proposed steps will be a sufficient excuse for me.'"

In the early part of 1916 Ballin went on a second mission to Vienna, and afterwards he prepared a detailed report for the Chancellor dealing with the state of public feeling as he found it. This document presents a faithful picture of the precarious conditions in that capital which the German Government had constantly to reckon with, and may therefore be of interest even now. The following passages are extracts from it:

"If we desire to keep the Austrian fighting spirit unimpaired we
must avoid at all hazards suggesting the possibility of an
understanding with Italy. The Italian war is popular down to the
lowest classes of the people, and the successful stand against
Italy is a subject of pride and hope to all Austrians.

"Hence the circumstance that Prince Bülow has temporarily taken up
his abode at Lucerne has roused a considerable amount of suspicion.
Even the officials in the various ministerial departments fear that
the Prince might intend to make unofficial advances to Italy when
in Lucerne, and that these steps might be followed in Berlin by a
movement in favour of a separate peace with Italy by which Austria
would have to cede the Trentino. People were obviously pleased and
relieved when I could explain to them that the Prince was greatly
embarrassed on account of having lost his Villa Malta, and that the
choice of a suitable residence during the winter had been very
difficult. They were particularly gratified when I told them--what
I had heard from the Prince's own lips--that he had had no official
mission, and that he had not been engaged upon any negotiations.

"People are especially proud of the Isonzo battles, but they do not
shut their eyes to the uncertain prospects of a successful Austrian
offensive. They really consider that Austria has gained her war
aims, and the old Emperor described the military situation to Frau
Kathi Schratt by saying that the war was in many respects like a
game of tarock, in which the winner was not allowed to cease
playing because the losers insisted upon him going on with the game
so that they might have their revenge. Matters at first had been to
the advantage of our enemies: the Russians had overrun Galicia, the
Serbians had defeated the Austrians at Belgrade, and the French had
looked upon the retreat from the Marne as a great success. Now,
however, the war was all in favour of Germany and Austria, and
therefore our opponents did not want to call a truce just yet.

"If this comparison which the venerable old gentleman has borrowed
from his favourite game of cards is correct, the war will not be
over until one side has nothing further to stake, and the decision
will be brought about by that side whose human and financial
resources shall last longest.

"Banking circles, of course, view the financial situation with the
utmost gravity, but the general public--in spite of the high prices
ruling here, and in spite of the great want of food which is much
more noticeable than with us--regard matters a great deal more
serenely. This is simply due to the greater optimism so
characteristic of the Austrians, whose motto is: 'Life is so short,
and death so very, very long.' They prefer to assign to future
generations the worries which would spoil their sublunary
existence.

"The present Cabinet is looked upon as weak and mediocre. The old
Emperor clings to Count Stürgkh because of the extensive use to
which the latter puts the celebrated paragraph 14 of the
Constitution, by which Parliament is eliminated altogether, and
which provides the Government with every conceivable liberty of
action. The all-powerful Tisza gives his support to Count Stürgkh
just because of his weakness. Hence the attempt to replace the
latter by Prince Hohenlohe, the present Minister of the Interior,
is beset with much difficulty. The Emperor wants to avoid a break
with Tisza at all costs. This state of things makes people feel
very worried. The strain in the relations between Austria and
Hungary has greatly increased since my last visit, whereas the
friendly feelings for Germany are now more pronounced than ever.

"Our Kaiser everywhere enjoys an unexampled veneration. Within the
next few days he will be made the subject of great celebrations in
his honour. Although the tickets of admission are sold at enormous
prices, even General v. Georgi, the Chief of the National Defence
Organization--whom I met last night--did not succeed in obtaining a
box, notwithstanding his high connexions. This morning the
well-known member of the Hofburg Theatre, Herr Georg Reimers, read
to me two poems dedicated to the Kaiser which he is going to recite
that night, and I feel bound to say that it can hardly be an
unmixed pleasure to the members of the court to witness this act of
enthusiastic homage paid to our ruler.

"The Roumanian question, particularly in its bearing on the food
supply, is regarded by people who are able to judge with great
anxiety. It is believed that the only thing to do is to send to
Bucharest experienced men connected with the supply and the
distribution of food who must be properly authorized to purchase as
much grain as possible for ourselves and for our allies.

"The big Austro-German _Zollverein_--or by whatever other name it
is intended to describe the proposed customs union--is looked upon
with very mixed feelings. Last night Baron Skoda (the Austrian
Krupp) explained to me after a dinner given at his house, with the
lively consent of members of the court and of the big
manufacturers, that the Austrian interests might indeed profit from
such a union with the Balkan States, but that it would be better
that Germany should remain an outsider for a period of fifteen
years. This is evidently a case of _timeo Danaos, et dona
ferentes_, and people feel that Austria, owing to her economic
exhaustion, would be easily absorbed by Germany after the
conclusion of the war. The Hungarians, naturally, view matters from
a different angle, not only because the Hungarian farmers would
like to sell their grain to Germany free of any duty, and because
industry counts for very little in their country, but also because
they dislike the Austrians.

" ... I also dined with Count Tisza. He is a purely Magyar
politician who regards the international situation from his
Hungarian point of view, and in conformity with his Magyar
inclinations. He is evidently a strong if obstinate character, and
he does not impress me as a man who will give up his post without a
protest. He, too, thinks the real war aims of Austria-Hungary have
been accomplished. Serbia is crushed, Galicia liberated, and
Russian supremacy in the Balkans--formerly viewed with so much
apprehension--is a thing of the past. All that is wanting now is to
bring the Italian campaign to a successful conclusion and the war
may be regarded as over as far as Austro-Hungarian interests are
involved.

"Both Tisza and the Austrian society showed strong symptoms of an
Anglophile leaning. Frau Schratt, who in such matters simply
re-echoes the views of the old Emperor, seemed very pro-English,
and had something to say about 'German atrocities.'

"I mention these facts because I cannot help thinking that,
notwithstanding the war, some friendly threads must have been spun
across from England to Austria."

The subject of an unrestricted submarine war, already touched upon by Ballin in his above-mentioned letter to the Kaiser written in January, 1916, was discussed with much animation in the course of the year, and a powerful propaganda in its favour was started by certain quarters. Ballin's attitude towards this question, and particularly towards its bearing on the possible entry of the United States into the war, is described with great clearness in a letter addressed to a friend of his attached to the Army Headquarters. In this message he wrote:

" ... You ask me to tell you something about the political and
military situation as I see it, and I shall gladly comply with your
wish.

"The American danger seems to be averted for the moment at least. A
severance of diplomatic relations with the United States would
have been nothing short of fatal to Germany at the present stage.
Just because the war may be looked upon as won in a military sense,
we were obliged to avoid such a catastrophe at all costs. As far as
military exertions are concerned, it is quite correct to say that
Germany has won the war, because in order to turn the present
position into a military defeat our enemies, in the first instance,
would have to gain military victories in Russia, France, and
Belgium. These would have to be followed up by our retreat from the
occupied countries and by their invasion of ours, and they would
have to defeat us at home. Every sensible critic must see that
neither their human material nor their organizing powers are
sufficient for such achievements. The fact is that we have reached
the final stage of a progressive war of exhaustion, which nothing
but the intervention of the United States could have prolonged.

"The accession of Italy to the ranks of our opponents has shown
what it means if an additional Power enters the war against us.
From a military point of view the entry of Italy did not materially
aggravate our position; but the whole aspect of the war, as viewed
by our enemies, underwent a complete change, and Grey, who shortly
before had announced that 'there is nothing between us and Germany
except Belgium,' stated a few weeks subsequent to the Italian
_volte-face_ that he could not find a suitable basis for peace
negotiations anywhere.

"The entry of the United States would have been of immeasurably
greater effect on the imagination and the obstinacy of our enemies.

"The very intelligent gentlemen who even now preach the
unrestricted submarine war, especially the leading members of the
Conservative and National Liberal parties, are misinformed about
what the submarines can do. They not only regard it as possible,
but even as practically certain, that the starvation of Great
Britain could be achieved if the unrestricted submarine war were
introduced. I need not tell Your Excellency that such an assumption
fails to estimate things at their true value. Great Britain will
always be able to maintain her connexion with the French Channel
ports. Quite apart from that, she will always succeed in importing
the 14,000 tons of cereals which she needs every day to feed her
population even if the number of our submarines is trebled, because
it must not be forgotten that the submarines cannot operate during
the night.

"Hence the whole problem is now, as ever, governed by the axiom to
which I have over and over again drawn the attention of the heads
of the Berlin economic associations, viz. that we can no more force
the British into subjection through our submarines than they can
hope to wear us out by their starvation blockade. Both the
submarine war and the blockade are extremely disastrous measures,
inflicting heavy losses on either side; but neither of them can
determine the fate of the war nor bring about a fundamental
improvement in the position of either of the belligerent groups of
Powers. That, apart from all other considerations, the unrestricted
submarine war would have exposed us to the open hostility of the
neutral countries, and might even have caused them to join the
ranks of our enemies, is an additional contingency which the
submarine enthusiasts have found it most convenient to dismiss by a
wave of the hand.

"If after the war Germany remains isolated from the rest of the
world, she cannot feed her population, and the doctrine of Central
European brotherhood promulgated by some of our amiable poets has
given rise to a movement which is apt to be of the greatest
detriment to the interests of our country when the war is over.

"If we had wished to invest large parts of our German national
wealth in countries like Austria-Hungary, Bulgaria, and Turkey,
nothing could have prevented us from realizing such a plan at any
time previous to the war, provided we had thought it economically
sound.

"Such a return to a continental policy, I maintain, would be a
disaster to Germany. Our needs and our aspirations have increased
to such an extent that we can no longer hope to satisfy them by
economic isolation or within the framework of a Central European
economic league of states.

"It is not because I am at the head of the biggest German shipping
concern that I tell you these things, but I do so with the
disinterestedness of a man who hopes to be allowed to retire into
private life when this terrible war is over. No one can perform
his life's work more than once, and no one can make a fresh start
at the age of sixty.

"The war has considerably strengthened the moral fibre of the
Chancellor; he has learnt to take upon his shoulders
responsibilities which, I think, he would formerly have shirked. It
is much to be regretted that the Conservative party cannot see eye
to eye with him in so many questions. He is blamed for the fact
that the Kaiser is so difficult of access, and that he does not
every now and then receive the leaders of our political and
economic life, as he should do considering the fateful time through
which the Empire is passing.

"If the Chancellor is to succeed in carrying through the huge tasks
still before him, it is, in my opinion, imperative that he should
not lose touch with Conservative circles, and I think there is no
reason why the Kaiser should not ask men like Herr v. Wangenheim,
Count Schwerin-Löwitz, etc., to visit him from time to time at
headquarters, and to acquaint him with their wishes and anxieties.

"I cannot help telling you that the whole nation views with
profound regret the Kaiser's isolation. Since the outbreak of the
war I have only once had an interview with His Excellency v.
Falkenhayn, and the main purpose of my asking for it was to request
him to bring about a change in this state of things by using his
influence with the Kaiser. His Excellency frankly told me that he
had some objections to doing this, but he promised me nevertheless
that he would exercise his influence in this direction. I am only
afraid that, because of the excessive burden of work he has to get
through, the matter has slipped his memory...."

Ballin was not the only one who, as early as 1916, regarded with such alarm the devastating effects of a possible entry of the United States into the war; other men of political training thought so too, although their number was not large. The following passages, taken from two letters which Ballin received from a member of the German diplomatic service, show that the feeling was there:

"February 16th, 1916. My chief apprehensions are purely political.
Although it seems that for the moment our differences with the
United States will be smoothed over, there can be no doubt but that
at times the tension has been so great that a wrong move at the
critical moment would have caused America to take up arms against
us. Contrary to what most people seem to think, I regard this
danger as having by no means passed; in fact I look upon it as
always lurking in the background. Those who, like myself, have seen
that the secret ideal of British policy is an alliance and
permanent co-operation with America, will agree with me that such
an Anglo-American understanding for the period of this war would be
of lasting detriment to our whole future. You know England, and you
know that the course of events has turned the Entente automatically
into an alliance, although the British, especially those who look
beyond the actual present, have always felt a great deal of
aversion towards such a development. The individual Frenchman,
indeed, is mostly looked upon as a somewhat grotesque and slightly
ludicrous character, but all the same there exists some sympathy
with the French as a nation, however artificially this may have
been brought about; but towards Russia the average Englishman never
felt anything but an icy aloofness and a great deal of antipathy.
Hence, the so-called allies of the British have never been the
cause of unalloyed joy to them.

"On the other hand, to establish permanent relations with that part
of the Anglo-Saxon race inhabiting the huge continent across the
Atlantic has at all times been the aim pursued by every really
far-sighted British statesman. By means of such an alliance, it is
hoped to consolidate and to strengthen for many generations the
foundations on which the venerable but also slightly dilapidated
structure of the United Kingdom rests. From a purely maritime point
of view, such an alliance would be of overwhelming strength. In my
opinion it would be perfectly hopeless for our country, constantly
menaced as it is by serious Continental complications, to gain the
trident of Neptune in opposition to these two Powers. I believe an
Anglo-American league, whose object it would be to prevent us from
becoming a commercial, naval, and Continental Power, would
restrict us once more to a purely Continental policy, a policy
which we have so successfully discarded since the accession of our
present Kaiser.

"To frustrate such an alliance must be our principal task. To call
it into being or even to facilitate its conclusion would be the
greatest crime against Germany's future which anyone could commit.

"Let us by all means sink as much enemy tonnage as possible, let us
lay mines, and let us proceed with our submarine warfare as
hitherto, or even with more energy, but let the people who are at
the head of the whole movement be aware of the immense
responsibility that rests on their shoulders. If our leading men
speak of a war with America just as cheerfully as though San Marino
or Montenegro were involved, I cannot help viewing such an attitude
with the utmost apprehension. The British will use all their
astuteness and all their energy to exploit any mistakes committed
by Germany. If they succeed in this, and if, in consequence, our
relations with the United States become very strained again or
drift towards a rupture, I fear that we shall not be able to bring
this war to a successful close, or derive from it any security for
our future development.

"Berlin, February 26th, 1916. During the two days I have now been
here it has greatly depressed me to see a number of fanatics who
cannot gauge the consequences of their doings attempting to drive
this splendid German people towards a new abyss. Alas! delusions
and folly are rampant everywhere. If I were you, I should now
disregard every other consideration, and explain to the Kaiser as a
friend that everything is being gambled away: the existence of his
Empire, his crown, and possibly the fate of the dynasty. It is like
living in a madhouse; everyone talks about war with Holland,
America, Denmark and Roumania as though a mere picnic were
concerned."

During the war Ballin tried over and over again to make the responsible authorities see the position in the same light as his own observations, and his repeated discussions with unprejudiced and clear-headed men had led him to see it himself. The letter reproduced below contains a description of the general situation at the time of writing (July, 1916). It was addressed to a friend of his in the diplomatic service who was looking after German interests in one of the countries allied with Germany, and who had asked him for some information concerning the situation at home:

"I am sorry that I can send you no good news at all. The conduct of
the war and its probable outcome are more of a mystery now than
ever, and with all that I cannot help feeling that our responsible
quarters do not even now realize the profound gravity of the
situation. The political and the military leaders are frequently at
variance. There is a lack of proper co-operation between Berlin and
Vienna. We imagine ourselves to be the rider, but we are only the
horse. The road between Berlin and Vienna is studded with
compromises of doubtful value, and incapable archdukes are given
the most important positions.

"The military situation was favourable until the Austrians thought
their day of reckoning with Italy had come, and when our own
Supreme Command set out to cover themselves with laurels in France.

"Both these undertakings turned out to be political and military
failures. For hundreds of reasons an early peace is imperative to
us. As matters stand at present only Great Britain and Russia can
conclude peace, because France and Italy must be regarded as mere
British vassals.

"Since the Cabinets of London and Petrograd remain absolutely deaf
to our publicly expressed overtures for peace, we have no choice
but to try to utterly defeat the one or the other of these, our
principal enemies, either Russia or Great Britain.

"We could have finished with Great Britain if we had had at least
300 first-class submarines, and in that case we might have regarded
a war against America with complacency.

"However, even if we possessed, as some optimists believe, as many
as 150 first-class submarines, we could not strike a mortal blow at
Great Britain and defy the United States as well. Therefore, we
have only one choice left: we must force Russia, our second chief
enemy, to her knees.

"Russia has been badly hit through the loss of the industrial
regions of Poland. If we had exerted all our strength in that
direction, and if we had taken Kiev, the economic key to Russia,
the Tsar would have had no alternative but to conclude a separate
peace, and this would have settled the Roumanian question at the
same time.

"With less certainty, but also, perhaps, with less exertion, it
might have proved possible to make peace _via_ Petrograd. But what
have we done instead? We have squandered our forces. The Eastern
theatre of war was denuded of troops, because at first Falkenhayn
felt sure he could take Verdun in a fortnight, then by Easter, and
finally by Whitsuntide. All our forces have been hurled at Verdun;
rivers of blood have been spilt, and now, in July, we are still
outside it. And what does it profit us if we do get it? We shall
only find other and more formidable lines behind it.

"In the meantime our good Austrians have transferred all their
reliable officers and men to the Tyrol, and have left nothing but
the rubbish and their inefficient generals to guard the points of
danger. And what are the results? A graceful retirement for
Salandra and the formation of an anti-German coalition government
in Italy on the one hand, and a manifestation of Austrian
superiority on the other, but a failure, nevertheless, because the
Austrians were not strong enough numerically to get down into the
plain. And even if they had compelled the evacuation of Venetia
nothing would have been gained. The fate of Italy, as it happens,
does not depend on Austria, but on Great Britain, who will rather
watch her starve and perish for want of coal than permit her to sue
for peace.

"Although all this is perfectly plain to everyone, our Supreme
Command seems to be undecided as to whether an offensive with all
the means at our disposal should be started on the Western Front
simultaneously with one against Russia, or whether it should be
directed against Russia only. As far back as last year I exerted
all my influence--small though it has become--in favour of an
energetic and whole-hearted offensive against Russia.

"Well-informed and far-seeing men have justly pointed out that, if
fortune so wills it, the Kaiser, arm in arm with Hindenburg and
Ludendorff, could risk a 'bad peace' without danger to himself and
his dynasty, but it appears beyond doubt that the influence of
Falkenhayn is all-powerful.

" ... If we were to arrive at an understanding with Russia to-day,
we should be able to go on with the war against Great Britain for a
long time to come, and, by means of unimpeded submarine activity,
to carry it to a successful issue. In that case we could also
estimate the danger threatening us from America at as low a figure
as many who are unacquainted with the position are putting it now.

"Thus it is my view that it is necessary to abandon definitely the
belief that the war can be brought to a successful issue on the
Western Front, and without first defeating Russia. It is greatly to
be deplored that many observers assert that the Western Powers will
make peace when they have found out that the big offensive now in
progress remains without any visible success. Only people who do
not know Great Britain can put forward such a proposition, but how
many people are there at the Wilhelmstrasse who do know Great
Britain? Very few indeed, if any....

" ... You said you would rejoice to hear from me, and I can only
regret with all my heart that I have not been able to report
anything to you in which it would really be possible to rejoice."

A still more serious note is struck in the following letter written in September, 1916:

"Very many thanks for your welcome letter of yesterday's date, with
the contents of which I agree in every detail.

"I quite share your belief that Hindenburg and Ludendorff must each
feel like a great physician who is only called in when it is too
late. Two declarations of war within 24 hours were necessary to
bring about this change which the German people had been looking
forward to for months and months. The Chancellor is justly
reproached for not having had the courage to insist upon the
appointment of these two men and on the resignation of Falkenhayn
long ago. It is contended that he should have tendered his own
resignation if his recommendations were refused, and his neglect to
do so makes him principally responsible for the fate that is in
store for us. For a long time back I have kept emphasizing the need
for transferring our main activities to the Eastern theatre of war,
and for definitely settling these personal questions.

"The Chancellor clings to his post because he believes that there
is no one better qualified than himself to be at the head of
affairs. Such an attitude reminds me of the old gentleman who
neither wanted to die nor to retire from his post as president of
the Berlin Chamber of Commerce, and who bitterly complained to
those who came to congratulate him on his ninetieth birthday that
he was compelled to stick to his office, in spite of his advanced
years, because he could not see a better man to succeed him.

"It is very sad that we have arrived at such an _impasse_, and I am
convinced that the present internal political situation is
untenable. No German Chancellor can possibly carry the business of
the country to a successful issue if, in the midst of a terrible
war, he is obliged to fight against an opposition consisting of the
Conservatives, the representatives of the Heavy Industries, and the
majority of the National Liberals.

"As far as I can make out, the Chinese wall surrounding the Kaiser
has not disappeared with the exit of Falkenhayn from the scene. No
one is granted access to him who knows something about the events
that led up to this war, and who, in the interests of his dynasty
as well as his own, would tell him the unvarnished truth. We are,
after all, a constitutional country. It would doubtless be best to
transfer General Headquarters to Berlin, but, of course, people are
not wanting who object to such a proceeding, asserting that it
would enable outside influences to acquire a hold on the conduct of
affairs.

"How badly people are informed with regard to the actual situation
was brought home to me when I was in Berlin a short while ago, and
when X. contended with great emphasis that we should have to attach
more value to huge indemnities than to annexations. If it is
possible that the men round the Kaiser count on heavy indemnities
even now, it shows how sadly they misjudge the real state of
affairs.

"My feeling tells me that the present Cabinets, containing as they
do men who are compromised by their actions since the outbreak of
war, cannot give us peace. How can anyone imagine that men like
Bethmann, Asquith and Grey, who have hurled such incredible insults
at each other, can ever sit together at the same table?

"The question as to who is to succeed them, of course, abounds with
difficulties.

"I recently met some Austrian gentlemen in Berlin. They are
completely apathetic; they have lost all interest in the future,
and they themselves suggest that Germany should no longer permit
Austria to have a voice in the conduct of affairs. Her food supply
will only last until March 1st. After that date she will depend on
Hungary and ourselves for her food. She fears that she is not
likely to get much, if anything, from Hungary; on the other hand,
she feels sure that we are compelled for our own sake to save her
from famine.

"Constantinople, too, has only supplies for a few more weeks.

"With us at home the paraffin question is becoming very serious. In
country districts it may be possible to tell people to go to bed at
curfew time, but the working population of our large cities will
never consent to dispense with artificial light. Serious riots have
already taken place in connexion with the fat shortage.

"I am afraid that Great Britain is trying to bring about such a
change in the situation as will enable her shortly to tell the
small neutral countries that no one in Europe will be permitted any
longer to remain neutral, and that they must make up their minds to
enter one or the other of the two big syndicates. You see nothing I
can write to you has even a semblance of comfort in it. I regard
the future with the utmost apprehension."

In contrast to such views as were expressed in the foregoing letters, the men who were at the head of affairs at that time maintained that nothing but the application of rigorous force, or, in other words, the unrestricted use of the submarine weapon against Great Britain, would lead to a successful termination of the world war. The propaganda in favour of that measure is still in everybody's memory. Whatever may be said in defence of the authors of this propaganda, there is one reproach from which they cannot escape, viz. that they left no stone unturned to prevent their opponents from stating their views, and this, on account of the strict censorship to which the expression of every independent opinion was subject, was not a difficult matter. Their one-sided policy went so far that, when a pamphlet on the question of submarine warfare was written by order of the Admiralty Staff and circulated among a number of persons, including leading shipping men, Ballin was purposely excluded, because it was taken for granted that he would not express himself in favour of the contents. It is not likely, however, that the methods of reasoning put forward in this document--which was much more like an academic dissertation than an unprejudiced criticism of a political and military measure affecting the whole national existence of Germany--would have induced Ballin to change his views on the submarine war. Once only, and then merely for a brief period, was he in doubt as to whether his views on that question were right, but he soon returned to his first opinion when he found that he had been misinformed regarding the number and the effectiveness of submarines available.

The inauguration of unrestricted submarine warfare in January, 1917, not only put a sudden end to the peace movement in which Ballin, as has been explained on a preceding page, played an important part, but also to the attempt of President Wilson to bring the two sides together. The details of the President's endeavours have meanwhile become public property through the revelations of Count Bernstorff, the German ambassador in Washington. In both instances a few weeks would have sufficed to ascertain whether the proposed action was likely to bring about the desired end, and the former attempt had even led to the impending establishment of mutual contact between the belligerents. The inability of the German political leaders to avail themselves of this opportunity, or at least their failure to do so, has doubtless been the greatest misfortune from which Germany had to suffer during the whole war.

Notwithstanding the successful exploits of the submarines, Ballin's apprehensions never left him, and they were not allayed by the development of the position at home. The letter published below, which he wrote to the Chief of the Kaiser's Civil Cabinet, believing that this gentleman would be most likely to assist him in laying his views before the Kaiser, admirably sums up his feelings, and testifies both to his real patriotism and to his presentiment of the fate that was to overtake his country:

"YOUR EXCELLENCY,

"_April 4th, 1917_.