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The Six Months That Changed the World

The Versailles Treaty of June 28, 1919

Ludwig van Mises Institute

John V. Denson discusses the world-changing events that happened between January and June 1919: disastrous decisions that resulted in creating a platform for Hitler to rise in Germany, the Second World War, and beyond.

Runtime 69 minutes, click play to start

A Failure of Management

The failure of the Treaty of Versailles was a failure of management. The Treaty-makers compartmentalised the process of negotiation – so there was one working group looking at the League of Nations, another at territorial adjustments, another at reparations etc.– and there was insufficient communication between the different aspects.

The problem was that each issue was settled quite reasonably in its own right. The damage to France was massive – so wasn’t it reasonable that the invader should pay to put things right? After four years of invasion and slaughter, wasn’t it reasonable for France to want the border with Germany to be VERY, VERY secure? And if German militarism had ignited the war, wasn’t it reasonable to reduce German armed forces?

The problem is that 10 plus 10 plus 10 doesn’t make 10. It makes 30. And it was the same with the Treaty of Versailles. Nobody was keeping track of the final total impact all these decisions would have on Germany. And when they put them all together into those 440 different articles, I think they all got a complete shock.

Because, taken together, all those ‘reasonable’ decisions (and remember that Lloyd George and Wilson had persuaded the French to tone down their demands) – taken together, the Treaty of Versailles simply wiped Germany out.

By the time they had got a reasonable sum for reparations, it came to 6,600 million – a third of what some people wanted, but still totally beyond any country of the time to pay (with the exception, perhaps, of the USA). By the time they had secured France’s eastern border, and created Poland etc., they’d taken a tenth of Germany’s land, half its industry, and its best farmland. Everybody else in Europe had got self-determination – but an eighth of the German population ended up under the rule of different countries, and the Germans in Germany were forbidden to unite with the Germans in Austria. And then the peacemakers reduced the German army until it was a tenth of the French army, and smaller than the Czechoslovakian army.

Lloyd George summed it up:

I am one of the four upon whom devolved the onerous task of drafting the treaties of 1919 . . .

The conditions that were imposed upon Germany were ruthlessly applied to the limit of her endurance.

She paid 2,000,000,000 in reparations. We experienced insuperable difficulties in paying 1,000,000,000 to America - and we are a much richer country than Germany.

We stripped her of all her colonies.

We deprived her of part of her home provinces.

We took her great fleet away from her.

We reduced her army of millions to 100,000 men.

We deprived her of artillery, tanks, airplanes, and broke up all the machinery she possessed for re-equipping herself.

- David Lloyd George

Perhaps worst of all, Germany was excluded from the League of Nations. Despite the fact that Germany had expelled the Kaiser, and adopted a new western-style democracy, and agreed to the Treaty: despite everything, Germany was still treated like an international leper and – although it had reduced its army to the point of impotence – it was excluded from the new process of international justice and peace-keeping that was meant to replace the old ways of wars and treaties. Again, it was Lloyd George who hit the nail on the head:

When communities are deprived of the protection of law by selfish and unscrupulous interests they generally find refuge in taking the law into their own hands.

- David Lloyd George

It wasn’t just the Germans who were horrified by the Treaty – Lloyd George, JM Keynes, most of the British public, the American Senate… they were all astounded at how harsh it was. And if we – and they – can understand just how crazy and unfair it all was, how badly must the Germans have felt?

And of course we know how badly the Germans felt – they felt 'Adolf Hitler' badly.

John D Clare (2002)

Brockdorff-Rantzau reply memorandum

15 May 1919

S-H BULLETIN No. 277 May 15th, 1919
Communication from Count Brockdorff-Rantzau, relative to the report of the Economic Commission.

Source:  Norman H. Davis, Box 44, Paris Peace Conference, Versailles Treaty, Manuscript Division, Library of Congress

Notes:  Indented numbers indicated original pagination.

German Peace Delegation
Versailles, May 13, 1919
To His Excellency Mr. Clemenceau:

In accordance with my communication of May 9h of this year, I have the honor to present to your Excellency the report of the Economic Commission charged with the study of the effect of the Peace Terms on the situation of the German population.

"During the last two generations, Germany has been transformed from an agricultural state to an industrial state. While an agricultural state, Germany could nourish forty million inhabitants.

As an industrial State, it can assure the nourishment of a population of sixty-seven million. In 1913, the importation of goods amounted in round figures to twelve million tons. Before the war, a total of fifteen million persons found an existence in Germany by means of foreign commerce and navigation, either directly, or indirectly, by using our foreign raw materials.

Under the terms of the peace treaty, Germany is to give up her Merchant Marine and vessels now under construction suitable for foreign commerce. Likewise, for five years, German shipyards are to construct primarily a tonnage destined for the Allied and Associated Governments.

Moreover, Germany must renounce her Colonies; all her foreign possessions, all her rights and interests in the Allied and Associated countries, in their Colonies, Dominions or Protectorates are to be liquidated and credited to the payment of reparations, and are to be submitted to any other step of economic warfare that the Allied and Associated Powers may see fit to maintain or to take during the years of peace.

When the territorial clauses of the Peace Treaty go into effect Germany will lose in the East the most important regions for the production of wheat and potatoes, and this would be equivalent to a loss of twenty-one percent of the total harvest of these foodstuffs.

Moreover the intensiveness of our agricultural production would be greatly decreased. On the one hand, the importation of certain raw materials indispensable for the production of fertilizer, such as phosphates, would be hampered; on the other hand, this industry would like all other industries suffer from the shortage of coal.

For the Peace Treaty provides for the loss of almost a third of the production of our coal fields; in addition to that loss, enormous deliveries of coal to various Allied countries are imposed on us for ten years.

In addition, in conformity to the Treaty, Germany will cede to her neighbors almost three-quarters of her ore production and three-fifths of her production of zinc.

After this privation of her produce, after the economic repression caused by the loss of her Colonies, of her Merchant Fleet and her foreign possession, Germany will no longer be in a position to import raw materials in sufficient quantities from abroad. As a matter of course an enormous part of German industry would thus be condemned to extinction. At the same time the need to import commodities would considerably increase, while the possibility of meeting this need would diminish to the same extent.

After a very short time Germany would therefore no longer be in a position to furnish bread and work to her many millions of persons forced to earn their daily bread by navigation and commerce. These people would have to emigrate; but this is materially impossible; all the more so, in that many countries, and the most important ones will oppose German immigration. In addition hundreds of thousands of Germans expelled from the territories of the Powers now at war with Germany, and from the Colonies and Territories which Germany must give up will come back to their native country.

The enforcement of the Peace Conditions would therefore logically entail the loss of several million persons in Germany. This catastrophe would not be long in occurring, since the health of the population has been broken during the war by the blockade and during the armistice by the increased vigor of the starvation blockade.

No assistance, however great and of however long duration could prevent these wholesale deaths. The Peace would impose upon Germany many times the number of human lives cost her by this war of four years and a half, (1,750,000 killed by the enemy; almost a million as a result of the blockade.)

We do not think and we do not believe that the delegates of the Allied and Associated Powers are aware of the consequences that will inevitably follow, if Germany, an industrial nation with a very dense population, closely bound up with the economic system of the world, and obliged to import enormous quantities of food and raw materials, finds herself suddenly thrown into a phase of her development corresponding to the period of her economic construction and the period when her population was the size it was a half century ago.

Those who sign this treaty, will sign the death sentence of many millions of German men, women and children.

I believe that my duty before beginning the discussion of other details of the treaty, lay in bringing to the attention of the Allied, and Associated Delegations, this summary of the problem facing the German people. At your request I hold ready for your excellency the statistical proof.

Kindly accept, etc.


A German View of the Treaty of Versailles

In October 1918, with the military defeat of Germany at hand, the German government sent a request for an immediate truce to the U.S. government, suggesting that peace be established on the basis of President Wilson's Fourteen Points. Wilson communicated this request to the Allied governments and received their approval to make peace "on the terms of peace laid down in the President's address to Congress of January 8, 1918," (i.e., the Fourteen Points) though adding that there should be no doubt in anyone's mind that "compensation will be made by Germany for all the damage done to the civilian population of the Allies and their property by the aggression of Germany by land, by sea and from the air." When this was conveyed to the German government on Nov. 3, however, that government- -the monarchical system of Imperial Germany--had disappeared in a radical upsurge within Germany that brought the flight of the Kaiser into exile and a new socialist-led democratic government usurping power in the defeated country. It was this latter government that agreed, under threat of invasion of Germany, to accept the armistice of Nov. 11, 1918. The resulting treaty was delivered to the Germans on May 7, 1919 and was immediately denounced on all sides, especially in regard to the imputation of the 'war guilt' of Germany and the incompatibility of the harsh terms with the broad principles enunciated in the Fourteen Points.

The Germans were allowed to submit their counter-proposals on May 29, to which the following extract is the preamble. But the Allied reply was uncompromising, rejecting all arguments and conceding only border adjustments in relation to Polish territory. The German position was, of course, untenable and in an atmosphere of bitter hostility the country's representatives were forced to sign the hated document on June 28, 1919.

I have the honor to transmit herewith the observations of the German Delegation on the Draft of the Treaty of Peace. We had come to Versailles in the expectation of receiving a proposal of peace on the basis actually agreed upon. . . We hope to get the Peace of Right which has been promised us. We were aghast when, in reading (the treaty), we learned what demands Might Triumphant has raised against us. The deeper we penetrated into the spirit of this Treaty, the more we became convinced of its impracticability. The demands raised go beyond the power of the German Nation.

[here follow a narrative of the territorial sacrifices to be made by Germany: most of West Prussia to Poland, the German city of Danzig, the German town of Memel, the heavily industrialized Upper Silesia, occupation of the Rhineland, and so on.]

In spite of such monstrous demands the rebuilding of our economic system is at the same time made impossible. We are to surrender our merchant fleet. We are to give up all foreign interests. We are to transfer to our opponents the property of all German undertakings abroad, even of those situated in countries allied to us. Even after the conclusion of peace the enemy states are to be empowered to confiscate all German property. No German merchant will then, in their countries, be safe from such war measures. We are to completely renounce our colonies, not even in these are German missionaries to have the right of exercising their profession. We are, in other words, to renounce every kind of political, economic and moral activity.

But more than this, we are also to resign the right of self-determination in domestic affairs. Dictatorial powers are conferred on the International Reparation Commission over our whole national life in economic and cultural matters, its power by far exceeding those ever enjoyed within the German Empire by the Emperor, the German Federal Council and the Reichstag put together. This Commission has the unrestrained power of disposal over the economic system of the state, of the municipalities and of private individuals. All matters of education and public health likewise depend on it. . . . The Commission . . can, in order to augment the payments of Serfdom, inhibit the whole system of social care for the working classes in Germany.

Also in other respects Germany's right of sovereignty is abrogated. Her principal rivers are placed under international administration, she is obliged to build on her own territory the canals and railways desired by the enemy, she must, without knowing the contents, assent to agreements which her adversaries intend concluding with the new states in the East [i.e., Poland and the Baltic states] and which affect Germany's own boundaries. The German people is excluded from the League of Nations to which all common work of the world is confided.

Thus a whole nation is called upon to sign its own proscription, yea, even its own death warrant.

Germany knows that she must make sacrifices in order to come to Peace. Germany knows that she has promised such sacrifices by agreement and wishes to carry them through to the utmost limit she can possibly go to.

1. Germany offers to take the lead before all other nations in disarming herself, in order to show that she is willing to help them in bringing forth the new era of the Peace of Right. She will give up compulsory service and will . . . diminish her army to 100,000 men. She is even prepared to surrender the battleships which her opponents intend leaving her. But she hereby acts on the assumption that she will be immediately admitted, as a state with equal rights, into the League of Nations. . . .

2. In territorial questions Germany unreservedly endorses the Wilson program. She renounces her sovereignty in Alsace-Lorraine, desiring, however, a free plebiscite to be carried through there. . . . [here follow a description of the further concession Germany is willing to make: cession of territory indisputably inhabited by Poles and Danes; a free port in Danzig and Polish access to the sea; submitting her former colonies to the administration of the League of Nations, with mandatory rights for Germany. All this is coupled with a 'demand' that the right of self-determination be respected also in favor of the Germans in Austria and Bohemia.]

3. Germany is prepared to make the payments incumbent on her . . . up to the maximum amount of 100 billion marks gold, namely, 20 billion marks gold until May 1, 1926, and the remaining 80 billion marks gold afterwards, by annual installments bearing no interest . . . In conceding this, Germany acts on the assumption that she will have to make no further sacrifices of territory beyond the above mentioned ones, and that she will again be granted freedom of action at home and abroad.

4. Germany is ready to devote her entire economic power to the work of reparation. She is desirous of actively cooperating in the restoration of the devastated territories in Belgium and Northern France. . . .

9. The German Delegation again raise their demand for a neutral inquiry into the question of responsibility for the war and of guilt during the war. An impartial commission should have the right of inspecting the archives of all belligerent countries and examining, as in a court of law, all chief actors of the war. . . . . . The high aims which our adversaries were the first to establish for their warfare, the new era of a just and durable Peace, demand a Treaty of a different mind. Only a cooperation of all nations, a cooperation of hands and intellects, can bring about a permanent peace. We are not under a misapprehension as to the intensity of hatred and bitterness that is caused by this war; and yet the forces at work for the union of mankind are now stronger than ever. It is the historical task of the Peace Conference of Versailles to bring about this union.

Accept, Sir, the assurance of my high esteem,

(signed) Brockdorff-Rantzau [German Foreign Minister]

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