CONTENTS Page For text of the Dawes Report see: World Peace Foundation For text of the London Agreements see: London Times, August FORMER PUBLICATIONS DEALING WITH THE Document No. 162. Addresses on German Reparation, by the Rt. Hon. No. 181. The Allied Debts: The Balfour Note of August 1, No. 182. Documents Regarding the European Economic Situation: The Report of the Bankers' Committee to the Reparation Commission on the Question of a German Loan; The Majority and Minority Reports to the Reparation Commission by the Technical Experts on the Stabilization of the German Mark; Reply of the German Government to the Reparation Commission; Note of the German Government to the Reparation Commission; Protocols Containing the Scheme for the Financial Reconstruction of Austria. January, 1923. No. 184. Documents Regarding the European Economic Situation, Series No. II: The French, British and Italian Plans for a Settlement of Reparation and the Interallied Debts. The Schedule of Reparation Payments of May 5, 1921. March, 1923. No. 190. Franco-German Reconciliation: Text of an address delivered July 6, 1923, at Paris, by Professor F. W. Foerster, formerly of the University of Munich, before the annual meeting of the Advisory Council in Europe of the Carnegie Endowment for International Peace. September, 1923. No. 193. Documents Regarding the European Economic Situation, Series No. III: Correspondence between Germany, the Allied Powers and the United States, Relating to Reparations. Speech of General Smuts in London, October 23, 1923. December, 1923. No. 199. Summary of Part I of the Report of the First (Dawes) Committee of Experts. Questions Resulting from the Corfu Incident Submitted September 28, 1923, by the Council of the League of Nations to the Special Commission of Jurists and the Replies of that Commission; Lord Parmoor's Comments. June, 1924. I THE DAWES REPORT ON GERMAN By GEORGE A. FINCH [Reprinted from The American Journal of International Law Vol. 18, Number 3, July, 1924] The completion and transmission to the Reparation Commission on April 9 last of the report of the expert committees appointed by it to "consider the means of balancing the budget and the measures to be taken to stabilize the currency" of Germany and to "consider the means of estimating the amount of German exported capital and of bringing it back to Germany" mark a further step in the efforts of the Allied Governments to give practical effect to the reparation clauses imposed upon Germany by the treaty of peace signed at Versailles on June 28, 1919. The report of the first committee has attracted especial interest in the United States because the American members, although not representatives of the Government of the United States, accepted the appointments from the Reparation Commission with the expressed approval of the State Department.1 Interest in the report has further been increased by the recent action of the Republican National Convention which nominated General Dawes, the chairman of the first committee, for the office of VicePresident of the United States on the Republican ticket with President Coolidge. A summary of the reports with a brief setting of facts showing their relation to the general subject may, therefore, be useful. The events directly leading up to these reports may be 1 See press notice of the State Department, Dec. 12, 1923. considered as having started on November 14, 1922, when the German Government, in anticipation of the expiration of the arrangements for the payment of reparations during the year 1922,2 requested the Reparation Commission to fix Germany's liabilities at an amount which could be defrayed from the budget surplus and to grant her a moratorium for three or four years. An Inter-Allied conference was held at London in December, 1922, and at Paris in January, 1923, for the purpose of considering this request. At that conference the British Government proposed that Germany's obligations under the treaty be fixed at substantially 50,000,000,000 gold marks, with a moratorium for four years (apart from certain deliveries in kind), on condition that Germany undertake to stabilize the mark and restore budget equilibrium within a specified time. The British Government further proposed that a foreign finance council should be set up in Berlin consisting of persons appointed by Great Britain, France, Belgium, Italy, the United States and a neutral European, with the German Finance Minister as chairman ex officio. The council was to be given jurisdiction over currency legislation, the budget, fiscal legislation and public expenditure, general treasury administration, financial prohibitions, control of foreign remittances, etc., and the plan provided that "If the Reparation Commission is retained at all it should be as a purely judicial body." In the event of Germany failing to discharge her revised obligations, the British plan provided that she should submit "to any measures which the Allied Powers, upon a report of such failure from the supervising authority, may unanimously decide to be necessary, including forceful seizure of German revenues and assets and military occupation of German territories outside the existing zone of occupation." See the decision of the Reparation Commission of March 21, 1922, on the subject of the payments to be made by Germany in 1922, and its modification on Aug. 31, 1922, printed in Supplements to The American Journal of International Law, Vol. 16, 1922, p. 238, and Vol. 17, 1923, p. 40. For text of the plan see British blue book, Inter-Allied Conferences on Reparations and Inter-Allied Debts, Misc. No. 3, 1923, pp. 112-119. France declined to accept any reduction of the payments which Germany owes under the schedule of payments fixed by the Reparation Commission on May 5, 1921, pursuant to the reparation clauses of the treaty of peace; she insisted upon a reorganization of the German finances, with the approval of the Reparation Commission, which should include the stabilization of the currency, restoration of budget equilibrium, stoppage of the discount of treasury bills by the Reichsbank, and the strengthening of measures designed to prevent the flight of capital abroad. The execution of this program was to be under the supervision of the Guarantees Committee, the seat of which was to be transferred to Berlin. France was unwilling to consider a moratorium of more than two years and proposed the immediate seizure of pledges which would yield an annual total of 1,000,000,000 gold marks during the moratorium period. The pledges proposed to be seized were the control of the coal output of the Ruhr by an Inter-Allied mission to be sent to Essen, the reservation of the right to realize additional quotas of timber from the state and communal forests in occupied territory, requisitions of raw material, nitrogen, etc., in the occupied territories or in the Ruhr, a levy on foreign securities on the basis of German exports coming from occupied territories and from the Ruhr basin, and the seizure of the customs and the coal tax in the territories actually occupied and in the Ruhr. The French memorandum stated that "the pledges contemplated could be seized by the Allies acting in common by merely utilizing the methods of economic control without military intervention." As penalties for the refusal of the German Government to execute this program the French memorandum provided for the military occupation of the Ruhr basin and the establishment of a customs barrier on the east of all the occupied territories.* The Inter-Allied conference at Paris lasted until January 4, when it broke up without an agreement between the For the text of the French plan, see Misc. No. 3, 1923, pp. 101-108. |