The Economic Consequences of the Peace

building in the same places would be foolish. As for the land, the wise course may be in some cases to leave long strips of it to Nature for many years to come. An aggregate money sum should be computed as fairly representing the value of the material damage, and France should be left to expend it in the manner she thinks wisest with a view to her economic enrichment as a whole. The first breeze of this controversy has already blown through France. A long and inconclusive debate occupied the Chamber during the spring of 1919, as to whether inhabitants of the devastated area receiving compensation should be compelled to expend it in restoring the identical property, or whether they should be free to use it as they like. There was evidently a great deal to be said on both sides; in the former case there would be much hardship and uncertainty for owners who could not, many of them, expect to recover the effective use of their property perhaps for years to come, and yet would not be free to set themselves up elsewhere; on the other hand, if such persons were allowed to take their compensation and go elsewhere, the countryside of Northern France would never be put right. Nevertheless I believe that the wise course will be to allow great latitude and let economic motives take their own course. ↩

La Richesse de la France devant la Guerre, published in 1916. ↩

Revue Bleue, February 3, 1919. This is quoted in a very valuable selection of French estimates and expressions of opinion, forming chapter iv of La Liquidation financière de la Guerre, by H. Charriaut and R. Hacault. The general magnitude of my estimate is further confirmed by the extent of the repairs already effected, as set forth in a speech delivered by M. Tardieu on October 10, 1919, in which he said: “On September 16 last, of 2,246 kilometres of railway track destroyed, 2,016 had been repaired; of 1,075 kilometres of canal, 700; of 1,160 constructions, such as bridges and tunnels, which had been blown up, 588 had been replaced; of 550,000 houses ruined by bombardment, 60,000 had been rebuilt; and of 1,800,000 hectares of ground rendered useless by battle, 400,000 had been recultivated, 200,000 hectares of which are now ready to be sown. Finally, more than 10,000,000 metres of barbed wire had been removed.” ↩

Some of these estimates include allowance for contingent and immaterial damage as well as for direct material injury. ↩

A substantial part of this was lost in the service of the Allies; this must not be duplicated by inclusion both in their claims and in ours. ↩

The fact that no separate allowance is made in the above for the sinking of 675 fishing vessels of 71,765 tons gross, or for the 1,855 vessels of 8,007,967 tons damaged or molested, but not sunk, may be set off against what may be an excessive figure for replacement cost. ↩

The losses of the Greek mercantile marine were excessively high, as a result of the dangers of the Mediterranean; but they were largely incurred on the service of the other Allies, who paid for them directly or indirectly. The claims of Greece for maritime losses incurred on the service of her own nationals would not be very considerable. ↩

There is a reservation in the Peace Treaty on this question. “The Allied and Associated Powers formally reserve the right of Russia to obtain from Germany restitution and reparation based on the principles of the present Treaty” (Art. 116). ↩

Dr. Diouritch in his “Economic and Statistical Survey of the Southern Slav Nations” (Journal of Royal Statistical Society, May, 1919), quotes some extraordinary figures of the loss of life: “According to the official returns, the number of those fallen in battle or died in captivity up to the last Serbian offensive, amounted to 320,000, which means that one half of Serbia’s male population, from 18 to 60 years of age, perished outright in the European War. In addition, the Serbian Medical Authorities estimate that about 300,000 people have died from typhus among the civil population, and the losses among the population interned in enemy camps are estimated at 50,000. During the two Serbian retreats and during the Albanian retreat the losses among children and young people are estimated at 200,000. Lastly, during over three years of enemy occupation, the losses in lives owing to the lack of proper food and medical attention are estimated at 250,000.” Altogether, he puts the losses in life at above 1,000,000, or more than one-third of the population of Old Serbia. ↩

Come si calcola e a quanto ammonta la richezza d’Italia e delle altre principali nazioni, published in 1919. ↩

Very large claims put forward by the Serbian authorities include many hypothetical items of indirect and nonmaterial damage; but these, however real, are not admissible under our present formula. ↩

Assuming that in her case $1,250,000,000 are included for the general expenses of the war defrayed out of loans made to Belgium by her allies. ↩

It must be said to Mr. Hughes’ honor that he apprehended from the first the bearing of the pre-Armistice negotiations on our right to demand an indemnity covering the full costs of the war, protested against our ever having entered into such engagements, and maintained loudly that he had been no party to them and could not consider himself bound by them. His indignation may have been partly due to the fact that Australia, not having been ravaged, would have no claims at all under the more limited interpretation of our rights. ↩

The whole cost