Chapter XVIII: Appendix (1)

1

=Resolutions of the London Conference, of April 26, 1915=[11]

On February 28, 1917, the _Isvestia_ published the following text of this agreement:

"The Italian Ambassador in London, Marchese Imperiali, acting on the instructions of his Government, has the honour to convey to the Minister for Foreign Affairs, Sir Edward Grey, the French Ambassador in London, M. Cambon, and the Russian Ambassador in London, Count Benckendorff, the following notable points:

§1. A _Military Convention_ shall be concluded without delay between the General Staffs of France, Great Britain, Russia and Italy. This convention to determine the minimum of forces to be directed by Russia against Austria-Hungary in case that country should turn all its forces against Italy, provided Russia decides to concentrate chiefly against Germany. The Military Convention referred to shall also settle questions bearing upon an armistice, in so far as these by their nature come within the scope of the Army Command.

§2. Italy on her part undertakes to carry on war with all the means at her disposal, together with France, Great Britain and Russia, against all countries at war with them.

§3. The naval forces of France and Great Britain are to render Italy undiminished, active assistance until the _destruction of the Austrian fleet_, or until the moment peace is concluded. A _Naval Convention_ shall be concluded without delay between France, Great Britain and Italy.

§4. At the coming conclusion of peace Italy is to receive: the district of the _Trentino; the whole of South Tyrol as far as its natural geographical boundary, thereby understood the Brenner; the city and district of Trieste; the provinces of Goerz and Gradisca, the whole of Istria_ as far as Quarnero, including Volosca and the Istrian islands of Cherso and Lussin, also the smaller islands of Plavnica, Unie, Canidolo, Palazzoli, as well as the island of St. Peter de Nembi, Astinello and Cruica, with the neighbouring islands.

Note: 1. By way of supplement to §4, the frontier shall be drawn through the following-points: From the peak of the Umbrail in a northerly direction as far as the Stilfserjoch, and thence along the watershed of the Ratische Alps as far as the sources of the rivers Etsch and Eisack, then over the Reschen-Scheideck, the Brenner and the Oetztaler and Zillertaler Alps; the frontier line then to turn southwards, cutting the Toblach range, and proceeding as far as the present frontier of Grein, drawn towards the Alps; following this it will run to the heights of Tarvis, then, however, pursuing a course along the watershed of the Julian Alps, over the heights of Predil, Mangart and Triglav group, and the passes of Podbrda, Podlaneskan and Idria. From there the frontier continues in a south-easterly direction to the Schneeberg, so that the basin of the River Save, with its sources, shall not fall within the Italian territory. From the Schneeberg the frontier proceeds towards the coast, enclosing Castua, Matuglie and Volosca in the Italian possessions.

§5. Similarly, Italy is to receive the province of Dalmatia in its present form, including Lissarik and Trebinje in the north, and all possessions as far as a line drawn from the coast at Cape Blanca eastward to the watershed in the south, so as to include in the Italian possessions all valleys on the course of the rivers debouching at Sebenico, such as Cikola, Kerke and Budisnica, with all those situate on their sources. Similarly also, Italy is promised _all the islands lying north and west of the Dalmatian coast_, beginning with the islands of Premuda, Selve, Ulbo, Skerda Maon, Pago and Puntadura, etc., in the north; as far as Malarda in the south, adding also the islands of St. Andrae, Busi, Lissa, Lessina, Torzola, Curzola, Cazza and Lagosta, with all rocks and islets thereto pertaining, as well as Pelagosa, but not to include the islands of Great and Lesser Zirona, Pua, Solta and Brazza.

The following are to be _neutralised_: (1) The entire coast from Cape Blanca in the north as far as the southern end of the peninsula of Sabbioncello, and in the south including the whole of the mentioned peninsula in the neutralised area; (2) a part of the coast beginning from a point situate 10 versts south of the cape of Alt-Ragusa, as far as the river Wojusa in the south, so as to include within the boundaries of the neutralised zone _the whole of the Bay of Cattaro_ with its ports, Antivari, Dulcigno, San Giovanni di Medua and Durazzo; this not to affect the declarations of the contracting parties in April and May, 1909, as to the rights of _Montenegro_.

In consideration, however, of the fact that these rights were only admitted as applying to the present possessions of Montenegro, they shall not be so extended as to embrace any lands or ports which may in the future be ceded to Montenegro. In the same way, no part of the coast at present belonging to Montenegro shall be subject to future neutralisation. The restrictions in the case of the port of Antivari, agreed by Montenegro itself in 1909, remain in force. (3) Finally, the islands not accorded to Italy.

Note: 3. The following lands in the Adriatic Sea are accorded by the Powers of the Quadruple Alliance to the territories of _Croatia, Serbia and Montenegro_: In the north of the Adriatic, _the entire coast, commencing from the Bay of Volosca_ on the frontier of Istria as far as the _northern frontier_ of Dalmatia, including the whole of the coast-line now belonging to Hungary, the entire coast of Croatia, the port of Fiume and the small harbours of Novi and Carlopago, as also the islands of Velia, Pervicchio, Gregorio, Goli and Arbe. In the south of the Adriatic, where Serbia and Austrian interests lie, the entire coast from Cape Planca as far as the river Drina, with the principal ports of _Spaluto, Ragusa, Cattaro, Antivari, Dulcigno and San Giovanni di Medua_, and with the islands of Greater Zirona, Pua, Solta, Brazza, Jaklian and Calamotta.

The port of Durazzo can be accorded to an independent Mohammedan State of Albania.

§6. Italy to be given full possession of _Valona, the Island of Sasseno_, and a sufficiently extensive territory to protect it in military respects, approximately from the River Vojusa in the north and east to the boundary of the Chimara district in the south.

§7. Italy, receiving the Trentino according to §4, Dalmatia and the islands of the Adriatic according to §5, as well as Valona, is not to oppose the possible wishes of France, Great Britain and Russia in case of the establishment of a small autonomous neutralised state in Albania, as to _division of the northern and southern frontier belts of Albania between Montenegro, Serbia and Greece_. The southern strip of coast from the frontier of the Italian district of Valona as far as Cape Stiloa to be subject to neutralisation.

Italy has the prospect of _right to determine the foreign policy of Albania_; in any case, Italy undertakes to assent to the cession of a sufficient territory to Albania to make the frontiers of the latter on the west of the Ochrida Lake coincide with the frontiers of Greece and Serbia.

§8. Italy to have full possession of all the _islands of the Dodecanessus_ which it occupies at present.

§9. France, Great Britain and Russia accept in principle the fact of _Italy's interest in maintaining political equilibrium_ in the Mediterranean, as also Italy's right, in case of any _division of Turkey, to a like portion with themselves_ in the basin of the Mediterranean, and that in the part adjacent to the _province of Adalia_, where Italy has already acquired particular rights, and developed particular interests, to be noted in the Italo-British Convention. The zone then falling to the possession of Italy will in due time be determined according to the vital interests of France and Great Britain. Similarly, the interests of Italy are also to be considered in case the territorial integrity of Asiatic Turkey should be maintained by the Powers for a further period, and only a limitation between the spheres of interest be made. Should, in such case, any areas of Asiatic Turkey be occupied by France, Great Britain and Russia during the present war, then the entire area contiguous to Italy, and further defined below, shall be granted to Italy, together with the right to occupy the same.

§10. In Lybia, Italy is to be granted all rights and claims hitherto conceded to the Sultan on the basis of the Treaty of Lausanne.

§11. Italy to receive such part of the war contribution as shall be commensurate with her sacrifices and efforts.

§12. Italy subscribes to the declaration issued by France, England and Russia whereby _Arabia and the holy cities of the Mohammedans_ are to be granted to _an independent Mohammedan Power_.

§13. In case of any extension of the French and English colonial possessions in Africa at the expense of Germany, France and Great Britain acknowledge in principle the right of Italy to demand certain compensation in respect of extension of Italian possessions in Eritrea, Somaliland, in Lybia, and the colonial areas contiguous to the colonies of France and England.

§14. England undertakes to facilitate the immediate realisation of _a loan of not less than 50 million pounds sterling_ in the English market on favourable conditions.

§15. France, England and Russia undertake to support Italy in _preventing the representatives of the Holy See from taking any diplomatic steps whatever in connection with the conclusion of a peace_, or the regulation of questions connected with the present war.

§16. The present treaty to be _kept secret_. As regards Italy's agreement to the declaration of September 5, 1914, this declaration will be made public as soon as war is declared by Italy or against Italy.

The foregoing points having been duly noted, the respective authorised representatives of France, Great Britain and Russia, together with the representative of Italy similarly authorised by his Government for this purpose, are agreed: France, Great Britain and Russia declare their full agreement with the foregoing notable points, as set before them by the Italian Government. With regard to §§1, 2 and 3, referring to the agreement upon military and naval undertakings of all four Powers, _Italy undertakes to commence active operations at the earliest possible date_, and in any case not later than one month after the signing of the present document by the contracting parties.

The present agreement, in four copies, signed in London on the 26th April, 1915, and sealed, by

Sir Edward Grey,
Cambon,
Marchese Imperiali,
Graf Benckendorff."

After the entry of Roumania into the war (September, 1916) this programme was further extended.

2

=Note from Count Czernin to the American Government, dated March 5, 1917=

From the _aide-mémoire_ of the American Ambassador in Vienna, dated February 18 of this year, the Imperial and Royal Ministry for Foreign Affairs understands that the Washington Cabinet entertains some doubt, in view of the statements issued by the Imperial and Royal Government on February 10 and January 11 of this year, as to what attitude Austria-Hungary contemplates adopting for the future with regard to submarine warfare, and whether the assurance given by the Austrian Government to the Washington Cabinet in the course of the proceedings with regard to the case of the vessels _Ancona_ and _Persia_ might not be taken as altered or withdrawn by the statements mentioned.

The Austrian Government is most willing to meet the desire of the United States Government that this doubt should be removed by a clear and final declaration.

It should here be permitted first of all to touch very briefly on the methods adopted by the Allied Powers in marine warfare, since these form the starting-point of the aggravated submarine warfare put into practice by Austria-Hungary and her allies, besides throwing a clear light upon the attitude hitherto adopted by the Austrian Government in the questions arising therefrom.

When Great Britain entered upon the war with the Central Powers, but a few years had elapsed since the memorable time when Great Britain itself, together with the remaining states, had commenced at the Hague to lay the foundations of a modern code of law for marine warfare. Shortly after that the English Government had brought about a meeting of representatives of the principal naval Powers, assembling in London, in order further to carry forward the work commenced at the Hague, presumably in a spirit of reasonable compromise between the interests of belligerents and those of neutrals. The unexpected success of these endeavours, which aimed at nothing less than concerted establishment of legal standards calculated to maintain the freedom of the seas and the interests of neutrals even in time of war, was not to be long enjoyed by the peoples concerned.

Hardly had the United Kingdom decided to take part in the war than it also began to break through the barriers with which it was confronted by the standards of international law. While the Central Powers immediately on the outbreak of war had announced their intention of observing the Declaration of London, which also bore the signature of the British representative, England discarded the most important points in that Declaration. In the endeavour to cut off the Central Powers from all supplies by sea, England gradually extended the list of contraband until it included everything now required by human beings for the maintenance of life. Great Britain then placed all the coasts of the North Sea--an important transit-way also for the maritime trade of Austria-Hungary--under the obstruction of a so-called "blockade," in order to prevent the entry into Germany of all goods not yet inscribed on the contraband list, as also to bar all neutral traffic with those coasts, and prevent any export from the same. That this method of proceeding stands in the most lurid contradiction to the standards of blockade law arrived at and established by international congress has already been admitted by the President of the United States in words which will live in the history of the law of nations. By this illegally preventing export of goods from the Central Powers Great Britain thought to be able to shut down the innumerable factories and industries which had been set up by industrious and highly-developed peoples in the heart of Europe; and to bring the workers to idleness and thence to want and revolt. And when Austria-Hungary's southern neighbour joined the ranks of the enemies of the Central Powers her first step was to declare a blockade of all the coasts of her opponent--following the example, of course, of her Allies--in disregard of the legal precepts which Italy had shortly before helped to lay down. Austria-Hungary did not fail to point out to the neutral Powers at once that this blockade was void of all legal validity.

For two years the Central Powers have hesitated. Not until then, and after long and mature consideration for and against, did they proceed to answer in like measure and close with their adversaries at sea. As the only belligerents who had done everything to secure the observance of the agreement which should provide for freedom of the seas to neutrals, it was sorely against their wishes to bow to the need of the moment and attack that freedom; but they took that step in order to fulfil their urgent duty to their peoples and with the conviction that the step in question must lead towards the freedom of the seas in the end. The declarations made by the Central Powers on the last day of January of this year are only apparently directed against the rights of neutrals; as a matter of fact, they are working toward the restitution of those rights which the enemy has constantly infringed and would, if victorious, annihilate for ever. The submarines, then, which circle round England's shores, announce to all peoples using and needing the sea--and who does not need it?--that the day is not far off when the flags of all nations shall wave over the seas in newly acquired freedom.

It may doubtless be hoped that this announcement will find echo wherever neutral peoples live, and that it will be understood in particular by the great people of the United States of America, whose most famous representative has in the course of the war spoken up with ardent words for the freedom of the seas as the highway of all nations. If the people and the government of the Union will bear in mind that the "blockade" established by Great Britain is intended not only to force the Central Powers to submission by starvation but ultimately to secure undisputed mastery of the sea for itself, and thereby ensure its supremacy over all other nations, while on the other hand the blockading of England and its Allies only serves to render possible _a peace with honour_ for these Powers and to guarantee to all peoples the freedom of navigation and maritime trade, thus ensuring their safe existence, then the question as to which of the two belligerent parties has right on its side is already decided. Though the Central Powers are far from wishing to seek for further allies in their struggle, they nevertheless feel justified in claiming that neutrals should appreciate their endeavours to bring to life again the principles of international law and the equal rights of nations.

Proceeding now to answer the questions set forth in the memorandum of February 18 of this year, already referred to, the Austrian Government would first of all remark that in the exchange of Notes in the cases of the _Ancona_ and _Persia_ this Government restricted itself to consideration of the concrete questions which had up to then arisen, without setting forth the legal position in point of principle. In the Note of December 29, 1915, however, regarding the _Ancona_ case it reserved the right to bring up the intricate questions of international law connected with the submarine warfare for discussion at a later date. In reverting now to this point, and taking up the question as to sinking of enemy ships, with which the memorandum is concerned, for brief consideration, it is with the hope that it may be made clear to the American Government that the Austrian Government now as heretofore _holds immovably by the assurance already given_, and with the endeavour to avoid any misunderstanding between the Monarchy and the American Union by clearing up the most important question arising out of the submarine warfare--most important as it rests on the dictates of humanity.

First and foremost the Austrian Government wishes to point out that the thesis advanced by the American Government and adopted in many learned works--to the effect that enemy merchant vessels, save in the event of attempted flight or resistance, should not be destroyed without provision for the safety of those on board--is also, in the opinion of the Austrian Government itself, the kernel, so to speak, of the whole matter. Regarded from a higher point of view, this theory can at any rate be considered in connection with possible circumstances, and its application be more closely defined; from the dictates of humanity, which the Austrian Government and the Washington Cabinet have equally adopted as their guide, we can lay down the general principle that, in exercising the right to destroy enemy merchant shipping, loss of life should be avoided as far as possible. This necessitates a warning on the part of the belligerent before exercising the right of destruction. And he can here adopt the method indicated by the theory of the Union Government referred to, according to which _the commander of the warship himself issues a warning to the vessel about to be sunk_, so that crew and passengers can be brought into safety at the last moment; or, on the other hand, the Government of the belligerent state can, when it is considered an imperative necessity of war, give warning, with complete effect, _before the sailing of the vessel_ to be sunk; or, finally, such Government can, when preparing comprehensive measures against the enemy traffic at sea, have recourse to _a general warning applicable to all enemy vessels concerned_.

That the principle as to providing for the safety of persons on board is liable to exceptions has been admitted by the Union Government itself. The Austrian Government believes, however, that destruction without warning is not only justifiable in cases of attempted escape or resistance. It would seem, to take one instance only, that the character of the vessel itself should be taken into consideration; thus merchant ships or other private craft, placed in the service of war operations, whether as transports or guardships, or with a military crew or weapons on board for the purpose of any kind of hostilities, should doubtless, according to general law, be liable to destruction without notice. The Austrian Government need not go into the question of how far a belligerent is released from any obligation as to provision for safety of human life when his opponent sinks enemy merchant vessels without such previous warning, as in the well-known cases, previously referred to, of the _Elektra_, _Dubrovnik_, _Zagreb_, etc., since, in this respect, despite its evident right, the Austrian Government itself has never returned like for like. Throughout the entire course of the war Austro-Hungarian warships have not destroyed a single enemy merchant vessel without previous warning, though this may have been of a general character.

The theory of the Union Government, frequently referred to, also admits of several interpretations; the question arises, for instance, whether, as has frequently been maintained, only armed resistance can be held to justify destruction of ship and persons on board, or whether the same applies to resistance of another sort, as, for example, when the crew purposely refrain from getting the passengers into the boats (the case of the _Ancona_), or when the passengers themselves decline to enter the boats. In the opinion of the Austrian Government cases such as those last should also justify destruction of the vessel without responsibility for the lives of those on board, as otherwise it would be in the power of anyone on the vessel to deprive the belligerent of his right to sink the ship. For the rest it should also be borne in mind that there is no unanimity of opinion really as to when the destruction of enemy merchant tonnage is justifiable at all.

The obligation as to issuing a warning immediately before sinking a vessel will, in the view of the Austrian Government on the one hand, involve hardships otherwise avoidable, while, on the other, it may in certain circumstances be calculated to prejudice the rightful interests of the belligerent. In the first place it cannot be denied that saving lives _at sea_ is nearly always a matter of blind uncertainty, since the only alternatives are to leave them on board a vessel exposed to the operations of the enemy, or to take them off in small boats to face the dangers of the elements. It is, therefore, far more in accordance with the dictates of humanity _to restrain people from venturing upon vessels thus endangered by warning them beforehand_. For the rest, however, the Austrian Government is not convinced, despite careful consideration of all legal questions concerned, that the subjects of neutral countries have any claim to immunity when travelling on board enemy ships.

The principle that neutrals shall also in time of war enjoy the freedom of the seas extends only to neutral vessels, not to neutral persons on board enemy ships, since the belligerents are admittedly justified in hampering enemy traffic at sea as far as lies in their power. Granted the necessary military power, they can, if deemed necessary to their ends, forbid enemy merchant vessels to sail the sea, on pain of instant destruction, as long as they make their purpose known beforehand so that all, whether enemy or neutral, _are enabled to avoid risking their lives_. But even where there is doubt as to the justification of such proceeding, and possible reprisals threatened by the opposing side, the question would remain one to be decided between the belligerents themselves alone, they being admittedly allowed the right of making the high seas a field for their military operations, of suppressing any interruption of such operations and supremely determining what measures are to be taken against enemy ships. The neutrals have in such case no legitimate claims beyond that of demanding that due notice be given them of measures contemplated against the enemy, in order that they may refrain from entrusting their persons or goods to enemy vessels.

The Austrian Government may presumably take it for granted that the Washington Cabinet agrees with the foregoing views, which the Austrian Government is fully convinced are altogether unassailable. To deny the correctness of these views would imply--and this the Union Government can hardly intend--that neutrals have the right of interfering in the military operations of the belligerents; indeed, ultimately to constitute themselves the judges as to what methods may or may not be employed against an enemy. It would also seem a crying injustice for a neutral Government, in order merely to secure for its subjects the right of passage on enemy ships when they might just as well, or indeed with far greater safety, travel by neutral vessels, to grasp at the arm of a belligerent Power, fighting perhaps for its very existence. Not to mention the fact that it would open the way for all kinds of abuses if a belligerent were forced to lay down arms at the bidding of any neutral whom it might please to make use of enemy ships for business or pleasure. No doubt has ever been raised as to the fact that subjects of neutral states are themselves responsible for any harm they may incur _by their presence in any territory on land where military operations are in progress_. Obviously, there is no ground for establishing another standard for naval warfare, particularly since the second Peace Conference expressed the wish that, pending the agreement of rules for naval warfare, the rules observed in warfare upon land should be applied as far as possible at sea.

From the foregoing it appears that the rule as to warning being given to the vessel itself before such vessel is sunk is subject to exceptions of various kinds under certain circumstances, as, for instance, the cases cited by the Union Government of flight and resistance, the vessel may be sunk without any warning; in others warning should be given before the vessel sails. The Austrian Government may then assert that it is essentially in agreement with the Union Government as to the protection of neutrals against risk of life, whatever may be the attitude of the Washington Cabinet towards some of the separate questions here raised. The Austrian Government has not only put into practice throughout the war the views it holds in this respect, but has gone even farther, regulating its actions with the strictest care according to the theory advanced by the Washington Cabinet, although its assurance as published only stated that was "essentially in agreement" with the Union Government's views. The Austrian Government would be extremely satisfied if the Washington Cabinet should be inclined to assist it in its endeavours, which are inspired by the warmest feelings of humanity, to save American citizens from risk at sea by instructing and warning its subjects in this direction.

Then, as regards the circular verbal note of February 10 of this year concerning the treatment of armed enemy merchant vessels, the Austrian Government must in any case declare itself to be, as indicated in the foregoing, of the opinion that the arming of trading ships, even when only for the purpose of avoiding capture, is not justified in modern international law. The rules provide that a warship is to approach an enemy merchant vessel in a peaceable manner; it is required to stop the vessel by means of certain signals, to interview the captain, examine the ship's papers, enter the particulars in due form and, where necessary, make an inventory, etc. But in order to comply with these requirements it must obviously be understood that the warship has full assurance that the merchant vessel will likewise observe a peaceable demeanour throughout. And it is clear that no such assurance can exist when the merchant vessel is so armed as to be capable of offering resistance to a warship. A warship can hardly be expected to act in such a manner under the guns of an enemy, whatever may be the purpose for which the guns were placed on board. Not to speak of the fact that the merchant vessels of the Entente Powers, despite all assurances to the contrary, have been proved to be armed for offensive purposes, and make use of their armament for such purposes. It would also be to disregard the rights of humanity if the crew of a warship were expected to surrender to the guns of an enemy without resistance on their own part. No State can regard its duty to humanity as less valid in respect of men defending their country than in respect of the subjects of a foreign Power.

The Austrian Government is therefore of opinion that its former assurance to the Washington Cabinet could not be held to apply to armed merchant vessels, since these, according to the legal standards prevailing, whereby hostilities are restricted to organised military forces, must be regarded as privateers (freebooters) which are liable to immediate destruction. History shows us that, according to the _general_ law of nations, merchant vessels have never been justified in resisting the exercise by warships of the right of taking prizes. But even if a standard to this effect could be shown to exist, it would not mean that the vessels had the right to provide themselves with guns. It should also be borne in mind that the arming of merchant ships must necessarily alter the whole conduct of warfare at sea, and that such alteration cannot correspond to the views of those who seek to regulate maritime warfare according to the principles of humanity. As a matter of fact, since the practice of privateering was discontinued, until a few years back no Power has ever thought of arming merchant vessels. Throughout the whole proceedings of the second Peace Conference, which was occupied with all questions of the laws of warfare at sea, not a single word was ever said about the arming of merchant ships. Only on one occasion was a casual observation made with any bearing on this question, and it is characteristic that it should have been by a British naval officer of superior rank, who impartially declared: "Lorsqu'un navire de guerre se propose d'arrêter et de visiter un vaisseau marchand, le commandant, avant de mettre une embarcation à la mer, fera tirer un coup de canon. Le coup de canon est la meilleure garantie que l'on puisse donner. _Les navires de commerce n'ont pas de canons à bord._" (When a warship intends to stop and board a merchant vessel the commander, before sending a boat, will fire a gun. The firing of a gun is the best guarantee that can be given. _Merchant vessels do not carry guns._)

Nevertheless, Austria-Hungary has in this regard also held by its assurance; in the circular verbal note referred to neutrals were cautioned beforehand against entrusting their persons or their goods on board any armed ship; moreover, the measures announced were not put into execution at once, but a delay was granted in order to enable neutrals already on board armed ships to leave the same. And, finally, the Austro-Hungarian warships are instructed, even in case of encountering armed enemy merchant vessels, to give warning and to provide for the safety of those on board, provided it seems possible to do so in the circumstances.

The statement of the American Ambassador, to the effect that the armed British steamers _Secondo_ and _Welsh Prince_ were sunk without warning by Austrian submarines, is based on error. The Austrian Government has in the meantime received information that no Austro-Hungarian warships were at all concerned in the sinking of these vessels.

The Austrian Government has, as in the circular verbal note already referred to--reverting now to the question of aggravated submarine warfare referred to in the memorandum--also in its declaration of January 31 of this year issued a warning to neutrals with corresponding time limit; indeed, _the whole of the declaration itself is, from its nature, nothing more or less than a warning to the effect that no merchant vessel may pass the area of sea expressly defined therein_. Nevertheless, the Austrian warships have been instructed as far as possible to warn such merchant vessels as may be encountered in the area concerned and provide for the safety of passengers and crew. And the Austrian Government is in the possession of numerous reports stating that the crews and passengers of vessels destroyed in these waters have been saved. But the Austrian Government cannot accept any responsibility for possible loss of human life which may after all occur in connection with the destruction of armed vessels or vessels encountered in prohibited areas. Also it may be noted that the Austro-Hungarian submarines operate only in the Adriatic and Mediterranean Seas, and there is thus hardly any question as to any action affecting American interests on the part of Austro-Hungarian warships.

After all that has been said in the preamble to this Memorandum, it need hardly be said that the declaration of the waters in question as a prohibited area is in no way intended as a measure aiming at the destruction of human life, or even to endangering the same, but that its object--apart from the higher aims of _relieving humanity from further suffering by shortening the war_, is only to place Great Britain and its Allies, who have--without establishing any legally effective blockade of the coasts of the Central Powers--hindered traffic by sea between neutrals and these Powers in a like position of isolation, and render them amenable to a peace with some guarantee of permanency. That Austria-Hungary here makes use of other methods of war than her opponents is due mainly to circumstances beyond human control. But the Austrian Government is conscious of having done all in its power to avoid loss of human life. _The object aimed at in the blockading of the Western Powers would be most swiftly and certainly attained if not a single human life were lost or endangered in those waters._

To sum up, the Austrian Government may point out that the assurance given to the Washington Cabinet in the case of the _Ancona_, and renewed in the case of the _Persia_, is neither withdrawn nor qualified by its statements of February 10, 1916, and January 31, 1917. Within the limits of this assurance the Austrian Government will, together with its Allies, continue its endeavours to secure to the peoples of the world a share in the blessings of peace. If in the pursuit of this aim--which it may take for granted has the full sympathy of the Washington Cabinet itself--it should find itself compelled to impose restrictions on neutral traffic by sea in certain areas, it will not need so much to point to the behaviour of its opponents in this respect, which appears by no means an example to be followed, but rather to the fact that Austria-Hungary, through the persistence and hatred of its enemies, who are determined upon its destruction, is brought to a state of self-defence in so desperate extreme as is unsurpassed in the history of the world. The Austrian Government is encouraged by the knowledge that the struggle now being carried on by Austria-Hungary tends not only toward the preservation of its own vital interests, but also towards the realisation of the idea of equal rights for all states; and in this last and hardest phase of the war, which unfortunately calls for sacrifices on the part of friends as well, it regards it as of supreme importance to confirm in word and deed the fact that it is guided equally by the laws of humanity and by the dictates of respect for the dignity and interests of neutral peoples.

3

=Speech by Dr. Helfferich, Secretary of State, on the Submarine Warfare=

The _Norddeutsche Allgemeine Zeitung_ of May 1, 1917, gives the following speech by Dr. Helfferich, Secretary of State, on the economic effects of the submarine warfare delivered in the principal committee of the Reichstag on April 28. The speech is here given verbatim, with the exception of portions containing confidential statements:

"In the sitting of yesterday a member rightly pointed out that the technical and economic results of the submarine warfare have been estimated with caution. In technical respects the caution observed in estimating the results is plain; the sinkings have, during the first month, exceeded by nearly a quarter, in the second by nearly half, the estimated 600,000 tons, and for the present month also we may fairly cherish the best expectations. The technical success guarantees the economic success with almost mathematical exactitude. True, the economic results cannot be so easily expressed numerically and set down in a few big figures as the technical result in the amount of tonnage sunk. The economic effects of the submarine warfare are expressed in many different spheres covering a wide area, where the enemy seeks to render visibility still more difficult by resorting, so to speak, to statistical smoke-screens.

"The English statistics to-day are most interesting, one might almost say, in what they wisely refrain from mentioning. The Secretary of State for the Navy pointed out yesterday how rapidly the pride of the British public had faded. The English are now suppressing our reports on the successes of our submarines and our statements as to submarine losses; they dare not make public the amount of tonnage sunk, but mystify the public with shipping statistics which have given rise to general annoyance in the English Press itself. The English Government lets its people go on calmly trusting to the myth that instead of six U-boats sunk there are a hundred at the bottom of the sea. It conceals from the world also the true course of the entries and departures of tonnage in British ports since the commencement of unrestricted submarine warfare. And more than all, the English Government has since February suppressed most strictly all figures tending to throw light on the position of the grain market. In the case of the coal exports, the country of destination is not published. The monthly trade report, which is usually issued with admirable promptness by the tenth of the next month or thereabouts, was for February delayed and incomplete; and for March it has not yet appeared at all. It is to be regretted that this sudden withdrawal of information makes it more difficult for us to estimate the effect of our submarine operations, but there is a gratifying side to the question after all. It is not to be supposed that England should suddenly become reticent in order to avoid revealing its strength.

"For the rest, what can be seen is still sufficient to give us an idea.

"I will commence with the tonnage. You are aware that in the first two months of the unrestricted submarine warfare more than 1,600,000 tons were sunk, of which probably considerably over one million tons sailed under the British flag.

"The estimates as to the quantity of English tonnage at present available are somewhat divergent; in any case, whether we take the higher or the lower figures, a loss of more than a million tons in two months is a thing that England cannot endure for long. And to replace it, even approximately, by new building, is out of the question. In the year 1914 England's newly-built ships gave a tonnage increment of 1,600,000; in 1915 it was 650,000 tons, in 1916 only 580,000, despite all efforts. And the normal loss of the British merchant fleet in peace time amounts to between 700,000 and 800,000 tons. It is hopeless to think of maintaining equilibrium by urging on the building of new vessels.

"The attempts which are made to enlist the neutral tonnage in British service by a system of rewards and punishments may here and there, to the ultimate disadvantage of the neutrals themselves, have met with some success, but even so, the neutrals must consider the need for preserving a merchant fleet themselves for peace time, so that there is a narrow limit to what can be attained in this manner. Even in January of this year about 30 per cent. of the shipping entries into British ports were under foreign flags. I have heard estimates brought up to 80 per cent. in order to terrify the neutrals; if but 50 per cent. of this be correct it means a decrease in British shipping traffic of roughly one-sixth. Counting tonnage sunk and tonnage frightened off, the arrivals at British ports have been reduced, at a low estimate, by one-fourth, and probably by as much as one-third, as against January. In January arrivals amounted to 2.2 million net tons. I may supplement the incomplete English statistics by the information that in March the arrivals were only 1.5 to 1.6 million tons net, and leave it to Mr. Carson to refute this. The 1.5 to 1.6 million tons represent, compared with the average entries in peace time, amounting to 4.2 millions, not quite 40 per cent. This low rate will be further progressively reduced. Lloyd George at the beginning of the war reckoned on the last milliard. Those days are now past. Then he based his plans on munitions. England has here, with the aid of America, achieved extraordinary results. But the Somme and Arras showed that, even with those enormous resources, England was not able to beat us. Now, in his greeting to the American Allies, Lloyd George cries out: 'Ships, ships, and yet more ships.' And this time he is on the right tack; it is on ships that the fate of the British world-empire will depend.

"The Americans, too, have understood this. They propose to build a thousand wooden vessels of 3,000 tons. But before these can be brought into action they will, I confidently hope, have nothing left to save.

"I base this confidence upon the indications which are visible, despite the English policy of suppression and concealment.

"Take the total British trade. The figures for March are still not yet available, but those for February tell us enough.

"British imports amounted in January of this year to 90 million pounds sterling, in February to only 70 million; the exports have gone down from 46 to 37 millions sterling--imports and exports together showing a decline of over 20 per cent. in the first month of the submarine warfare. And again, the rise in prices all round has, since the commencement of the U-boat war, continued at a more rapid rate, so that the decline in the import quantity from one month to another may fairly be estimated at 25 per cent. The figures for imports and exports, then, confirm my supposition as to the decrease of tonnage in the traffic with British ports.

"The British Government has endeavoured, by the strictest measures rigorously prohibiting import of less important articles, to ward off the decline in the quantity of vital necessaries imported. The attempt can only partially succeed.

"In 1916, out of a total import quantity of 42 million tons, about 31 millions fall to three important groups alone, viz., foodstuffs and luxuries, timber, and iron ore; all other goods, including important war materials, such as other ores and metals, petroleum, cotton and wool, rubber, only 11 million tons, or roughly one-fourth. A decline of one-fourth, then, as brought about by the first month of unrestricted submarine warfare, must affect articles indispensable to life and to the purposes of war.

"The decline in the imports in February, 1917, as against February, 1916, appears as follows:

"Wool 17 per cent., cotton 27 per cent., flax 38 per cent., hemp 48 per cent., jute 74 per cent., woollen materials 83 per cent., copper and copper ore 49 per cent., iron and steel 59 per cent. As to the imports of iron ore I will give more detailed figures:

"Coffee 66 per cent., tea 41 per cent., raw sugar 10 per cent., refined sugar 90 per cent., bacon 17 per cent., butter 21 per cent., lard 21 per cent., eggs 39 per cent., timber 42 per cent.

"The only increases worth noting are in the case of leather, hides, rubber and tin.

"As regards the group in which we are most interested, the various sorts of grain, no figures for quantities have been given from February onwards.

"The mere juxtaposition of two comparable values naturally gives no complete idea of the facts. It should be borne in mind that the commencement of the unrestricted U-boat campaign came at a time when the economical position of England was not normal, but greatly weakened already by two and a half years of war. A correct judgment will, then, only be possible when we take into consideration the entire development of the imports during the course of the war.

"I will here give only the most important figures.

"In the case of iron ore, England has up to now maintained its position better than in other respects.

"Imports amounted in 1913 to 7.4 million tons.

"In 1916 to 6.9 million tons.

"January, 1913, 689,000 tons; February, 1913, 658,000 tons.

"January, 1916, 526,000 tons; February, 1916, 404,000 tons.

"January, 1917, 512,000 tons; February, 1917, 508,000 tons.

"Here again comparison with the peace year 1913 shows for the months of January and February a not inconsiderable decrease, though the imports, especially in February, 1917, were in excess of those for the same month in 1916.

"Timber imports, 1913, 10.1 million loads.
" " 1916, 5.9 " "
" February, 1913, 406,000 loads.
" " 1916, 286,000 "
" " 1917, 167,000 "

"As regards mining timber especially, the import of which fell from 3.5 million loads in 1913 to 2.0 million in 1916, we have here December, 1916, and January, 1917, with 102,000 and 107,000 loads as the lowest import figures given since the beginning of 1913; a statement for the import of mining timber is missing for February.

"Before turning to the import of foodstuffs a word may be said as to the export of coal.

"The total export of coal has decreased from 78 million tons in 1913 to 461/2 million tons in 1915; in 1916 only about 42 million tons were exported. In December, 1916, the export quantity fell for the first time below 3 million tons, having remained between 3.2 and 3.9 million tons during the months from January to November, 1916. In January, 1917, a figure of 3.5 million tons was again reached; it is the more significant, therefore, that the coal export, which from the nature of the case exhibits only slight fluctuations from month to month, falls again in February, 1917, to 2.9 million tons (as against 3.4 million tons in February of the year before), thus almost reaching once more to the lowest point hitherto recorded--that of December, 1916. And it should be remembered that here, as in the case of all other exports, sunk transports are included in the English statistics.

"Details as to the destination of exported coal have since the beginning of this year been withheld. England is presumably desirous of saving the French and Italians the further distress of reading for the future in black and white the calamitous decline in their coal supply. The serious nature of this decline, even up to the end of 1916, may be seen from the following figures:

"England's coal export to France amounted in December, 1916, to only 1,128,000 tons, as against 1,269,000 tons in January of the same year; the exports to Italy in December, 1916, amounted only to 278,000 tons, as against 431,000 tons in January, and roughly 800,000 tons monthly average for the peace year 1913.

"As to the further development since the end of February, I am able to give some interesting details. Scotland's coal export in the first week of April was 103,000 tons, as against 194,000 tons the previous year; from the beginning of the year 1,783,000 tons, as against 2,486,000 tons the previous year. From this it is easy to see how the operations of the U-boats are striking at the root of railway and war industries in the countries allied with England.

"Lloyd George, in a great speech made on January 22 of this year, showed the English how they could protect themselves against the effects of submarine warfare by increased production in their own country. The practicability and effectiveness of his counsels are more than doubtful. He makes no attempt, however, to instruct his Allies how they are to protect themselves against the throttling of the coal supply.

"I come now to the most important point: _the position of England with regard to its food supply_.

"First of all I would give a few brief figures by way of calling to mind the degree to which England is dependent upon supplies of foodstuffs from overseas.

"The proportion of imports in total British consumption averaged during the last years of peace as follows:

"Bread-corn, close on 80 per cent.

"Fodder-grain (barley, oats, maize), which can be utilised as substitutes for, and to supplement, the bread-corn, 50 per cent.; meat, over 40 per cent.; butter, 60-65 per cent. The sugar consumption, failing any home production at all, must be entirely covered by imports from abroad.

"I would further point out that our U-boats, inasmuch as concerns the food situation in England, are operating under quite exceptionally favourable conditions; the world's record harvest of 1915 has been followed by the world's worst harvest of 1916, representing a loss of 45-50 million tons of bread and fodder-grain. The countries hardest hit are those most favourably situated, from the English point of view, in North America. The effects are now--the rich stocks from the former harvest having been consumed--becoming more evident every day and everywhere. The Argentine has put an embargo on exports of grain. As to the condition of affairs in the United States, this may be seen from the following figures:

"The Department of Agriculture estimates the stocks of wheat still in the hands of the farmer on March 1, 1917, at 101 million bushels, or little over 21/2 million tons. The stocks for the previous year on that date amounted to 241 million bushels. Never during the whole of the time I have followed these figures back have the stocks been so low or even nearly so. The same applies to stocks of maize. Against a supply of 1,138,000 bushels on March 1, 1916, we have for this year only 789,000 bushels.

"The extraordinary scarcity of supplies is nearing the panic limit. The movement of prices during the last few weeks is simply fantastic. Maize, which was noted in Chicago at the beginning of January, 1917, at 95 cents, rose by the end of April to 127 cents, and by April 25 had risen further to 148 cents. Wheat in New York, which stood at 871/4 cents in July, 1914, and by the beginning of 1917 had already risen to 1911/2 cents, rose at the beginning of April to 229 cents, and was noted at no less than 281 on April 2. This is three and a half times the peace figure! In German currency at normal peace time exchange, these 281 cents represent about 440 marks per ton, or, at present rate of exchange for dollars, about 580 marks per ton.

"That, then, is the state of affairs in the country which is to help England in the war of starvation criminally begun by itself!

"In England no figures are now made public as to imports and stocks of grain. I can, however, state as follows:

"On the last date for which stocks were noted, January 13, 1917, England's visible stocks of wheat amounted to 5.3 million quarters, as against 6.3 and 5.9 million quarters in the two previous years. From January to May and June there is, as a rule, a marked decline in the stocks, and even in normal years the imports during these months do not cover the consumption. In June, 1914 and 1915, the visible stocks amounted only to about 2 million quarters, representing the requirements for scarcely three weeks.

"We have no reason to believe that matters have developed more favourably during the present year. This is borne out by the import figures for January--as published. The imports of bread-corn and fodder-grain--I take them altogether, as in the English regulations for eking out supplies--amounted only to 12.6 million quarters, as against 19.8 and 19.2 in the two previous years.

"For February the English statistics show an increase in the import value of unstated import quantity of all grain of 50 per cent., as against February, 1916. This gives, taking the distribution among the various sorts of grain as similar to that of January, and reckoning with the rise in prices since, about the same import quantity as in the previous year. But in view of the great decrease in American grain shipments and the small quantity which can have come from India and Australia the statement is hardly credible. We may take it that March has brought a further decline, and that to-day, when we are nearing the time of the three-week stocks, the English supplies are lower than in the previous years.